JOANN Inc. (JOANN) operates as a fabric and craft specialty retailer.
The company's store locations and website feature a variety of competitively priced merchandise used in sewing, crafting and home decorating projects, including fabric, notions, crafts, frames, paper crafting supplies, artificial floral, finished seasonal and home decor items. The company operates store locations in 49 states.
The company offers an extensive assortment, which at its seasonal peak, averages more than 80,000 s...
JOANN Inc. (JOANN) operates as a fabric and craft specialty retailer.
The company's store locations and website feature a variety of competitively priced merchandise used in sewing, crafting and home decorating projects, including fabric, notions, crafts, frames, paper crafting supplies, artificial floral, finished seasonal and home decor items. The company operates store locations in 49 states.
The company offers an extensive assortment, which at its seasonal peak, averages more than 80,000 stock keeping units (‘SKUs’) in store locations and over 200,000 SKUs online, across Creative Product categories. The company has expanded access to this broad assortment through e-commerce and digital capabilities that complement the company’s physical network, drive customer engagement and deliver an exceptional customer experience while supporting consistently strong gross margins. Through the company’s omni-channel platform, the company serves its customers in a differentiated manner by offering several convenient fulfillment options, including buy online pick-up in store (‘BOPIS’), curbside pick-up and ship-to-home offerings.
The company’s data-driven digital capabilities further reinforce its relationship with the company’s customers. Customers can interact with the company’s brand whenever and however they want. Customers connect with the company through its mobile-first website, joann.com, both domestically and internationally, as well as the company’s widely-used mobile application with more than 15 million downloads. As of January 28, 2023, the company had approximately 81 million addressable customers in the company’s vast database and approximately 20 million customers in the company’s email database.
The company appeal to an expansive customer base ranging across all ages, demographics and skill levels. The company serves the do-it-yourself customer, including those who make to give or donate their creations, and supply small business owners with components to create and sell their own merchandise. The company estimates this group makes up approximately one-quarter of its customers and typically resells on online marketplaces, such as Etsy, eBay, Shopify and other platforms. The company’s customers are passionate and creative, using their hearts, hands and minds in their sewing, crafting and decorating activities. The company’s customers’ enthusiasm drives the JOANN culture. The company strives to support the company’s community of creators, and they create to support their communities by donating or gifting the items they make, such as blankets for hospitalized children, homeless persons and shelter pets.
The company has an expansive data-driven digital footprint, which includes the company’s extensive digital marketing assets, customer relationship management system (‘CRM system’), social media platforms and e-commerce capabilities.
The company’s store locations offer a complete selection of fabric and sewing accessories and an assortment of art, crafts, artificial floral, finished seasonal and home decor merchandise that varies based on store location size.
Sewing
The company offers a broad and comprehensive assortment of Sewing (fabric and sewing) products in all of the company’s store locations and online. These Sewing products offer the company’s customers a combination of unique designs and fashionable trends at competitive prices. The company is organized in the following categories for the convenience of the sewing enthusiast, as well as those that utilize fabric for other crafting projects:
Cotton fabrics used in the construction of quilts as well as craft and seasonal projects;
Warm fabrications, such as fleece and flannel fabrics in both prints and solids, used for the construction of loungewear, blankets and craft projects;
Home decorating and utility fabrics and accessories used in home-related projects, such as window treatments, bed coverings, pillows and indoor and outdoor furniture coverings;
Fashion and sportswear fabrics used primarily in the construction of garments for the customer seeking a unique, on-trend look;
Special occasion fabrics used to construct evening wear, bridal and special event attire;
Products sewn inside crafting projects such as pillow forms, stuffing, batting and foam;
Sewing machines, some of the company’s store locations also offer a wider selection of sewing machines through leased departments operated by a third party;
A wide array of sewing construction supplies, including cutting implements, irons, lighting, threads, zippers, trims, tapes, pins, elastic and buttons, as well as the patterns necessary for most sewing projects; and
Seasonally themed and licensed fabric designs, including professional and collegiate sports teams and pop culture licensed prints, on a variety of fabrications to support a wide range of uses.
Arts and Crafts, Home Decor and Other
The company offers a broad assortment of merchandise for creative enthusiasts to support their arts and crafts, as well as home decorating needs. The company offers the following product assortments both in the company’s store locations, as well as online:
Yarn and yarn accessories, as well as needlecraft kits and supplies;
Paper crafting components, such as craft cutting machines, albums, paper, stickers, stamps and books used in the popular home-based activities of scrapbooking and card making;
Craft materials, including items used for stenciling, jewelry making, decorative painting, wall decor, food crafting and kids crafts;
Fine art materials, including items such as pastels, water colors, oil paints, acrylics, easels, brushes, paper, canvas as well as pencils and paper used for sketching;
Craft technology, organizers and other products that support multiple creative endeavors;
Artificial floral products, including flowers, artificial plants, finished floral wreaths and a broad selection of accessories essential for floral arranging and wreath making;
Seasonal decor and entertaining products themed for all key holidays and portions of the year;
Home decor accessories, including baskets, candles and accent collections designed to complement the company’s home decor fashions;
Ready-made frames and, in several of the company’s larger store locations, full service custom framing departments;
A comprehensive assortment of books and magazines to provide inspiration for the company’s customers; and
Other, including non-merchandise services.
Marketing
The company leverages its proprietary customer database to provide relevant and timely communications to customers through multiple digital channels (email, SMS text, mobile application push notifications and display marketing), and to the company’s most engaged customers via a robust direct mail program. This allows the company to efficiently and effectively reach the company’s target customers on a regular basis throughout the year. The company relies primarily on digital marketing tactics to drive customer acquisition, including online display and search marketing, social media and affiliate marketing programs. The company’s retention marketing programs leverage a robust CRM platform and database that provides the company a detailed view of customer behavior, combining sales in the company’s store locations with online and social media activity. Through this database, the company can personalize its digital marketing, email, SMS text and direct mail campaigns to ensure the company is providing the most relevant content to the company’s customer at all times.
Customers can interact with the company’s brand whenever and however they want. Customers connect with the company through its mobile-first website, joann.com, both domestically and internationally, as well as the company’s widely used mobile application with more than 15 million downloads. As of January 28, 2023, the company had approximately 81 million addressable customers in its vast database and approximately 20 million customers in the company’s email database. Customers have the ability to shop their local store location online, with convenient omni-channel services available like BOPIS or curbside pickup. Customers can also choose to order direct to home, with extended aisle offerings across all major product categories. For customers seeking to purchase in greater quantities, the company offers low pricing for bulk purchases through the company’s JOANN+ service on joann.com or through the company’s new wholesale service, Inspiration Direct. Those looking for inspiration and education can access thousands of projects in multiple ways and formats, including the company’s digital platforms that offer thousands of project ideas, from novice to expert level, and include convenient shopping lists for each project. Customers seeking video tutorials can access free content both through joann.com and on the JOANN YouTube channel, where the company posts additional ‘how-to’ videos. Finally, customers looking to build more advanced skills can gain access to Creativebug, the company’s wholly owned subsidiary, which offers hundreds of longer form video tutorials from experts in the industry via a subscription. The company’s Creativebug website offers an extensive array of online arts and crafts instructional videos allowing customers to learn how to paint, draw, sew, quilt, knit, crochet and much more, while capturing the intimate experience of learning from top designers and artists.
The company interacts with customers and communities digitally and in person, through social media, multi-channel marketing campaigns, in-store and community events and on joann.com. The company’s highly active social networks are playing an increasingly significant role in the company’s marketing, public relations and customer engagement. The company utilizes Instagram, Facebook, YouTube, Pinterest, Twitter and TikTok to inspire, educate, promote sales, introduce new products, share customer stories and offer customer service support and proactive brand engagement. The company also has established relationships with key crafting and sewing influencers who help promote the company’s brand, projects and product offerings.
Blue Ocean Initiatives
In addition to the advancements the company has made in its store location refresh program and omni-channel platform, the company is moving forward with a number of blue ocean initiatives expected to provide long-term profitable revenue growth. For example, Ditto is a joint venture with SVP Worldwide, that the company expects will revolutionize the way consumers create, design and complete all of their sewing and crafting pattern projects. In addition, the company has forged a strategic partnership with JDM Growth Group, a premier wholesale & e-commerce consulting firm, to develop new avenues for the company in the business-to-business wholesale channel ranging from single-sellers all the way to multi-chain retailers.
Competition
The company competes with select mass merchants, including Walmart, Inc. and Target Corporation. The company also competes with specialty retailers in the Creative Products industry, such as The Michaels Companies, Inc. and Hobby Lobby Stores, Inc.
In addition to e-commerce options offered by the retailers mentioned above, the company competes with companies that sell fabrics and crafts only over the internet, such as Amazon.com.
Trade Names
The company does business under trade names for ‘Jo-Ann,’ ‘JOANN,’ ‘joann.com,’ ‘Jo-Ann Fabrics,’ ‘Jo-Ann Fabric and Craft Stores,’ ‘Jo-Ann Fabrics and Crafts,’ ‘Jo-Ann Fabrics & Crafts’ and ‘Creativebug,’ as well as under numerous trade names relating to the company’s private label products and marketing programs.
Seasonality
The company’s business exhibits seasonality, which is typical for most retail companies. The company’s net sales are stronger in the second half of the year than the first half of the year (year ended January 2023). Net income is highest during the months of September through December when sales volumes provide significant operating leverage. Working capital needs to finance the company’s operations fluctuate during the year and reach their highest levels during the second and third fiscal quarters as the company increases its inventory in preparation for the company’s peak selling season.
History
The company was founded in 1943. It was incorporated in 2012. The company was formerly known as Jo-Ann Stores Holdings Inc. and changed its name to JOANN Inc. in 2021.
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