Posters showing tombstones and the chalk outlines of victims lined the walls of Jerry McLaughlin’s offices at Branders.com leading up to Feb. 14, 2008, or the Valentine’s Day Massacre as it became known internally.
It wasn’t an anti-Valentine’s Day protest by single employees but rather a goal — kill the competition. In fact, upon closer inspection of the posters, written beside the chalk outlines and on the tombstones were names of competitors. It may seem morbid, but it was a goal three years in the making.
You see, back in 2005, McLaughlin felt beat down and discouraged. The promotional products business that he had co-founded in 1999 amid the hype of online shopping had begun to wear on him and made him question if it was even worth it anymore.
“Things were difficult, and what I mean by that, everything was hard,” he says. “ … Sometimes you looked at friends and other people and people in the media running other companies, and at times, it seemed they had a charmed life, and we didn’t feel the charm. And as someone of Irish descent, I felt a little ripped off because we’re supposed to have leprechauns and that stuff.”
The company was growing by about 20 percent — but also simultaneously losing money — each year. While the loss got increasingly smaller each year, he was still tired of losing money.
“I started to really doubt whether the convenience of online was really as compelling as all of us who drank the Kool-Aid thought it was,” he says.
He started looking at data for both his industry and general U.S. retail sales and was shocked to discover online sales accounted for less than 5 percent of all retail sales.
“We’re five or six times past [Amazon.com founder Jeff] Bezos being Time’s person of the year, and all of this effort, all together, hasn’t captured 5 percent of retail sales yet?” the chairman and CEO says.
Clearly the world hadn’t drank the online shopping Kool-Aid like he had, so he decided to differentiate Branders from the competition so he could make it profitable. Here’s how he arrived at the Valentine’s Day Massacre solution.
