IT'S BEEN another challenging year, but many trends continued to demonstrate resilience in a sluggish economy.
Consumer enthusiasm for all things local continues to grow. Shoppers have developed a keener eye for bargains and a new definition for value that weighs in factors such as quality and potential waste. Good salesmanship is more important than ever when upselling a shopper or even just encouraging them to try something new.
Here in our annual Strategic Planner, Fresh Market takes a look at some of those opportunities that have continued to emerge around these trends. Many of them share a theme of deepening ties with each store's local community, whether that involves developing new partnerships with local suppliers, or finding new ways to present a store's staff as experts within the community.
Become a Fresh Food Storyteller
PEOPLE LOVE STORIES, even about products. Indeed, especially about products.
Whether it's a particular cheese, a cake baked in Italy or the corn grown 12 miles down the road, consumers want to know more.
“Storytelling is the essence of being a great merchant,” Neil Stern, senior partner, at McMillan Doolittle, a Chicago research and consulting firm, told SN. “Every product in every supermarket fresh department offers the opportunity to differentiate, and to compel the consumer to try it.”
Some products, more than others, lend themselves to a background tale.
“When we were planning the rollout of Murray's to 50 Kroger stores, Kroger's people were very interested in romancing the product,” said Robert Kaufelt, president, Murray's Cheese, New York.
Kroger Co.'s website includes a veritable cheese primer with interesting facts about various types of cheese, what to pair them with and how to serve them.
As Murray's opened stores within Kroger stores in Atlanta this year, opening events included featuring cheese makers themselves talking about their craft, and answering customers' questions.
“People love that,” said Shelley Balanko, vice president, ethnographic research, Hartman Group, Bellevue, Wash “They see people like themselves, people who care about what they're doing. It establishes trust.”
Even “local” can be a story.
“Retailers are in a good position to capitalize on a product's background, even just that it's local,” said Bob Goldin, executive vice president, Technomic, a Chicago-based research and consulting firm. “They have many opportunities to merchandise the product. More ways than a restaurant does.”
— Roseanne Harper
Continue Building Local Food Sales
LOCALLY GROWN and raised products continue to present a huge and growing opportunity for retailers, industry sources told SN.
Consumers deem local products safer, fresher, healthier and sustainable. And more than ever, they want to support their local communities.
That fact emerged strongly this fall in the Hartman Group's most recent sustainability study.
“In this economy, sustainability took on new meaning,” said Shelley Balanko, vice president of ethnographic research at Bellevue, Wash.-based Hartman Group. “Respondents said they wanted to keep money in the community, and to support local businesses because they hire local people.”
Meanwhile, the National Restaurant Association has named “local” as one of the top three trends for restaurant menus in 2011, and retailers see that as significant.
“The trend will continue to trickle down to supermarkets,” Jack Gridley, meat/seafood director at upscale Dorothy Lane Market, Dayton, Ohio, told SN. “Actually, we've been at the forefront here. It's trickled down from us to restaurants. I just saw our own local poultry supplier named six times on a restaurant menu here in town.”
Gridley said he's constantly looking for more local suppliers, and he estimates the amount of food DLM can claim as local has increased by a third since this time last year.
The trend began with locally grown produce, but retailers have expanded their efforts to meat, poultry, seafood and other categories.
“We've just contracted with a bluegill farm in the northeastern part of the state,” Gridley said.
Even bakery and deli are on it. Kings Super Markets, Parsippany, N.J., is sourcing branded breads and cakes from nearby New York City, products already dear to the hearts of its customers.
“These are products my customers are familiar with from when they lived in the city,” said Ken Downey, Kings' director of bakery sales and merchandising.
Local deli meat is the most recent local category at Dorothy Lane.
“It's made from our locally grown turkeys,” Gridley said.
A while back, he contracted with a local turkey grower to raise natural turkeys for the company, and now, that same grower is producing six different turkey deli meats for Dorothy Lane.
— Roseanne Harper
Work Closely With Small Growers on Safety
AFTER NUMEROUS setbacks, the U.S. Senate finally passed the Food Safety Modernization Act late last month. It remains to be seen how the bill will be reconciled with its companion legislation in the House, but it seems likely that the law will offer many exemptions for small growers and other small businesses that supply food to retailers.
Various amendments in the Senate bill exempted small farmers from most traceability and record-keeping requirements and gave small farms the option of working with local and state agencies, instead of complying with a new federal program.
Exemptions for small farmers could create more of a regulatory patchwork, which industry organizations such as the Produce Marketing Association and the United Fresh Produce Association had wished to avoid.
New regulations and increased FDA inspections will never eliminate foodborne illnesses, but everyone has been hoping that the new laws will help curb the number, size and duration of future outbreaks. Small farms may not have the scale needed to cause a major outbreak, but that certainly doesn't mean that these farms don't need to have modern safety protocols in place.
The local food trend is still booming, and retailers should continue to respond to shopper demand for local produce. But as the trend continues to grow, buyers should be vigilant regarding the conditions at their partners' farms and facilities.
— Matthew Enis
Increase Direct Community Outreach
MOST SUPERMARKETS host occasional in-store events, and many donate to charities and causes in their communities. But retailers are also finding new ways to reach their customers in venues outside the store.
For example, in September, Food City's Louisa, Ky., location entered a float in its county's annual SeptemberFest parade. Produce department manager Lequitte Perry and head cashier Cheryl Gowan walked the parade route handing out apples to kids.
At Chandler, Ariz.-based Bashas', registered dietitian Barbara Ruhs finds opportunities to talk to potential customers, regularly making appearances at events like book signings and regional conventions focused on parents and kids.
Last week, SN reported on a partnership that nutritionist Meghan Locantora has developed between ShopRite of Medford, N.J., and the community's local libraries. Kids and parents that attend story time sessions are treated to “Snack Attacks!” featuring easy-to-make, healthy snacks from ShopRite.
Since these types of events happen outside the store, the impact on sales may be difficult to quantify. But, the key concept is “local.” Whether it's a major chain or a one-store independent, the size of the parent company may not matter as much when it's store-level staff reaching out and meeting people from their own community. In many cases, all that's needed is to give the right staff members some autonomy.
— Matthew Enis
Continue to Offer Simple Meal Ideas
THE ECONOMY may be slowly improving, but for many shoppers, bargain-hunting habits born of necessity during the past three years have become ingrained. For many others, finding deals that help stretch tight household budgets continues to be imperative.
“This recession has created an incredible value shopper. They're looking for quality and lower price,” Dennis Krause, industry leader of food, beverage and agribusiness for GE Capital, told SN in a recent interview.
But, no matter how many coupons they clip or specials they stock up, these customers are still looking for ideas that they can use in their home kitchens.
Research by Margaret Condrasky, an associate professor at Clemson University's Department of Food Science and Human Nutrition, indicated that many shoppers in produce and other fresh-food departments lack confidence in their cooking skills, are often reluctant to purchase unfamiliar foods because they don't know how they will taste, and are concerned that they will waste foods like fresh produce if they don't know what to do with leftovers that aren't immediately used in a recipe.
Many participants in her “What's Cooking” in-store project “really weren't certain how to utilize kale or fresh carrots or canned beans,” Condrasky said. “I think the idea of not being sure what it would taste like, or not feeling secure in their cooking skills was a barrier for some people.”
Recipe demos or even cooking classes are commonplace at high-end food retailers. But, Condrasky's findings indicate that live sampling demos could present an opportunity regardless of the demographics a store serves.
Retailers concerned that their customers are too often zeroing in on specials and coupons, keeping departments in a bargain-focused holding pattern, could try tempting shoppers with recipes that bundle higher margin items with products that are on sale.
The key, however, is giving customers an opportunity to taste the finished recipe, and giving them the confidence that they can replicate it at home.
And, offering secondary recipe ideas that utilize some of the same ingredients is a good way to address shopper concerns about waste. Showing shoppers “what to do with what's left” turned out to be a key part of Condrasky's project, she said.
— Matthew Enis
