Party City’s Pandemic Plan Leans Hard on Digital Investments

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Party City’s Pandemic Plan Leans Hard on Digital Investments

By Lisa Johnston - 08/10/2020

Although the health crisis effectively put the kibosh on most celebrations, consumers stuck at home still did their best to whoop it up.

Unfortunately for Party City, car parades and oversized lawn signs weren’t enough to reverse the damage inflicted by nationwide store closures enacted to help slow the spread of COVID-19. In reporting its second-quarter earnings, ended June 30, Party City saw total sales down 54.5%. Total retail sales dropped 56.3%.

Like many retailers, Party City quickly pivoted its store operations to launch and/or leverage such omnichannel fulfillment services as curbside pickup, buy-online-pickup-in-store (BOPIS) and same-day delivery. As a result of these efforts, e-commerce sales grew 83%.

The company launched a new online digital balloon bouquet builder experience during the quarter, helping drive the category to encompass over 50% of its BOPIS, curbside pickup and same-day delivery sales. Curbside pickup is now available in all Party City stores, and almost all offer same-day delivery.

Party City partners with Shipt for 90% of its delivery services, while it teams with Hertz for large balloon orders. It also recently teamed with Bringg for new fulfillment options. 

BOPIS with curbside grew 324% during the quarter, and the company is piloting additional procedures to expedite curbside pickup, said Brad Weston, president and CEO.

A trio of three prototype stores opened in June, while eight remodels did so in July. Party City intends to open 20 to 25 next-gen stores this year, down from its original plans of 35 to 45, the bulk of which will be remodels. It will close 21 stores by the end of this year.

The new store designs seek to capitalize on Party City’s leadership in balloons — they represent 20% of its retail sales on an annualized basis — as well as be easier to navigate with improved product adjacencies, reduced inventories and curated assortments.

Although these new stores have cut SKUs by more than 20%, customers perceive them as being expanded and containing more merchandise, Weston said. Associates in turn have more time to engage with consumers and speed up transactions.   

The company is also updating its website, with updated content, enhanced visual merchandising with tagged and shoppable vignettes, how-to videos, programs supported by influencer sharing, podcasts and consumer content.

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