Dive Brief:
- Fresh foods made up nearly a third of supermarket purchases in 2017, and sales from the perimeter of the grocery store outpaced growth in other food and beverage departments over the past few years, New Hope Network reports.
- Analysts from market research firm IRI and the Food Marketing Institute said transparency is important to those shopping in fresh food departments. More than 30% said claims that food items are free of antibiotics, do not contain growth hormones and are pesticide- and fertilizer-free are important when making a purchase.
- IRI’s research shows consumers are turning to retailers to educate them about their food, and so grocers should highlight the integrity of fresh items, focusing on the social and cultural values important to today’s millennial consumers.
Dive Insight:
Consumers are willing to pay more for fresh foods that are sustainable, organic and healthful, but they want information about what they're buying before they pull out their wallets, according to the IRI report.
Sales of no-antibiotics-ever meat grew 45% from 2016 and 2017, and antibiotic-free meat made up 10% of meat sales last year. Consumers also bought more deli meat and chicken with no antibiotics. That’s despite the fact the average price of a food basket with meat rings in at $76, whereas one that includes organic or antibiotic-free meat sets the buyer back $105. Consumers want fresh meat, fruits and veggies, and — at least as long as the economy remains strong — cost is not an inhibitor.
What’s more, according to the Organic Trade Association, 52% of organic consumers are millennials, and they eat 52% more vegetables than previous generations. This is a growing trend that food companies cannot afford to ignore. As Food Dive has reported, younger consumers like to experiment with foods and beverages, regardless of brands, and if a product is fresher, healthier, more "ethical" or convenient, they may switch. They also favor sustainability and “clean” foods, so retailers who use in-store marketing to highlight those qualities in food items are likely to make stronger sales. It’s one thing to offer organic, cruelty free foods as consumers push carts around outer aisles, it’s another to promote these foods prominently in stores rather than relegate them to a corner of the fresh food or meat departments.
Labels and packaging should alert consumers to the makeup or "stories" of these products, and smart retailers would do well to provide information about where fresh food products came from that is easily accessible to consumers. That’s true even as shoppers go online to buy groceries. A report from Field Agent found that produce is a popular category for online grocery shoppers in both planned and unplanned purchases. Sixty-five percent of the consumers surveyed said they bought fresh produce, making it the top choice along with chilled dairy products, and another 31% said they made unplanned purchases of fresh foods.
Grocery stores that make strategic moves selling relatively higher-priced clean foods and then market them smartly are the ones most likely to reach today’s shoppers.
