MTAC Meeting

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MTAC Meeting November, 2008 MailOrder Gardening
Association
Presented by Camille Cimino, MGA Executive
Director Ken Lane,
Chair, MGA Freight Committee
Wednesday November 19, 2008
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Foreword

• In this presentation we will
• The MGA Who we are
• What we doOur Mission
• Our MembersWhy we love Direct Mail
• Our Metrics
• Review recent Outbound Shipping survey results
• How to contact us

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Whats an MGA member to do in Order to Exist 20
Years From Now?
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Who we are and What we do
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MTAC the MGA

• Who we are
• The Mailorder Gardening Association is a member
  organization for companies who sell gardening
  products to the consumer via paper catalogs as
  well as the internet.
• We also represent the grower/wholesale segment of
  the industry
• The 3rd Membership Category is our Allied
  Membership. This segment is represented by any
  company that provides a service to the cataloger
  or wholesaler such as printing companies,
  gardening magazines, list management companies,
  PR consultants, shipping companies, etc.
• We are celebrating our 75th Anniversary in 2009.
  Our headquarter Office is in Elkridge, Maryland.
  Camille Cimino has been the Executive Director
  since 1987. There are presently around 200
  member companies with the majority being
  catalogers.

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MTAC the MGA
Some of our member companies
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MTAC the MGA

• What we doOur Mission
• To Make Mail Order Gardening businesses the most
  successful they can be. This is accomplished
  by
• Promoting its members and the MGA brand
• Educating and representing its members
• Protecting the integrity of its members
• The MGA sponsors 2 conferences annually which
  provides a forum for networking, education and
  making new contacts. Convention brochures as
  well as Membership Literature, has been
  distributed to everyone here today.
• The Associations website is www.mailordergardenin
  g.com. The site serves a dual purpose
• For Consumers it is a resource for locating
  garden catalog companies as well as Hardiness
  Zone information. There are smart tips for
  consumers on how to purchase mail order garden
  products and what to look for and do once you
  receive them.
• There is a Members Only Section that contains
  the results of past recent survey results, as
  well as demographic information on each member
  company and much more.

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MTAC the MGA

• What we dowe mail Packages!!!

• Average MGA company mails is 60,000 packages
  annually
• Extrapolating this across the membership base
  provides a range of 1.9mm to 4.0 mm total MGA
  packages.

MGA external research. Estimate based on
participation rate and mailer provided volumes.
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MTAC the MGA

• What we doGreen Thumb Awards
• In addition the Education, we also help promote
  our member companies. In January 1998, we
  launched the Green Thumb Awards in order to
  recognize outstanding new garden products
  available through paper catalog and the Internet.
• Winners, chosen by an independent panel of garden
  writers and editors, are selected based on their
  unique qualities, technological innovation,
  ability to solve a gardening problem or provide a
  gardening opportunity, and their potential appeal
  to gardeners.
• The award winning companies and their products
  are featured in news releases and the MGA
  website. Companies may use the Green Thumb logo
  in recognition of their receiving the Award.
  Gardening Magazines and local Newspapers are
  willing to print articles on these products and
  their companies.

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MTAC the MGA

• Why do we love Direct Mailit Works!!!
• "I received my favorite gardening catalogs the
  day before we got two feet of snow. The gardening
  Gods were watching over me!
• I just received my order today, just as your
  e-mails stated it would. I'm very happy, not only
  with the service I relieved from you, but with
  the USPS person who knew to put it where it would
  be kept dry. I know this my be a small thing, but
  in today's world, when someone gives this kind of
  service, we, the customer, really appreciate it."
• Hi! I just wanted to tell you I received my
  catalog today and it is gorgeous!!!!!! The colors
  remind me of last spring and have me pining for
  another season in the garden.

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MTAC the MGA

• Did you knowOur Metrics

MGA Member Companies Jump in 2008 MGA Member
First Generated 743 Million in Annual Sales
during the 12 month period (Nov. 2007 Oct.
2008) Direct Mail and Internet Sales
promotions of seeds, bulbs, nursery stock,
gardening aids and outdoor power
equipment.                                     
Number of Sales                    Gross
Sales                Avg. Order            
2006                6,015,637                   
           385,121,074                  
64.02               2008               
6,840,496                             
461,801,880                   67.51       
              Variance         
824,859                             
76,680,806                                       
                     13.7                        
                   19.9 January December 2006
Source MailOrder Gardening Association, Zed
Marketing
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MTAC the MGA

• Did you knowOur Metrics

 Publications magazine subscriptions and book
buyers                          Number of
Sales                    Gross
Sales                Avg. Order   2006           
    12,903,276                             241,42
0,296                   18.71   2008   
            13,284,125                            
281,431,110                 
21.26   Variance         380,849     
                        40,010,814             
               8.2                        
                  22.9 January December 2006
Source MailOrder Gardening Association, Zed
Marketing
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MTAC the MGA

• MTAC Communication with our members
• Three MGA Representatives on MTAC
• Camille Cimino Mailorder Gardening Association
• Andy Lagendyk K. Van Bourgondien Sons
• Ken Lane Hathaway Lane Direct
• MTAC Workgroup 119 representation
• MTAC updates at two MGA conferences annually as
  well as email updates during the year.

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MTAC the MGA

• Whats important to our members
• Costs
• Printing, paper and postage
• Outbound Freight expenses
• People costs
• Commissioned Market Research to quantify the MGA
  in total
• Results on the next slides

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Survey
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MGA Outbound Freight Survey

• Details
• 21 Wholesale and 110 Regular Member companies
  were sent survey via email 58 responses
• Web-based to protect anonymity
• Three email blasts for survey submission
• June 4, 2007 All members
• June 26, 2007 - Reminder
• July 17, 2007 Post Summer Conference Last
  Chance Reminder
• Forty-two questions measuring
• Type of business
• Usage
• Packaging/Product specs

Source Hathaway Lane Direct
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Section 1 Who are you and what do you ship
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MGA Outbound Freight Survey

• Responses
• 21 Wholesale and 110 Regular Member companies
  were emailed the survey
• 131 total companies surveyed
• 58 responses (2 via paper response)
• Greater than 40 participation (!!!)
• Audience

• Survey spoke to the right people at the right
  companies.

Source Hathaway Lane Direct
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Survey Questions Business Channel

• Most respondents are Cataloguers or run
  Catalogue/Wholesale operations

Source Hathaway Lane Direct
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Survey Questions Business Channel

• This translates to 95 are in the sweet spot of
  shipper targets

• and 95 are shipping residences. Again, no
  surprises..

Source Hathaway Lane Direct
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Survey Questions What do you sell ANY of?

• There is a diverse mix of what products are
  shipped

Source Hathaway Lane Direct
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Section 2 Shipping Specs Volumes, etc
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Survey Questions What do ship in?

• Over 80 of respondents are shipping to their
  customers in BOXES.

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Survey Questions If BOXES, what SIZE?

• Almost 70 of respondents ship in boxes not
  subject to shipper dimensional weight surcharges.

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Survey Questions The average weight of a
package shipped is

• The predominance of Gardening Hard Goods drives
  71 of survey respondent packages above 5 pounds.
  
• Weighted average is 11.1 pounds per package

Source Hathaway Lane Direct
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Survey Questions The amount of packages shipped
in 2006 was

• Annual package volumes by respondent vary
  greatly.
• Average per respondent is 60,000
• Extrapolating this across the membership base
  provides a range of 1.9mm to 4.0 mm total MGA
  packages.

Estimate based on participation rate and
mailer provided volumes.
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Survey Questions The Month most packages
shipped in is

• Overall, respondents are Spring shippers
• converse to most mailers Q4/Q5 shipping curves

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Section 5 Current Outbound Freight Providers
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Survey Questions Who do you currently ship most
with?

• UPS is clearly the current shipper of choice
• FedEx growing from prior levels
• USPS has opportunity for growth

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Survey Questions

• Do you pay a residential surcharge?
• My guess is the IDK Yes
• Yes estimate is 93.

Source Hathaway Lane Direct
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Survey Questions

• Do you pay a fuel surcharge?
• Assume Sometimes/IDK Yes
• Yes estimate is 90.
• There is an opportunity to negotiate these on
  behalf of MGA members.

Source Hathaway Lane Direct
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Section 4 Impact on Business Strategy
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Survey Questions
What would you do if your Outbound Freight
Expenses increased by 5-10 next year?

• Lets face itrates will continue to go up and
  members will be forced to do things that are not
  good for their business
• This clearly underscores how critical this issue
  is!

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MTAC the MGA

• How to Contact us

MGA Office 5836 Rockburn Woods Way, Elkridge,
MD 21075 410-540-9830 FAX [phone]
www.mailordergardening.com
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Thank You
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Marketing Solutions
PO Box 1003 Litchfield, CT 06759 (860)
567-5275 www.hathawayandlane.com