Incredible Shrinking Transactions... and What to Do – Part 2
Incredible Shrinking Transactions... and What to Do – Part 2
by Sid Raisch
Incredible Shrinking Transactions, and What to Do - Part 2
by Sid Raisch
[Continued from Part 1 - Click to review from Group Blog]
The Garden Center Group’s 2023 P&L Study shows a continued trend of flatness of the three top KPI’s with nearly flat revenue, transaction counts, and average dollars per transaction (barely keeping with inflation). Of course there are the above average performing companies who lift this average, along with the corresponding below average performers. No matter which side of average a garden center is, this is an alarming trend. The most alarming thing is the slide, which began in 2008 at the start of the Great Recession and continued to 2019 (after a brief COVID relief in 2020 and 2021), has returned and it is sticking. The reason - Baby Boomers are aging out. The real reason? We as an industry are failing at replacing revenue from Baby Boomers.
If you read Part 1 of this article, you picked up on the shifting demographics related to birth rate, which is the underlying cause of declining transactions. Fortunately, the more proliferous birth rate of the Echo Boom younger generations, (GenY/Millennials, and GenZ) are aging in as they begin to buy plants at younger ages than ever before as tweens, and into their independent lifestyles and rising incomes. This is the best opportunity for transaction growth. However, they are not coming in to most IGC’s in sufficient numbers to replace their aging-out parents and grandparents. We know who they are, but how do we reach them in an effective manner?
The question now, and Part 2 of this article is about…
What to Do
The apparent problem is captured within the Axiom Marketing Communications recently published research (Click Here to View) showing the younger generation’s overwhelming preference for nationally known chain and box stores and national brands of products they have grown up with. IGC’s are relatively invisible to Echo Boomers, as they reported buying most of their garden plants from IGC’s only 11.3% of the time. Prior generations knew a world before these chains and big-boxes were well established when there were many more IGC’s and established traditions of shopping with us at least in spring. On the brighter side of this research indicates 48.3% intend to spend more money on gardening, 52.1% intend to spend more of their time gardening, and 69.7% intend to plant more and garden more in 2024. Will they actually do this? We won’t know until they have a chance. Let’s give them that chance at our IGC’s because if we don’t, 88.7% will be relying on big box retailers to supply them.
Our solution for attracting these younger consumers is in three areas
- Speaking in THEIR language
- Meet them where THEY are
- Sell what THEY want to buy
These are relatively simple objectives.
Speaking in THEIR Language
The first thing to do when we have a persistent or worsening problem is to stop digging a deeper hole - where no hole should be in the first place. We have terrific muscle memory when we talk about ourselves and our products. The trouble is when we use jargon, an “insider language” that is unfamiliar to outsiders. There is a dangerous effect to using jargon, the greatest of which is they tune us out.
If we look at jargon from the personal perspective of how we receive it from providers of medical care the concept is directly relatable in as little as 3 minutes of your time starting when we - Click Here to Check out the 7 Types of Jargon Oblivion
The jargon we use in our business is life threatening as well - to the health of our our business which is at risk when we don’t communicate with our desired customers in THEIR language.
What is their language, LOL?
The Boomers among us struggle with text abbreviations, a form of Jargon. (I would estimate that there are a few people reading this still wondering what LOL is, LOL.)
Echo Boomers have another language and that is their Interests, Desires, and Passions. Baby Boomers are legendary for Jonesing - keeping up with the Jones’ family next door and across the street, and around the country as they filled their homes and lives with the stuff malls full of chain stores and big boxes put in front of them. Their kids became more mindful about the quality of goods over the quantity, and the sourcing of those goods especially as related to the carbon footprint, aka sustainability.
While young people have been coming into IGC’s well educated on botanic names, propagation, and seeking rare houseplants and collecting succulents, the research is showing that the majority of them simply don’t, instead preferring the familiar chain stores and big boxes. While many of them have taken an interest in plants, there are still many of them haven’t, at least yet. We need to be figuring out why this is true.
Could it be that younger people aren’t that into us, just like they aren’t into memorizing the jargon of algebra, trigonometry, calculus, spelling, sentence structure, or even phone numbers? This is not a debate about whether it is important to be proficient with grammar or how to write and read cursive, and we’re don’t have time to wait for those issues to be settled either. It’s about the future of IGC’s and yours in particular.
Beginners are always going to be beginning. More advanced customers are always going to gravitate to more sophisticated communication over time, but when we begin with a foreign language many will give up in a heap of gardening failure, well before they figure out what we’re talking about. They don’t have to walk into an IGC to do this - they decide from the palm of their hand.
How much water is the right amount? Do I remove the plant from the pot when I plant it in a larger pot, or in the ground? Evergreen or deciduous? And my perennial favorite after all these years of all of us trying to get customers to understand - Is it a perennial or annual? “It’s an annual because it comes back ever year, right?” Over 45 years of my lifetime and we have absolutely failed to get our customers to know which is which. It’s time we take a different approach.
It’s not Echo Boomers’ problem to understand what we’re saying, it's our problem if they don’t. Speaking in a foreign language is one reason we have a shrinking base of customers. Don’t be fooled by this as we were in the 80’s and 90’s when demand from baby boomers started to surge, and we thought we got away with it. We didn’t. We gained a lot of customers but lost untold amounts who we systematically dumbed down to buying eye candy with chlorophyll, only once a year - if they and we were lucky.
The absence of Jargon is honest, transparent, and understandable communication, which is highly prized by GenY and GenZ. Review Part 1 of this article to familiarize yourself with their values. If we can’t be heard, we won’t be heard.
Am I suggesting we “dumb it down?” I’m suggesting that if we don’t, we have more to lose than we already have in terms of market share, revenue, and profitability. In Doug Hall’s, book, Jump Start Your Marketing Brain, the best chance of success is to “dumb it down so a 10-year-old can understand”, and “brands with the clarity of a 5th grade level or less consistently show a higher probability of success.” Doug Hall is founder of Eureka Ranch, whose current President presented at Fall Event 2023.
Are we failing at attracting the numbers of younger consumers we desperately need? How are we going to change that? Begin at the beginning, with speaking in their language - which is not our industry jargon.
Watch for Part 3 - Meet Them - Where THEY Are
Watch for Part 4 - Sell What THEY Want to Buy
Takeaways - What to DO
Before procrastination or other busyness steals another year from you Text or Call 937-302-0423 or send an email to [email protected] .
Sid Raisch is an advocate for family business leading growth, change, and results throughout US horticulture. Redefining the business future for consumer horticulture by understanding how the end-to-end supply chain needs to be redirected is a skill Sid has honed into an art. He has understanding and insight through inquisitive observations and extensive experience and has served as a trusted advisor helping transform both national and local businesses into more profitable and sustainable businesses. Developing national and international educational programs that create change in culture, community and company provides Sid venues with a front row seat creating effective and innovative business models.
Sid is a Certified Value Builder System Advisor, and currently serves as Chief Strategist and the Swiss Army Knife of Consultants to The Garden Center Group clients. Contact Sid at [email protected] or call or text 937-302-0423.
REMEMBER: Your interaction (by phone and email) with Group Service Providers such as Sid Raisch, Tim Quebedeaux, Jean Seawright, John Kennedy, and of course Danny Summers are included in your retainer!
