CURRENT ISSUE
| Cover Story |
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| Product Pioneer |
| Profile | |
| By Alan Dorich | |
| Saturday, 30 June 2007 | |
 Based in Virginia Beach, Va., Lillian Vernon Corp. sells gift, holiday décor, toys, children’s décor, fashion accessories and household products, including storage solutions, closet organizers, bags and jewelry. Based in Virginia Beach, Va., Lillian Vernon Corp. sells gift, holiday décor, toys, children’s décor, fashion accessories and household products, including storage solutions, closet organizers, bags and jewelry. “It’s really a wide range of merchandise,” Gershkovich notes. Lillian Vernon Corp. specializes in offering its high-value products at low prices. “We’re really positioned at the high of the low end in terms of price points, with our sweet spot being, on average, $14.98 or less,” Gershkovich says. “We have great value.” Establishing Leadership Founder Lillian Vernon started the company in 1951 when she was expecting her first child. From her apartment, Vernon operated a small mail-order business and offered personalized purses and belts. By 1954, Vernon’s company had grown to occupy a storefront, which it used as a warehouse, in Mount Vernon, N.Y. In adjacent buildings, the company had its own monogramming operation and shipping department. That same year, the company began manufacturing and wholesaling custom products for multiple clients, including Max Factor, Elizabeth Arden and Revlon. In 1956, Vernon published her first 16-page catalog, which had a circulation of 125,000. Through the years, her company added more items and expanded with additional retail and distribution locations. “Lillian Vernon was really a pioneer,” Gershkovich says, noting that Vernon was one of the first merchants to source items from China. “[She established] relationships with manufacturers abroad.” In 2006, the company was acquired by Sun Capital Partners, a private investment firm with offices in Los Angeles, New York and Boca Raton, Fla. According to Gershkovich, half of Lillian Vernon Corp.’s total business is now comprised of its Lilly’s Kids children’s products. The Lilly’s Kids line includes toys and back-to-school products, as well as décor items. “We actually [have seen] growth in kids’ décor,” Gershkovich says, adding that these products include personalized towels, window treatments, bedding, wall pieces and personalized storage racks. In addition, the company offers 15 types of personalization for its products, ranging from embroidery to engraving. Approximately 50 percent of the company’s products sold are personalized. Lillian Vernon Corp. publishes two catalog titles, Lillian Vernon and Lilly’s Kids, with more than 700 products in each edition. Gershkovich notes the company also earns sales from its Web site, lillianvernon.com. The company first began offering its products over the Internet in 1995. “Well over 50 percent of our sales [are] coming from online,” Gershkovich notes. “It’s very dynamic.” Staying On Top Lillian Vernon Corp.’s customers consist of a cross-generational base of women nationwide, ranging from young mothers in their 30s to grandmothers. To stay on top of what they are looking for, Gershkovich says the company does “a lot of competitive shopping. “We go out into the retail world,” she continues, explaining the company visits competing retail locations and trade shows. “We’ll study price points, we’ll study merchandise mix [and] we’ll study changes. We’re data-driven, so it is really all about the data and all about information.” Although the company has won creative awards for its catalogs, Gershkovich says the best reward is acquiring new customers and seeing its rate of repeat business increase. This past October, the company consolidated operations by moving its corporate headquarters from White Plains, N.Y., to its facilities in Virginia Beach. “We have approximately a million square feet in Virginia Beach,” Gershkovich says, adding that the site features a warehouse and office, as well as its manufacturing facility for personalization. The company maintains a product development and a corporate sales office in Harrison, N.Y. “We are essentially under one roof,” she says, noting that this has greatly enhanced communication across departments and has reduced travel. Overcoming Challenges A new challenge for Lillian Vernon Corp. is the higher postage rates that were implemented this May. “It’s affecting all of the direct marketers,” she says. “It’s having over a $5 million bottom-line impact to our company. “In response to that, many catalogers are reducing their mailings or the basic weight of paper,” she says. “We’ve really looked at all of those things, [and] we are mailing quite efficiently.” Extending the Legacy Gershkovich says she sees opportunity for growth at Lillian Vernon Corp. “There’s a great legacy in the brand and [the opportunity] to continue to build the brand, based on the heritage,” she says. The company is planning to offer more kitchen products, as well as personalized items for pets. “We think we can have a lot of fun with that area,” Gershkovich adds. |
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