E·ter´·a (n) 1. The epitome of green goods marketing. 2. A winner.
If a grower new to the concept of marketing can take one lesson from Etera, the Mt. Vernon, Wash.-based winner of the 1999 GPN/MasterTag Marketing Innovator award, it would be that Etera’s marketing program is not a component of the company’s overall operation. At Etera, marketing interfaces (as they say in Silicon Valley) with every aspect of the operation; likewise, every aspect of the operation interfaces with the marketing program.
By selecting Etera, the GPN/MasterTag independent panel of judges have bestowed deserved recognition on an operation that simply cannot be characterized as "production driven" or "marketing driven." Indeed, in a special supplement that appeared in the Dec. 20, 1999, issue of Fortune magazine, Etera was characterized as an Internet company, which has "developed a thriving business by combining the benefits of a cutting-edge Web strategy with a patented growing process for a wide range of plants." Etera even scored with its 1999 Perennial Guide (which targeted both retailers and consumers), winning the Silver Award from Catalog Age magazine.
In other words, this Skagit Valley operation is garnering favorable press within and without the floriculture industry because, in the words of Emile Gebel, co-owner of Shagreen Nursery and Arboretum (an Etera network member based in Shelby, N.C.), "They’ve (Etera) got it right. All of it. Everything."
This is a remarkable accolade for a company founded by Carl Loeb, a former English teacher concerned by the inroads big box retailers were making into the marketplace. To the good fortune of independent garden center owners and operators, this also is a company that has proven almost prophetic in its ability to detect germinating market trends and then move quickly and aggressively to capitalize on them.
For instance, three years ago, when many in the floriculture industry were still drawing up sides in the great "branding" debate, Etera’s new vice president of marketing issued the edict that building an Etera brand would be the company’s highest priority, both in the short and long term. "A brand is not simply a logo and a packaging design," was the guiding philosopy brought to Etera by Roger Heins, former sales & marketing v.p. for Bear Creek Garden’s Jackson & Perkins Rose brand. "Brand is built on from the total customer experience," Heins elaborates. "In the case of Etera, the customer is the garden center retailer, so our mission has been to create a new category of horticultural product that is different from other plants on the market, an exclusive branded product that gives independent garden centers a competitive edge over mass merchandisers."
With the enthusiastic support of Loeb, Heins launched an extensive marketing plan targeting garden center retailers. "The garden center is where the consumer meets the plant product," explains Heins. "In fact, the garden center is in the best position to build brand recognition at the consumer level."
The power behind Etera’s branding stragegy is a field-grown premium perennial (Etera offers about 360 varieties) sold in a container designed "to hit the ground running" once planted in a consumer’s garden.
"Just plant the pot...and stand back!" captures the essence of Etera’s marketing program presented to the GPN/Mastertag panel of judges. Indeed, "stand back!" lends itself to more than one interpretation, not only conveying the promise of a flourishing garden to the consumer, but also reassuring the independent garden center owner that Etera is ready and eager to contribute its marketing muscle in the competition with the chains. "For as many years as I have been a commercial grower, my family has owned and operated an independent garden center," says Loeb, who founded Etera in 1998. (The company formerly operated under the name Summersun Greenhouse Co.; Loeb also served as CEO of Summersun which he started 24 years ago.) "We’ve watched the number of independent garden centers across the United States go from 25,000 to just under 15,000 since the big box retailers and mass merchants have taken a foothold. So we began Etera with a firm commitment to not only grow a top-quality product that would differentiate the independent garden centers from its mass merchant competitors, but also to find ways to use emerging technology to positively impact the garden center’s business."
Obviously, the best way to help garden centers is to provide them with something that consumers demand. Perennials meet this category. Gardeners with only a basic level of knowledge like the idea of a plant that comes back year after year, while more knowledgeable gardeners appreciate the diversity of size, habit, color, and bloom time perennials offer. Yet, the dizzying array of perennials on the market also intimidates many gardeners, as does perennial care and maintenance
When Loeb set out ten years ago to develop a style of growing perennials that would result in more gardener-friendly plants, he already knew that the key would be creating a growing process for extremely vigorous plants in an energetic, easy-to-plant form.
Working on the premise that optimally-grown, properly hardened-off perennials are very forgiving toward beginning gardeners, the company introduced a start-to-finish perennial program. In 1998, Etera introduced consumers to perennials grown in eco-friendly fibrous pots, and received a patent for the program, the Etera Growing Process. The program, which had a launch of 250,000 units, will grow to an expected 10 million units by the end of the 2000 season.
Purchased in its cardboard sleeve, a field-grown Etera perennial needs only to be planted. The company asserts that its 4 1/2-inch product will catch up with and/or surpass one-gallon plants in eight to ten weeks.
Etera can make this assertion because their product has the inherent vigor of field-grown plants. Etera perennials begin their life in a 13-acre greenhouse range with zoned climate controls, automatic watering, and radiant-heated floors. After six weeks, plants are graded for consistency and then transplanted into 3-inch bottomless pots and transferred to the growing fields for a full season.
After they go dormant in the winter, plants are harvested and placed in cold storage until they are ready for transplant from bottomless plastic pots into 4-inch coconut fiber pots (in late January through May, depending on variety). Pots are placed on a warm (radiant-heated) floor for two to five weeks to establish roots and stimulate additional root growth. When finished, these retail-ready products are picked and shipped. Etera also maintains a brisk market in plugs (the 3-inch bottomless-pot product); last year nearly 3 million Etera plugs were distributed to growers through Novartis.
"These are not bare-root plants so there is not transplant loss, nor do they have to be knocked out of the container before planting," says Heins. "And the varieties we offer are those that have passed a three-stage trial process: observation through an entire growing season, integration into the EGP (Etera Growing Process) utilizing our bottomless pot technology, and then on to plantable-pot testing. We also continue evaluating varieties after they go into full production."
Heins adds that plants deemed garden-worthy are produced at a minimum of 10,000 units to ensure availability to all retailers in the Etera network. "If well-received we can up the numbers to 150,000 or more in subsequent seasons."
True to his commitment to the welfare of independent garden centers, Loeb has struck up a mutually beneficial partnership with more than 1,000 garden centers across the nation. Instead of having to spend millions of dollars marketing Etera perennials to end-consumers, the company has been allying with garden centers that already have a significant base of loyal customers. In return, garden centers have access to Etera’s selection of 375 perennials, all in the patented, "Just plant the pot...and stand back!" fibrous pots. The service, along with associated signage and P.O.P. materials, is free as long as the garden center carries Etera perennials. Of equal value is the ability of the garden center to establish a presence on the Internet.
Loeb underscores that the national awakening to the reach and power of the Internet occurred simultaneously with Etera’s introduction of its consumer product line and the company’s pledge to reinforce the muscle of the privately owned garden center.
"I saw a Rodale Press (a Pennsylvania-based gardening information and publishing powerhouse) study released in 1995 that 78 million Americans identified themselves as gardeners," says Loeb. "These gardeners collectively spent about $4 billion on gardening products in 1998. I set out to reach these gardeners, not directly, but through independent garden centers, where the bond of trust between the customer and the purchasing source is already very strong."
Loeb understood that gardeners typically seek advice at the local level, fence-to-fence with neighbors, but more importantly from their neighborhood garden center. "My goal has been to build a dealer network that combines the power of the Internet with the power of trust," Loeb explains. Through this dealer network the consumer is served through an expanded virtual inventory and a nearly unlimited supply of gardening information, accessible on demand 24 hours a day, seven days a week."
Three months ago, Etera hired Ken Schneider, former director of e-commerce at Microsoft, to lead Etera’s 40-person Internet development staff. In contrast to sites that deal directly with end-consumers, Etera.com functions as a "clicks and mortar" site; that is, Etera sells its product through certified dealers. These dealers have Gold, Silver or Affiliate status, based on the number of flats of Etera perennials they stock. Etera currently has about 1,000 dealers in the network with a goal of 5,000 dealers by the year 2004.
In addition to having access to all Etera plant products, dealers in the network receive a co-branded custom Web site through their own URL (i.e., www.billandsuegardens.com), which can be used to promote in-store seminars, sales and other activities. Consumers who visit the site see the dealer’s home page, which includes the logo and a photo of the garden center, along with information about the garden center. Consumers who purchase plants (either Etera’s or others) do so through the retailer’s Virtual Garden Center.
Retailers receive commissions of up to 15 percent for all Etera plants purchased through their sites, along with purchasing data. Also accessible on the sites are numerous Etera informational services, including an Ask the Expert page, a Garden School, and an "Over the Fence" chatline.
Consumers who visit Etera.com to shop for plants are directed to the Web sites of local garden centers on the network by entering their zip codes.
"We are very fortunate to be building the Etera brand during a time when success in e-commerce is being completely rethought," says Loeb. "A year ago the Internet was all about business-to-consumer contact. Today, we look back and the business-to-consumer model has proven time and again to be risky and incredibly expensive in terms of the costs associated with gaining and keeping a customer."
While characterizing his feeling about Etera.com as "exhilarating," Loeb acknowledges that Etera has once again stepped up to a major challenge. "Not to downplay the challenges of producing plants, but building an Internet company requires an incredible amount of work, resources and commitment," he says. "The most obvious challenge is trying to strike a balance between the demands of growing and the demands of the Internet operation."
"I was encouraged to enter the Marketing Innovator competition from the time I learned about it" says Heins. "What finally persuaded me to follow through was the lobbying effort by a group of independent garden center owners. As our customers they felt it was important that Etera send the message that we are serious about providing strong marketing support for our product, our brand, and the independent garden centers that sell our products."
In sending this message out to the industry, Heins hopes that other growers will be receptive. "We believe that marketing is building a brand in the minds of the consumer. Today, and in the future, plants are more bought than sold. In other words, it’s the consumer, not the retailer, who drives the market. Branding can facilitate sales because it can pre-sell a product. A strong brand has the power to influence the gardener’s purchasing behavior."
Etera’s Sales and Marketing Support Tools
Can Etera’s assurance that certified dealers will receive "sensational" support materials actually be an understatement? Here’s a partial inventory of support materials (provided free to certified dealers):
•Promotional banners and posters
•Waterproof price chart for display near cash registers
•Metal plant tag with engraved botanic name for each plant
•Lavish four-color Plant Guide with information on each Etera perennial (also available in waterproof form for use as in-store sales tool)
•Etera Growing Process video
•16-pack shipper/display box
•Four-color hang tag with plant and cultivation information for each Etera perennial
•Customer brochures including four-color garden design cards.
•Themed P.O.P. stickers (i.e., butterfly attractors) and color-coded packaging (i.e., orange for ornamental grasses).
•T-shirts, caps and aprons featuring store Web address
•Advertising support through national print and television ad campaigns and customized co-op direct mail campaigns.
•Co-op and co-marketing advertising dollars
•Etera Selection Center, which includes a hand-crafted cedar kiosk
•Trade show and garden show support, which includes the opportunity to exhibit from an Etera trade show booth
•Internet support, which includes a customized URL dedicated to the garden center and a 5- to 15- percent dividend on all items purchased by garden center customers through the site.
The Etera Approach to Marketing
The foundation of Etera’s marketing program is the company’s mission statement: "To build a highly recognized and successful brand in the horticulture market by 2002." In fact, Etera’s 1999 program (winner of the 1999 GPN/MasterTag Marketing Innovator award) was Phase One of the program.
MasterTag was not involved in the judging of the Marketing Innovator competition; nonetheless sales and marketing manager Joe Fox catches the essance of Etera’s marketing triumph when he notes, "Etera is one of the very few growers doing consumer-level packaging; this packaging is backed by a very strong and persuasive message that the plant the consumer holds will go from ‘this to this’ in just eight weeks." A summary of how Etera’s marketing program has evolved to date follows:
1. Talk one-on-one with both the primary customers – independent garden center owners and operators – and their primary customers – home gardeners.
2. Determine customer needs as presented to Etera (i.e, purchasing, displaying and promoting perennials).
3. Involve all key Etera people (i.e., Loeb, Heins, Richard Gigot, COO; Tim Bowling, Sr. V.P. Sales; Debbie Paap, director of marketing; Bruce Gibson, Sr. V.P. Production; Gina Falcetti, R&D manager) in developing a marketing and sales strategy.
4. Enlist the field expertise of Etera area and regional sales managers, as well as key garden center retailers, to assist in honing objectives to specific tactics.
5. Implement tactics, which is the responsibility of marketing.
Etera handles most of this work inhouse but the company does not hesitate to use outside professional experts such as Seattle-based Heckler Associates for graphics, MasterTag (Montague, Mich.) and Horticultural Printers (Port Orange, Fla.) for plant tags, and Chicago-based Lante to build the Web site and test the concept at selected garden centers.