Flora-Stats Annual Report 1997
Consumer Tracking Study
What Is Important To A Floral Customer When Choosing Where To Shop?
The floral industry enjoyed moderate growth in the number of floriculture products purchased by
consumers during this latest annual period ending August, 1997. The lift in buying traced particularly to an increase in how often consumers made a floral product purchase during the year. A small expansion in the number of customers reached provided the balance of the gain.
Yet, not all product segments experienced this same trend. Some products, such as Green Plants, Bedding/Outdoor and Flowering Plants, enjoyed stronger growth and captured a larger share market (transactions), while others, including Artificial/ Dried and Fresh Cut Flowers did not keep pace with the overall trend and lost market share.
While the major retail outlets (Discount Chains, Florist Shops, Garden Centers, Home Impr./ Hardware Stores and Supermarkets) all benefited from the increased demand for floral products, retailers that receive a significant percentage of their purchases through plants rather than cut flowers, accounted for the majority of the industry’s gains this year. Garden Centers, for example, were where nearly a third of the incremental purchase occasions occurred. At the same time, one-half of the additional purchases were split evenly between Discount Chains and Home Improvement/ Hardware Stores.
What underlying reasons drove these trends? Do consumers purchase products at different places for different reasonsdid convenience, price or product quality influence their decisions to make a specific purchase?
To gain insight into this issue, each product segment was reviewed based on the input from study respondents: These households have a list of nine reasons to choose from as they tell us why they purchased from a particular outlet. Viewing the trend in these responses indicates why a particular type of outlet was chosen to receive more transactions this year than the year prior. For further understanding, changes in the importance of Gift vs. Self and Planned vs. Impulse buying was also identified.
Green Plants
Consumers increased their purchasing of Green Plants between September, 1996 and August, 1997 at a faster rate than the overall market trend. Buying increased at all outlets except the combined group of identified outlets (Dept. Stores, Convenience Stores, Mail Catalogs, Street Vendor, Toll-Free Number and Drug Stores). Home Improvement/ Hardware Stores customers contributed three out of every ten additional Green Plant purchases made in 1997. Outlets following in rank order of transactions gained were: Discount Chains, Supermarkets, Other (Unidentified) Outlets, Garden Centers and Florist Shops.
The strength of the Green Plant segment in `97 traced to a lift in the importance of Planned purchases and of buying these products for Self.
Price and Product Quality were the key motivators influencing the lift in purchasing of Green Plants at Home Improvement/Hardware Stores this year, though Selection and Convenience remained very important to this outlet. At Discount Chains, Convenience and Product Quality drove the increase in buying as Price, the dominant motivator, slipped in importance in `97 when compared to a year ago. For the second consecutive year, the percentage of consumers indicating Price as the key reason for purchasing a Green Plant at a Supermarket increased while the share held by Convenience and Selection eroded. While Price, Reputation and Selection continued to be very important reasons that consumers bought Green Plants at a Garden Center, these reasons gave way to Convenience and Product Quality during this most recent annual period.
Bedding/Outdoor Plants
Consumer demand for Bedding/Outdoor Plants accounted for over one-half of the increase in the number of floral product purchases this year. Outlets most responsible for the lift in buying were: Discount Chains, Home Improvement/Hardware Stores and Garden Centers. At the same time, the share held by Supermarkets, Other Identified Outlets and Florist Shops slipped compared to a year ago. At Discount Chains and Garden Centers, consumers were more likely to buy these products for their own enjoyment on Impulse, providing further support for the product segment gains. However, at Home Improvement/Hardware Stores, it was Gift buying that fueled the gains.
At Discount Chains, Convenience captured a greater percentage of Bedding/Outdoor Plant purchases than the year prior. Still, Price continued to be the most often cited reason for selecting the outlet (though the disparity between Price and Convenience narrowed in 1997). Consumers were more likely to frequent Home Improvement/Hardware Stores this year based on their Selection, Other Reasons and Product Quality. However, these outlets were found to be somewhat less Convenient than in the past. Product Quality, Price and Convenience remained the three most important reasons consumers visited a Garden Centers when purchasing a Bedding/ Outdoor Plant this year. In 1997, though, the gains noted for Garden Centers sourced especially to Product Quality as the importance of the other two reasons slipped compared to the `96 annual period.
Flowering Plants
The growth rate for Flowering Plants in the most recent annual period closely mirrored the overall industry's pacemaking a turn toward recovering some of the market share lost a year ago. Consumers were particularly attracted to Discount Chains, Other (unidentified) Outlets and Florist Shops during 1997 compared to the year prior. This year, consumers were more likely to Plan their purchase in advance, rather than buying them on impulse compared with a year ago. Further, buying of Flowering Plants for a Gift contributed disproportionately to the product segment’s recovery.
In particular, Convenience and Product Quality inspired a higher percentage of consumers to purchase a Flowering Plant at a Discount Chain in this latest annual period than noted in 1996. The combined group of "Other" outlets received more transactions as well with customers pleased with both their Reputation and Service. Florist Shops attracted consumers based on Convenience, Wire Service and Other Reasons.
Fresh Cut Flowers
As mentioned, there was also an increase in Fresh Cut Flower purchasing this year. The rate of increase over last year, though, was more moderate than that noted for the combined group of all floral products.
Buying of Fresh Cut Flowers was higher than last year in Supermarkets, Discount Stores and it even recovered a bit with Street Vendors. However, these gains were largely off-set with fewer Fresh Cut Flower purchases in Florist Shops and other outlet groups.
Convenience and Price continue to be the primary reason given by consumers for buying Fresh Cut Flowers in Supermarkets. However, the lift in buying Fresh Cut Flowers in Supermarkets this year was driven by Selection in particular. These outlets may be broadening their offerings and so, attracting more customers. More respondents also mentioned Reputation this year than last.
While there is a wider variety of motivations for choosing to buy Fresh Cut Flowers in Florist Shops, the slow down in buying at Florist Shops was most influenced by Reputation, Price, Service and Convenience. The surprise and concern is that two of these (Reputation and Service) are motivations that particularly distinguish Florist Shops as a place to buy.
Artificial/Dried Products
Consumer demand for Artificial/Dried products lagged the overall market trends once again this year. In particular, fewer purchases of Artificial/ Dried products were made by consumers at other, non-traditional outlets (including Craft and Hobby Stores) and Discount Chains. Only at Florist Shops, did the number of purchases made by consumers increase compared to last year. The product segment's weakness can be traced to buying Artificial/Dried flowers on Impulse and for one's Self, except at Florist Shops. In 1997, buying continued to skew towards purchasing these products for Self, though the disparity between purchasing Artificial/Dried Products for a Gift or Self narrowed this year. Though, once again, with Florist Shops as the exception.
Artificial/Dried Product customers were less likely to shop at Other (unidentified) outlets based on Selection and Convenience. The combined group of smaller (identified) group of outlets (Discount Chains, Florist Shops, Garden Centers, Home Improvement/Hardware Stores and Supermarkets) gave these outlets lower marks for Convenience. Discount Chains continued to attract customers based on both Price and Convenience. In 1997, both of these reasons accounted for a smaller percentage of Artificial/Dried purchases than a year ago. In fact, the importance of Convenience at these outlets has slipped in each of the past three annual periods.
Summary
Overall, 1997 was a good year for the floral industry as consumers once again made more purchases than they did the year prior. Similar to a year ago, consumers continued to buy floral products at a variety of outlets. For the current crop year, however, plants fared best and, therefore, the outlets that received a higher percentage of their volume (transactions) from these products benefited the most.
Consumers clearly chose to purchase floral products at Garden Centers based on Product Quality. Product Quality was also important to Discount Chains, Home Impr./ Hardware Stores and Florist Shops. In addition, Discount Chains continued to increasingly fill a Convenience need for the customer. Consumers indicated that Price prompted a greater percentage of purchases this latest annual period for all outlet groups except for Garden Centers and Florist Shops than did last year. At the same time, Selection and Product Quality attracted Home Improvement/ Hardware customers to their stores in 1997.
