April 14, 2008

Celebrate Express Q3 Catalog Implosion

Celebrate Express (NASDAQ: BDAY) announced a third quarter loss (before taxes) of $4.7 million (on sales of $13.3 million).


Catalog circulation strategy was cited as a key contributor to the implosion. According to the 10-Q statement, increased postage costs drove changes in circulation strategy. The company blamed sub-optimal catalog selection and mailing strategy, saying "... certain circulation decisions and execution problems resulted in catalog mailings to a mix of customers and prospect customers which we believe were less productive".

The company states that a new data warehouse and hiring of marketing talent are expected to improve results. Long-time readers of this blog know a pair of fundamental truths about catalog and online marketing strategy, truths that will serve Celebrate Express well:
  • Smart & Experienced People + Strategy > Data Warehouse + Data Mining
  • Smart & Experienced People + Data Warehouse + Data Mining + Strategy = Profit
The company recently hired long time multichannel marketing whiz Harry Egler to help solve key challenges in catalog and online marketing. I worked for/with Mr. Egler, he's one of the kindest individuals you'll ever meet.

Celebrate Express enjoyed profitable performance a few years ago. Here's hoping that Harry can help return the brand to prominence.