12       Marketing¹ and Customer Satisfaction

Facing Business Challenges at She’s Florists²

Profiting from a Bunch of Data

With only $500 in their pockets, Helen and Marty Shih (pro­nounced "she") came to the United States from Taiwan in 1979 to pursue a graduate education. But the brother and sister were sidetracked--instead of using the money Dad had given them to begin their studies, they invested it in flowers. A visionary with a passion for life, Marty Shih believed they had a one-way ticket to a better life. So he and sister Helen set up a flower stand on a Los Angeles street corner.

       They worked hard--sometimes 16 and 18 hours a day--and before long they were able to move their busi­ness indoors. Neither had a formal education in market­ing, but they understood the importance of customer ser­vice. They began making notes about who their customers were, where they lived, why they were buying flowers, who they were sending them to, and what types of flowers they liked. The Shihs used this information to send postcards reminding customers that a special day was approaching.

Their customers appreciated being reminded to send flowers, and business grew. Customer by customer, the Shihs expanded beyond their little lobby stand, even­tually opening 16 She's Flowers shops in the Los Angeles area. They did more than just sell their blooms. They mass-produced their arrangements on an assembly line, just like McDonald's mass-produces hamburgers. Each shop offered between 15 and 21 designs, which were listed on a menu board. Again, customers appreciated the speed and consistency³ of these flower arrangements.

However, bouquets⁴ weren't the only things blossom­ing at She's Flowers. Over time, the company's customer in­formation files had grown and were full of valuable names­--mostly Asian American immigrants. In fact, the Asian Amer­ican market became the Shihs' primary focus. Pulling Asian names and addresses out of phone books and recording⁵ cus­tomers one-by-one, the Shihs eventually gathered so many names (all potential customers) that they decided⁶ to spend $200,000 to computerize their database. In 1985 they de­signed a database program that allowed them to track much more information than they had been able to keep by hand--credit-card numbers, payment dates, personal mes­sages, delivery and vendor⁷ services, preferred floral arrange­ments, and so on. Simple to run, the database was integrated with all the shops' cash registers. In fact, employees could not complete a sales transaction without inputting⁸ all cus­tomer data, including personal notes like "Mr. Jones never wants the orchid⁹ arrangement to be sent to Mrs. Jones:'

It wasn't long before Floralfax invited She's Flowers to join a worldwide telemarketing organization that was staffed by American Airlines reservationists during slow travel periods. After joining, the Shihs' annual revenues for the 16 shops doubled-from $2 million to $4 million. Convinced that telemarketing was a garden of opportu­nity, Marty Shih began exploring the possibility of selling other products to customers.

If you were Marty Shih, how would you profit from a customer information file that contained data on mostly Asian American immigrants? What other products might you market to your customers? How would you continue to build relationships with your customers and keep their business?

Meeting Business Challenges at She's Florists

Customer by customer, Helen and Marty Shih built a business empire serving the huge multi cultural Asian American market. While Helen continued to push flowers to customers, Marty be­gan telemarketing other services to this rapidly growing mar­ket. After all, having a database of Asian American immigrants, knowing their language, and understanding their cultural dif­ferences, the Shihs could make their blossoming database pay off. So Marty Shih founded the Asian Business Co-op, an Asian buying club that negotiates discounts on products and services for its members.

For instance, by entering into a joint¹⁰ venture with Sprint¹¹, the co-op sold special discount long-distance services to the Asian community. Of course, the growth of the partnership¹² was helped by the fact that Asian Americans make three times more inter­national calls than other ethnic¹³ groups in the United States. Soon Marty entered into relationships with other service providers: DHL Air Express, New York Life Insurance Company, Service Master, Lucent Technologies, United Van Lines, and Pearle Vi­sion-to name a few. It seemed that the Shihs' not-so-little data­base (currently 1.5 million names) was a gold mine of opportu­nity for companies looking for new business. And Marty was their bridge-repackaging and customizing products and services and selling them to Asian Americans at a substantial discount.

At the heart of the co-op were the 550 telemarketers who understood the diverse Asian culture and collectively spoke¹⁴ six different languages-Mandarin, Cantonese, Korean, Japanese, Vietnamese, and Tagalog (spoken in the Philippines). Asian im­migrants (most of whom did not speak English) needing advice on dealing¹⁵ with immigration officials or perhaps help in un­derstanding a bill, could call the Asian American 411 (at 1-800-777-Club) and get whatever information they re­quested-for free. After all. Marty knew that they would even­tually buy something. Meanwhile, each caller was added to the company's database. With over 1,200 new immigrants calling daily, the Shihs decided to sell the flower shops and concentrate on the more profitable telemarketing business.

Today the Asian American Association (founded in 1995 as an offshoot of the co-op) comprises 13 companies and has branches across the United States. The 550 informed telemar­keters sit ready at computer banks and phones to address the fi­nancial, health, insurance, travel, and other personal concerns and needs of Asian Americans, while moving well over $200 mil­lion in merchandise annually¹⁶ and bringing the association over $25 million in annual revenue. The association has become a center of social, cultural, educational, and political life for Asian Americans. With over 1.5 million members, the list of offerings keeps expanding. The more the telemarketers learn about the callers, the better the association can serve them.

Headquartered in a 65,00O-square-foot building in El Monte, California, Marty and Helen Shih have come a long way fr0111 that single street corner flower stand. Still, many challenges lie ahead. With services aimed mostly at recent immigrants, the Shihs must find new ways to keep customers once they become more assimilated into the American culture. Plus, it's not easy to market to this diverse group. After all, a person who is Chi­nese is not Japanese is not Korean or Thai. And that makes it especially difficult to convey a single marketing message. But, "we always keep thinking big," says Marty. With over 500,000 people visiting the association's Web site daily, there's a bloom­ing opportunity out there.