When it comes to buying plants and produce, Ben Campbell, assistant professor and Extension economist from University of Connecticut, is interested in learning, “How do people think and how do we change it” so they buy more. He discussed this topic during his “Perceptions and Misperceptions of Labeling” workshop at the 22nd Northeast Greenhouse Conference and Expo 2014.
He noted that these are his views, and do not necessarily reflect those of University of Connecticut.
“It is a competitive world, with only a finite number of customers,” he said. Research shows that plant type sales per household are trending down, or are stable at best.
The bottom line is, would you buy it? He advises getting to know what your customer thinks. What the consumer wants and needs varies on demographics.
He reined in the “Wild West” of key marketing terms — local, organic, eco-friendly and sustainable — which mean entirely different things to different people. This is called perception formation. There is a production definition, a consumer definition and a retail definition.
How you label your product directly impacts what your customer buys. To some, buying locally grown conjures up the supposition that it is supporting certified organic or they’re supporting the employees and their children. One may suppose that ‘fresh’ implies a product that is organic and local, and that buying it supports the local economy.
Federal regulations exist in the U.S. and Canada only regarding labeling products local, or certified organic. To be local, federal regulations mandate it must be grown within 400 miles, but state definitions vary state-to-state. Labeling a product local in Connecticut, for example, requires it must have been grown within Connecticut.
‘Eco-friendly’ has no certification requirements. “There is no process that says you can’t use that label.” However, “This is causing an issue, as people are associating this with organic.”
Research on impact of consumers’ purchase decisions show that 10-20 percent are very price sensitive; 10-20 percent are very environmentally conscious; and 60-80 percent value a contribution of attributes. “If I say local, people generally have a positive response. Organic not so much.” Mention that organic plants were grown using biopots, compost-pots or recycle-pots, and interest perks up.
People are also requesting GMO-free. “If people come to your store and want GMO-free, they’re expecting local,” he said. If customers ask about GMOs, put signs up explaining what you’re doing about them.
Further studies show that if a product is labeled ‘local’, two-thirds believe decreased miles were driven producing it, that less pesticide was used or no synthetic pesticides were used at all, or that it was produced organically.
Labeling’s impact for the green industry is that it can improve sales and customer loyalty. Some customers may not care about labels, so you have to understand your market to flip someone from not buying to buying. Buying from a box store, means only 30 percent of the money stays in the community, he said. Buying local, 60-70 percent stays in the community. It might just be into your pocket.