1-800-Flowers set to compete with Amazon with new snacking brand

The online gifting retailer recently sold its Chicago-native chocolate brand Fannie May Confections​​ to Ferrero for $115m. The deal was sealed at the end of May 2017.

Steve Druckman, president of the Midwest Gourmet Food Group (which owns all 1-800-Flowers brands, except Harry & David) told this site that e-commerce is always a challenge for the company as online retail giant Amazon continues to expand its footprint.

Amazon announced its plan to acquire Whole Foods​​ earlier this year.

“We’re looking to figure out how to replace Fannie May,”​ Druckman said. “We still have a commercial relationship with Fannie May, so we’re able to continue to sell its products across our sites as well as the Ferrero products such as Nutella, Tic Tac and [Ferrero] Rocher.​

“But whatever we do, it will be in a gifting way,”​ he added.

Strategy to compete with Amazon​

The key to competing with Amazon is to buy and build brands that are unique to 1-800-Flowers, Druckman said.

“For example, you can only find Cheryl’s Cookies on our website, and [other companies] have wanted to knock it out for years.”​

However, some of the company’s brands are sold on Amazon, such as Popcorn Factor and Harry & David. “For me, it’s all about a tailored set of products that are made for that channel,” ​he said.

The company has to make sure its products do not not compete with those available on Amazon or its own website.

1-800-Flowers recently launched Passport, which allows its online consumers to pay an annual fee to get free shipping when purchasing any of the company’s brands.

Partnership with Nestlé​

1-800-Flowers purchased popcorn brand Harry & David two and half years ago, and the brand has experienced 5% sales growth during the spring season for the first time since 2012.

Harry & David’s president, Steven Lightman, said the brand has been around for 15 years, but was never marketed outside of the major holiday seasons. The spring sales growth was mainly driven by 1-800-Flowers repositioning it as an everyday brand, he added.

In addition to targeting new snacking occasions, Harry & David has partnered with several confectionery companies to come up with cobranding products for brick-and-mortar retail.

The latest partnership with Nestlé, for example, helped Harry & David develop Moose Munch with Buncha Crunch and Moose Munch with Butterfinger: both were showcased recently at the Summer Fancy Food Show in New York. These products will also roll out to major US retailers including 7-Eleven, Walgreens and Walmart later this year.

1-800-Flowers said it will continue to innovate flavors and packaging across its confectionery and snack portfolio and aims for high single-digit growth by the end of 2017.