December, 2015

Research Perspective and Comments & Analysis

The Power of Produce Part 1: Before They Shop

By Rick Stein, Vice President Of Fresh Foods, Food Marketing Institute


Food retailers spend tireless hours and millions of dollars on selecting the right items, at the right prices, for weekly circulars, Facebook promotions and flash sales. For most, produce is front-and-center of these promotions. Why? Along with meat, produce is one of the most researched categories in preparation for food shopping — and importantly, a key driver of store loyalty among primary shoppers — as well as a prime way to attract shoppers of other channels and banners. Get produce right, and a store’s success is largely guaranteed.

While in-store execution is the ultimate step in “getting produce right,” the process starts long before shoppers enter the store. Eight in 10 shoppers typically create a list before heading to the store. This list may be on the back of an old envelope or compiled by using the store’s app on a smartphone, but for more than 90 percent of these shoppers, produce is a standard shopping list item. Simply put, seven in 10 shoppers walk into your store with a list containing produce.

Of those lists where produce is specified, 59 percent of the lists contain exact produce items (such as apples or broccoli), whereas roughly 34 percent of shoppers list the need for fruit and/or vegetables generically.

This leaves us with 20 percent of shoppers who don’t make lists and purely make produce-purchase decisions in-store. This scenario underscores the importance of clear communication of promotions and prices — since missing price information is one of the top shopper pet peeves in the produce department.

For many decades, the paper circular has been the top source for shoppers to browse sales promotions. This remains unchanged today, although shoppers now often alternate using the paper circular with other ad vehicles. More than seven in 10 shoppers review the paper circular at home — especially those shoppers who list exact items. Another 42 percent pick up a copy in-store.

These numbers are likely to change rapidly during the next few years as retailers shift ad dollar allocation, and more shoppers, especially Millennials, integrate mobile and online research to create their lists and add online grocery ordering to their shopping routines. Apps, in particular, are rising stars for pre-trip planning.

Connecting with shoppers pre-trip can help build the basket or even lead to increased spending for items across the store. Inspiration may include: recipe ideas, ideation for juicing or snacking, a Sunday picnic, and other ways to use produce beyond the traditional meal occasions. Parents, in particular, welcome any such ideas in their efforts to ensure their children eat sufficient fruit and vegetables.

Shoppers not only review a variety of ad vehicles for produce promotions, they also compare promotions across different stores. No less than six in 10 compare prices frequently or even every time they shop for produce. Especially in areas such as the Northeast, with a ubiquity of conventional supermarkets, shoppers are in the habit of comparing produce promotions across stores. This means in a world with an increasingly scattered grocery landscape, no store is guaranteed the produce purchase, and ad planning along with in-store execution have to be right week after week.

In addition to a trip driver and well-researched category, produce generates its fair share of impulse sales too. Nearly six in 10 shoppers say they almost always (23 percent) or frequently (34 percent) purchase additional, unplanned produce items when in the store. Shoppers most susceptible to impulse produce purchases are Millennials (64 percent). Others likely to make unplanned produce purchase include shoppers with kids and higher-income households. On the other hand, shoppers aged 65-plus are twice as likely compared with Millennials to stick to their shopping lists.

Being both a planned category and having opportunity to drive impulse sales is quite unique. Through visibility, appealing displays and cross-merchandising, produce will not only be a great driver of traffic and sales, but also a great way to grow the basket.

Source: The Power of Produce 2015 — Shopper research by the Food Marketing Institute, made possible by Yerecic Label and implemented by 210 Analytics.


Food Marketing Institute is a trade association that advocates on behalf of the food retail industry. FMI’s U.S. members operate nearly 40,000 retail food stores and 25,000 pharmacies. Through programs in public affairs, food safety, research, education and industry relations, FMI offers resources and provides valuable benefits to more than 1,225 food retail and wholesale member companies in the United States and around the world.



It’s What’s In Store That Counts

This study gets to the core of what makes produce such an absolutely vital category for the supermarket. Produce is simultaneously a “must-have,” “pre-planned” staple and an exciting “impulse opportunity” for new trial and indulgence.

Although it is not surprising to learn that senior citizens are more inclined to stick to their shopping lists than Millennials — one presumes that over the course of a lifetime, the older shoppers know they like broccoli — even this is overstated. If the industry provides new and innovative products, say pomegranate arils, so senior citizens don’t have to use a knife on an unwieldly pomegranate, senior citizens will change their purchase patterns as well.

One factor PRODUCE BUSINESS research has identified is an increasing willingness on the part of consumers to switch their shopping habits to include multiple venues. Some of this is due to the growth of private label that truly offers distinctive products. So this columnist’s wife may go to Trader Joe’s specifically, because they offer meatballs that our children love.

One wonders if the future for produce could not take a similar path. Much has been written regarding proprietary produce; companies such as Driscoll’s and Sun World built important businesses around these concepts. But these proprietary efforts are typically marketing-restricted only on the business-to-business end — only Driscoll’s can sell Driscoll’s; only licensed Sun World marketers can sell its varieties.

Generally though, with the possible exception of low-volume-launch years where a retailer may get exclusivity, any retailer can sell these, and many do. Yet, perhaps this is leaving value on the table. If consumers are willing to go to Trader Joe’s because they think the flavor of its meatballs or puttanesca sauce for pasta are superior, why wouldn’t they go to Kroger or Costco or Walmart to get a proprietary variety of grapes or apples that they prefer?

The challenges are obvious. The meatball factory produces 100 percent perfect meatballs, or it reprocesses the imperfect ones that are returned. The Good Lord causes produce to grow in various grades and sizes. Still, one could imagine Costco having exclusive retail rights to a variety — indeed, Costco could own the variety — and for those sizes and grades Costco doesn’t want, the grower could sell for foodservice and processing and export.

Another key variable increasing the importance of produce is the growth of Internet shopping. In the U.K., especially in London, one sees a pattern developing where large-size stores are being devalued, because consumers increasingly buy their staples — including plenty of produce — online. They are especially buying heavy and bulky non-perishable items (such as water or paper towels) online.

But, they are not shopping less. They are actually going into smaller, more local stores on a frequent basis. This leads the focus to being on retail/foodservice, bakery and departments such as produce.

One can see a world where the shopping list as we know it ceases to exist because a list is all taken care of in one’s pre-established online-shopping order. This preemptive step frees the consumer to walk into local stores with minimal requirements. Typically just replenishment of a few perishables or dinner for tonight. The consumer’s expectation is for the store to entice and to delight them.

These transformations may also mean that stores are merchandised incorrectly. Space allocations, typically based on historical sales, may under-index for the new responsibility of enticing and delighting. If attracting consumers to a store requires an interesting produce department, then giving new, innovative and propriety lines a small row won’t have the impact required.

Perhaps produce retailers need to think more like car dealerships where the focal point is always the red sports car convertible — even though the bulk of the business is blue sedans. Perhaps that tasty new beet or innovative new blend needs front-of-the-department, larger, showcase space, because stores need to brand their department as interesting, fun and always offering something special.

We would urge a different perspective when noting that many consumers do not deviate from their lists. Yes, certainly, one solid approach is reaching out with ideas and information before the consumer gets to the store, but we would also say that enhancing the produce shopping experience is really a prime industry responsibility.

Everyone will buy on impulse if what they are offered is an extraordinary opportunity. All too often, the only incentive retailers offer is a lower price. That matters, but most people do not spend a large percentage of their family expenditures on fresh produce, so it is an ineffective way to boost long-term demand.

We have to give consumers interesting products to buy — produce that is delicious, is convenient and that makes life better. Then, whether they put it on a list or buy on impulse, it is all but certain they will buy. pb