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ISHS Acta Horticulturae 432: IX International Symposium on Virus Diseases of Ornamental Plants

THE DYNAMIC NATURE OF THE MARKET FOR ORNAMENTALS: IMPLICATIONS FOR VIRUS RESEARCH

Author:   A.J. Malter
Keywords:   Ornamental horticulture, marketing, market trends, economics, innovation, virus research
Abstract:
Continuous innovation has propelled ornamental horticulture on a decades-long growth path, developing the industry into one of the leading economic branches of modern agriculture. Such unparalleled success, though, has led to a certain degree of complacency and a lack of preparedness by many established firms in the industry. Some firms are experiencing difficulty in confronting the competition from new and/or more innovative suppliers in what is perceived to be an increasingly "mature" market. Recent trends show that growth in industry supply exceeds growth in consumer demand, resulting in diminished sales growth and downward pressure on prices. Now and in the foreseeable future, the market will be characterized by continuous and unpredictable change. What role can researchers of plant viruses and diseases play in such a dynamic and uncertain commercial environment? This paper addresses this question by examining: (1) the overall size and recent trends in the market for ornamental horticulture products; (2) Dickson's (1992) theory of "competitive rationality" from the marketing literature, which models the dynamics of constantly changing competitive markets of the type we find in the ornamental horticulture industry; (3) the vital contribution of research and development scientists to the processes of innovation and imitation in dynamic market systems; and (4) the importance of market-based targeting of research efforts, using knowledge about customer preferences and economic potential, and the need for improving communication and coordination processes in the provision of virus-free plant material. Since the ornamental horticulture industry is likely to face a turbulent and continuously changing external environment in the future, this paper argues that suppliers need to be more alert and innovative in order to find opportunities in precisely this type of market. Firms and individuals who develop such skills will be able to achieve a competitive advantage that will help them succeed and survive, while others will face an uncertain future.
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