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Viewing report
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Greetings Cards Market Report Plus 2008
Key Note Publications Ltd, Sep 2008, Pages: 104
UK consumers are the most avid card purchasers in the world and, to the relief of the industry and contrary to some fears, they show little sign of any large-scale abandonment of traditional cards in favour of electronic greetings. If anything, the personal aspect of sending a traditional card has become even more meaningful. The retail sales value of greetings cards increased in 2007, despite the maturity of the sector, which means that one publisher's growth tends to be at the expense of another. Recent corporate activity has included the acquisition of Riverdale Publishing Ltd by Budget Greeting Cards, UK Greeting's purchase of Card Connection and the West Country wholesalers Card World Ltd's descent into administration.
While International Greetings has announced that it intends to transfer more production to its factory in the People's Republic of China (PRC), it has been suggested that the increasing cost of production there may persuade publishers to move their operations elsewhere — perhaps even back to the UK, as the publisher Lello has done. At the moment, the PRC and Hong Kong are by far the largest non-EU suppliers of greetings cards to the UK, together accounting for a massive 94.1% of the value of non-EU imports and more than four-fifths of all imports. Where once the UK had a favourable trade balance in greetings cards, its deficit now grows year-on-year.
Nevertheless, the UK greetings cards publishing industry is one renowned for its innovation and design skills, with the value of retail sales at £1.44bn in 2007. An increase in the UK population size, longevity and expanding family networks through divorce and remarriage have resulted in a higher number of card-giving occasions and of potential recipients, while the rise in the number of ethnic minority groups offers ongoing potential to boost sales of multicultural cards.
There is no denying that the UK economy is faltering. Householders are facing rising food, utility and travel costs, while the housing market is in decline and an increasing number of consumers are unable to pay their debts as the credit crunch takes effect. Although the greetings cards industry is not as adversely affected by such issues as other consumer industries might be, it is quite possible that people may curb their expenditure on individual cards and/or reduce the number they send. Posing a far greater threat to the immediate future of the industry is the planned large-scale closure of post offices, as well as the growing encroachment of supermarkets into the sector, which have a huge buying power that enables them to sell quality cards at reasonable prices. In common with other market sectors, the industry also faces the challenge of being seen to be as environmentally friendly in its production as possible.
The UK greetings cards industry continues to introduce a constant stream of innovative products, although it has had limited success in persuading the card-buying public to embrace new occasions. A NEMS Market Research survey commissioned for this report in June 2008 found that only 8.1% of respondents did not buy/send birthday cards, demonstrating an enviable percentage penetration — albeit reduced from previous years — which the UK's dynamic greetings cards industry will continue to enthusiastically exploit.
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