Company Description
Flowers Galore is a full service floral shop located in Baridhara, Gulshan . A full service shop is one that offers a wide range of services and products so that it can attract customers from all market segments. The products offered at Flowers Galore includes a wide variety of fresh flowers and foliage, a variety of green and blooming plants, plush stuffed animals, balloons, ceramic and glass vases, novelty giftware, greeting cards, and silk and dried flowers. Services offered include regular and special deliveries, set-ups for special events, custom floral designs in fresh and silk arrangements.
Flowers Galore has been in business for twenty years. There have been multiple owners over this period, but the current owners have been managing this business for the past four years.
According to R.H., owner of the shop, over the past year, Flowers Galore has seen a 5% sales gain even though there has been zero profit realized during the same period. The zero profit is due to major investments the owners have made in the business over the past 18 months. A 10% profit is regarded as a desirable level for a retail floral shop.
Weddings account for about 15% of the business at Flowers Galore. A 50% increase has been recorded for the number of weddings done annually over the last two years. Flowers Galore prides itself on excellent customer service and attributes much of their success to that factor of the competitive advantage (RH).
Product/Service Description
Flowers can add much beauty and inspiration to any occasion. A wedding is likely to be one of the biggest occasions in a person’s life, and at Flowers Galore they strive to make this very special occasion even more beautiful.
The service this marketing plan will focus on will be the selling, creating, and delivering of wedding flowers. Setting up an appointment with the
Flowers Galore wedding consultant to determine the needs and desires of the wedding party is the first step in the “procedure” of selling wedding flowers. The bride is typically the person who schedules and meets with the wedding consultant. Once the appointment is made, the bride meets with the wedding consultant at the specified time to determine what kinds of flowers, colors, and bouquet styles the bride desires for her wedding. During this procedure in selling the service, the
wedding consultant gains a sense of how much money the bride is planning to spend on floral arrangements for her wedding. At the end of this meeting, the bride will be presented with an estimate of the cost for the flowers she has chosen for her wedding.
The average cost of flowers for an average size wedding is approximately $700. A deposit of $50 is required to “hold” the date specified and the prices agreed to. Full payment is due two weeks before the wedding at which time the bride and the wedding consultant should meet again to review and finalize the order. To ensure that the specified flowers will be available, all flowers for each wedding are special ordered one week prior to the actual date of the wedding. Two days before the wedding, construction of the floral arrangements begin. On the actual wedding day, a designer from Flowers Galore delivers the flowers to the location at a
time specified by the bride.
Delivery service is an additional charge beyond the cost of the flowers and is based on how far away the location is and how much preparation must be done. Flowers Galore will deliver anywhere in the Twin Cities Metropolitan area and also to some outlying areas.
Flowers Galore will also do the flowers and/or balloon decorations for a reception. These items are usually discussed in the initial consultation.
Description of theTargetMarket
Cities of Coon Rapids and Blaine
Demographic Characteristics
According to the information obtained from www.dempgraphics.caci.com – the ACORN Data, the city of Coon Rapids, MN is described as Consumer Type 2B: Boomers with Children. What this means is that more than half of the households in the city are married couples and over 50% of these couples have children. More than 35% of the population is under the age of 20. The median household income for families in Coon Rapids is Tk61,8800, and they live in single-family homes.
For the city of Blaine, the Acorn Data describe these residents as Consumer Type 1E:
Prosperous Baby Boomers. These baby boomers were born between 1949 and 1964 with young, primarily preschool and grade school age children, which is over 40 % greater than the national average. Nearly 20% of the population is under 10 years of age. Blaine residents have a median household income of Tk60,1000. Over 70 % of the households in Blaine have two or more workers.
Coon Rapids and Blaine do vary in educational background though. Coon Rapids residents are less likely to have completed a graduate or professional degree. In contrast, two-thirds of Blaine residents have attended college or completed a degree.
For a services related to weddings, which Flowers Galore would like to provide more frequently in the form of floral arrangements, the demographics of the target market show that there is available income to spend through the abundance of two-income households in Coon Rapids and Blaine. Also, with many households having children in these two target markets, the possibility exists that with good marketing strategies, Flowers Galore could conceivably attract customers for generations to come.
Geographic Characteristics
Flowers Galore is located almost on the boundary line between the cities of Danmondi and Baridhara. It is located on the corner of a busy intersection that crosses two main city streets. Because of the location, Flowers Galore can provide equal accessibility to both cities that have a combined population of 50,88,040 which was obtained from the ACORN population data for 2004.
Both Danmondi and Baridhara residents are very mobile. In Danmondi, residents tend to relocate to an area that will provide the best jobs. For Blaine, over 35 % of the population have moved in the past five years, which is double the national mobility rate.
Psychographic Characteristics
“Baby Boomers with Children” as described for most Coon Rapids residents, and “Prosperous Baby Boomers” as described for most Blaine residents represent family and home-oriented consumerism. They do home projects, go camping, fishing, and hunting.
They rent videos; grow vegetables; use their PCs; and visit museums, zoos, and theme parks. They own pets and spend their discretionary income on swimming pools, outdoor grills, and campers. They own multiple cars, minivans, and sports utility vehicles.
Neither group invests or saves in proportion to their income.
For Blaine residents specifically, they rank among the highest nationally to dine at family restaurants and to order take-out pizza. Much of their time is spent on the PC playing games, doing their taxes and finances, or just browsing the web. They are likely to visit theme parks or gambling casinos. They buy electronics, camcorders, PCs, sports equipment, and home furnishings.
The described values (family focused), self-concepts (spend on what they want), and lifestyles (family-oriented activities & minimal investing and saving) of these two target markets support the belief that they would be likely to spend the necessary amount of money to provide a beautiful wedding for their daughters and/or sons. This is the exact psychographic make-up that can make Flowers Galore more successful in the wedding floral arrangement business.
Benefit Usage Characteristics
The most important benefit characteristics that a consumer looks for in flowers for their wedding are level of service, quality of the product, and the price.
As described in the product/service description portion of this marketing plan, working individually with a wedding consultant is the first procedure of selling wedding flowers. This part of the service experience can either make or break the sale so the customer
service provided must be excellent in all aspects. This part of the service experience can set Flowers Galore apart from the competition and is the competitive advantage needed to meet the objectives of this marketing plan.
The quality of the product (flowers) must also meet the expectations of the customer. Flowers Galore offers a wide variety of fresh flowers and foliage to meet those expectations. Designing arrangements to be special “one of a kind” for the customer also allows
a competitive advantage that is currently available at Flowers Galore.
Most weddings are constructed under a budget. The average wedding costs approximately TK80,000 and of that, about 10% is spent on flowers. Keeping prices in line with the average will assist Flowers Galore with staying competitive in the wedding flower business. The average cost of wedding flowers from Flowers Galore is about TK7,000 (TP).
Description of the Competition
There are multiple businesses in the cities of Coon Rapids and Blaine that provide the largest competition to Flowers Galore in the area of wedding flowers. The strongest competitor would be Main Floral in downtown Anoka; this store is similar in size to Flowers Galore and they employ a very knowledgeable and creative staff.
Secret Garden flower store is another strong competitor because they have two locations in Coon Rapids and Blaine. Secret Garden has a similar pricing structure for wedding flowers as that of Flowers Galore though.
Pederson Floral is located in Coon Rapids and is another competitor, but this store seems to discourage wedding work, as it can sometimes be difficult to make it profitable. The pricing of arrangements for weddings must include the extra time spent with the customers and the fact that many special order items have fluctuating costs. The “speed” and experience of the designers doing the wedding arrangements can also affect profitability.
Toni’s Flowers in Anoka has been “for sale” for several years. They are a competitor, but they seem to have limited expertise in their staff.
Although there are others, those stores appear to provide the strongest immediate competition to Flowers Galore in the area of wedding flowers since they are both full-service shops in the local vicinity. All full-service flower shops in the Twin Cities could be
considered competition for Flowers Galore because they tend to service the entire metropolitan area. There are also some people that do wedding work from their homes that provide competition. The widespread availability of artificial flowers from retail stores
such as Michaels in Blaine, and Joanne Etc. in Coon Rapids provide opportunity to some brides to do their own floral bouquets or to have their friends do the necessary design of arrangements for their weddings.
Financial Objectives
1. A growth rate in sales of 12% for the year 2007, to total in excess of Tk341,200,0 in
total revenues.
2. An average sales per business day (305 days per year) in excess of Tk10,000.
3. Reduce the existing credit line by a minimum of £26,4
Marketing Objectives
The following marketing objectives are the focus of our marketing plan:
1.Increase the number of weddings performed by 20 through year-end 2001
2.Increase the number of weddings performed by 10 more each year through 2003
3.Increase store profit through the promotion of and additional weddings performed by 2% by year end 2001.
4.Establish a customer base for weddings performed that is referral driven, to then reduce advertising costs spent to achieve objective #1 by 50%
Target Market Strategy
The target markets are separated into four segments; “Housewives,” “Middle-aged Couples,”
“Young Professionals” and “Do-It-Yourselfers.” The primary marketing opportunity is selling to these well defined and accessible target market segments that focuses on investing
discretionary income in these areas:
Housewives — The most dominant segment of the four is comprised of women in the age range of 35 to 50. They are married, have a combined income of greater than Tk80,000,0 own at least one house or flat, and are socially active at and away from home. They are members of one or more professional, social, or charitable organisations. They have discretionary income, and their home and how it looks is a priority. The appearance of where they live communicates who they are and what is important to them.
Middle-aged Couples — This group, typically ranging in age from 50 to 65, is going through a positive and planned life transition. They are changing homes (either building or moving) or refurbishing due to empty nest syndrome, retirement plans, general downsizing desires, or to just get closer to the golf course. Their surprisingly high level of discretionary income is first spent on travel, with decorating their home a close second. The woman of the couple is the decision maker, and often does not always include the husband in the selection or purchase process.
Young Professionals — Couples between the ages of 25 and 35 establishing
“adult” household fall into this group. They both work, earn in excess of Tk50,000,0 annually and now want to invest in their home. They seek to enjoy their home and communicate a
“successful” image and message to their contemporaries. They buy big when they have received a promotion, a bonus, or an inheritance.
Branding
Our name is our brand. “Interior Views” represents our mission of celebrating the home through the colour and texture of fabric. The brand invokes the fact that the home should be a unique and personalised expression of the person living there. The home is a “view” of the home’s owner. The word “view” also evokes the vision of what a house or flat owner wants their home to be.
In addition to our name, our logo reflects the architectural quality of the work that we do. Our products are more than just decoration, they enhance and reflect the home.
Marketing Strategies
Product Marketing
Our products enable our customers to experience support, gather ideas and options, and accomplish their decorating goals. They will be able to create a look that is truly unique to their home. They will not be able to do this in the same way through any other resource.
Pricing
Product pricing is based on offering high value to our customers compared to most price points in the market. Value is determined based on the best quality available, convenience, and timeliness in acquiring the product. We will consistently be below the price points offered through interior designers and consistently above prices offered through the warehouse/seconds retail stores, but we will offer better quality and selection.
Promotion
Our most successful advertising and promotion in the past has been through the following:
• Newspaper Advertisements – Evening Standard.
• Radio Advertisements – “Capital FM” and “Virgin Radio”.
• Quarterly Newsletter and Postcard – A direct mail, 4-page newsletter distributed
to the customer mailing list generated from people completing the “register” sign up
in the store. The mailing list now totals more than 4,300 people.
• In Store Classes – “How to” classes, most of which are free, have been successful
because of the traffic and sales they generate after the class. Typically 90 minutes in
length and most held on Saturday, these are the most popular classes:
• “Pillow Talk” – Pillow fabrication.
• “Speaking of Slip Covers” – Slip cover presentation and discussion.
• “Shades of the Season” – Window treatment options with fabric.
Advertising
To achieve the stated objectives, Flowers Galore plans to:
Advertise Flowers Galore wedding flowers in the community paper (Anoka County Shopper)
Review the major newspapers for engagements and send a flyer to the newly engaged bride.
Send flyers to the target market households (9,1950 in Coon Rapids and 10,6270 in Blaine – obtained from ACORN data 1999)
Partner strategically with a bridal shop like Angelique’s, located very near the shop, to share the cost of advertising.
Reserve a booth twice a year at the largely attended “wedding fairs” held at the Mpls. convention center and/or the more prominent hotels (Spring and Fall 2001)
All methods of advertising mentioned above would focus on the wedding portion of Flowers Galore services. The ads in the community papers, and the flyers would highlight the service experience and quality of the product that can be obtained through Flowers Galore. We are trying to also achieve a long-term objective of reducing advertising costs and relying more specifically on word-of-mouth referrals. By sending flyers to each household in the target market, our chances of attracting customers who might then name drop the store to other family and friends is likely to result from this marketing campaign.
Personal Selling
Again, the first meeting (consultation) with the wedding consultant is personal selling, and must be done with each wedding performed. This takes place even if the customer is a walk-in and has not previously scheduled an appointment. Personal selling is
one of the most important factors in the benefits to the customer. v currently has one designated wedding consultant who is eager and enthusiastic about this aspect of her job. Strategy to support the objectives would be to train an additional wedding consultant to provide the level of service needed to effectively manage and maintain growth in this area. The wedding consultants would be given time off to attend designing seminars and to take classes to keep creative and fluent on the trends in wedding flower arrangements. These same consultants would also be sent to seminars and classes that would provide them with ongoing information on how to provide exceptional customer service.
Knowing the competitive advantage lies in excellent customer service and knowledge of the industry, it is important that the wedding consultants at Flowers Galore stay current in these two areas to meet the demands of increased wedding business at the store.
Sales Promotion
Discounts would not be offered, as we know Flowers Galore’s prices are in line with competitors, and we are trying to gain a slight profit in year 2001. However, one selling point in the advertisements would be that if a bride chooses Flowers Galore to do the
flowers for her wedding, Flowers Galore would provide a “free” bouquet to toss at her wedding. This selling point could be expanded to include “free” flowers for her wedding veil or “free” flower of choice for the groom and the groomsmen.
Recognizing that it will be expensive to print and deliver 19,822 flyers to the households in the target market, and this will likely be a one shot attempt at promoting wedding sales, the exact selling point will be defined prior to the creation of these flyers. The selling point(s) probably will be a choice of free enticements for the customer, but minimally inexpensive for the store to provide.
Publicity/Public Relations
At this time, Flowers Galore will not go beyond promoting and encouraging referrals as publicity/ public relations. It is believed that the atmosphere of the store, together with excellent and knowledgeable customer service is the means by which word-of-mouth
publicity will be gained.
Direct Communications
At this time, Flowers Galore would not participate in any form of direct communications other than to receive and respond to telephone inquires from potential customers about its services and prices.
Sales Forecast
The sales forecast is broken down into the four main revenue streams; direct sales, Web sales, consignment sales, and sub-lease revenues. The sales forecast for the upcoming year is based on a 25% growth rate. This is a slower growth rate than what was experienced in previous years at 33%, and also less than what is expected for future sales, estimated to be approximately 28%. These projections appear attainable and take the increasing base into consideration. Future growth rates are based on percentage increases as follows:
• Direct Sales 20% growth rate per year
• Web Sales 50% growth rate per year
• Consignment Sales 20% growth rate per year
• Sub-lease Revenues 10% growth rate per year
Expense Forecast
Marketing expenses are to be budgeted at approximately 5% of total sales. Expenses are tracked in the major marketing categories of radio adverts, newspaper adverts, the newsletter and postcard mailings, Web marketing support, printed promotional materials, public relations, and other.
Controls
The following will enable us to keep on track. If we fail in any of these areas, we will need to re-evaluate our business model:
• Gross margins at or above 40%.
• Month-to-month annual comparisons indicate an increase of 20% or greater.
• Do not depend on the credit line to meet cash requirements.
• Continue to pay down the credit line at a minimum of Tk24,000,0 per year
