Factors Affecting U.S. Consumer Expenditures of Fresh Flowers and Potted Plants

Abstract

The floral industry has experienced declining sales in the past few decades, causing many to speculate as to the underlying causes. To identify consumers’ spending patterns for fresh flowers and potted plants, we extracted and analyzed quarterly expenditure interview data from the Consumer Expenditure Survey, 1996 to 2013. Our analysis revealed consumption trends over time by age group, and compared the differences in expenditure patterns across states. Additionally, we employed the Heckman two-step model to estimate how flower consumption is affected by sociodemographic characteristics, geographic factors, housing status, and seasonal factors. The estimation results show that the source of declining demand can be attributed to the decrease in both number of flower purchasers and expenditure among purchasers. Many factors including age, marital status, gender, education, income, number of earners in household, population size of the residing city, house type, and number of rooms in the house affect the demand for fresh flowers and potted plants. Given that floral expenditure has been decreasing among consumers under 40 years of age for the past two decades, innovative marketing strategies to target this age cohort are essential for the floral industry’s success in the future.