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Can the Greeting Card Industry Thrive?
In recent years, the once-thriving greeting card industry has faced a major decline. Sales have dwindled, and retailers are scaling back on shelf space. Once prominent retailers like Hallmark have been forced to close multiple store locations over the last few years. With the rise of social media and texting, traditional paper cards seem to belong to a bygone era.
However, there’s a modern solution for those who still value heartfelt sentiments: e-cards. These digital greetings have evolved far beyond the basic GIFs of yesteryears. Now, they offer customization options, embeddable videos, digital gift cards, and even artificial intelligence to help craft the perfect message.
Matt Douglas, founder and CEO of Sincere, which owns online card maker Punchbowl, emphasizes the shift toward digital greetings. He notes that the events of 2020 propelled the adoption of digital cards as people sought safer alternatives to traditional paper cards.
Punchbowl is just one player in this growing industry. Giants like Hallmark and American Greetings have also embraced digital cards, each offering their own unique spin. Even NASA has joined in, offering customizable e-Valentines featuring space-themed designs.
Nonprofits like the World Wildlife Fund have also jumped on the e-card trend, using them as a way to attract new supporters. These digital greetings not only help raise funds but also spread awareness about important causes.
JibJab, known for its humorous content, has been focusing on e-cards since 2007. Its unique feature allows senders to embed their faces onto various images or videos, adding a personalized touch to their greetings.
Will Younger Generations Continue To Embrace Physical Greeting Cards?
Contrary to popular belief, many young people still appreciate the sentimentality of physical greeting cards, valuing their tangible nature over digital counterparts. This sentiment is echoed by Nora Weiser of the Greeting Card Association, highlighting a resurgence in the demand for physical cards among millennials.
“Greeting cards have a long tradition, and digital greetings just haven’t proven to hold the same value or meaning for consumers,” Weiser explained. “Millennials, in particular, see value in handcrafted, embellished, unique cards, and they are willing to pay a premium for cards that manage to precisely express their sentiments.”
Despite the rise of digital communication, Hallmark’s research also reveals a continued appreciation for traditional cards, with many consumers finding them more meaningful than other forms of communication. Specifically, “about 80% say they enjoy receiving cards and about the same percentage save the cards they get.”
As the industry navigates through economic challenges and changing consumer patterns, there lies a potential for innovation and adaptation. Carlton Cards’ vice president, Paul Werynski, emphasizes the importance of meeting evolving consumer needs. He explained, “Younger consumers have other life events — such as gender reveal parties — that they want to celebrate so we continue to innovate across all product lines to meet that demand.”
Meanwhile, Markus Giesler from York University has noticed a demand for physical items since the pandemic. He explained, “This pandemic with lockdowns, Zoom calls, virtual and remote workplaces that we’ve lived in, has made us crave these kinds of three-dimensional, material forms of consumption.”
In response to consumer demands for customization, companies like Hallmark have introduced innovative solutions, such as Hallmark Video Greetings and Hallmark’s hybrid service, where a customer can buy a card online and have it mailed to its recipient — both of which blend digital and physical elements to create a personalized experience for recipients. American Greetings also offers a subscription service that caters to the diverse needs of its customers.
Even in the digital era, traditional greeting cards can make a comeback, possibly driven by millennials and Gen Z. Screen fatigue and a desire for authenticity fuel this trend, with small businesses thriving in the industry. Representation matters too, with diverse voices shaping card content. Technology also plays a role, offering augmented reality and digital customization options.
In a time after social distancing and constant social media use, greeting cards offer a tangible connection. The question is whether younger generations will continue to embrace this revival — otherwise, it might just become a thing of the past.
Discussion Questions
In an era marked by technological advancement and social media, how might the greeting card industry redefine its value proposition to remain relevant with younger generations?
What strategies can traditional greeting card companies employ to effectively integrate digital elements while preserving the emotional depth and personal touch associated with physical cards?
With the resurgence of interest in handcrafted and unique greeting cards among younger demographics, how can retailers and manufacturers leverage this trend to innovate their product offerings?
Poll
Loading …BrainTrust
Carol Spieckerman
President, Spieckerman Retail
Brent Biddulph
Industry Marketing Lead, Retail & CPG
I do not buy this gloomy narrative, at least not in the US. We closely track this market has part of our ongoing work on occasions and gifting spending. The US greetings card market is worth about $7.1 billion. Over recent years it has actually grown – albeit modestly – not shrunk. Around 82% of the market is still physical cards; and while the online market is growing steadily, penetration is only increasing moderately over time.
As for Hallmark shutting stores, that has more to do with Hallmark being less able to compete than it has consumers buying fewer cards. What we have seen over the past 5 or so years is a big shift to non-specialists because of convenience and price: it’s far easier to pick up a card at Target or Walmart than it is to make a special trip to a Hallmark store (a host of which were in odd locations to start with).
What’s also important to realize is that retailers selling greetings cards often benefit from additional halo spending on gifting and gift accessories.
Wow. The greeting cards market has actually grown. I would have never guessed.
The research claiming it has fallen is probably not measuring the market correctly. It’s true that many traditional players like Hallmark have seen declines, but that’s because other channels and brands are taking their share rather than because the whole market is in contraction. Also, that research is global whereas the figures I quote are for the US.
You know, if we’re including all channels, I probably send way more cards than I used to. Instead of sending one Happy birthday card, I’ll send 2 or 3. Especially to loved ones. And the online players have done a good job in sending reminders for special events (like birthday cards you’ve sent to someone before, etc.). That’s a very good point.
The greeting card department was a hybrid of a leased department when I was a CIO. Most retailers outsourced their cards to others who’d merchandise the area and then charge the retail for managing the area, and, if I remember correctly, a portion of the card price – even if the card was damaged instead of sold. I am not 100% sure of this last but it’s something like that.
Another fun fact, CVS, which did outsource its greeting cards, saw a big rise in its own sales when it moved the card displays (and other accoutrements like wrapping paper) to the back of the store. In other words, left to their own devices, consumers made a very directed trip to pick up a card. eCards are just easier for so many reasons.
Thanks Paula – interesting stuff!
The greeting card category is special to me. So much has changed since I worked at Carlton Cards and visited American Greetings in Cleveland in the early 2000s.
The blend of artistry, direct mail and handwritten notes offers a quaint, tactile and personal alternative to digital correspondence. I’ve even won new business from greeting cards. One CEO said he chose me because of this personalized medium: “It was the Christmas card.”
As consumers seek personalization, greeting card companies can emphasize product innovations like embedded videos and recordable voice messages, which modernize the personal touch. In addition, reflecting an array of ethnicities, cultural celebrations, price points and sustainable materials will align with consumers’ values.
Part of evaluating the greeting card business should include price elasticity of demand. Its an investment to stock up on cards for occasions! Personalized holiday cards can be purchased for $1 each while an individual birthday card at a card store is more than 5 times that. Perhaps a level set would help.
Good idea, Allison. Pricing has been a key factor for decades due to fierce rivalry from dollar stores across the assortment (cards, gift bags and wrap).
Thrive? No. Survive? Perhaps. But I’m not sure how much an(allged) embracing of bespoke cards is going to help mass producers like Hallmark: someone spends $25 for something handmade, and sends out maybe one or two a year,…not going to do much for an industry that encouraged buying card by the carton, and developed a whole calendar of contrived “days” for sending them out. They might turn some of their message and graphics crafting abilities toward e-cards. but – just as with newspapers – the e-age isn’t going to provide the same types of revenue.
Traditional category leaders Hallmark and Carlton have strong motivation to not only preserve physical cards, but to also encourage e-cards and other new offerings. And they have content and distribution to do, however to truly be successful at e-cards and evolve their offering, they’ll need to invest like a tech company and not a traditional greeting card business. I believe that these traditional category leaders have a real opportunity to connect their physical cards and their digital offerings. For example, as an acquisition strategy, they might offer a free e-card with any physical card that gets purchased. Traditional card buyers won’t care; younger demographics that like cards and e-cards will love it.
While physical greeting cards hold sentimental value, the industry faces sustainability challenges. Even digital cards may struggle to monetize directly. Future revenue for digital card companies likely hinges on advertisements. Adaptation to evolving consumer behaviors and innovative revenue models will be key for industry survival.
I am very wrong on this one. I would have guessed this discussion is 20 years too late. I thought the entire greeting card cycle had already been replaced by electronic means—too much personal projection on my part.
This is a market worth $7.1 billion in the US alone! One only has to look at the amount of space dedicated to cards at Walmart, Target, etc. to know this isn’t a dead market!
Despite the dizzying pace of innovation, the transitions between “now” and “next” tend to last longer than predicted. In the meantime, what’s old can become new again. Consumers want options, particularly when it comes to high-touch, sentimental purchases. Physical greeting cards aren’t going anywhere anytime soon.
Carol – agree with your assessment. While everyone is completely immersed in the digital world all day long, receiving a physical card in the mail is a delightful surprise and highly enjoyable moment.
There’s definitely more e-vite usage happening, but that’s very different to e-cards. I’m not sure there’s a replacement for e-cards really. E-mail just doesn’t cut it.
Physical cards have soooo much more emotional impact than e-cards. Somebody took the initiative, time and trouble to buy the card, write a greeting, and either mail it or hand it over in person. We talk a lot about how much people like personalized products and services. What could be more personalized than a hand written greeting on a physical card? In my house, cards from any occasion stay on the fireplace mantle or a credenza for a week or two. The occasion is appreciated for several days. I don’t think e-cards accomplish that, even remotely. That’s not to say that e-cards should not be appreciated. There’s still an effort being made, just not on the scale of a physical card. I have to believe that the personal touch delivered by real life experiences has a long and rich life, understanding that it may happen within a smaller market share.
This is spot on! I do order cards online for friends and relations overseas via Moonpig.com as it is simpler. However, they are always physical cards which I can personalize with photos and a message and then they’re printed and sent through the mail. I would never send an e-card, in my book it is lazy and unimaginative and shows a lack of care.
I looked up some of our latest US consumer data on this:
For my family and friends, giving cards is an important tradition:
Agree: 72.5%; disagree: 9.8% (balance is neutral/no opinion)
There is no substitute for the personal touch that a card provides:
Agree: 68.3%; disagree: 7.9%
I put lots of thought into what I write in a greeting card:
Agree: 71.7%; disagree: 5.8%
When I receive cards, I usually throw them away within a few days:
Agree: 42.1%; disagree: 39.3%
Wow! I am such an outlier!
So we’re not on your Christmas card list, Gene? 😉
I would not count our Hallmark, American Greetings & others, who are key physical greeting cards players. However, the key to success in this market will be laser target market focus & differential advantage. Varied forms of access, innovation & emerging card-warranted needs will be necessary to compete in a market with greater fragmentation & competitors.
The greeting card industry is alive and well in my view. There is a company called Papyrus, who make premium, clever cards for every occasion (Cost around $5) and they always sell…I think the desire for interesting greeting cards links to a “low cost luxury” desire that reminds us that there is something special about a physical card that a text or email could never match.
Retailers just need to carry the brands that adhere to this strategy!
Sadly, all the NYC Papyrus stores closed at least five years ago. It was a great go-to place for cards.
I think all Papyrus own stores closed back in 2020. However, the brand is still strong and is sold in a lot of other stores. We now go to Paper Source – which is owned by the same company as Barnes & Noble – for nice cards.
Greeting card ‘content’, meaning text and images will thrive. The word ‘card’ is a bit of a false pretense.
Of course, physical cards are doomed to near extinction. However, there will still be demand, especially for older generations. Although, ‘mailing’ a card is simply cost prohibitive today, and also influencing the mass exodus to digital gift cards.
And digital providers, including traditional retailers, definitely need better content options for consumers. Not more cards, that are still taking up valuable floor space in brick and mortar.
That is the path forward for growth at traditional ‘card’ manufacturers and retailers. Not, physical ‘cards’ per se.
In an age of digital bombardment, there is still something magical about a physical card.
Irrespective of age, consumers – both buyers and receivers get this. Moreover, younger generations are likely to consumer in a different way – buy via a mobile app rather than in a store – but also create personalised items to send to people. In the UK a number of outfits in this mould have appeared; – ‘Thortful’ who provide funny – sometimes edgy cards – promoted via social media are one example. On the personalised front ‘Funky Pigeon’ and ‘Moonpig’ allow personalised designs of cards with your own photographs.
Established players are being disrupted by these new entrants – but this is not a new thing – Moonpig was established in 2000. As for Funky Pigeon – WHSmith a major seller of greetings cards in the UK saw what was happening and bought the brand in 2010.
It is interesting and surprising to read about research and studies that show the greeting card industry being so large, vibrant and maybe even growing. I suspect that the reason why is e-cards, which I find impersonal, but that’s just me. As far as paper greeting cards go, I prefer to believe personal experience rather than studies. Years ago, my family sent and received about 45 paper Christmas cards. That number has declined each year and now it is less than 20. That’s my research.
The physical greeting card business still has life and there are certain segments that may thrive more than others. The discount greeting cards at dollar stores and discount departments stores always seem to be busy areas and probably are prospering. The lower prices may inspire customers to buy multiple cards for the same person on a single occasion. Another segment that seems promising, it the premium segment, such as 3D cards. They can be expensive, but they make a huge impact on the people that receive them.
Great research provided by the Braintrust as always. With the rise of the artificial, I am sure that there are sites built or will be built that can write out all of your birthday wishes on e-cards for all friends and family a year in advance. We will also soon be able to automatically create a Gen-AI image for everyone based on a few key words.
However, with AI in digital communications, no one knows whether cards were written by you or were helped along with an ai-assistant. Physical cards will continue to remain an excellent alternative for genuine, legitimately authentic sentiments. For those that you want to establish or maintain trustworthy relationships, a physical card will be a great option for the foreseeable future.