2018 Plant Something NH Industry Benchmarking Survey and Consumer Survey
The results of the 2018 Plant Something NH Industry Benchmarking Survey and Consumer Survey are here! As you prepare to update your marketing plan for 2020, consider how your business compares and what NH consumers are saying about their gardening habits.
The majority of Industry survey respondents are retailers (vs. growers) of perennials, annuals, trees, shrubs and edibles. Most experienced growth in 2017 and at the time of the survey, they expected that growth to continue in 2018.
Applying Benchmarking to your marketing strategy allows you to compare your methods and performance to your NH peers and best practices in the local industry.
As you prepare for 2020, consider some of these Key Takeaways from our analysis of the 2018 survey results:
Website & eCommerce
In a November, 2018 study for the American Society for Horticultural Science out of Kansas State University, researchers noted that the US horticultural industry faces numerous challenges to maintaining successful, independently owned retail businesses and concluded, "A high-quality online presence is essential for the viability of horticultural businesses," the study's authors said. "Lack of modernization, however, coupled with often limited resources for developing online content, have resulted in slow adoption of new sales technology in small to medium enterprises, such as garden centers, nurseries, and other horticultural businesses."
Time, Budget, Proving ROI & Strategy Development are the Top Challenges cited by respondents, with just over half of respondents dedicating less than 10 hours per week to marketing and less than half of respondents having a formal marketing plan.
These challenges are the same for every small to mid-size business. When there's inventory to protect or customers and other business to attend to, it's natural to focus on addressing what demands the most immediate attention. The result is marketing gets back-burnered in favor of more pressing items, becoming passive, reactive or foregone all together.
According to LeadershipIQ only 19% of new hires achieve unequivocal success. Discovering the inability to afford or choose the right hire may result in wasted time, resources and ultimately abandoning this goal.
Without definition of a brand position that serves business goals, a message that identifies with the right audience, reaches that audience in the right place and without a metric to measure that performance, successful growth is near impossible.
53% of respondents indicated they are currently utilizing (spending money on) Print Ads in advertising. Only 16% indicated Print Ads to be Very Effective, yet 57% plan to spend more money on Print Ads in 2019!
Word of Mouth, Sales Opportunity & The Consumer Journey
Only 9% of respondents typically respond to inbound sales inquiries within an hour. Inbound inquiries are highly engaged prospects, in buying mode, reaching out to you. All that might be needed to convert them to a sale is the final bit of information they're seeking. Spending money on advertising or worse, not spending money and hoping for customers to find you, and then not responding when the customer is ready to buy = lost revenue. With or without a marketing plan, answering the phone or a DM in a timely manner is one of the easiest ways to increase revenue. In today's environment, it's too easy to move on to the next source and he who answers gets the sale.
What's your average sale?
How many calls or messages were missed this week?
What if 10% or 25% or 50% of missed calls were answered and converted to a sale?
Now multiply those figures over a week or number of weeks you're in operation. The result might surprise you and could even warrant additional staffing. Now set a goal for improving by a percentage that justifies an ROI.
Word of Mouth and it is still king across all industries, and 81% of respondents rely on it, but Word of Mouth is not only happening at cocktail hour or over the garden fence anymore. Word of Mouth is now taking place digitally in the form of online reviews and recommendation requests on social forums. From here, the consumer journey may take them to your website, a view of your social profiles and then a phone call or DM. Place yourself in a potential new customer's shoes. What would that experience with your business look like? Is your website functioning and aesthetically consistent with modern expectations? Is your online reputation reflective of your business? Does your digital presence reflect current or accurate business information and display consistent content across all channels? How does the journey to your place of business compare with your competitor?
The Consumer Survey data is reflective of a changing demographic and generational shift.
Among those who have bought Products & Services in the past 12 months, about 1/3 spent more than $500. Among those who have not purchased in the past 12 months, 2 in 5 say it is due to "Time."
Ages 18-29 were the group most influenced (69%!) by a Store Display
Ages 50-59 were the group to most influenced by Social Media
Ages 70+ and Men were groups most influenced by Online Reviews
Ages 18-29 were the group to care most about Customer Service & Quality of Product (67%!)
Ages 30-39 were the group to care most about Supporting Local Business & Price
Ages 50-59 were the group to care most about Convenience
Women and Men cared most about Supporting Local Business, but Women more than Men
Men cared more about Convenience than Women
Those who have Lived in NH More Than 30 Years is the Resident tenure group who care most about Supporting Local Business
63% of Ages 18-29 will Research a Product or Service Months before purchase
21% of Men will Research a Product or Service Days before purchase
63% of Ages 18-29 Spend Time Gardening for Peace & Relaxation
Men most Spend Time Gardening For Improvement / Beautification
Women Spend Time Gardening mostly for Peace & Relaxation
Ages 50-59 were the group to Spend Time Gardening mostly to Grow Food
After the Beauty of Plant Life, Mental Health was the top cited reason to encourage people to Spend Time Gardening, predominantly Women, ages 30-39
The Environment encourages 61% of 18-29 year olds to Spend Time Gardening
This is an important reminder that methods of advertising and customer service must be examined and business adaptations must be made to the meet expectations of changing generational priorities.
Marketing budget is a bit of an enigma - not only for the NH horticultural industry, but for all industries. Our survey benchmarks provide some indication of trends by sales and size of operation, but the truth is there is no magic number. We provide some SBA and Retail benchmarks for you to see how your budget compares, but only you can decide what is right for your business and that number should be based on a strategic plan to meet your goals.
Anecdotally, (information gained through conversations vs from the survey), we've learned that the NH horticultural industry relies on a benchmark of 2-2.5% of annual revenue to determine marketing budget. Think critically about that number. Where did it originally come from? How long has this number been perpetuated throughout the industry? Is it competitive with modern best practices in marketing across all the channels (think digital) and all industries with which we now compete for consumer attention? Even if it has been the unofficial benchmark for even a decade, it is likely inadequate in the current marketing environment.
So, how much is the right amount to allocate to your marketing budget?
Make these questions part of your marketing strategy and plan development to arrive at the number that is right for you:
How much would you like to increase sales in the marketing plan year?
What other kinds of business goals do you have?
Based on your average historical transaction amount, how much do you need to increase sales or customer count a to meet those goals?
Have you determined the best channel for your budget and ideal audience to achieve those goals?
Is the amount you're spending a match to adequately meet your goals?
How will you know if you're successful?
How should you adapt if results are unexpected - good or bad?
Once you've answered some of these questions, use the benchmarks provided to decide if your number is in alignment or whether the benchmark is out of alignment with modern marketing needs.
Top 3 Key Recommendations for 2020
1. Invest in the right talent to address your challenges - in house or outsource if needed.
2. Develop marketing strategy based on business goals and implement a marketing plan.
3. Be prepared to reach and respond to your target audience where they spend their time or where their interests lie, at their convenience and on their clock.