Where is the growth coming from?

According to Green Profit Magazine, a nursery trade journal, Scotts Corporations growth was broken down this way. “At their largest retail accounts, straight lawn fertilizer had a 28% increase on a year-to-date basis, with garden soils seeing a 24% increase. Plus, they say that the launch of Miracle-Gro Liquid Feed has seen year-to-date sales of more than $35 million, making it the most successful new product launch in the company’s history.” Green Profit continues, “The other place Scotts saw a lot of growth was in the do-it-for-me sector, the Scotts Lawn Service. That had a 26% sales growth.” Here is what I find interesting, according to the article, “What isn’t growing? The company’s Smith & Hawken sales were flat compared to last year.”

We have talked about how Scott’s wants to enter the“gourmet” garden market with its high end fertilizers. I had been thinking that what Scotts needed to do was spin off a company that used separate packaging to separate it from typical Scotts or Miracle-Gro packaging. Now we see Scotts having a tough time with Smith & Hawken, not quite a spin off but close. You have to wonder if its corporate culture that is the problem.

More than ever it becomes clear that you can’t please everyone all the time. You have to pick the audience that you are best at serving and focus on them. Scotts has built its fortune on middle of the road products almost exclusively run through chain and box stores catering to the 70% of gardening customers that shop the chains. Trying to reach out to a different set of consumers may or may not work. You loose focus, and you company wasn’t built on that anyway. Smith & Hawken could just be experiencing a slow year. My goodness we all have, but it will be interesting to watch and see if Scott’s can pull it off.

I don’t think Scotts will be successful. They, like so many other large corporations that have saturated the market with their products are now looking into the little hidden away areas of gardening, as far as they were concerned. Now there is interest in the organic market, and the “gourmet” independent nursery market. The problem is this smaller market generally hasn’t responded to Scotts offerings before. Why would they now?