Effectiveness of Retail Promotions in the Green Industry by Age Group: A Case Study

Abstract

In the horticulture industry, age has frequently been used to divide and quantify gardeners (National Gardening Association, 2013).  For instance, consumers over the age of 55 account for the majority of U.S. household lawn and garden retail sales and the number of gardeners in this group is increasing (National Gardening Association, 2013).  Interestingly, young consumers are also expressing interest in gardening.  In 2012, Millennials (born after 1980) spent 78% more on gardening purchases than in the previous 2 years.  Surprisingly, men are the driving force in this age group (with a 125% increase) who spent approximately $441 per household (in 2012) with most of the expenditures being on food producing/edible plants (i.e. fruit trees, berries, vegetables and herbs).  The local and ‘grow your own food’ movements are likely the main drivers of increased interest in edible and food producing plants (National Gardening Association, 2013).  To date, research addressing retail promotions in the green industry by age segments has not been adequately addressed.  Once differences and similarities by age group are identified, promotions can be designed to attract those groups.  Target marketing is a promotional strategy where consumers are segmented into homogenous groups with common needs that respond similarly to marketing stimuli (Belch & Belch, 2009).  Advantages of target marketing include streamlining promotional efforts, better market penetration, improved promotion efficiency, and stronger brand recognition. Many consumer characteristics can be used to create segments with one of the primary factors being demographic characteristics (Belch & Belch, 2009).  Specifically in the horticulture industry, young consumers have been of interest due to their increased spending power, low market penetration (in the horticulture industry), and potential to rejuvenate the industry (Rihn et al., 2011). For instance, in 2015 Millennial’s annual spending exceeded $600 billion and is projected to rise to $1.4 trillion in 2020 (Donnelly & Scaff, 2019).  Consequently, identifying how different age groups respond to in-store marketing efforts could aid in capturing additional market share and ultimately improve green industry performance and profitability. In this report, results from a study investigating in-store signage and plant tag information are shared.  Specifically, similarities and differences between younger and older consumers and their visual attention to point-of-sale (POS) information is explored.  Results provide a deeper understanding of how end consumers use POS information while determining their purchases in the retail center. Overall, this EDIS publication is intended to aid green industry growers, marketing intermediaries, and retailers as they design their in-store marketing materials.