March 2009 Big Grower

Angelic Acumen By Tim Hodson

If you tried to find Wolfgang Engelmann at January’s Tropical Plant Industry Exhibition (TPIE) in Ft. Lauderdale, Fla., you had to be quick. The president and chief operating officer of Hermann Engelmann Greenhouses in Apopka, Fla., was a man in motion. Actually he was more like a blur as he spent each day talking to potential clients as well as many of his existing customers, showing them his company’s newest products, programs and marketing initiatives.

After the show ended, he took the opportunity to talk to Big Grower about the company’s success in the foliage market and how it has evolved over the years.

The History

Hermann Engelmann Greenhouses took root in America 38 years ago, when the German-born Hermann Engelmann saw an ad in a trade journal for a 10,000-square-foot nursery in Florida.

Prior to founding the company, Hermann learned about the industry both in Europe and the United States. His parents were in the nursery business in Germany, so he kind of grew up in the business. Prior to moving America, Engelmann worked for horticulture companies in Germany, Holland and the United Kingdom.

He established his first nursery in the United States in the 1960s in New York. After nearly a decade of success, he sold that business and returned to Germany to help run his family’s nursery for several years.

In 1971, he moved back to the United States and started Hermann Engelmann Greenhouses in Apopka. Today the company grows more than 400 types of indoor foliage in 2.7 million square feet of greenhouses in nine locations.

Hermann Engelmann is still the chief executive officer of the company mand his son, Wolfgang, is president and chief operating officer.

Guiding Principles

Quality, consistency, creativity and profitability are the cornerstones to the company’s business philosophy and its ultimate success, Wolfgang Engelmann says.

“Quality is the foundation of the company. It is not only in our products but our customer service as well, Engelmann says. “Every single one of our product lines and new product introductions is designed and positioned with the goal of stepping above and beyond the industry standards.” To maintain product consistency, every plant that leaves the greenhouse “is hand planted, grown with care and specially selected to meet the needs of our customers.”

When it comes to creativity, Engelmann says, “We are constantly looking for innovative new ideas on products, packaging or shipping. Remaining creative keeps us ahead of the game.”

“My father always said the easiest way to make a customer come back is to make them say “WOW!” each time they open a box of our plants. Besides the physical beauty of our product, we emphasize our long shelf life, post-purchase consumer success, and outstanding ROI for our retailers.”

Engelmann says not only is he concerned about his company’s profitability, but the profitability of the retailer selling their products is also extremely important. “We provide high-quality and unusual foliage at an affordable price. This offers retailers a unique selection at competitive pricing.”

Individualized Solutions

Engelmann’s customer base is made up of home improvement retailers, lawn and garden retail centers, national discount merchandisers, supermarkets and independent floral outlets — more than 11,000 stores in the United States and Canada.

But sometimes this wide spectrum of customers can generate challenges. “We face the challenge of differentiating our product line from the commodity-style foliage plants available on the market.”

To overcome this challenge, Engelmann says, “We take a highly customized approach to serving and delivering to each individual account. Creating customized products and developing marketing to the specific needs of each retailer is of utmost importance to us.”

The relationships with their customers are based on problem solving and trust. “We try to dig deep and discover the real underlying problems our customers face. Then, solution alternatives follow,” Engelmann remarks.

But these solutions cannot be self-serving. “The consumer’s needs come first, then the retailer’s objectives and finally our own profit goals.”

Consumers Come First

“The consumer is first among all elements of the supply chain,” Engelmann remarks. “With consumers being our primary target, we need to find ways to deliver a product that works best for them. It must be interesting, unique and it must deliver a great value for its price.”

In today’s economic climate, “You have to really provide good value for the consumer.”

“Staying close to the consumer, listening closely to our retail partners, and educating ourselves about market trends from within and [outside] the industry have helped us craft a product mix that is not only cutting edge but provides real value for the consumer.”

Engelmann says the company uses a variety of tools “to determine the validity of a new product or a service — we are working on the total package.”

The goal is for consumers to consider foliage plants more as home dŽcor or lifestyle products. “We no longer view plants purely as ‘horticultural products,’ but more as distinctive packaged consumer goods,” Engelmann states.

And because they have such a broad range of customers, “We try to provide products that fit the needs of each individual consumer group.”

To gain insight into the mind of the consumer, they attend home fashion shows in Europe and consumer marketing conferences as well as conduct in-store consumer research, he says.

Staying Successful

Engelmann attributes the success of the company in large part to his employees. He says they each deserve sincere thanks for the job they do.

“We have always strived to be the best foliage grower; the only way to do that is to have really good people — from the ladies sticking the cuttings to our marketing and sales staff.” It is the employees “that really make things happen and really enable us to do what we do so successfully and consistently.”

Despite the current state of the economy, Engelmann says he is “cautiously optimistic” about 2009. He says there is still a strong demand for the company’s products. “The question is to provide a product portfolio that is really in demand right now and at the right price.”

Engelmann acknowledges that there is a “place and purpose” for commodity positioning, quality and price in the marketplace, “but the current consumer trends are most definitely against them.” He says the whole industry suffers when growers sacrifice their product quality to compete on price and market share.

He says the industry would persevere during the slowdown because “our industry really does provide the consumer with a tremendous value for their dollar” compared to many other products. “People really feel good about our product.”

A Heavenly Brand

According to Wolfgang Engelmann, the Exotic Angel Plants brand was one of the first brands in the foliage industry. When his father created it more than 38 ago, he understood and followed the basic definition of branding.

It is a promise for an emotional guarantee for an identical experience each time. For the retailer, this was expressed through exceptional product quality and profitability. For the consumers, it means plant uniqueness, health and beauty.

Back then, the available tools to communicate the brand’s message were a bit limited. Wolfgang often smiles when he shares the stories of having to write hundreds of plant care tags all by hand when he was younger. But the importance of providing basic plant information was paramount, even in the early days.

When the first printed labels were introduced, the red angel logo became the highly visible symbol of the brand’s message. Because people like stories, a whimsical story for each variety tag was created. The more interesting and personalized the story, the more value to the product. “For instance, the ‘I am Hoya Rope, and I come from South Africa’ story line, as short as it sounds, creates emotional value for the reader and encourages the purchase decision,” Engelmann says.

The Exotic Angel brand has changed and adapted over the years, but it never lost its core promise. Hermann’s brand legacy continues to inspire all of the company’s current marketing activities — the preservation and communication of that foundational promise is “our primary goal,” states Engelmann.