Cornell Horticultural Business Management and Marketing Program Marketing Your Horticulture Service Business Marketing Your Horticulture Service Business January, 2001 Wen-fei Uva Senior Extension Associate Department of Applied Economics and Management Cornell University

Max Brunk (1983) Marketing is Not Just Selling! To Market is to Create Value; To Offer a Product or Service Which Someone is Willing to Pay. Cornell Horticultural Business Management and Marketing Program WHAT IS MARKETING?

Differentiation Give your customer a REASON to buy your products What are you known for? 3 kinds of sacrifices must be made to win a differentiation Product/service sacrifices - don’t be everything for everybody Attribute sacrifice Target market sacrifice

Products Place Promotion Target Market The Marketing 4 Ps Price Cornell Horticultural Business Management and Marketing Program

Characteristics of Marketing a Service-Oriented Business

Services are IntangibleServices are Intangible  Customers like to sample, taste, feel, see, hear, smell before they buy.  Promotion program should portray the benefits rather than the service itself Services can’t be Separated from the Creator or SellerServices can’t be Separated from the Creator or Seller  Production and marketing performed simultaneously  Customer’s opinions are formed through contact with the production personnel  Often direct sale is the only channel of distribution

Services are Difficult if not Impossible to “Standardize”Services are Difficult if not Impossible to “Standardize”  Each “unit” of the service is somewhat different  Product planning for consistency is important Services are Highly Perishable with Fluctuating DemandServices are Highly Perishable with Fluctuating Demand  Develop new uses for idle capacity during off-season  Use advertising and creative pricing to stimulate demand during slack periods

Products Place Promotion Target Market Strategic Marketing Planning for Service Marketing Price Cornell Horticultural Business Management and Marketing Program

Target Market Analysis Demographic  Components of population, income Market Segmentation The psychological determinants  Attitudes, perceptions, and personality Sociological Factors Determine why customers buy your service for each market segment  Who are your most profitable customers?  When, where, how and what do they buy?  Who does the buying?

Top 5 Household Spending on Lawn and Garden Activities in 1998: Landscaping - $337 Water Gardening - $219 Lawn Care - $190 Tree Care - $145 Flower Gardening - $102

Who is Buying Lawn Care/Landscape Services

Most Important Reasons When Deciding on Who to Hire for Landscape, Lawn and Tree Care Services

Target Market Analysis Market trends  Economic outlook, disposable income, less time, more emphasis on convenience, internet use.  Ex: Minority buying power nearly double in the 1990s (Asian consumers %, Hispanics consumers - 118% and U.S. consumers overall - 70%)

Average Household Spending on Lawn and Garden Activities

Households Hired Landscape, Lawn, and Tree Care Professional Services

Product (Service) Planning Define your products  What service will be offered?  What will be the breadth and depth of the product mix?  How will the services be positioned?  What attributes will the service have? Expanding product mix by trading up or down

Product (Service) Planning Quality is critical  Defined by the consumer not the provider  Consistency - Standardization training. Branding:  Include a tangible good as part of the brand image  Tie in a slogan with the brand - Allstate  Use a distinctive color scheme

Price Your Service Require more creativity and skills Most services are highly differentiated Customers may perform some services themselves - need know elasticity of demand Know Your Costs!! Fixed costs: cost items that do not vary with production volume. Examples are building rent, property taxes, and family living expenses. Variable costs: cost items that vary proportionately with production volume. Examples are plant materials and hourly wages.

Profit Costs and Revenue Variable Costs Fixed Costs Price (Revenue) Contribution Break-even

Place - Distribution Channel Traditionally sold directly from producer to consumer or business user - No middlemen Employees are the most important asset Broaden distribution  Convenient “Location”  Use of intermediaries

Train Your Employees Some of Successful Customer Service Techniques  Double check  Pretend it’s you  Get involved  Stay focused/Listen  Do something extra  Smile - show your teeth  Ask questions/Listen  Use a complete sentences  Care  Laughter

Promotion Strategies 5 Components of a Promotion Program:  Personal selling  Advertising  Sales promotion  Public relations  Direct marketing Promotional Strategies:  Visualization  Association  Physical representation  Documentation

Strategies to Create Tangible Images  Display Garden  Open House - bring a friend  Newsletter  Employees  Professional and Comfortable Office Setting

What do Customers Want?  Tangibles  Reliability  Responsiveness  Assurance  Empathy

Customer for Life Know what the customer wants and needs Exceed their expectations Delight your customers! Thank You