Flora-Stats Annual Report 1999
Flowering Plants
The Ô99 crop year was a bit brighter for the flowering plant segment than the recent past has been. The category has struggled over the past four years, except during the Ô97 crop year when the category took a turn toward recovery. That turn was short-lived, however. as consumers have cut back on their flowering plant purchases over the past two years. For the twelve months ending August Ô99, demand for flowering plants was just shy of the Ô98 level, though outpaced the market trend. As a result, the product segmentÕs share position improved this year compared to Ô98. Further, consumers were willing to spend more on these products this year compared to Ô98. Consumer expenditure on each flowering plant increased at a double-digit rate for this crop year.
Flowering plant customers are somewhat more likely to buy these plants for their own enjoyment than as a gift. In 1999, it was the gift segment that prevented the category from growth. Consumers cut back on buying these products as gifts for "tradition" and "romance" reasons.
Convenience and price are the key discriminating factors to flowering plant buyers when deciding where to shop.
These two reasons typically account for two out of every three category purchases. This year, consumers were driven more by convenience when choosing their outlets than in the past, while product quality, selection, price, and other reasons were less important than in Ô98.
Once again, Supermarkets held the largest share within the flowering plant category. receiving about a third of all purchases during the year. Supermarkets were followed in importance by Discount Chains. Garden Centers, and Home Centers. In 1999, Supermarkets out-paced the category trend while Garden Centers lagged behind and lost shares.
Bedding/Outdoor Plants
After a sluggish Ô98 crop year, consumer demand for bedding/outdoor plants out-paced the overall market. The number of purchase transactions made by consumers in 1999 held close to that of last year. At the same time, the growth rate for expenditures exceeded that ofÕ purchases. as consumers spent more on each bedding/outdoor plant transaction this year than they did the year prior.
Consistent with the to industry trend, fewer households were attracted to the bedding/outdoor plant segment. However, these losses were offset by a lift in the frequency with which existing buyers made a category purchase. Bedding plants are usually purchased for oneÕs own enjoyment and to decorate the garden. There was no notable change in the distribution in purchases here.
Consumers select an outlet when buying bedding/outdoor products for a variety of reasons. There is less disparity between the top and lesser purchase motivators in this category segment compared to the others. Fully, a quarter of all purchases were driven by price, followed by convenience, selection, and product quality each contributed a fifth of all buying. For the most recent crop year, selection, product quality, and other reasons influenced more bedding/plant purchases than in the year prior. In fact, the importance of selection has increased each of the past five crop years.
Among the major outlet types, consumers are most likely to buy bedding/outdoor plants at Garden Centers, Home Centers, and Discount Chains. Home Centers captured a greater share of these purchases in Ô99 than in Ô98 at the expense of Discount Stores and Other Outlets.
Summary
In summary, the Ô99 crop year was rocky for the floral industry. Demand slipped from the prior year. The industry has had difficulty in retaining its customer base over the past few years and 1999 was no different In addition, customers cut back on how often they bought floral products this year accounting for much of the industryÕs losses in Ô99. Profits for growers and retailers continue to be squeezed. The higher prices paid by consumers this year only provided partial relief. Looking toward the next millennium, the floral industry needs to consider a two-tiered marketing approach designed to spur buying. Programs need to be developed to:
- Encourage the existing customer base to purchase floriculture items on a more frequent basis than they currently do.
- Win back lost customers as well as reach new households.
