January, 2007

Research Perspective and Comments & Analysis

New Year’s Food For Thought

The Produce Marketing Association (PMA) regularly commissions consumer studies to help identify factors driving fresh produce demand.

Produce has purchase power. In March, 72 percent of consumers responding told us they shop for fruits and vegetables where they do most of their grocery shopping, 47 percent will change stores for better fruits and vegetables, and nearly 20 percent travel to a different store to get better freshness, quality or prices.

On several occasions, consumers told us produce has become increasingly important, whether eating at home or out. In July, 14 percent of households reported at least one “flexitarian,” who eats a mostly vegetarian diet, 33 percent of those households reported the level of flexitarian eating has increased in the past few years, and 29 percent of households with a vegetarian reported this preference has increased.

Forty-three percent of respondents in May told us produce offerings (excluding French fries) were “very much” a factor in their restaurant choice, and 45 percent said so about their entrée choice. Almost 30 percent told us they looked for and/or purchased a produce item after first trying it in a restaurant. As I’ve said before, produce marketers and retailers need to pay close attention to what is happening at American restaurants.

In those restaurants, produce is also taking on a greater share of the plate and is sometimes moving increasingly to the center of the plate. In May, consumers told us that when dining out, they are purchasing more entrée salads (44 percent), side salads (56 percent), fresh-cut fruit salads (42 percent) and vegetarian entrées (26 percent).

Meet the royal food court: taste, convenience, nutrition, quality, selection and price. Taste was very important to 81 percent of respondents in our May survey; nutrition was so ranked by 62 percent. Consumers responding to our September survey regarding take-home meals cited as most important: taste, quality, consistency, convenience, service, price and selection, in that order.

Parents ranked health and nutrition, quality, variety and convenience as top motivators in purchasing more fruits and vegetables for their children in a January survey. Twenty-four percent of respondents in our March survey told us they would buy more produce if retail pricing was better, 15 percent if fresher and better quality, and 8 percent if better variety and selection.

In May, 86 percent of consumers reported they had purchased fresh-cut produce in the past year, 41 percent reported their purchases had increased, and 34 percent planned to increase purchases in the year ahead. Since the body blow to the category from the September outbreak of E. coli traced to spinach, sales have taken a hit, with products containing spinach feeling the most pain. I wrote about this last month and we’ll be tracking consumer attitudes and reporting on those results in the months ahead.

How consumers feel about produce safety is impacted easily. We commissioned consumer surveys on food safety in February and May, before and after an NBC Dateline segment on fresh-cut food safety. While the broadcast did not increase the share of consumers expressing concerns about food safety, it appeared to elevate levels among those already concerned. For those who already harbor concerns, this type of news ratchets up the level. Most consumers rated the safety of bagged salad highly pre- and post-segment.

The spinach outbreak had extensive media coverage and generated great concern. That’s been followed more recently by the E. coli outbreak at Taco Bell, which was initially attributed (wrongly) to green onions by the company and then (without final definitive evidence) to lettuce by CDC and FDA, as well as some state health departments.

We’re continuing to track consumer confidence and hope to see an upswing with the positive steps being taken by the industry to prevent additional outbreaks and regain consumer and regulatory authority confidence. I expect to see considerable media coverage as government hearings proliferate. Produce will be front-and-center stage.

So, what about some goals and resolutions for the year ahead? These research findings offer several possibilities.

No other food group offers the flavor, eye and nutritional appeal of produce, and at bargain per-serving prices. Increased sales profits will go to those suppliers, retailers and foodservice operators who capitalize on the importance consumers place on produce. We have the opportunity to grow consumption of important existing customers. Our surveys indicate even vegetarians’ and flexitarians’ produce repertoire is limited, a reality that likely applies to most produce consumers, too.

We have an opportunity to capitalize on our consumers’ demands for flexibility of form, function and venue, whether they seek the convenience of fresh-cut produce and take-home meals over whole produce, enjoy year-round variety or prefer to buy seasonally and locally. Consumers tell us we can also increase sales by offering a broader selection of tastier, higher-quality produce.

We must redouble our efforts to improve the information flow about our products themselves (aimed at consumers) and the standardized, descriptive data we can share electronically (within the supply chain). It’s time to tell our story more effectively to the public while also improving the efficiency of the data we could be transmitting so we improve quality, analyze better and enhance traceability. The last of these is no small measure in this era of food-safety concerns.

Consumers have given us much food for thought this year. As we continue to listen and learn from them in the year ahead, PMA looks forward to sharing our insights.

It’s Just An Appetizer

We are very fortunate to be part of an industry that has an association, such as PMA, willing and able to support such important research. It is only by knowing what customers think and are concerned about that we can develop and effectively market products that consumers will value.

Yet, it is also frustrating — a review of the research also points out the limitations of consumer surveys. Respondents may lie, engage in wishful thinking or give the answer they think is “right.” And, when asked questions outside the realm of their experience, they may not even know what they really think.

Consumers aren’t the only ones inclined to wishful thinking. In interpreting research, it is tempting to pluck out supportive information and leave the rest for further research.

We have done an excellent job of spreading the word that fresh produce is good for you. So much so that we have “tainted” the jury pool. When we ask questions, people feel compelled to align themselves with the good — though their actions often speak otherwise.

Re-read this summary of the research on consumer attitudes toward produce in foodservice done in May:

“…produce is also taking on a greater share of the plate and is sometimes moving increasingly to the center of the plate. In May, consumers told us that when dining out they are purchasing more entrée salads (44 percent), side salads (56 percent), fresh-cut fruit salads (42 percent) and vegetarian entrées (26 percent).”

It sounds like fantastic news, but what is it telling us? My guess: It is an idealized version of what people believe they should be doing — not what people do but what the culture is telling people they ought to do.

Learning what consumers think they are supposed to say can be very valuable. But we have to understand that in consumer research, rather than automatically accepting what consumers say as an accurate description of their behavior, the more interesting question is, “Why do consumers tell us that?”

The May figures can’t be literally true. If such enormous percentages of people were really switching to entrée salads, adding side salads, buying fresh-cut fruit salads and giving up meat entirely to go vegetarian, we would see massive increases in consumption. The news reports would be filled as big foodservice distributors were struggling to build enough refrigerated capacity to keep up.

Unless, of course, it is literally true but the base is very small. If only 1 percent of the people bought fresh-cut fruit salads once a year but now that number is up 42 percent, then the results could be literally true but not matter that much for consumption.

So we need far more information to grasp the meaning and importance of this data. Often the questions answered lead to more questions. Think about this report from July:

“…33 percent of those households reported the level of flexitarian eating has increased in the last few years, and 29 percent of households with a vegetarian reported that this preference has increased.”

Flexitarian implies a mostly vegetarian diet but without a hard-and-fast rule against animal products. Many flexitarians eat fish or occasionally meat. But do people who eat less meat eat more fresh produce? We don’t know. Perhaps health concerns motivate them to eat less meat — and to eat less overall. Their diet may be more weighted toward fresh produce in percentage terms but in actual volume consumed, it might be less than a typical American omnivore. Or pasta and grain-based foods might fill the place of meat or they may disproportionately eat frozen or canned produce.

Another enormous issue that colors a great deal of the research done on produce is the fact that we don’t know how accurately consumers can identify “fresh” produce, especially at foodservice operations, and we don’t know how much they care if the product is fresh. By far the greatest competitor for fresh broccoli is frozen broccoli. How loyal consumers are to fresh and when and where they will use frozen or canned makes an enormous difference to the fresh produce industry. The research we’ve been able to do so far is just a starting point. A lot more work is required before we can understand what consumers are saying sufficiently to feel confident acting upon the knowledge.

Another issue is the difficulty of syncing the consumer and trade usage of a word. When we ask consumers about “take-home meals” or “fresh-cut,” do they understand these words as the trade does? Or are we, literally, speaking different languages? We have to be careful not to assume we are all on the same page but to research these actual points.

It is difficult to ascertain how consumers act in real life. When a consumer says “taste” is very important, does that reflect shopping behavior? Does it mean preference or avoidance of an item based on how it tasted last time? Does it mean consumers value sampling programs? Does it mean they want lessons on how to select ripe produce? And if both “taste” and “nutrition” are important, how do consumers weigh one against the other?

The more we know, the more questions we are able to ask. And that is the great benefit of the 2006 PMA research. It sets the stage to help us ask better questions about consumers, our products and our shopping venues.

In April 2006, Bryan’s research report was a first-person observation from China. He told us of how the Great Wall, under construction for 2,000 years, was intended to keep out the Mongols. It was a big task, but understanding the constantly changing consumer is a big task as well. We have many more years of research ahead of us.

Yet we begin 2007 in better shape than we entered 2006 because we’ve been researching all year, and, as Lao-Tzu reminded us: “The journey of a thousand miles begins with a single step.” We have begun.