How to Send Flowers in 2016
If you want to know how the flower business works these days, have a baby. Or, if you’re lazy, visit a friend who has a baby. For a week or two, the bouquets are as frequent and fragrant as the diapers.
My son was born just before Mother’s Day, so I wasn’t surprised by the tide of blooms in our hospital room and, later, our apartment. What did startle me was the sprawling provenance of the posies. They were from all over the world, sent by every imaginable supply chain, a riot of business models in an ecosystem both vibrant and lethal.
The flower-delivering trade, once as neat as a greenhouse, is now a jungle.
How can one send flowers these days? Let’s count the ways.
Traditional flower shops still provide some of the best bouquet bang for one’s buck, and in a turnaround time Amazon drones would struggle to top. Coleen’s Flower Shop in Dorchester, Mass., has been blanketing about a third of Boston with bouquets for 37 years.
“We do fairly decent work here,” Coleen O'Donnell, the owner, said. “Weddings, funerals, you name it. It’s not cookie-cutter. We mix it up.”
The challenge is finding a dependable shop like Coleen’s, particularly from afar. A lot of bricks-and-mortar businesses struggle (or don’t bother) with digital marketing and search-engine optimization.
Posies, a shop on the Upper West Side of Manhattan, doesn't take online orders, though it has a bright, simple web site. About one-third of its business still comes from people walking in to pick up one of the 35 or so bouquets on display every day. "We're kind of based on a Dutch model," said Susan Holt, who opened the shop in 2006. "The idea is that flowers are more of an everyday thing."
Once you’ve found a trusted shop, there’s the challenge of relaying exactly what you want – or don’t want. Leave it up to the florist and you face what my wife would call carnation risk.
Of course, there is a whole cottage industry designed to solve long-distance bouquet shopping, so-called networks like 1-800-Flowers.com. With a catalog of standardized bouquets, they route orders to participating shops near the delivery site. Part quality control and part virtual store window, the basic idea has been around since the telegraph.
The 1-800-Flowers.com network includes about 7,000 florists, who processed about 12 million stems on Mother’s Day weekend, according to CEO Christopher McCann. “It’s a great business to be in,” he said. Last year, the company had $504 million in flower-related revenue.
Still, the company is pivoting away from flowers and adding other gifts, like filet mignon and “fruit bouquets," which offer fatter profit margins. Bouquets account for less than half of the business now. And yes, the company's official name is a phone number (so 1990) with a .com tacked on the end (so 2000).
One of the issues executives like McCann face: reluctant partners. Florists grumble at length about the network arrangements, because of the size of the cut that order-routing networks take (which varies widely). What's more, the shops are hamstrung creatively. They have to crank out the prescribed bouquets regardless of which flowers are freshest, and are often required to tack on a cheesy teddy bear 1 Which they also have to buy in advance and keep in stock. . 1-800-Flowers has something called the Party Pooch, a $60 bouquet that approximates a white lapdog jumping out of a gift box. It is really quite something.
"When run properly, the economics still work for everybody," McCann said 2 The company also drop-ships flower deliveries from farms and distribution centers. .
But the old-fashioned flower shops that typically cut the stems and build the bouquets aren't just reluctant. They're dying out.
Between 2005 and 2014, 35 percent of U.S. florists disappeared—some 7,400 businesses, according the the U.S. Census. The workforce for those shops fell by 40 percent in that time, as some 40,700 employees were trimmed.
The beautiful brand
David Bladow and Matthew Schwab don’t see much they like in today’s flower business. There are too many choices, much of the marketing is “bro-y,” and many transactions are structured to upsell.
Their online shop, BloomThat, is set up like a sparse boutique. Launched in early 2014, it offers only a few bouquets at any time, depending on the flowers available at their five distribution centers around the country. Customers in Los Angeles, New York, and San Francisco can get same-day deliveries, while everyone else can have their buds delivered the following day.
With precious names like the Bea and the Tina, all the bouquets look like a prop-styled West Elm shoot. None approximates the Party Pooch, and there is no cellophane (think burlap and bows). “There’s definitely a level of taste and inspiration that we bring,” Schwab said. The goal is to get more people buying flowers more often, not just for special occasions. BloomThat is focused on the 18-to-35 demographic and leans toward women 3 Some 70 percent of its customers are female. .
"We are attacking millennials," Schwab said “This generation doesn’t have a brand that they look to in this space.” BloomThat has raised $7.6 million in venture capital 4 Investors include Ashton Kutcher, First Round Capital, former 49er Joe Montana, and Y Combinator. and delivered almost seven million stems. Schwab also used the “L” word: BloomThat considers itself a “lifestyle” brand. First, flowers. Next, artisanal chocolate, stationery, and scented candles.
The Bouqs Co. aims to cut out all the middleman. No wholesalers. No warehouse. No storefronts. The flowers generally ship straight from the farm – at first, a giant growing operation on the side of a volcano in Ecuador, but more recently a smattering of some 50 farms all over. The company's latest coup is sourcing the fickle peony from growers in Alaska, Chile, New Zealand and Peru.
Co-founder John Tabis had two big advantages in starting the business. His college buddy and business partner, Juan Pablo Montufar, was a biologist and heir to a flower-growing empire in Ecuador. And he had a background in strategy, first for Bain and later for Walt Disney Co. The consultant-speak comes through loud and clear.
“You look at the traditional flower delivery business, and every step along the way it’s margin and waste, margin and waste,” he said. “By the time flowers get to the florist, they’re almost two weeks old,” and about half of them die en route.
Tabis promises Bouqs flowers will be better and cheaper on a petal-for-petal basis, because fewer suppliers get a cut of the sale. "We're giving the farmers 20 to 25 percent more than they'll get anywhere else," Tabis explained, and the Bouqs blooms go from soil to countertop in six or seven days.
The supply-chain shrinkage has been attractive enough to harvest about $23 million in venture funding and Tabis said The Bouqs will ship around 1.5 billion stems this year.
So which of these models will win the day and come to dominate the $31 billion industry in the U.S.? The answer, at the moment, is none of them. If there is an Uber or Amazon.com of flowers in the making, it hasn’t become apparent. The only winner in the flower business these days is you. Or, more likely, your mother.
Traditional florists are struggling for obvious reasons. They excel at the close of the flower deal: crafting arrangements, getting to know customers, and delivering the blooms. But they generally don’t have the scale, marketing reach, or skills to effectively tap into a customer base from afar or shrink the supply chain to capture more value.
The Silicon Valley-seeded startups are challenged as well. Flowers, it turns out, are too delicate for the classic digital hackathon—they require more care than code. Tech-savvy startups can tap into masses of customers through carefully crafted e-commerce channels but still struggle with the last mile. Same-day delivery is a challenge, and there’s something less than magical about flowers in a cardboard box.
So digital flowers still need a dose of analog fertilizer, and vice versa. What may make the most sense for the $8 billion industry is a symbiotic relationship, and that’s where the flower business appears to be going.
The Bouqs realized that farmers aren't always great at floral design and a lot of customers don’t want to wait days for an order. It took a page from the 1-800-Flowers playbook and gathered a network of about 300 old-fashioned flower shops that it can rely on to fulfill orders. Posies, on Manhattan's Upper West Side, is one of the partner shops.
"They essentially pay us to hold our inventory locally," Tabis said. "And we drive orders to them at margins they don't get anywhere else."
One of the first clients: Shark Tank’s Robert Herjavec (the shark on the far right). He used The Bouqs and its local partners to handle the flowers for his wedding in July. "The original estimate was something like $55,000," he said. "We easily saved half the cost." Herjavec had passed on The Bouqs when it pitched on the show in 2014, but after the nuptials he joined part of a $5 million funding round. “I actually think The Bouqs is a godsend to many of these florists,” he said.
Meanwhile, BloomNation is helping local flower shops sharpen their digital skills. It sells templates for them to build and maintain simple and functional websites. At the same time, it runs an online marketplace where consumers can search for a bouquet among its many clients. In other words, BloomNation is slowly become both the Squarespace and the Etsy of flower delivery.
Co-founder David Daneshgar said the platform now has 3,000 florists, many of which didn’t have a site until recently. Coleen's Flower Shop, in Dorchester, Mass., has been on the platform for two years now.
“A lot of the ones that we help are stuck in an older world,” Daneshgar said. “Finally there’s a David they can side with against Goliath.”
And how did the newborn blooms turn out in the Stock household?
In our small and unscientific survey, the bouquets from neighborhood florists were by far the prettiest and most impressive, both in presentation and sheer volume. The flowers from the wire services was a little anemic, both in freshness and scale 5 The best gift, by far, was from 1-800-FLOWERS, although it wasn't a bouquet. Rather, a box of English muffins from the company's Wolferman's brand. . The roses from the volcano – TheBouqs shipment – lasted almost twice as long as any other bouquet, even though they came in a box. It got to the point where even the baby was noticing them from across the room, no doubt wondering if they were fake.