ProFlowers

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ProFlowers
Type Subsidiary
Founded 1998
Headquarters San Diego, California
Key people Bill Strauss CEO
Industry Retail
Products Flowers
Website www.proflowers.com

ProFlowers, a Provide Commerce brand, is a major flower retailer in the United States.

ProFlowers is an e-commerce marketplace that sells products shipped from growers, suppliers and distributors to consumers. The Company's platform combines an online storefront, proprietary supply chain management technology and established supplier relationships to create a market platform that includes growers, manufacturers and distribution warehouses.

Through their network of suppliers, ProFlowers claims that they have eliminated some intermediaries from the legacy supply chain, realizing cost advantages and higher margins. They also claim that their platform reduces or eliminates many of the typical costs associated with traditional retail businesses including inventory, capital expenditures, labor and administrative expenses.

ProFlowers is headquartered in San Diego, California.

Contents

[edit] History

Provide Commerce launched its marketplace in 1998 through its ProFlowers brand. Provide Commerce also offers fruit, sweets and premium meat direct from the supplier through its Gourmet Food Business Unit.

In February 2006 Liberty Media Corporation (NYSE:L; LMC.B) purchased Provide Commerce, Inc. (Nasdaq: PRVD) for a sum of $477 million in cash, at which point Provide Commerce became a wholly owned subsidiary of Liberty.

[edit] Litigation

ProFlowers was sued by its major rival, Florists' Transworld Delivery (FTD), for false advertising and unfair competition in August 2005. The suit focused on ProFlowers' claim to ship "direct from the fields" with "no middlemen", alleging that the company actually often stored flowers in refrigerated warehouses, including those of third parties. For its part, ProFlowers responded that the lawsuit was "without merit" and brought counterclaims against FTD. The lawsuit was settled a year later. ProFlowers did agree to make some modifications to its advertising, although as of February 2008, ProFlowers is once again claiming in its TV commercials that it delivers flowers "straight to the door from the growers' fields".[1]

Two months after the FTD suit was filed, two law firms filed a class action lawsuit claiming that ProFlowers used deceptive marketing, also targeting the company's freshness claims. ProFlowers called it a copycat of the FTD lawsuit. It was settled with ProFlowers not admitting any wrongdoing, but offering $10 store credits to the millions of customers in the class, paying $250,000 in attorneys' fees, and "altering its advertising".[2]

Florist advocacy groups continue to take umbrage at ProFlowers' marketing which disparages the role of the local florist, particularly since ProFlowers itself uses local florists to fulfill its same-day, late next-day and Sunday delivery orders. [3]

ProFlowers issued a cease and desist order against Bloomery Florist. Bloomery Florist videotaped and photographed frozen flowers from ProFlowers then posted the dramatic video on YouTube. [4]

[edit] Brands

  • ProFlowers – Flowers
  • Cherry Moon Farms – Gourmet fruit and gift baskets
  • Secret Spoon – Desserts
  • Uptown Prime - Steak, seafood & pork
  • Shari's Berries - Chocolate covered strawberries and other gourmet food gifts
  • RedEnvelope - upscale gifts for all occasions

[edit] Competitors

[edit] References

  1. ^ Provide Commerce and FTD Resolve Lawsuit, joint press release, August 8, 2006.
  2. ^ Vuong, Andy. "Lawsuit Pricks at Net Florist". Denver Post, November 6, 2006.
  3. ^ ProFlowers vs. Florists.
  4. ^ ProFlowers vs. Florists.

[edit] External links

[edit] Sources