It’s What’s In Store That Counts

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

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 unwieldy 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.