Sweet Success

Harbor Sweets’ multichannel strategy helps it enjoy double-digit sales increases and a growing average order value

May 2007 By Donna Loyle

multipage

In a red brick building in Salem, Mass., within a stone’s throw of the Atlantic coast, is a small company that uses local labor to handcraft a line of gourmet chocolates sold through multiple channels to customers worldwide. This company is demonstrating that a viable multichannel selling strategy needn’t be reserved for just the behemoths in direct marketing.

Harbor Sweets sells its luxury confections via a catalog, Web site, e-mail campaigns, retail channels and wholesale accounts, including Whole Foods Markets. Its overall sales have been growing 10 percent annually in recent years, and its average order value has increased 6 percent since 2004. Not bad for a company that started in someone’s basement.



From 75 Names to 500,000

Harbor Sweets’ founder Ben Strohecker was director of marketing at a candy company in Boston in the 1970s. But the company was struggling, and its managers started to make decisions, such as shrinking candy sizes, that left Strohecker less than enthusiastic about the company’s prospects.

“Ben felt you couldn’t fool consumers that way,” says Phyllis LeBlanc, CEO and now owner of Harbor Sweets. “He thought that if you produced a good piece of candy, packaged it nicely and charged a fair price, consumers would respect that.”

So in 1973 Strohecker struck out on his own, producing candy at his Marblehead, Mass., home and selling it at church bazaars and street fairs. The first pieces he produced were triangular-shaped and made of dark chocolate. One day, he didn’t have enough dark chocolate to complete a batch, so he dipped the tops of almond butter crunch candies into white chocolate instead. His son said the resulting half-dark/half-white confections looked like sailboats; hence the name Sweet Sloops for what is—even to this day—Harbor Sweets’ best-selling product.

To expand his customer base, Strohecker mailed product announcements to everyone on his Christmas card mailing list: 75 people in all. Today, Harbor Sweets has about 500,000 names on its mailing list.

Eventually Strohecker developed a catalog and moved the company out of his basement and into a building in Salem, Mass. The company remains in that same location, but has since expanded and now inhabits 25,000 square feet on two floors.

Most operations are carried out here, including candy production, warehousing, fulfillment, accounting, creative direction, customer service, marketing and management. Call center operations are outsourced to Taction, a company based in Waldoboro, Maine. The Salem location also houses a retail store, a mecca for chocolate-lovers worldwide, says LeBlanc. Guests are greeted by an employee offering chocolate samples on a silver tray.

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