The little label company that could has cracked the wall of Walmart.
Mabel’s Labels, a born-and-bred Hamilton company that has taken online and mommy marketing by storm, is now found in 330 of the company’s Canadian stores in a one-year exclusive contract with the Mississauga-based chain.
The business began when two sisters and their two friends were tired of their kids coming home from day care, school or camp minus their belongings. They came up with durable personalized labels, self-adhesive or iron-ons, that can be affixed to clothes, lunch boxes, backpacks, water bottles and anything else kids tote around and often leave behind.
Forty-five customized labels sell for $21.
In 10 years, Mabel’s has sold more than 50 million labels in 97 countries through its website. The company has mastered social media, hired public relations companies to generate attention in mom-oriented media, won plenty of business awards and built enormous loyalty out of customers, including some celebrity followers.
They’ve grown out of the basement of one of their homes and into a 14,000-square-foot facility on Chatham Street.
Where they used to stay up late into the night filling orders after their work days were done, the partners now employ 40 people.
But this is their first foray into retailing and president and partner Julie Cole says it was terrifying.
“We started the negotiations six months ago and then we went into pitch. It was scary,” says Cole, a mom of six who gave up a law career to focus on the business.
“Here’s little Mabel and big, old Walmart. But they responded really warmly to us. They recognized the value of the product and knew their customers would love it.”
Mabel’s had hired a retail consultant who has plenty of experience from the inside, including a stint as Walmart’s leader of vendor development and pricing strategy.
Gerald Harris prepared them for what Walmart would require, including building a sophisticated distribution and supply chain process to keep the store shelves packed with labels. He coached them on the pitch and Cole says she doesn’t think they could have landed the deal without him.
But Harris disagrees.
He believes the company’s story, its product and its aggressive marketing would have landed the labels at Walmart eventually. He says the giant retailer has a reputation for playing hardball with the big guys, but when it comes to small business, its approach is different.
“They are looking for more local products, more Canadian products, and, at least in the States, there is a big focus on businesses owned by women,” says Harris.
Harris says moms have always been Walmart’s core customer. For years, the typical shopper was dubbed “Linda” by the retailer. She had two or three kids, a double-car garage and a middle-class income.
“If you gain that shopper’s loyalty when her kids are young, she sticks with you when her kids are big, burly teenagers eating everything in sight. Who doesn’t want that customer?”
Cole says they jumped into retail in response to customers who often wish the labels were sold in stores. But at the same time, the partners worried about cannibalizing their own online business by going the retail route.
So they did market research and focus groups and determined that the two channels will serve different markets.
“Lots of people don’t order online or they need labels last minute because their kids are going to camp.”
Then the partners worried about how to transfer their personalized labels to a store. They considered the top 100 most popular names in spinning racks.
“But how do you manage that? How do you keep track? Oh, the Jennifers are sold out there and the Alexes are all gone there. It was too overwhelming.”
So they developed prototypes for peel and stick labels that are written on with marker and then a clear overlay is pressed over top as lamination, making the labels dishwasher and microwave proof. Called Write Away! Labels, they sell for $10.47 for a package of 30.
Jenn Williams, category manager for stationery with Walmart Canada, knew about Mabel’s Labels before the company pitched its product.
“I was very excited they had come to us. They had done their research and were very well prepared. It was a perfect match for Walmart because our customer is Mom.”
Cole says the Walmart deal is a huge step for the company and will mean some hiring.
“I can hardly believe it. The labels are on the shelves as of last week. I have never been to Walmart so many times in my life,” she jokes.
About half of Mabel’s online sales come from the U.S. and Harris says the next logical extension will be talking to Walmart there. But he says the plans are even bigger than that.
“We have a full North American go-to market strategy developed. We hope to be in lots of retailers in North America and beyond.”
With files from Torstar News
Article courtesy The Hamilton Spectator.