Hobby Seeds Division

Growth Plan for the Spanish Market

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List of Contents

1. History2. Objectives3. Methodology4. Project Plan5. Macro Analysis Summary6. Micro Analysis Summary7. Spanish Market Research8. Fitó Value Curve9. Conclusion10.Next Steps11.Recommendations12.Annex

Hobby Seed Division Marketing Mix– Product

• EuroGarden & Semillas Fitó

– Price• Semillas Fitó – 1,50€/sachet + VAT• EuroGarden – 1,00€/sachet + VAT

– Promotion• Exhibition• Point-of-Sale• Education

– Place• Modern Channel• Traditional Channel

History

This is a brief overview of the Hobby Seeds Division’s current Marketing Mix – the key being the strategy diversification between Eurogarden and Semillas Fitó

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• Engineer Growth Plan for the Spanish Market• Increase Brand awareness• Increase market share• Increase revenue

• Create Recommendations for Semillas Fitó’s Marketing Mix

• Compare prices with competitors• Suggest new products• Compare CSR and Online Marketing Tactics• Find innovative new channels

Objectives

Recommend actions for Semillas Fitó to consolidate market leadership in Spanish market.

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Phase 1

Research 4 major countries macro and micro situation

Phase 2

Research Spanish market and competitors

Phase 3

Analyze successful strategies taken by competition

Phase 4

Create recommendations based on findings

Project Plan

By analyzing the four top Home & Garden markets, we created recommendations based on the successes and weaknesses of the major global competitors

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Macro Analysis:• Consumer

lifestyle• Indicators

Prioritization:• Inhibitors• Drivers

Micro Analysis:• Market share• Top

competitors

Prioritization:• Top

companies• Marketing

Mix

Current Situation & Trend in Countries:• Macro trends• Major

Competition

Creativity Analysis:• Analyze online

policy• Compare Product

Selection

Fito Business Understanding:• Analyze Fitó’s current Marketing Mix

Current Situation In Spain• Observe Spanish

consumer behavior

Marketing Proposal for Fito:• Brand• Promotion• Channel

and Price

Methodology

We divided the Methodology into 2 parts, The Macro & Micro. Then we develop the marketing proposal based on our insights.

Hobby Garden (USD Millions)

Seeds Market Drivers:

• Trend in Healthy Eating

• School Gardens

Inhibitors:• Global

Recession• Available

Growing Space

Growth

Macro Analysis

Social trends are driving growth, while macro economic pressure is threatening it.

812 107

Source: Nursery & Garden Stores in the US. IBISWorld Iexport Industry Summary 44422. November 2012“Gardening in Japan”. Euromonitor International. May 2012

“Gardening in France”. Euromonitor International. October 2012.

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Burpee Takii Suttons Vilmorin/ Oxadis

Product Variety

Matching with Fito

478 Vegetable seeds296 flower

99 Vegetable Seeds70 Flower Seeds

427 Vegetable seeds463 Flower seeds

unknown

Different Products/ Families

5 Seed Categories 2 categories4 Families

11 Seed Categories8 Families

unknown

New varieties 29 vegetable19 flower

12 Flower23 Home garden

14 Vegetable10 Flower

unknown

Price Levels .70-1.5 euros Depends on Location

Not found ± 2.5 euros Varies upon seed

unknown

Sales Channel Walmart and garden centers

Not found Garden Centers and online

unknown

Marketing

Micro Analysis

Product Variety and Marketing activities plays important roles in consumer market to increase brand awareness.

Product Variety

Matching with Fito 222 Vegetable seeds160 flower seeds13 grass

327 vegetable seeds173 flower seeds26 grass

73 vegetable seeds36 Flower4 grass

Different Products/ Families

6 seed categories2 families

3 seed categories4 families

7 Seed categories

Price Levels 1.5-1.8€ 2€ 2€

Sales Channels Las RamblasBordas (Hospitalet)

Las Ramblas Las Ramblas

Marketing

Capillarity in Country

Batlle Rocalba Productos Flower

Spanish Competitors

Productos Flower has the most comprehensive marketing strategy of all the Spanish companies – they are Semillas Fitó’s most direct competition in the Spanish market.

Spanish Market Research

El Corte Inglés is selling only Fitó seeds (for 2,00€) and Jardineria Bordas (Hospitalet) is selling only Batlle seeds (for 1,50€).

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Company: FITÓWhere: El Corte InglésPrice: 2,00 €

Company: BATLLEWhere: Jardineria Bordas (Hospitalet)Price: 1,50 €

Source: Stores visits

Spanish Market Research

El Corte Inglés is sellling Turf grass from Fitó for 9,40€ (30m2) and Jardineria Bordas is selling it for 9,95€ (40m2)

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Company: FITÓWhere: El Corte InglésPrice: 9,40 € (30m2)

Company: BATLLEWhere: Jardineria Bordas (Hospitalet)Price: 9,95 € (40 m2)

Source: Stores visits

Low

High

Reduce Raise Create

Value Curve

Semillas Fito’s competitive strength lies in its high quality product, however, Semillas Fito could redirect efforts to become more consumer oriented.

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• We recommend that Semillas Fito invest in Brand• Rebrand Product Lines (ex.: Mediterranean Kitchen, Kids Line, Christmas Line)• CSR Policy

– Employee welfare– School/Public gardens– Community Activities

• Update Point-of-Sale

• To maintain competitive advantage, focus on Promotion • Loyalty Programs and Gift Certificates• Update your marketing merchandise to remain global• Buzz Gardening to develop Gardening Market

• Beware of competition in Price and Channels• Online presence

– Online Sales– Social Media (Facebook, Twitter, YouTube) – Store Locator– SEO

• Price• Promotional Prices & Discounts

Conclusions

Suggestion for the future recommendation, Marketing Strategies and Competitive advantages, and Pricing and Distribution

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• Sell online• Product Diversification• Develop CSR Activities• Community Outreach

Next Steps

From all the marketing analysis that we obtain from competitor, we suggest Semillas Fitó to conduct several strategies to be able to compete in global market

Recommendations

The top priority for Semillas Fito should be to establish a new online sales channel in order to meet customers where they are and stay up-to-date with new trends.

Sell online

• 4% of Home & Garden Sales in Spain are online, but 60% of consumers conduct online research before purchasing

• Online search for home & garden grew 49% year over year from 2011 to 2012

Sources: http://www.consumerbarometer.com/#?app=home&viewMode=0, http://www.google.com/trends/

• Put catalog online• Make products easily searchable • Create Shopping Cart & Checkout• Offer personalized recommendations• Social Media Marketing using a

contracted intern

Suttons

Burpee

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Recommendations

By rebranding product lines & focusing on consumer demands, the Hobby Seed Division can become more consumer-oriented

Product Diversification • Selling gifts, flowers, and other peripherals• Rebranding product lines to be more consumer

oriented (Mediterranean Kitchen, Kid’s Garden)

• Suttons has “Fun to Grow- Seeds for Kids!” to encourage life long gardening and educate in line with Stage 1 of National Curriculum

• Burpee & Suttons have Seasonal Gift Offerings to capture the holiday spikes in sales

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RecommendationsDevelop CSR Activities

• Educate students• Create an Employee Wellness Program• Provide the “how to plant” videos

A strong CSR Policy benefits companies in branding and retaining happy customers and employees

• Build the good brand image to the public• Gives employees a clear understanding of

what is their responsibility and welfare.• Gives the users directly information and

show it visually

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Recommendations

Community Outreach builds brand, contributes to social responsibility, and generates goodwill

Community Outreach• Sponsor Patio Competition in Southern Spain• Partner with a Social Outreach Class to develop

gardening programs in residence and prisons• Buy a packet of seeds, donate a packet of seeds to a

developing country

• Córdoba’s Batalla de Las Flores is government sponsored competition attracting citywide participation and tourism

• Schools participate in student outreach programs & need projects

• Allowing your customers to “do good” by consuming your product is huge CSR trend (TOMS, Warby Parker)

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Thank you!

Competitors

Environment

Country Summary

Overall, the Opportunities & Strengths outweigh the Threats & Weaknesses of the U.S. market, because although you must have a strong consumer brand to be a player, consumer trends are favorable to a growing gardening market.

“Gardening in the United States”. Passport. Euromonitor International. July 2012.Gardener’s Supply Customer Service. Direct Email. 12.11.2012.

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Competitors

Environment

Country Summary

The use of technology allow the UK company own special strategies when competing with other competitors, but the limited of gardening space and low consumer confidence can bottleneck these companies growth.

21Source: “Gardening in the United Kingdom”. Passport. Euromonitor International. July 2012.

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Competitors

Environment

Country Summary

The traditional retail marketing make the France company close to their consumers, but the lack of official website and online store are the most seriously problem when they are competing in the global market.

“Gardening in France”. Passport. Euromonitor International. July 2012.

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Competitors

Environment

Country Summary

Because of the focus on CSR and the shifting of targeting market, the JAPAN company exist unique strategies. But the increased taxes is a huge barrier to new entrants.

“Gardening in Japan”. Passport. Euromonitor International. July 2012.

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Similarities

Differences

Main Competitors

American companies invest heavily in patenting, marketing and advertising, and e-Commerce, but they have varying degrees of global partnership & CSR

• Online marketing is provided by the way of e-Commerce • Across country network to provide directly information

to their customer• Increased competition situation • Expiration of key product patent • CSR activities

• The investment on marketing as well as brand image• Global partnership is different from company to

company• The abilities of manage CPR(crisis public relation ) • The specialist of products and solutions that different

companies provide

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Similarities

Differences

Main Competitors

The U.K. companies are quite advanced in the online marketing, sales, and social media, but they invest less on product development

• Take advantage of social media especially on the use of website and e-Commerce abilities

• Online store as well as traditional Retailer store• Increased competition situation• CSR activities

• The investment on market research and market activities

• Global partnership • Independent & Subsidiary

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Similarities

Differences

Main Competitors

Vilmorin is currently re-vamping its Oxadis brand to increase their consumer oriented marketing and web promotion

• Gift Certificates & Loyalty card• The investment on marketing and creative marketing

solutions are needed• Increased competition situation• CSR activities

• No Official Website & No Online Store• The investment on market research and market activities• Global partnership • The abilities of manage CPR(Crisis Public Relation )

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Similarities

Differences

Main Competitors

The Japanese companies emphasize CSR and their responsibility to their communities and employees

• Take advantage of social media especially on the use of website and e-Commerce abilities

• Emphasis on the credibility of its product by showing both the company’s longevity and the seeds’ renowned

• The values of sustainability, longevity, innovation, and social wellbeing in its PR strategy

• Global partnership when facing the expanding issues• SKATA Specialized in online shopping for home

gardeners • Across country network to provide directly information to

their customer