Annual Report 1995
American Floral Endowment
CONSUMER FLORAL PURCHASES TRACKING STUDY
1995 Flora-Stats Annual Report
What Consumer Needs are Being Fulfilled with Floral Products?
The consumer market for floral products was the same size this latest year as it was the year before. Consumers spent as many dollars on floral items in the annual period ending August, 1995 as they did in the year ending August, 1994. Of some potential concern, however, is that when the overall rate of inflation (3% last year) is removed from the spending level, the trend in real sales (constant dollars basis) actually slipped a bit. This is reflected, too, in the trend in the number of purchase occasions. Consumer purchase occasions lagged last year’s level by 3%.
What aspect of consumer behavior, then, is holding back growth for this market? The consumer tracking study sponsored by the American Floral Endowment provides some insight into this. The study allows us to view the change in the number of purchases made and the motivations prompting consumer purchases of floral products. The assessment by product segment reveals when purchases are intended as gifts and when they are purchased for the buyer him/herself. The study further identifies the reasons consumers made the choice for a gift or self and helps us understand what other gift type products may have been in competition for the floral gift purchase. We may call this a review of the consumer needs being satisfied by the industry (which needs are supporting growth in buying - which are not). Not all product segments performed the same so let’s review the trend in buying and motivations for each major segment separately.
Fresh Cut Flower purchasing did not keep pace with the industry’s overall trend this past year. The rate of loss in purchase transactions was greater than the rate average for the industry. Fresh Cut Flower buying is heavily dependent on gift intended purchases. And, in this past year, this product segment became even more dependent for volume on satisfying this need. Where weakness occurred was in the purchases made for one’s self. These purchases accounted for 32% of the transactions last year but only 29% this year. Two of the listed reasons for buying for one’s self declined in importance this past year: “Caught my eye” and “Long lasting”. To rebuild consumer demand for Fresh Cut Flowers, retailers and suppliers may wish to address these two issues motivating purchases made for self. Of course, continuing to address the gift needs is of critical importance to this product segment. The top three reasons given for gift purchases by consumers were: “Makes recipient feel special”, “Communicates feelings”, and “Like to give flowers”.
Both Flowering Plants and Green Plants fared relatively well over this past year. The number of purchase transactions increased moderately from the year before. In both cases, the growth was supported by increased instances of consumers purchasing these items for themselves. In the case of Flowering Plants, this motivation increased to 56% of the transactions, up from 54% in the year prior. For Green Plants, buying for self accounted for an even higher 73% of the transactions, up from 70% last year. Flowering Plants increasingly satisfied consumers’ interest in using them to “Decorate my home”. This reason increased most from last year - now accounting for 57% of the transactions for self, up from 53% last year. The reasons of growing importance in buying for self were more varied for Green Plants. These three held higher shares this year than last: “Treat myself”, “Other” (than listed reasons) and “Long lasting”.
Artificial floral products fared well this past year, too. The number of purchase transactions increased from last year’s level. The distribution of transactions intended for self and gift did not change much from the prior year, though buying for self did increase at a bit faster rate than gift transactions. The larger market is buying for self (60%) and the primary reason given is “Decorate my home”. This reason accounts for a high 76% of the transactions for one’s self.
The smallest segment is Dried Flowers. Fewer purchases of this segment are occurring. This product has lost share standing in the industry for two consecutive years. The large majority of the purchases are intended for self (68%), and this is where most of the transaction losses are seen. Here, too, this product satisfies consumer’s interest expressed as “Decorate my home” (77% of the self intended transactions). Where weakness was noted was in the purchases motivated by “Caught my eye”. Retailers may want to address this with enhanced and more focused displays of these products as an attempt to counter this trend.
Outdoor/Bedding Plants enjoyed considerable growth in purchasing last year. This past year, however, the trend in consumer transactions for this product segment simply mirrored that of the industry overall. That is, a small decline occurred from the high transaction level posted last year ending August, 1994. Only 15% of the transactions for Outdoor/ Bedding Plants are intended as gifts. A variety of reasons are given for the gift intended pur chases. Among those most mentioned were: “Like to give plants”, “Makes recipient feel special”, “Communicates feelings”, and “Other” (than listed reasons). Of course, for those transactions intended for self, the overwhelming reason given was “Decorate my garden”.
In summary, what we’ve seen is that the two product segments with the softest trend in consumer purchase transactions from last year were Fresh Cut Flowers and Dried Flowers. In both cases, weakness traced to a loss of purchases made to satisfy the personal needs of the buyer. (Gift intended buying held up better than buying for one’s self.) Less impulse buying seems to have occurred for both product groups as fewer purchases intended for self were motivated by “Caught my eye”. In addition, for Fresh Cut Flowers, consumers reported fewer purchases for themselves prompted by “Long lasting” as their reason for making the purchase.
