Previous research has shown the floriculture retail industry is in the mature stage in the product life cycle resulting in decreased profits and sales (Behe et al., 2003). Supporting research suggests the overall demand for fresh-cut flowers and floral products is decreasing compared with several years ago, particularly among younger consumers, indicating they have needs that are unmet by available floral products (American Floral Endowment, 2008; Burke, 2007; Silvergleit, 2004). One technique to reinvigorate sales is to implement an innovative marketing strategy; that is, to introduce the product to a segment that currently does not use the product. Lack of use among younger consumers gives marketers an opportunity to stimulate purchases among members of this age cohort, potentially shifting sales of fresh floral products from the mature stage back to the growth stage (Kerin et al., 2009). Based on this information, the current study explores the needs of different age cohorts to better understand how to find and attract new, younger consumers to shift fresh floral products back to the more profitable growth stage.
Consumers are not homogenous and show different attitudes and preferences toward products they are considering for purchase. Because of this, individual product attributes also tend to vary in importance among consumers. Earlier research suggests that market segmentation works well to centralize consumer needs and attract new customers (Oppenheim, 2000). Market segmentation groups consumers with similar preferences and who will frequently respond similarly to specific but similar market mixes and stimuli (Oppenheim, 2000). Often segments are based on demographics such as age or gender (Kerin et al., 2009; Oppenheim, 2000). Age has been successfully used in studies to segment consumers and show similarities in purchasing behavior (Dennis and Behe, 2007; Roberts and Manolis, 2000). Age segmentation is effective because people of comparable ages have shared life experiences, including historical events, social norms, political influences, and educational standards (Roberts and Manolis, 2000). For example, a previous study found that as people age, material items become less important to them (Roberts and Manolis, 2000). As a result, people find greater enjoyment and fulfillment in other activities such as gardening and garden-like experiences as they age (Behe et al., 2003; Dennis and Behe, 2007).
Life experiences also shape how consumers view products and make purchasing decisions. Generation X and Generation Y are two distinct age groups that have been repeatedly studied and effectively targeted by other industries (Barrow, 1994; Littrell et al., 2005; Roberts and Manolis, 2000; Silvergleit, 2004) but, until recently, have been neglected by the floral industry. Generation X consists of 44 million people born between 1965 and 1976 (Dunn, 1993). Research suggests that consumers in this age group tend to value money, possessions, and the shopping experience more than older generations, potentially leading to greater credit card debt and personal bankruptcy (Dunn, 1993; Roberts and Manolis, 2000). Members of this age cohort are also characterized as educated, media-savvy, self-reliant, pragmatic, and often exhibit a distrust of uneducated people (Littrell et al., 2005). Compared with older generations, Generation X has had greater exposure to cable TV and the Internet (Bartlett, 1997; Roberts, 1998; Roberts and Manolis, 2000) resulting in their being receptive to marketing messages and yet often quite cynical and suspicious of them (Freeman, 1995; Roberts and Manolis, 2000).
Generation Y consists of 71 million people born between 1977 and 1994 (Morton, 2002; Paul, 2001). These individuals are thought to have distinct traits and spending behaviors that differ from previous generations (Maciejewski, 2004). For instance, Maciejewski (2004) found this group to be distrustful of political agendas and of the media as a result of their views being biased on important issues. Additionally, celebrities have less influence as a result of publicized scandals; as a result, this generation tends to have greater respect for parents and grandparents than celebrities. Another difference is that Generation Y is accustomed to having discretionary dollars to spend and therefore expects to have sufficient financial resources to maintain a certain standard of living. For example, in 1999, Generation Y spent $153 billion and influenced their parents to spend an additional $48 billion (Rushkopf, 2001). With so much spending power, this group is an attractive market segment and gaining insight as to their preferences greatly enhances an industry's ability to market to this group.
Over $100 billion is typically spent each year in the United States on gifts (Parson, 2002), making the understanding of gift selection and purchasing decisions a necessary requisite for industries supplying gift-related products and services. Studies have shown that gift giving often symbolizes levels of trust, cooperation (Bolle, 2001), attractiveness, devotion, and the intensity of social relationships (Huang and Yu, 2000). In addition, gifts implicitly communicate the giver's intentions and attitudes about the gift and recipient (Burgoyne, 1999). Given the amount of money spent on gifts by U.S. consumers and that 75% to 80% of floral transactions (≈$5 million of industry revenues) are for gifts (IBISWorld Inc., 2010; Silvergleit, 2004), the present study was designed to explore the use of floral gifts among Generations X and Y. This information could then be used by the floral industry to address the problem of the downward trend in floral sales (IBISWorld Inc., 2010; Silvergleit, 2004).
To optimize the use of fresh floral products as gifts, what are commonly referred to as the four Ps of marketing must be explored, including product, price, promotion and placement, because each plays a role in driving purchasing decisions (Kerin et al., 2009). The product is a good, service, or idea that satisfies the consumer's needs such as a bouquet or a florist's design and delivery services. The price is what is exchanged for the product and the promotion is used as a means of communication between the seller and buyer. Promotions include paid commercials, advertisements, Internet pop-up advertisements, and word of mouth. Placement is the means of getting the product to the consumer (Kerin et al., 2009) and can either be a physical location such as a retail store or it can be mental imagery such as an environmentally friendly company or product. This study explored the perceptions of Generations X and Y relative to product, price, promotion, and placement of floral products as gifts. The overall objective was to discover ways to assist the floral industry to improve sales and increase the use of floral products as gifts by Generations X and Y consumers by investigating their perception of and preferences relative to the 4 Ps of floral marketing. Specifically we: 1) explored Generations X and Y's positive or negative attitudes toward flowers as gifts; 2) explored differences in perceptions about price, product, place, and promotions among Generations X and Y to determine the best marketing techniques to reach them; and 3) determined what actions the floral industry can take to improve Generations X and Y's use of flowers as gifts.
Research results can be used by florists, floral producers, and other marketing intermediaries that sell fresh floral products to develop strategies for improving product marketability and enhancing consumer loyalty through positive experiences. This study also contributes to the literature regarding the decision-making processes of consumers in making floral purchases and their use of floral gifts compared with other competing gifts of similar prices.
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