PetSmart acquired Pet360 for $130 million in cash and up to $30 million more in future performance-based payments.
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But when HP reorganized in 2007 after he’d been with the company 18 months, Taylor decided to take stock of his career. He realized that in a working life that followed bigger and bigger publicly-traded brands, he’d never worked for a private firm, an environment that would allow him to look beyond the demands of quarterly financials to do more long-range planning. Having set the parameters of a more entrepreneurial organization backed by private equity, where he would have the opportunity to be chief executive officer, he was receptive when a recruiter called on behalf of Oriental Trading Co. a few months later.
“The first thing I did when I got off the phone with the recruiter was to ask my wife what she knew about Oriental Trading,” Taylor recalls. “She started pulling out catalogs she had received from Oriental Trading and raving about the company.”
As the mother of three school-age children, she considered Oriental Trading a go-to source for party, arts and crafts, and school supplies. Asking around, Taylor found that other local moms and teachers held a similar view, as did moms, teachers and others across the country who need such supplies at a value price. 75-year-old Oriental Trading in fact dominates its space as the largest direct marketer of party supplies, novelties, and arts and crafts items.
With a customer base that loyal, Taylor could apply everything he’d learned and come to believe in about acquiring and keeping customers in every other retail job he’d ever held. And with some 50% of Oriental Trading’s $600 million business already web-based, Taylor saw that the time was right to leverage that loyal base online with new technology and marketing programs.
“I saw the opportunity to transform Oriental Trading from a traditional cataloger to a company that is truly driven by the Internet,” he says. While catalogs will remain an important part of the mix, “Our goal is to make Oriental Trading the online destination for our product categories in all of our customer segments, from both an e-commerce perspective and an online community perspective,” he says. “We are really going to focus on improving the customer experience.”
As to what form that will take at OrientalTrading.com, Taylor is keeping specifics under wraps for now, though the site recently rolled out a promotion that offers a hint. “Make the world more fun” is aimed at gathering user-generated content. It was developed prior to Taylor’s arrival May 5, but he gives it a thumbs-up as the kind of initiative the company will do more of.
“It’s our strongest foray into user-generated content and beginning to build an online community,” he says. “Between now and the end of the year, you’ll see enhancements to the online community aspects of our site.”
Taylor aims to more than double Oriental Trading’s business over the next several years by growing its share of the categories in which it plays and expanding into new product categories. He’s also out to grow international business, building on a small but growing foothold in Canada. “I see no reason we should not be able to make Oriental Trading into a global brand,” he says.
Such big visions face obstacles in a shaky economy-a situation not unique to Oriental Trading. “Private equity-backed companies like Oriental Trading take a longer term view than the stock market as a general rule,” Bass says. “The issue with private equity companies as you go into a turbulent market is that it’s a lot of work to keep the company cranking along. It’s not the short-term focus you have to worry about, it’s the long-term health of the business.”
But Taylor has a plan for that, based in part, he says, on what he learned at Lands’ End from founder Gary Comer, but tweaked with what he’s discovered on his own over the years.
“Number one, we’ll take care of our employees. Number two, we’ll let our employees take care of our customers. Number three, we’ll let our customers take care of spreading the word-and then everything else will take care of itself,” he says. “If you have engaged employees and loyal customers, the business results will follow.”