2002 MAILORDER GARDENING ASSOCIATION

PROPRIETARY MARKET RESEARCH

(Results compiled in March 2003)

Background:

      In the fall of 2002, the Mailorder Gardening Association contracted the National Gardening Association to include two proprietary market research questions about the mail order gardening market on their annual National Gardening Survey conducted by Harris Interactive Inc. The results of this survey are provided as a membership benefit of the MGA.

 The purpose of this research was to accomplish the following objectives:

1.      To document the percentage and number of households in the U.S. that purchased each of ten categories of lawn and garden products from direct marketing sources in 2002. To compare the 2002 results to the percentage and number of households that also purchased each of these product categories from direct marketers in 1998 and 1996.

2.      To determine the average amount of money spent by U.S. consumers on lawn and garden products they purchased from direct marketers in 2002 and compare this with the average spent in 1998 and 1996.

3.      To estimate the size of the mail order lawn and garden market in 2002 and compare this with the size of the market in 1998 and 1996.

Methodology:

      During January and February 2003 Harris Interactive conducted an online survey with a representative sample of 2,548 U.S. households nationwide. This sample provides results with a margin of error of plus or minus three percentage points.

      To identify households in the survey that participated in one or more types of do it yourself lawn and garden activities during the past year, a screening question was asked so that only those households that participated in these activities would be asked about their mailorder gardening purchases and spending.

The Lawn and Garden Market in 2002:

      In 2002, 79% of all U.S. households or an estimated 85 million households participated in one or more types of lawn and garden activities. These 85 million households spent an average of  $466 on their lawns and gardens in 2002 and an estimated total of $39.635 billion.

      That compares with lawn and garden participation in 1998 of 65% of U.S. households or an estimated 67 million households spent an average of $452 and an estimated total of  $30.188 billion. In 1996, 64% of U.S. households or an estimated 65 million households spent an average of $353 and an estimated total of $22.519 billion.

Summary of Mail Order Market Research Results:

      In 2002, 28% of the 85 million U.S. households that participated in lawn and garden activities purchased one or more categories of mail order garden merchandise. That was an estimated 23.8 million households. In 1998, 22% of lawn and garden households or an estimated 15 million households purchased one or more categories of mail order garden merchandise. In 1996, 22% of lawn and garden households or an estimated 14.6 million households purchased one or more categories of mail order gardening merchandise.

      From 1998 to 2002 the number of households that purchased mail order garden merchandise increased from 15 million households to 23.8 million households. That?s an increase of 8.8 million households or 58% during the four-year period. The compound annual growth rate in the number of households that purchased mail order garden merchandise from 1998 to 2002 was 12.2%.

Mail order garden merchandise purchased in 1996, 1998 and 2002:				Change
Product Category:	1996	1998	2002	1998-2002
	%            Mil.	%            Mil.	%            Mil.	HH?s Mil.
Bulbs	13            8.3	12            8.3	11            9.4	+1.1
Seeds	10            6.8	8              4.6	11            9.4	+4.8
Live Plants or Nursery Stock	9              5.6	6              4.0	13            11.0	+7.0
Garden Books or Information	6              3.9	6              4.0	6              5.1	+1.2
Supplies (Fertilizer etc.)	3              1.8	3              2.2	7              5.9	+3.7
Tools, Hardware	2              1.6	3              2.2	4              3.4	+1.2
Garden Accessories	1              0.9	2              1.1	2              1.7	+0.6
Outdoor Power Equipment	1              0.8	2              1.0	1              1.7	+0.7
Garden Aids	1              0.7	2              1.0	3              2.5	+1.5
Landscape Products	1              0.7	2              1.0	3              2.5	+1.5
Other	1              0.4	1              0.1	1              0.8	+0.7
TOTAL	22            14.6	22            15.0	28            23.8	+8.8

In   2002, 23.8 million mail order gardening households spent an average of $122 per household on mail order gardening merchandise and an estimated total of $2.903 billion. In 1998, 15 million mail order gardening households spent an average of $140 per household on mail order gardening merchandise and an estimated total of $2.100 billion. In 1996, 14.6 million mail order gardening households spent an average of $142.20 per household on mail order gardening merchandise and an estimated total of $2.076 billion.

        From 1998 to 2003 the total spent on mail order gardening merchandise increased from $2.100 in 1998 to $2.903 billion in 2002. That?s an increase of $803 million or 38% during the four-year period. The compound annual growth rate in the total spent on mail order garden merchandise from 1998 to 2002 was 8.4%.

Amount of money spent on mail order garden merchandise in 1996, 1998 and 2002:

                                                                                   Change

                1996                1998                2002     1998-2002

Mean    $142.2             $140.0             $122.0            -$18.0

Median    $40.0               $50.0               $49.0               $0.0

TOTAL $2.076 Bil.  $2.100 Bil.       $2.903 Bil.     +$803 Mil.

Mail Order Market Share:

      Of the $39.635 billion total that consumers spent on their lawns and gardens in 2002, $2.903 billion or about 7% was spent for mail order purchases. Of the $30.188 billion total consumers spent on their lawns and gardens in 1998, $2.100 billion or about 7% was spent on mail order purchases. Of the $22.519 billion total that consumers spent on their lawns and gardens in 1996, $2.076 billion or about 9% was spent on mail order purchases.

                1996      1998 2002

Total Lawn and Garden Sales      $22.519 Bil. $30.188 Bil. $39.635 Bil.

Mail Order Sales    $2.076 Bil. $2.100 Bil.      $2.903 Bil.

Mail Order Market Share      9%        7%      7%

      Lawn and garden consumers also purchase products from a number of different types of retail outlets. For comparison here is the percentage of lawn and garden consumers that purchased products at each type of retail outlet where they are sold and by mail order

Retail Outlet:	1996	1998	2002
	%	%	%
Garden Center	50	48	43
Hardware Store	36	24	33
Mass Merchandiser	32	32	48
Feed/Seed Store	15	16	14
Supermarket/Drug Store	20	12	21
Home Center	36	43	52
Mail Order	22	22	28

More Detailed Information Available: