Quick Stats

Quick Stats

    You are here

    FMI’s ‘Power of Produce’ Peels Into Mega Trends

    Department wields clout as supermarket stronghold

    By Meg Major, EnsembleIQ

    Despite an ever-growing variety of food shopping outlets, supermarkets remain a “powerhouse in fresh,” especially fresh produce, which resides as a “supermarket stronghold” among 68 percent of shoppers, according to Anne-Marie Roerink, who unpacked findings of the Food Marketing Institute's second annual Power of Produce report at this week’s FMI Connect in Chicago. Supercenters (16 percent) are the second most popular outlet for fresh produce purchases, followed next by warehouse clubs (5 percent).

    Highlights of this year’s produce shopper study – sponsored by Yerecic Label and supplemented with POS data from IRI and Nielsen Perishables Group –  found that nearly one-quarter of shoppers switch outlets when purchasing fresh produce versus the bulk of groceries, primarily to full-service supermarkets, farmers’ markets/produce stands and specialty organic stores.

    Roerink, principal of 210 Analytics, which prepared the “mega trends” produce study, warned that younger generations are drawn to alternative channels, which she deemed “a red flag for traditional retailers, as losing the produce basket may result in losing additional spending in center store.”

    Ringing up a whopping $61 billion in annual sales, fresh produce is in hot demand with no signs of a slow down. Powered by a 4 percent growth rate, the category is a lucrative and influential element for grocery baskets, which average nearly $30 more with fresh produce than one without. 

    “The nation’s food retailers fully understand the clout of the perimeter, and when it comes to their fresh strategies…produce certainly wields influence,” affirmed FMI VP of Fresh Foods Rick Stein.

    Ripe for Growth

    As a mature category, “driving growth in fresh produce requires innovation,” explained Roerink, noting that “variety is the top area of improvement,” followed next by better prices and promotions and enhanced in-store operations. 

    The most potentially promising tactics to spur growth, according to Roerink, pertains to more dedicated customer service/outreach, greater staff accessibility and more knowledgeable produce department staff.

    Interestingly, that same sentiment was further reinforced in a later session by Chef Mario Batali, one of the owners of dining-grocery hybrid Eataly, who suggested grocery retailers should consider adding “vegetable butchers” to encourage exploration, impart education and foster interaction between store associates and produce shoppers.

    While shoppers most often base purchase decisions on price, execution will seal the deal, Roerink said.

    Beyond price, the most successful incremental produce purchase drivers, per the Power of Produce study, include:

    • Eye-catching displays, which are extremely influential
    • Produce cross-merchandised in other parts of the store
    • Impulse through ideation, including recipes, serving ideas and sampling
    • Education/information, especially nutrition call-outs that are relevant to the audience 

    Notably, consumers are placing increased value on transparency – how and where the crop was grown – as evidenced by how support for the local farmers/economy overtook perceived freshness as the top reason for buying locally-grown. This sentiment also applies double-digit sales gains for organic fresh produce and an expressed need for “free-from” products. Still, organic remains a niche segment to date, according to the Power of Produce consumer research study, reflecting 8 percent of total produce sales, with usage skewing to the more affluent shoppers and families with children.

    By Meg Major, EnsembleIQ
    • About Meg Major Veteran supermarket industry journalist Meg Major brings a wealth of experience to her role as Chief Content Editor of Progressive Grocer. In addition to her editorial duties, Major also spearheads the retail food industry’s premier women’s leadership recognition platform, Top Women in Grocery. Follow her on Twitter at @Meg_Major, connect with her on LinkedIn at www.linkedin.com/in/megmajor, or email her at [email protected]

    Related Content

    Related Content