The Washington Post reported in April that a recent survey of shoppers in 64 countries found that consumers around the world are confident, but they are likely to spend more cautiously in the coming months amid political and economic uncertainty. This includes scaling back some on discretionary spending like clothing and entertainment, as well as taking measures to save on expenditures for necessities like gas and electricity, according to The Conference Board “Global Consumer Confidence Survey,” conducted in collaboration with Nielsen.
How to survive a possible drop in consumer confidence and slowdown in GDP during the second half of this year.
So what does this mean for the floral industry? Flowers are discretionary goods, and the floral market is highly affected by the state of the economy.
While 2019 is expected to be another good year for floral in the United States, some analysts predict the gross domestic product (GDP) – total value of goods produced and services provided in one year – will slow to 1.8 percent by the third quarter and 1.6 percent by the fourth quarter, setting the stage for a possible recession in 2020 or 2021.
Consumer feelings are mixed in terms of personal finances. Given the uncertain economic outlook, strategies should be actively managed while keeping an eye on inflation and market fluctuation.
Some brands flourish during economic downturns, so understanding how to sell during these times and testing new ideas could help retailers differentiate. Know your consumer base, and as the saying goes, hope for the best but prepare for the worst.
Idioms aside, millennials (a.k.a. Generation X, ages 23-38 in 2019) are about to overtake baby boomers as the largest adult generation, according to the U. S. Census Bureau. On their heels is Generation Z (post-millennials, ages 7-22 in 2019), which will be the largest consumer group by 2020, making up 40percent of consumers in the United States, according to a Fast Company survey.
Reports indicate these two groups may struggle more to achieve middle-class status, and renting may likely become more prevalent to owning a home. Value is a strong driver for these consumer groups.
Research tells us that plants and flowers increase feelings of well-being and that mindfulness is an aspirational ideal that many are striving for in this age of uncertainty. Millennials and Generation Z are fueling this mindfulness movement, but consumers of all generations are seeking deeper meaning in life.
During Produce Marketing Association (PMA)’s “Pantone Webinar” in March, Laurie Pressman, vice president of the Pantone Color Institute, emphasized how color, particularly colors of nature, can be a respite and that greenery and floral tones can be a reprieve from the stresses and uncertainties of our time.
If consumers can’t control the immediate political and economic landscape, they can control their reaction to it. For some, that means investing in their homes and surroundings as part of the innate need for optimism and joyful pursuits.
Millennials and Generation Z are also digital natives, whose purchasing behavior is influenced by social media. A March RetailWire article posed the question, “Can Instagrammable moments turn into immediate direct sales?” In response, members of PMA’s “Fresh Ideas: Produce and Floral Marketing Professionals” LinkedIn group posited whether our industry can capitalize on Instagram’s new checkout service that will allow users to buy items direct from the app.
According to the “2018 Customer Experience/Unified Commerce Survey” from Boston Retail Partners, a retail consulting firm, 55 percent of retailers plan to leverage artificial intelligence (AI) for personalized customer service within three years to better the customer experience.
Omnichannel commerce is a complex, multifaceted challenge for the mass-market floral industry. PMA’s work with the industry to have access to aggregated point-of-sale (POS) data is a start in the right direction. We need to figure out, however, how to use technologies, data and artificial intelligence to close the gaps and reach digital-native audiences.
Are floral retailers ready? Can you imagine a day when you’ll be able to make a personalized floral recommendation part of every shoppers’ experience?
The future isn’t too far off for newer technologies aimed at bringing products to life, including high-def video, holographic phone calls and more. The Mall of America, in Bloomington, Minn., introduced Ellie the Elf, a 3D avatar shopping concierge, in December. The AI software connects a 3D model with a chatbot to drive the experiences. Canadian startup Twenty Billion Neurons has developed an AI-powered sales assistant and is discussing trials with retailers. While we’re not in a Star Trek sci-fi world where we can beam up a bouquet, a hologram concierge might assist customers with floral purchases someday!
Busy consumers are using multiple shopping channels these days, and in many cases – unless they have big families – they aren’t stocking up during shopping trips. Instead, consumers make more frequent trips to pick up fewer items. The floral industry needs to take advantage of these quick stops by continuing to have floral products stocked at impulse kiosks near registers.
Floral will continue to have an emotional advantage, especially in the expression of love, affection, friendship, thanks and sympathy. We need to focus on the emotional connection between purchaser and recipient in the gift category.
Tech-savvy millennials are leading the resurgence of houseplants and the new plant-parent trend. According to a recent MarketWatch article, every day is “National Houseplant Appreciation Day” (Jan. 10) for this demographic. “Plant Nite” parties (group.plantnite.com/plant-nite-about-us) have taken root in bars, and #plantgang is all over Instagram, they say.
Much like the mindfulness trend, millennials might be leading the revival, but they’re not alone. Houseplants have a strong demand for space for everyday home decorations, holiday home decorations and just because. Marketing efforts should focus on houseplants as the perfect home accessories, as well as reinforce durability and how to care for plants.
Becky Roberts is director of Floral & New Initiatives at the Produce Marketing Association (PMA). For more information about PMA membership, floral events, or the work of the Floral Council and PMA’s Floral Transportation Task Force, contact her via email at firstname.lastname@example.org.