Roughly 40 miles outside Chicago, Personalization Mall’s 365,000-square-foot production and fulfillment facility hums 24 hours a day, with 4,000 employees producing 150,000 items daily during the holiday season.
By the end of November, the web-only merchant that specializes in personalized gifts is operating at its peak to create 40,000 personalized ornaments and tens of thousands of other personalized stockings, blankets, mugs, cutting boards, champagne flutes and other gifts per day.
November and December bring in roughly 35-40% of all Personalization Mall’s annual revenue, says Dan Grebel, vice president of operations at PersonalizationMall.com. The rest of the year, the facility has a 10th of the employees — 400 — who can handle the production volume during the 10-month offseason.
Personalization Mall’s history and business model
Personalization Mall launched in 1998 as an online “mall” where consumers could choose from 20 different items to personalize. Today, the brand offers 2,000 unique “blank items” that shoppers can have personalized with one of 14 different methods, such as laser engraving, embroidery, glass printing, 3D printing, sandblasting and others, plus variations within each method. In total, the merchant now offers 40,000 different product designs, with new designs created each year.
New for this year is an agreement with The Elf on The Shelf. Shoppers can personalize apparel for their elves or purchase personalized items with the The Elf on the Shelf image on it.
Bed Bath & Beyond acquired Personalization Mall in 2016 for $190 million. In 2020, the web-only merchant again changed hands and 1-800-Flowers.com (No. 53 in the Digital Commerce 360’s Top 1000 database) bought Personalization Mall for $252 million from Bed Bath & Beyond Inc. (No. 31).
1-800-Flowers.com Inc. owns 17 gifting brands, including Harry & David and Cheryl’s Cookies. The Personalization Mall logo and link to its site is included in the banner of brands that runs across each of these merchants’ websites. The parent company is still working on integrating Personalization Mall’s items into its other brands, such as offering a personalized Easter basket with Harry & David goodies instead.
Personalization Mall’s Bolingbrook, Illinois, facility opened in 2019. It includes a second 100,000-square-foot building for administration and warehousing, giving the online retailer 465,000 square feet of space. This is an 86% increase from its previous facilities that totaled 250,000 square feet.
During a media tour, the merchant showcased its facility as it geared up for Black Friday and the 2022 holiday season, and the process a product goes through from purchase to creation to shipping.
How a blank item becomes personalized at Personalization Mall
After a shopper clicks buy on PersonalizationMall.com, that item is placed in a queue for employees to pick at the warehouse. The warehouse runs four major waves of picks a day, in which employees select all the blank products for the most recent orders. It takes about two hours to pick the roughly 40,000 products in each wave, Grebel says. About 10% of orders during the holiday season have some level of rush shipping, Grebel says. Those orders are picked in smaller waves throughout the day to ensure they are shipping to the customer on time.
Once the items are picked, employees bring them to various areas where they are personalized. Some items, like a name on a stocking, can be personalized right away in the embroidery area. On a screen, the employee can see exactly what the customer saw on her computer screen when she approved the order. When the shopper designed the order on her own computer, she was interacting directly with the software that the machines use, Grebel says. This means the employee doesn’t have to reenter any information, as the software already knows the letters it needs.
The associate then lines up the stocking underneath the machine and hits Enter. The machine gives an estimate of how long the embroidery will take, typically four to six minutes for a stocking, and then goes to work.
Each associate is manning three machines at a time — typically two smaller items, like stockings, and a more time-intensive item, such as a skirt for a Christmas tree, which could take 17 minutes. Each employee typically can embroider 12 to 13 items per hour, Grebel says.
Other items are more complex, such as certain ornaments and personalized blankets that require a two-step process with a heat transfer. About 50% of Personalization Mall’s products require a heat transfer, which is when the image the customer selected is first printed and then transferred onto the item using heat.
Personalization Mall has about 40 printers for this process, all housed in a pressurized part of the facility with temperate and humidity control. Those printers continuously spit out images that are applied to the final product within hours.
Quality assurance for each item is paramount at PersonalizationMall.com
Upon creating an item, employees attach a barcode to it and send the product to quality assurance. Employees scan each item, and an employee compares the final product against the proof image the customer approved on its website to ensure it matches.
“When we’re producing items, we understand that peoples’ expectations with gifting in general is usually a little higher than their own standards because they want to wow their recipient,” says Jeff Chun, vice president of marketing at PersonalizationMall.com.
Not only is the employee checking to make sure the personalization is correct, but also that the presentation looks good and the product is suitable to give as a gift. For example, Personalization Mall will remake an item if it is slightly off center or the product is even slightly damaged, Chun says.
“We view it as much healthier as a business to absorb that and just make a new product that will wow them, than to send something that’s subpar to our customers because long-term, we want those customers to come back, and so we want to present them with the best possible option,” he says.
Repeat orders are a key part of its business, representing roughly 50% of sales, Chun says.
Associates ship completed items within one to two days. In total, it takes about five business days for the product to be created and then landed on the shopper’s door.
If, for some reason, a product is damaged during transit, the merchant will remake the product.
Because each product is unique to each shopper, customer service is an important part of PersonalizationMall.com. The merchant employs 40 agents year-round, and that swells to about 100 agents during the holiday season. During the holiday season, call volume can be about 400% higher than during the summer.
These agents work in the production facility, so they can walk over to where that consumer’s product is if needed to resolve an issue, Chun says. Shoppers call with questions before, during and after placing an order.
Customer service agents require more training compared with seasonal warehouse workers, Chun says. And so Personalization Mall hires agents in the summer to start training for the holiday season, whereas it onboards the bulk of its seasonal workers in November.
Chun says finding labor has not been an issue for the retailer this year, unlike in 2021, when it was harder to attract good-quality candidates, he says.
2022 holiday season goals for Personalization Mall
With surging sales during 2020 and 2021, Personalization Mall is looking to match 2021’s holiday sales figures for the 2022 season, Chun says.
“The last two years have been exceptional for us,” Chun says. “We’ve had record demand and we’re seeing good engagement with the consumer right now. Our expectation is to be on par with last year.”
PersonalizationMall.com’s online sales grew more than 50% in its 2021 fiscal second quarter ended Dec. 27, 2020, which includes holiday sales during the first year of the pandemic. Plus, it grew sales 4% in its 2022 fiscal second quarter ended Dec. 26, 2021.
Chun says even though the 2022 shopper is dealing with inflation and is being more careful with dollars, the retailer still expects a strong holiday season.
“Even when the customer is a little bit more selective with how they are spending their dollar, personalization is a way where you don’t have to spend a lot to say a lot,” Chun says.
Overall, Chun predicts the sales pattern of the holiday season will look more like pre-pandemic 2019, unlike 2020 and 2021, when shoppers started purchasing much earlier in the season to ensure they could find the items they wanted at a time when supply chain issues prevented retailers from getting all the merchandise they ordered.
While some retailers started promoting the holidays before Halloween, and many released promotions and marketing materials during Amazon’s Early Access Sale Oct. 12-13, Personalization Mall did not see any impact or notable pull forward of holiday sales because of this event, Chun says.
How Personalization Mall views Amazon and its competitors
Plus, as a maker of personalized goods, Personalization Mall is one of the few merchants that doesn’t count the web’s largest merchant — Amazon.com Inc. — as a direct competitor, Chun says.
“Fortunately, personalization is a very specialized industry and so a lot of the big retailers can’t do it and they don’t want to, necessarily, and that’s where our expertise is. That’s where our strengths lie and it’s given us an advantage that we’ve been able to stand out among some of these well-known retailers,” Chun says.
Amazon has not done personalization on a major scale that the retailer is aware of, Chun says.
“We’ve been fortunate to be somewhat insulated from that effect,” he says. “It’s a great boon for the consumer to have a lot of choice in digital shopping, but for retailers, it puts pressure on the retailer for how they can differentiate themselves. But being in personalization, we’ve stood out.”
The retailer does, however, have a number of online competitors that also offer personalized products. They include Shutterfly Inc. and Walgreen Co., which offers personalized stationery and home décor products. Chun says Personalization Mall stands out from them with its large assortment and 14 different ways to personalize products.
Within the Digital Commerce 360 rankings of top online retailers, 260 merchants offer product customization in some way, such as engravings on jewelry, a specific color combination on sneakers or tailored specifications on furniture. But, when looking at retailers that specialized in this area, only six Top 1000 retailers are in the custom merchandise subcategory and only five retailers are in the greeting card category that also offer a number personalized products.
These 11 merchants lag behind the larger Top 1000 merchants, with a collective five-year compound annual growth rate of 8.9% compared with 22.4% for the larger Top 1000. But for 2022, Digital Commerce 360 projects this group to grow 11.5% year over year compared with a projected collective growth of the Top 1000 at 4.2% year over year.
The final few weeks of year are paramount for Personalization Mall. Cyber Monday is the merchant’s top day but its facility will continue to operate all day and night until the final few days of the season.
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