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Gen X / Y: What IGCs Need to Know to Profit from the New Gardener Slide 2 Index Methodology Debunking Myths and Establishing Facts Slide 3 Methodology Slide 4 Phase I: Consumer Focus Groups Focus groups were conducted at two IGCs: Good Earth Garden Market (Olney, MD) Mulhalls Nursery (Omaha, NE) Each group consisted of 10 consumers. The consumers were split into four groups: Group 1Group 2 Good Earth - Not familiar with - Never purchased from - Purchased from other IGC - Not familiar with - Never purchased from - Limited experience with other IGCs Mulhalls- Currently a customer of - Familiar with - Never purchased from Slide 5 Phase II: Validation Survey 400 consumers were driven to an online survey via email invitations. All respondents were required to have purchased a plant and completed a gardening / landscaping project without the help of a professional in the past 12 months. All respondents were required to own a single-family home with a yard. Slide 6 Methodology Debunking Myths and Establishing Facts Slide 7 True or False: The Gen X / Y consumer has low interest in gardening. Slide 8 TRUE Slide 9 Gen X / Y consumers have lower interest levels in gardening than their parents did when they were the same age. Top-Box Interest Levels in Gardening* *Top-Box represent the % of consumer selecting a 5 on a 5-point scale. Slide 10 The good news: Gen X / Y consumers are spending the same amount of time and money as the general population on gardening activities. In comparison to a 2006 industry benchmark, both the Gen X / Y consumers are spending: - a median of $250 per year on gardening consumables. - a median of 5 hours per week on gardening and lawn maintenance activities during peak months. Slide 11 True or False: The Gen X / Y consumer gardens for different reasons than previous generations. Slide 12 TRUE Slide 13 Gen X / Y consumers primarily garden for home / property beautification. % of Consumers Citing as the Primary Motivation to Garden (n=404) Slide 14 True or False: It will be difficult to advertise to the Gen X / Y consumer using traditional marketing methods. Slide 15 TRUE Slide 16 Some local advertising methods will not be effective in marketing to Gen X / Y consumers. More than half of the respondents indicated that they only occasionally use the Yellow Pages to look up phone numbers. A quarter recycle or throw the Yellow Pages away! Less than half of the respondents currently subscribe to a local newspaper. Slide 17 While the Yellow Pages are only occasionally used, more than 75% of Gen X / Y consumers use the Internet to look up phone numbers. Slide 18 2 out of 3 Gen X / Y consumers are watching gardening-related programming on cable networks. % of Consumers Watching Television Network on a Weekly Basis (n=404) Slide 19 Gen X / Y consumers enjoy reading magazines focusing on home and garden content. % of Female Consumers Reading Magazine on a Monthly Basis (n=203) Slide 20 True or False: The Gen X / Y consumer hires professionals rather than completing gardening activities on their own. Slide 21 TRUE and FALSE Slide 22 2 out of 3 Gen X / Y consumers are opting to complete the project themselves rather than hire a professional. % of Consumers Completing Project Without Professional Help v. % Hiring Professional (n=404) Slide 23 Gen X / Y consumers are opting to hire professionals for the maintenance activities, while completing the more enjoyable tasks without professional assistance. Slide 24 True or False: The Gen X / Y consumer grew up on Home Depot and Lowes, and they prefer this channel. The Gen X / Y consumer has a low affinity for local specialty retailers. Slide 25 True or False: The Gen X / Y consumer grew up on Home Depot and Lowes, and they prefer this channel. The Gen X / Y consumer has a low affinity for local specialty retailers. FALSE Slide 26 Over 60% of Gen X / Y consumers are shopping at IGCs for plants. % of Consumers Shopping Channel (n=404) Slide 27 On median, Gen X / Y consumers are shopping for plants 6 times per year. On median, 2 trips will be to a home center and 1 trip will be to an IGC. Slide 28 True or False: The Gen X / Y consumer does not recognize the benefits provided by an IGC. Slide 29 FALSE Slide 30 The frequent IGC shopper (3+ visits / year) primarily shops IGCs for plant quality and assortment. Top-Box of Factors Impacting Decision to Shop at an IGC v. Big Box Retailer *Top-Box represent the % of consumer selecting a 5 on a 5-point scale. Slide 31 The occasional IGC shopper (1-2 visits / year) primarily shops at the IGC for the staff experience / expertise and the plant quality. Top-Box of Factors Impacting Decision to Shop at an IGC v. Big Box Retailer *Top-Box represent the % of consumer selecting a 5 on a 5-point scale. Slide 32 The non-IGC shopper is primarily not shopping at an IGC due to the perception of higher prices and inconvenience. Top-Box of Factors Impacting Decision NOT to Shop at an IGC *Top-Box represent the % of consumer selecting a 5 on a 5-point scale. (n=149) Slide 33 The words most frequently used to describe IGCs were consistent regardless of shopping frequency. % of Consumers Using Word to Describe IGCs Slide 34 Myth: The Gen X / Y female consumer will be more active and profitable than their male counterpart. Slide 35 TRUE Not Necessarily Slide 36 On median, Gen X / Y males are spending 3 more hours per week gardening than their female counterparts. Gender Comparison of Median Time Spent on Gardening Activities During Peak Gardening Months Slide 37 Male and female frequent IGC shoppers are both visiting IGCs for plants 5 times per year. Gender Comparison of Median Shopping Visits to all Garden Centers and IGCs for plants Slide 38 On median, Gen X / Y males are spending more on gardening consumables than Gen X / Y females. Gender Comparison of Median Spending on Gardening Consumables Slide 39 True or False: The inducements needed to draw the Gen X / Y consumer will be vastly different. Slide 40 FALSE Slide 41 The strongest IGC shopping inducements were consistent regardless of shopping frequency. % of Consumers More Likely to Shop at IGC based on Inducement Slide 42 Gen X / Y consumers are most interested in learning how to rely less on professionals. % of Consumers More Likely to Shop at IGC if Course Offered Slide 43 True or False: The Gen X / Y consumer considers the IGC to only be a destination for plants. Slide 44 TRUE, But Slide 45 3 of 10 Gen X / Y consumers are likely to purchase organic fruits and vegetables from an IGC. Top-Box Likelihood to Purchase from an IGC *Top-Box represent the % of consumer selecting a 5 on a 5-point scale. Slide 46 True or False: The Gen X / Y consumer does not grow vegetables. Slide 47 FALSE Slide 48 6 out of 10 Gen X / Y consumers currently grow vegetables. Slide 49 3 out of 4 Gen X / Y consumers who have a vegetable garden are growing tomatoes. % of Consumers Growing Vegetable (n=234) Slide 50 Gen X / Y vegetable gardeners are primarily motivated by personal satisfaction and taste. Consumers Motivations to Grow Vegetables (n=234) Slide 51 The Gen X / Y consumer has interest in vegetable gardening that exceeds their current levels of experience. % of Consumers Experience v. Interest in Learning More Gen X / Y consumers want to learn more about vegetable and herb gardening. (n=404) Slide 52 True or False: Among Gen X / Y consumers the green and organic movements can increase interest in IGCs. Slide 53 True or False: Among Gen X / Y consumers the green and organic movements can increase interest in IGCs. TRUE, But Slide 54 Approximately 1 out of 10 Gen X / Y consumers will both agree that an IGC could be a green center and be very likely to shop for organic products at an IGC. Top-Box % of Consumers *Top-Box represent the % of consumer selecting a 5 on a 5-point scale. (n=404) Slide 55 Nearly 3 out of 4 Gen X / Y consumers are occasionally purchasing organic foods. Frequency of Purchase (n=404) Slide 56 True or False: Targeting Gen X / Y consumers will be difficult. Slide 57 True or False: Targeting Gen X / Y consumers will be difficult. FALSE Slide 58 A new home purchase was cited by the most Gen X / Y consumers as a stimulus to increased gardening activity. % of Consumers Citing as Impetus for Higher Interest in Gardening (n=404) Slide 59 The good news... % Growth in Age Cohorts by Decade Source: United States Census Bureau