Etera has become a leader in promoting products for gardeners to the public via the Internet. Consumers can buy Etera plants through independent garden centers' Web pages or through Etera's virtual garden center. When consumers purchase plants from Etera, the garden centers get a 10- to 15-percent dividend from the sale. Tim Bowling discussed the progress of the program and its outlook.

Q. When did Etera begin to dedicate itself to Internet sales?

A. The potential for application of information technology in the independent garden center channel was part of the business model from the beginning. The formation of Etera Networks in 1999 formalized the mission to Internet-enable the independent garden center channel with a comprehensive e-business infrastructure that leverages the channel's core competitive advantages and ensures its long-term growth.

Q. Are Internet sales on track with what your company envisioned at this point?

A. To the extent that early adopters of the technology have actively promoted their URLs, trained and educated their employees on the resource and, as a result, created traffic to their sites, which in turn created sales, the answer is yes.

We continue to provide customized Web sites for independent garden centers at no charge, but now require 50 percent of their full-time employees to complete a computer-based training program, which we created and provide at no charge.

We've also developed complete Web site marketing and promotion packages, which are provided at a nominal charge. Simply putting up a Web site really accomplishes nothing. Training and site promotion are the next steps toward integrating the Internet into the independent garden center.

Q. Is there some recognition of the Etera brand with the public? What are some things you're doing to increase brand awareness?

A. The Etera brand has critical mass of recognition at both the dealer and consumer level. This spring many gardeners will be buying Etera perennials at their favorite garden center for the third year in a row.

Etera consumers have success in their gardens and tell other gardeners. The Etera brand is communicated to the industry and consuming public via trade and consumer shows, trade and consumer advertising and through participation in professional organization events, including [ones by] the American Nursery & Landscape Association.

Q. What have been the responses from garden centers that have participated in the Etera Internet program?

A. They vary directly with the garden center's expectations. Some were unrealistic with regard to revenue that would be generated by simply having a Web site. We are helping shape their expectations now by providing training and positioning the Internet as part of a multichannel retailing approach to their business.

Q. What has been the average return for garden centers that have participated in this program?

A. If by return, you mean revenue, the variations are again wide. Some of our most successful dealers generated more than $10,000. Our training program for 2001 has already trained more than 4,000 employees at more than 700 garden centers.

This training and our Web site promotion packages will allow more independent garden centers to be successful. Additionally for this spring, the content and functionality we provide to our network far exceeds last season. Features such as My Garden, newsletters, hundreds of tutorials, a 38,000-plant database with care sheets for each plant and thousands of SKUs all create a broad base of information and service the independent garden center can provide to its customers.

Further, the Etera dealer's Web site has been integrated into the virtual garden center, emphasizing the dealers' brand names and affording the dealer the opportunity to easily customize content and tips with local information.

Q. What has been the maximum rebate a garden center has received and what is this company doing to improve Internet sales?

A. Despite missing the prime spring selling season for gardening products last year (due to the timing of the site launch) our most successful dealer earned in excess of $1,000 in dividends on nearly $9,000 in revenue. Etera Certified Dealer dividends are net margin, not gross margin, and at 10 to 15 percent compare very favorably with national averages of 2.5- to 5-percent net profit for garden centers.

The training program and Web site promotion packages are designed to improve Internet sales. Since customers who visit the dealer Web site tend to spend more on average in the store than customers who come into the store only, the training focuses on promoting the dealer URL and driving traffic to the dealer site.

Q. What changes have occurred recently regarding the Etera Internet sales program?

A. We have created a field position called retail sales support specialist. These individuals are focusing on a limited number of accounts throughout the country to work with the dealer on integrating the Internet into the garden center. For example, Etera CenterWorks, the newest division of Etera, provides complete business management services software, which allows the dealer to put in-store inventory on his Web site, linked to inventory management and POS systems, accounts receivable, accounts payable and general ledger. This training is designed to allow the Etera Certified Dealer to use the Web resource as part of an overall multi-channel retailing strategy.

Q. You recently extended your 15-percent rebates for garden centers from a two-year period to an indefinite amount of time. Why did you do this and what has been the response?

A. The Etera Internet solution is not about us, but about the independent garden center accruing benefit from our technology platform. This shifts the focus from product to the garden center and enables the garden center to communicate with its customer base in a multichannel environment. This eliminates the need for a finite term for dividend payments. This change has been received well by new and existing dealers.

Q. Do you see Internet sales of plants and gardening products increasing in the next few years? Do you think we'll see a rebound of Internet retailers in the near future?

A. We have followed Forrester Research and their projections for growth of online retailing. Their projections for the Tool & Garden category have actually increased recently and total well over $8 billion by 2004.

The independent garden center channel currently owns 31 percent of this dollar market share, translating to almost $2.5 billion in online sales by 2004 with just flat market share.

A revival of the stand-alone business-to-consumer models appears to have zero chance. On the other hand, Internet shopping traffic continues to grow, primarily in multichannel environments such as J.C. Penney, Nordstrom, REI and Eddie Bauer.

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© 2001 Branch-Smith Publishing