Lawn and garden trends and opportunities

The cold, hard facts you need to stay on top in the lawn and garden industry!

Today's economic conditions have completely redirected trends in the lawn and garden industry, and have created emerging markets that did not exist before and brand new opportunities to go with them. Many of today's opportunities we have in the lawn and garden industry were actually created by the downturn.

Though business models that have worked for the past 25 years are now obsolete and don't work in today's economy, new opportunities have created new business models that DO WORK and create exciting times if you pay attention.

Many retailers that have sold lawn and garden products as an accessory category in the past are looking to the lawn and garden category as a "safe haven" from the downward spiral of other categories such as home improvement and hardware. Sales of lawn and garden products are now representing as much as 27% of some retailers' selling space and generating comparable profits.

By using facts and not fear to manage your lawn and garden business, you're better armed and can thrive in any economic climate.

Today's hot trends in the lawn and garden industry that are showing substantial increases in consumer sales and support are:

• Food gardening is in ... big time!

The faltering economy makes growing vegetables and herbs attractive to every pocketbook-conscious and green-thumbed consumer -- which includes most of us. Veggie seed sales are up double digits at the nation's biggest seed sellers this year, with some seed producers reporting their sales were up about 46%, and others could double their sales if they could find product.

• Staycations became a buzz word last year when gasoline prices soared to more than $4 a gallon, and instead of receding with gas prices, staycations have mushroomed to a much stronger trend this year. Staycation simply means an individual or family stays at home and relaxes at home or takes day trips from their home to area attractions. Common activities of staycations include use of the backyard pool, hosting barbeque events in the yard and buying products to make Staycations more enjoyable.

• Being "green" is still a growing trend.

The market for green products was estimated at $209 billion in 2008 and is actually still growing in 2009. According to the findings in "Sustainability: CPG (consumer packaged goods) Marketing in a Green World."

More middle-of-the-road consumers, known in the report as "respectful stewards" and "proud traditionalists," increased their spending on green products by 15.5% and 8.4%, respectively.

• Web site sales of lawn and garden products are up substantially.

Retailers such as Lowe's sprouted a 24% increase in Web site traffic last year, growing their Web site sales while the store sales and traffic was down. Home Depot, not to be outdone by their competitor Lowe's, had 11.2 million visitors to their Web site in January 2009 alone.

Whether you are a retailer or a supplier, recognizing the importance of your Web site to your gross sales and profits will give you an edge and opportunity in this economy. Consumers are spending more and more of their time shopping on Web sites. The economy does not seem to have altered this trend but enhanced it. Your opportunity is to focus some of your marketing and sales effort on this area of your business.

• Coupons are hot, clipping is not.

In the past four months coupon usage surged 10% according to Inmar, a coupon processing service, and coupon redemption rates also surged. However, consumers' use of online coupons surged 140% last year, with a redemption rate of more than 13%, which is much higher than the average redemption rate of newspaper or insert coupons. More than 40 million people currently print online coupons, up 20% from last year, according to Simmons Market Research Bureau.

In the same time period, the number of people who only print coupons from the Internet and never use newspaper coupons has risen a dramatic 46%, while 61% of consumers who took a recent poll indicated they are now using more coupons than at any other time in their lives.

• Conspicuous frugality is in, conspicuous consumption is out.

The average consumer has switched from asset-based spending (meaning spending based on their credit limits) to income based spending (meaning the consumer is trying to spend only what they earn). Paying full price for almost anything is out. Today, everybody feels guilty about paying full price for anything. "Today, it's cool to be frugal."

• Everything is being re-negotiated.

Price increases that were initiated last fall due to tremendous increases in transportation, gas and raw materials are being renegotiated every day. Costs associated with those increases have shrunk since then. Up until this year, if you sent out price changes in May for orders being shipped the following January or later, that was the time of negotiations. Now retailers and suppliers are re-negotiating after their orders have been placed and sometimes even after orders have been shipped. Retailers, who begrudgingly went along when suppliers pushed up prices to recoup record-high raw material costs, are flexing their muscles and demanding price cuts to match the recent steep retreat in costs of commodity materials such as plastics, NPK that goes into fertilizer, fuel surcharges and other related costs.

Rick Pontz is founder of The Lawn & Garden Performance Group

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