CASE SUMMERY

VOYAGE FROM 911-EMERGENCY

SERVICE TO PLEASURABLE RED-
ENVELOPE DREAMY GIFT SERVICE

M. NAWAZ KHAN
RIPHAH INTERNATIONAL UNIVERSITY, ISLAMABAD 11
ISSUES AND MEASURES TAKEN
The firm 911Gifts, in 1997 soon after its launching, faced decline in its
sale growth rate. Major reasons behind the decline were as follow:-

• Company name/image wrongly perceived by the public.

• Insufficient capital.

• The most important, ineffective strategies.

As a result a experienced marketing experts namely Ms. Hilary Billings

was hired as Marketing Officer. Previously, she served in Willians-
Sonoma (deals in kitchen wares, home furnishings, food, soaps) where she fruitfully
dealt with same sort of situation. After her joining, she developed very
effective corporate and business level strategies of the firm.
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CORPORATE LEVEL REVOLUTIONARY
STRATEGIES

• Ms. Billings re-developed and expanded its strategy from just gift
seller to expensive classiness/elegance.

• New Hiring for effective implementation of new strategies.

• Acquired loan of $ 31 million in exchange of firm’s 1/3 ownership.

• Firm’s name was changed from 911Gifts to Red-envelope.

• A distinct/attractive packing approach for gift was used.

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MARKETING STRATEGY

• Refine strategy to target the upper class, high income, well-educated

professionals as its potential customers.

• Database was managed in respect of people with internet access

specifically who had online buying history to attract them through
online adds and portals.

• She conducted research and market analysis with the help of firm’s
managers to understand the customer’s needs and preferences.

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RE-DEFINE PRODUCT LINE

• High quality products like, amber heart necklaces, old fashion

thermometers and seven stalks bamboo (sign of good health) etc.

• Introduced a range of gifts in one package namely “lifestyle kits”.

• Firm dropped almost its 450 items (those were not giving handsome
profit) and 300 new items were introduced in product line.

• Firm’s website was simplified to facilitate the customer through

browsing by the help of type of recipient, by gift giving occasion or
through gift category.

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ADVERTISEMENT AND PROMOTION

• 1/3 of capital of the firm was allocated to advertisement budget.

• Used high profile print media instead of expensive TV adds.

• Online sources like American Online, yahoo, excite and

ivillage.com were used.

• Marketing efforts were accelerated just before Christmas 1999.

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DISTRIBUTION NETWORK /
OUTSOURCING

• Outsourcing from ComAlliance was carried out for warehouse

space and workers for packaging process in Ohio State.

• Warehouse location was selected near to Airborne Express runway

for timely shipment by taking less distance advantage towards
airport.

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OUTCOMES OF NEW STRATEGIES

• In only first two months, generated more profit than the preceding
two years.
• Delivered its 98 % orders accurately.
• 99 % deliveries were done on time.
• Only 2 % recipient’s complaints were received.
• In initial 2 months 4:1 marketing expense was recorded against
gross sale. But gradually managed it.
• In 2003, $70 million sales revenue of the company was recoded.
• In 2006, firm promised $31 million initial public offering of its
stock.
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LESSON LEARNED
• Its not necessary that every time owners/leaders must be
good managers.

• First impression of Company’s Name matters a lot.

• Organization must be clear about its target

market/segment.

• Outsourcing can add values to the organization.

• Geographic location of plants/distribution channels plays

vital role in organizational success.
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VOYAGE FROM 911-EMERGENCY SERVICE TO
PLEASURABLE RED-ENVELOPE DREAMY GIFT
SERVICE

Q
&

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