Old Saybrook Internet flower, jewelry retailer thriving in new, larger spot
Old Saybrook - Twelve years ago, Mike Chapin found himself out of a job after the company he had been working for, Flowers USA in Centerbrook, was bought out by an even larger floral-delivery firm, industry powerhouse FTD.
Rather than fret over the setback to his marketing career, within a month Chapin and four other key colleagues had launched their own floral-marketing service, From You Flowers, with the idea of taking the company aggressively forward on the Internet. Whereas his previous employer had done 70 percent of its business on the phone and only 30 percent online, Chapin said, From You Flowers is heavily weighted toward online ordering.
Now with about 240 mostly full-time employees at its Old Saybrook headquarters - a number that swells to more than 400 before busy holidays such as Valentine's Day and Mother's Day - From You Flowers and its associated online jewelry company, Eve's Addiction, just finished a move late last month to a newly renovated 25,000-square-foot facility on Mill Rock Road. Chapin figures nearly $1 million went into the expansive building with 152 telemarketing desks that were designed in over-the-top colors similar to Google headquarters in Mountain View, Calif.
"I chose this location because I love this area," Chapin, chief executive of From You Flowers and executive chairman of Eve's Addiction, said in an interview at his simply adorned office featuring posters of Boston sports teams, including his favorite, the New England Patriots. "My core group here has been here a long time ... since the beginning."
From a financial point of view, Chapin said, outsourcing customer-service personnel to foreign countries or low-wage states may make some sense. But he prefers working closely with his customer-service team, he said, to ensure customers of the two companies are well served around the clock - an average of 5,000 a day, or about 1.8 million orders a year.
What's more, with the addition of Eve's Addiction and the possible acquisition of other related product lines in the future, having personnel from both companies in one place makes it easier to cross train so customer-service representatives can handle any type of sale.
"This new facility opens up entirely new opportunities for us to expand our employee base and gain operational efficiencies across all our businesses, and ultimately improve the customer experience," he said.
Chapin, an Old Saybrook resident who in 2011 sold a majority share of his business to the New York City-based private equity capital firm Tenth Avenue Holdings LLC, said he has never had a down year at From You Flowers. He sold an 83 percent share of the company, he said, to bring in a partner that could help the business grow and had deep pockets to make future acquisitions of profitable companies such as Eve's Addiction, which the holding company acquired last September.
"I'm empowered to find e-commerce businesses that could use some marketing kick," Chapin said.
Eve's Addiction, a nationwide marketer of customizable, mostly sterling silver jewelry, fit the bill. It was a profitable company that had hit a lull, Chapin said, but now ships several hundred boxes of jewelry a day out of Old Saybrook, where six engraving machines are kept in almost constant motion.
Eve's Addiction, which had seen a 20 percent slump in sales before its acquisition, has experienced a 25 percent percent boost thanks to new marketing techniques and collaboration between the combined floral and jewelry staff, Chapin said. The combined businesses, he added, do about $110 million in business annually.
All about eyeballs
Chapin said two keys to his marketing success have been analytics and the development of an easy-to-use and attractive website. A team of analytics personnel stationed in New York City, several from Princeton University, have developed algorithms to identify people most likely to be willing to pay certain price points and then push those products through the website or by use of telemarketers, he said.
From You Flowers also works hard to ensure that its website is near the top of online search engines, knowing that of 100 people who visit the site only 10-12 are likely to buy a product.
"It's all about getting eyeballs to your website," Chapin said.
Chapin started in a small office with five desks, and his only out-of-pocket expense was $5,000 for a website.
"You're nationwide the day your website goes up," he said.
The company has grown quickly - over the past five years about doubling in size, he estimated, to become the fourth-largest flower-delivery service in the nation. Chapin expects to increase his workforce by another 50 people during the next two years.
While starting a nationwide flower-delivery business from scratch would seem daunting, Chapin was unfazed by the process, quickly signing up networks of florists with whom he had been in contact at his old job.
"This isn't a business I would start today," Chapin said. "It's incredibly competitive."
And the competition isn't just the floral industry anymore, as more and more gift-based businesses are now offering same-day delivery. It used to be only flower-delivery businesses could offer such last-minute purchases, he said.
Chapin's recent diversification into jewelry is in part a response to the competition and in part an acknowledgement that many of the same people who buy flowers likely are interested in other products for women. He said future business acquisitions would likely come outside the flower industry.
"We're very lean," he said. "We adapt quickly."
The combining of Eve's Addiction and From You Flowers at one location has meant a more than doubling of the previous space, Chapin said, and was accomplished over a three-month period without a single minute of down time - a must for this around-the-clock operation that never closes, even on Christmas. The company has a 10-year lease on the space, with room to grow.
"We're trying to find good, solid businesses that just need a little extra push," Chapin said. "We're looking for established brands that could use help getting to the next level."
WHAT: From You Flowers and Eve's Addiction
PRINCIPAL: Mike Chapin
WHERE: 143 Mill Rock Road East, Old Saybrook
YEARS IN BUSINESS: 12
NO. OF EMPLOYEES: 240
WEBSITES: www.fromyouflowers.com, www.evesaddiction.com
PHONES: 1-800-838-8853 (flowers); 1-800-679-3837 (jewelry)