11 Reasons Why the Flower Business is in Turmoil

In Floral Industry by Seamus9 Comments

There is no doubt that among many other industries, especially in the retail sector, floristry has become a game of struggling to compete under rapidly changing marketplace conditions. It’s not just about purse-strings being tighter; it’s about several fundamental business realities that have changed which are putting the squeeze on the floral industry – especially florists.

In this week’s blog post is a quick look at some issues as we have seen them being discussed in a global floral industry forum. This is not suggesting that these changes in the floral business landscape are good or bad but rather it’s about taking a good look at factors that are affecting the international industry and asking: Are these factors also having an influence on your Australian businesses?

1. Internet-based Model #1: Order Gatherers

Like it or not, by gathering the order and on-selling it to actual florists these website operators are squeezing florists’ margins. How did this happen? Well, according to one industry pundit “The order gatherers … were there (online) when retailers were still trying to figure how to hook up their fax machine.”

OK maybe that’s an exaggeration but it is certainly true that these e-commerce pioneers were quick to use new technologies to exploit the business opportunity of selling flowers online.

2. Internet-based Model #2: Warehouse to  Customer Direct

Cutting bricks and mortar florists out altogether these online operators can offer reduced prices by simply using a website as their storefront and constructing and delivering from central warehouses.

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3. Demographics

In aged populations such as Japan there are, logically, fewer weddings per capita. Add to this that the fact that less people are actually getting married at all. Australia’s wedding activity level is peaking now but as our population ages we will see less weddings in the coming decades.

4. Artificial Flowers

Artificial flowers have increased in popularity as the (comparative) quality of the products has improved. It is not unusual now to see them on restaurant tables whereas ten or twenty years ago this was more unusual because back then plastic flowers were ghastly. Maybe you think they are still ghastly – but a lot of people probably don’t even notice that they’re fake.

5. Cultural Gifting Changes

You may never have considered other gifts such as wine, pot plants, gift cards, jewellery or chocolates as being direct competition – but they are. It makes sense that if somebody only has a certain budget to spend, they may have to make the choice between flowers or a little knick-knack rather than purchasing both.

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Rather than bringing flowers, presenting a bottle of wine when arriving at a dinner party has become the norm (perhaps for selfish reasons?!), and there has even been a new trend into buying gifting “experiences” rather than “things”.

6. Chain stores

We’ve looked into this in detail already but it bears repeating here. Chain stores offer what look to the untrained eye like a half decent bunch of flowers at a low price. What’s really on sale is standardization, reduced quality, and reduced shelf life.

7. Work Internet access

People’s shopping habits have changed. These days it simply makes more sense to people to spend a few minutes online during work hours paying bills and shopping, leaving their lunch hour free to relax. This means less walk-ins for traditional florist shops and more sales for the most successful floral websites.

8. Florist Websites with Non-Existent SEO

SEO is short for “Search Engine Optimisation” and is to websites what “location, location, location” is to a bricks n’ mortar shop. If they can’t find your website online how are you going to sell them any flowers?

9. Unsuccessful Florist E-Commerce Strategies

A website is not just a tool for attracting business to your store, it’s a sales and marketing channel in its own right that needs an entirely different strategy.

Brandon Kirkland: “The (order gatherers) understand this and know how to compete in this area.

“Retail florists need to fight fire with fire and gather orders and send them to their retail shop.

“Here’s a quick test for those of you who think you know how to run an online business…. when it comes to email marketing do you send out a mass email blast, or are hitting niches? For example, all of those people who bought birthday flowers last March, did you send them a birthday special email last March 1st? If you answered yes, nice work; if not, know that the (order gatherers) are.”

 

10. Failure to tell an Engaging Story

If your product can be filed under “general”, then it has no differentiation which means the only game open to you is to compete on price – which is a race to the bottom that only the big guys can win.

An option for small operators is to niche your offering down and to tell an engaging story to your customers and prospects.

How do you know what story to tell? Find the intersection between expressing who you genuinely are and what a segment of the population wants to hear. For example: your story might be “I only do high-end traditional wedding floral design”. Tell this story and find those who want to re-tell that story to help them re-enforce their own personal story by hiring you.

How do you tell this story? Verbally, in writing, in imagery and in everything your business does. Service and product are the marketing.

11. Lack of Industry Level Messaging

Some have cited a failure on behalf of the floral industry to sell compelling reasons to the public to buy flowers.

Robert Trimbee: “As an industry we have done an almost nonexistent job of selling the image of flowers as something that adds to life and is irreplaceable as a communicator of feelings…. does anyone remember that FTD throughout the 60’s used to promote… “Say it with Flowers.

“We are a fragmented industry that was not able to come together to build a cachet in the mind of our consumers and secondly, as a fragmented industry the quality consumers receive is inconsistent.

“We exploited the advantage that many consumers naturally like flowers, but we failed to reinvest to maintain, let alone expand, that market advantage.”

The Way Forward

There is no going back – the Internet is not going away and people are not going to go back to doing things the way they used to do. People will do more online shopping, not less and the combined forces of new technologies and flower commoditization will increase the squeeze on the traditional florist model.

However – all is not lost! Next week we look at some ideas that can help turn these challenges into opportunities.

Meanwhile – have you found these or any other issues to be affecting your business? Any of them irrelevant? Let us know your thoughts in the comments section below.

Seamus - marketing nerdWritten by Seamus – Tesselaar’s website manager and marketing nerd.

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Seamus is Tesselaar Flowers' digital marketing manager. He's a creative marketing geek, writer, musician & accidental flower lover. He helps small businesses with websites and web marketing. If you need any help regarding the Tesselaars website you can contact him on seamuse@tesselaars.com

Comments

  1. Yes a very relevant article indeed. Small florists cannot compete with the online “middle men” or “relay organisations” who bump up their adword campaigns, in order to receive customers attention first. It used to be about contacting your local florist,
    supporting local business. However as the financial situation continues to decline, the personal experience once had by florists and their customers is now an online experience. We need to redevelop that connection and revert back to the good ol’ days!

  2. This is so true, until we recently redid our website and added in more add words we were not getting many orders. Now we are at the top of the list for florists in our area other than the relay systems.

  3. Thanks Seamus, for your insite, I agree with you holeheartedly and unfortunately it is time to move with the times so to speak, just another marketing issue to tackle amongst everything else and less and less communications between society. I actually
    really used to enjoy interacting with my customers coming in and asking my advice but I guess life is too busy as you suggested to go walking in to smell the roses in their lunchtime. Looking forward to your next installment on how to improve things for our
    trade. All the best Ginger.

  4. Hi Amy – although Adwords can get costly, the local bias of Google in fact means small businesses can get placed very well on search results for product+locality so be sure to have your website tuned to attract this favourable attention. And we ain’t going
    back to the old days but great customer service will never go out of style. Hi Ginger – while face-to-face interaction with customers may or may not wane (depending on your future business direction), the explosion of the social web has proven that technology
    doesn’t cause people to become disconnected, largely the opposite. How can you work with technology (facebook, google local, twitter, foursquare) to attract customers in to your store? See https://www.tesselaars.com/_blog/Inside_Flowers/post/7_Ways_Florists_Can_Attract_Local_Customers_Online/

  5. I have been a small business florist than runs my floral outlet from home..I live in a small town in South Western QLD up near Toowoomba..I have been operating since 2003..I have to admit when I first stated all those years ago I was receiving customers thru my door on a regular basis..Over the last 5 years or so the no’s of people have dropped off..Only on an ocassional basis when some one has died in the community do I get many orders all at one time..Its a real fight tokeep going..Thankfully because I do work from home I don’t have the big overheads with rent or staff..
    I have deverified into hampers at Christmas & on occasion thru the year people ask for living plants but not as many as I would like..Cash flow is my biggest killer..Yes Weddings …well hardly any these days…I look forward to any comments you can encourage me with..yellow pages I feel are a waste..maybe $200 a month on goole would be more advantageous…:-))

  6. Hi well so much for florists but what about the suppliers of flowers and fillers to the florists I have been supplying fillers namely emu grass and snotty gobble into the Melbourne market for the last 20 years and from a time when I could hardly keep supplying on average up to 4000 bunches a month to now where I struggle to sell 500 bunches a month.I have just lost everything I have worked for including my house and land and am forced to live in my car now I see only a further demise in this industry to a point where it will disappear forever as times change and eventually suppliers of flowers and fillers find it impossible to survive

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