Produce Variability Makes It Harder For Solution Selling

By Jim Prevor, Editor-in-Chief, Produce Business

One is always wise to pay attention to Bill Bishop, and so when he gives the clarion call that produce marketers should pay attention to “shopper marketing,” one should start taking notes.

Shopper marketing has varying definitions but, in essence, the idea is to look at how one’s target customers behave in their role as shoppers and then try to leverage these insights into increased sales. Initially, the efforts focused mostly on the in-store experience, but increasingly, the focus has shifted to efforts outside the retail environment.

Think about how specific consumers decide to add something to their shopping list and how they decide to deviate from that list, and then think about what understanding these processes could do in terms of offering opportunities to change those consumers’ purchasing behaviors. One then starts to gain insight into “shopper marketing,” and one understands why a company such as Proctor & Gamble spends upward of half a billion dollars annually on these efforts.

The challenge in produce is the difficulty in getting accurate data on consumer behavior, combined with a paucity of marketing budgets to implement whatever insights can be derived. Even the relevance of the data we do have is often suspect because quality, condition, and availability of product — both the one we are studying and competitive products — are ever-changing variables in produce. So what will work just fine under dataset one will be a total failure under dataset two, collected one week later. Consumer packaged goods companies don’t generally work under the same highly variable conditions.

Of course, the idea of solution marketing, basically selling not a product but a solution to consumers’ problems is very powerful. The example Bill Bishop gives is a case in point: One philosophy is to offer a whole bunch of products in different parts of the store and make the consumers solve their own problems.

This attitude, pretty much the universal way product is merchandised and marketed in supermarkets, poses a couple of challenges. First, it means that shopping is going to be hard work. Consumers have to be organized and search out products all to solve their problems — in the example Bill gives, what shall I buy to have healthy snacks around the house? Second, it is bound to reduce sales either because consumers don’t realize all their needs or they don’t find all the options that might help them in identifying a solution to their problems.

So it is not surprising that offering “Perfect Pairings” would be a hit with many consumers. It solves their problem, simplifies their lives and expands their horizons all at once. In a sense, it is a “no-brainer.”

Yet the fact that these types of efforts happen so rarely that they are the exception — worthy of a Bill Bishop study — rather than the rule, points to major obstacles in implementing these types of solutions.

Part of the challenge is the way retailers are structured. When a produce department gives shelf space to yogurt, that ring typically still goes to dairy. So the companion produce product has to increase in sales sufficiently to cover the total loss of a produce ring on the shelf space given to the yogurt for the enterprise to be profitable for produce. In other words, if the promotion is berries and yogurt, and the consequence is that the apples got scaled back to make room for the yogurt, the berries alone have to increase in sales sufficiently to cover the reduced sales of apples. The yogurt sales, no matter how large, don’t count because that ring goes to a different department.

Produce vendors often fail to even propose these types of solutions. They are into selling their “stuff,” and neither have good insight into what consumers might really want nor do they have the time or skills to put together deals with other companies in different fields for jointly merchandised solutions.

Of course, some produce companies, particularly in the value-added area, have honed right in. Sometimes the solution selling is inherent in the product — say party vegetable trays. Sometimes they segregate a market — say mini carrots sold with ranch dressing or peanut butter in a snack pack. Sometimes it is the packaging that provides the solution, as in cup-holder-sized-and-shaped snacking packages.

Gaining insight and developing products is key, of course, but retailers know which consumers they are targeting, so the most successful shopper marketing efforts depend crucially on collaboration between a retailer and a vendor.  More of that is much to be desired and would probably boost sales all by itself.