The bloom is off the poinsettia
On a day when America’s banks were failing and the Big Three automakers were on their knees begging Congress for money, Paul Ecke III could muster little sympathy.
“I can’t go to Washington looking for a bailout,” the 53-year-old industry leader said. “I should be making $20 million a year like these auto guys. All they have to do is make good cars that don’t break down. Mine is a far more complicated business.”
Foreign competitors and outdated equipment. Lowball pricing by upstarts trying to muscle market share. Crushing energy costs and a tanking economy. European regulators and Chinese patent thieves.
The poinsettia game has never been tougher.
“When I tell people that I’m in the flower business, they say, ‘Ohhh, that must be so pretty,’ ” Ecke said. “But I can tell you it’s no tiptoe through the tulips.”
The Eckes of Southern California are to poinsettias what De Beers of South Africa is to diamonds. Over the last century, four generations of Eckes took a cold-weather bloomer few Americans had ever seen and made it a holiday staple.
Their zealous promotion is the reason the poinsettia is the nation’s bestselling potted plant -- an astonishing fact considering about 100 million are sold each year in just six weeks. Let’s see the iPhone top that.
German immigrant Albert Ecke and his family were headed to Fiji to open a health spa when they stopped in Los Angeles in 1900 and liked what they saw. They established a dairy farm and fruit orchard a few years later in the Eagle Rock area.
Ecke became intrigued by the red-and-green shrub that is native to Mexico and Central America and grew wild throughout the Southland. The Aztecs extracted dyes and a fever treatment from poinsettias, and the Spanish used it as a Christmas decoration. The plant was brought to the United States in the late 1820s by the first U.S. ambassador to Mexico, Joel Roberts Poinsett.
Ecke was the first to develop the commercial potential. He grew poinsettias on farmland in Hollywood and sold them from street stands. His son, Paul Ecke Sr., had bigger ideas.
A visionary horticulturist and businessman, Paul Ecke Sr. gave the poinsettia a makeover through a secret breeding technique that turned the delicate and gangly weed into a sturdy and voluptuous potted plant. In the 1920s he moved south and laid a carpet of poinsettias stretching from Carlsbad to Encinitas.
His son, Paul Ecke Jr., expanded the business yet again. In the 1960s he moved the poinsettias into greenhouses and pushed cuttings shipped by air instead of mature plants hauled by rail.
An inexhaustible promoter who would’ve given P.T. Barnum competition, Paul Ecke Jr. created buzz by showering television networks with free poinsettias from Thanksgiving to Christmas. He extolled their virtues on programs such as “The Tonight Show” and Bob Hope’s holiday specials.
The Ecke family had a virtual monopoly on the world’s poinsettia market largely because no one could figure out how they produced uniformly perfect plants with multiple branches emanating from a single stem -- the so-called Ecke style.
“My grandfather learned this from a German backyard gardener he knew,” said Paul Ecke III, also known as P3. “Nobody at the ranch knew the secret. My grandfather, my dad and their breeder knew, and it was done at the breeder’s home so nobody could see.”
In 1992, Ecke took out a 30-year loan and bought out other family members, well aware he was following in the footsteps of two flower industry legends.
His timing couldn’t have been worse.
Imagine Col. Sanders with his 11 herbs and spices laid bare. Or Coca-Cola with its recipe splashed across the Internet. That’s how Ecke felt when a university researcher published an article revealing his family’s secret process.
It wasn’t pollination, but rather the grafting of two types of poinsettias to create the desired plant from which cuttings were taken. It was stitched together like Frankenstein’s monster.
“The people who wanted to compete with us said, ‘Ah, now we get it,’ ” Ecke said. “I was saying, ‘My life is over.’ ”
The Ecke Ranch in Encinitas is a California plein air painting come to life, an idyllic island in a sea of sprawl where soft December light slants across towering palms and eucalyptus trees and rows of massive greenhouses.
The rickety buildings are more than 40 years old and are heated by a hulking boiler that looks like an artifact from the Industrial Revolution. Employing technology that wouldn’t pass muster at a junior high science fair -- cheap box fans suspended by wires circulate the air -- the greenhouses are a mess of rot and rust and coils of black irrigation pipe lying about like dead snakes.
Nearly half of them are empty, monuments to the upheaval in the poinsettia business over the last 15 years.
The outing of the Eckes’ secret opened the door to competitors. They challenged the family’s market domination by lowering costs, establishing farms in Latin America and undercutting Ecke’s prices. Meanwhile, discount stores and big box outlets such as Home Depot began selling poinsettias as loss leaders to entice customers into their stores.
Ecke gradually followed his competition overseas. Every year, he ships millions of tiny cuttings harvested from closely guarded “select stock” to Guatemala. There they are grown into small plants and sold to large growers. Armstrong Garden Centers harvests the rest in California under a licensing agreement with Ecke.
Last year, for the first time, no poinsettias were grown for sale at the Encinitas ranch. An 83-year-old tradition came to an end.
Ecke’s near-monopoly is gone, but he still accounts for 70% of the poinsettias sold in the U.S. and half the market worldwide. His annual harvest is bigger than ever. But with retail prices about the same as they were 20 years ago, profits have never been slimmer. On Black Friday, a poinsettia could be had at some stores for 99 cents.
“We’re arguing over half-pennies now,” said Ecke, who has an undergraduate degree in horticulture from Colorado State University and a master’s in business administration from Duke University. “What I want to be is a farmer. What I am is a businessman.”
Much of that business is deliberately conducted out of public view, in temperature-controlled greenhouses filled with experimental poinsettias that aren’t for sale.
These are not your grandmother’s poinsettias. The plants are pink, cream, orange, purple and multihued. Some grow fast, others slow. Some bloom early, others late. Some are short and wide, others tall and thin. Their leaves, or bracts, are variously smooth, velvety or wrinkled.
“This is a poinsettia genetically crossed with another plant,” Ecke said, pointing to a leggy plant that looks more like a small tree than a traditional poinsettia. “But I’m not going to tell you what it is. . . . People would pay a lot of money to know.”
He moved on to another R&D; project, a shock of fuchsia bright as neon.
“This is waaaaaaay out there.”
They’re all beautiful. And the vast majority of them will end up in the compost pile.
“The stiff competition out there has changed the playing field,” said Ruth Kobayashi, who oversees Ecke’s poinsettia breeding.
“People want variety. Each year, ‘it’s give me something new, new, new, new.’ ”
The search for the next big thing in poinsettias is a tedious, expensive process. And it’s fraught with risk. Fickle consumers flit from fad to fad. Poachers copy the genetic code contained in the pollen of the tiny flowers at the center of a plant’s bracts, hoping to skirt patents.
“There’s a lot of cheating going on,” Kobayashi said. “But to assay whether a plant is a clone of another is very expensive.” Legal challenges are rare.
The work to develop a new variety often begins in a laboratory where a roomful of beakers and petri dishes hold tissue cultures of mated test plants -- poinsettia in-vitro fertilization.
It can take five to eight years to refine a single trial plant’s gene pool and produce a new variety such as Ice Punch, Freedom Peppermint or Polar Bear. (“Retailers demand novelty poinsettias that add value and interest, and new Winter Blush™ delivers,” a sales brochure promises.)
Before they hit store shelves, graduates of this biology boot camp are sent to the “torture chamber,” which tests their ability to survive clumsy shippers, neglectful retailers and abusive owners. The plants are overwatered and left thirsty. Exposed to extreme heat and cold. Dropped from heights and driven around in rumbling trucks.
Like other Christmas traditions, the poinsettia has lost an intangible quality through years of overexposure. What was once a symbol of refinement is now an inexpensive commodity. Like a pumpkin at Thanksgiving, it is ubiquitous and easily disposed of when the Christmas tree is tossed out, even though cared-for poinsettias can survive into spring.
“People don’t treat poinsettias like they’re special anymore,” Kobayashi said. “But they are special. To bring that plant to the marketplace . . . took a lot of hard work. It’s a living thing! To essentially treat it like dirt -- that’s horrible. How would you like it if you were forced to stand by a hot fireplace 24/7?”
Ecke has been surrounded by poinsettias all his life, and he never tires of them. He can talk about the nuances of the flower business and “poinsettia politics” for hours. It’s been a rough year, with growers cutting purchases about 15%, he said.
“I know people’s 401(k)s are 201(k)s now. But if I can go buy a poinsettia for $10 or $20 and it makes me feel good at Christmas -- that’s worth it,” he said, playfully hugging a potted plant. “People need to buy more poinsettias. It’s not enough to put just one in the house. What’s that? They look better grouped together.”
He walked briskly through a greenhouse of select stock, stopping to stroke the bracts of one plant, moving on to admire another’s color.
“This is Christmas 2010,” he said of the indoor spread. “Christmas 2009, as they say in the movie business, is already in the can.”
He held up a Prestige, a durable variety developed to appeal to wholesalers hoping to reduce profit shrinkage from plants damaged in transit.
“Look at that stem,” Ecke said, giving it a good wiggle with his fingers. “Tough! Tough! That’s what it’s all about in this competitive, tough world.”