Floral Departments: A Growth Perspective

Although many shoppers are coping with the recession by cutting back on discretionary purchases, floral departments should keep in mind that not all of their shoppers are hurting right now. Many may still be expecting premium bouquets for their floral occasions, and retailers should be careful not to focus so closely on price that they lose sight of those premium shoppers. At St. Louis-based Schnuck

Although many shoppers are coping with the recession by cutting back on discretionary purchases, floral departments should keep in mind that not all of their shoppers are hurting right now. Many may still be expecting premium bouquets for their floral occasions, and retailers should be careful not to focus so closely on price that they lose sight of those premium shoppers.

At St. Louis-based Schnuck Markets, sales of $6.99 bouquets increased significantly last year — a trend that floral director Michael Schrader attributed to customers trading down when making impulse buys. However, he also noted that the company had not seen much of a decline in sales of one of its more expensive bouquets, priced at $22.99.

“We didn't see that much of a decline in the sales of the more expensive bouquets,” he said. “It just seemed like the middle of the road sales, it just became a little more polarized.”

Schrader said Schnucks sells more units of the basic bouquet than the high-priced ones, but the higher-priced bouquets are usually bought as a gift, for which the consumer wants to spend more than $6.99. Also, for more affluent shoppers, $22.99 won't seem unreasonable for an occasional impulse buy.

Regardless, because of the discretionary nature of floral purchases, it is crucial for retailers to evaluate product mix according to demographic, noted Terry Humfeld, vice president of volunteer leadership relations for the Newark, Del.-based Produce Marketing Association.

“They have to evaluate the assortment that they have on a store-by-store basis because the demographics obviously change as you move around,” he said.

“Retailers can't assume that every single consumer out there is hurting,” Humfeld added. “Sure, unemployment in some states is as high as 15%; there are other states where it's down to the 8%-10% range, [but] that means there's still a lot of people out there working and doing OK. Some are doing better than others, so let's not strip the department of every high-value item that you have.”