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Case study · Yankee Candle

How a teenager’s crayon candle became Yankee Candle, sold for a reported $500 million in 1998

TL;DR

Michael Kittredge II made his first candle as a teenager in Massachusetts in 1969 and built it into one of the best-known candle companies in the United States. He sold it in 1998 for a reported $500 million. The lesson is that a simple product with a strong sensory hook can grow into a destination brand if you invest in the experience around it.

How it started

In the late 1960s Kittredge was a teenager working at a burger restaurant. He learned to make candles from melted crayons in his family’s basement in South Hadley, Massachusetts. Obituaries say he made his first candle as a gift for his mother. His parents doubted the plan, and he later said he first hoped to earn enough to buy a car.

Neighbors asked to buy candles, which led him to start a company in 1969 with two school friends. The company eventually moved to South Deerfield, Massachusetts, and became one of the largest employers in Franklin County.

How they got the first customers

The first customers were neighbors in the local area. The source material does not give sales figures for the earliest days, so the main lesson is the order of events: people asked to buy before there was a company.

Kittredge later added heavy fragrance to scented candles, which the obituary coverage credits with helping create a larger household fragrance market. Strong scent gave customers an obvious reason to buy and to return.

What drove growth

Kittredge pushed the idea of retail as an experience. He attached a Christmas and toy store to the candle shop, including a replica of a Bavarian village, and a flagship store opened in South Deerfield in 1982. People came to browse, which turned a candle maker into a tourist stop.

After a cancer scare in 1993, he began handing the company to a friend and employee. The business needed capital to expand its retail store network, and in 1998 it was sold to the private equity firm Forstmann Little, reported at $500 million. The company later changed hands again: Madison Dearborn paid about $1.6 billion in 2007, and Jarden acquired it for $1.75 billion in 2013.

Lessons you can copy

  1. 1Start when people ask to buyNeighbors asking to buy his candles was the signal. A request from strangers or friends is worth more than a plan.
  2. 2Pick a product with an obvious sensory hookScent is easy to sell in person and hard to ignore. A strong, memorable feature gives customers a reason to choose you.
  3. 3Make the place part of the productThe attached store and Bavarian village turned shopping into an outing. If you sell locally, consider what makes people want to visit.
  4. 4Expand your retail footprint with capitalThe business reached a point where it needed outside money to grow its stores. Know when growth is limited by cash and plan for it.

Frequently asked questions

How did Yankee Candle start?

Michael Kittredge II made candles from melted crayons as a teenager in 1969. After neighbors asked to buy them, he started a company with two school friends.

How much was Yankee Candle sold for in 1998?

It was sold to Forstmann Little in 1998 for a reported $500 million.

Who owns Yankee Candle now?

Yankee Candle is part of Newell Brands, which came together after Newell Rubbermaid bought Jarden. Ownership may change, so check current company information.

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