INDUSTRY VIEWPOINT: Turn your produce department into a customer magnet
- by Jason Stemm | October 26, 2008
As the prices of food and fuel continue to rise -- and salaries lag -- Americans are feeling the pinch. They're tightening their belts, looking for bargains and spending less, even on the essentials. According to a recent "IRI Times & Trends Special Report," about half of American consumers with annual incomes under $55,000 are now having difficulty buying the groceries they need.
So what incentives can you offer to attract penny-pinching customers and get them to open their wallets?
The most obvious strategy is to lower costs. In Southern California this summer, Ralphs, Fresh & Easy and Wal-Mart were all promoting steep markdowns. Last month, Whole Foods launched its Value Tour campaign, which involves leading groups of bargain-hunters through the store and pointing out the bargains.
But is price-cutting the only -- or even the best -- strategy?
Not according to your customers.
While it's true that of all the variables influencing the choice of a supermarket, price was number one according to 23 percent of consumers; quality of the produce department was a close second, cited by 19 percent of respondents.
In fact, produce is such a key driver in supermarket choice that nearly six out of 10 U.S. consumers (57 percent) said that they have changed supermarkets for better fruits and vegetables, according to an Opinion Dynamics survey conducted on behalf of the Produce Marketing Association.
So how can you exploit the full potential of your produce department as a key to customer attraction and retention? Try these eight simple steps:
* Make it homey. Bridge the gap between store and home kitchen by designing an open space whose decor features soft lighting and hardwood flooring. Exploit the intrinsic color and beauty of fresh produce with eye- appealing displays. Showcase employees preparing the day's ready-to-eat food offerings at stations that provide everything the shopper needs to create the entire meal at home.
* Give them what they want. That includes convenience and choice, such as potatoes packaged and by the piece; mushrooms whole and sliced; and garlic fresh and jarred. Consumers also want information. Put stickers on avocados to identify when they are ripe. Describe each variety of apple -- is it sweet or tart? better for eating or cooking? Finally, never forget to give the customer the produce department's recommendation as to what's particularly interesting or delicious that day.
* Connect the dots. Look for better and easier ways for your customers to shop. Instead of forcing them to walk down aisles to find what they need to complete a dish, group foods together in specific categories as a convenience. For example, display avocados with tomatoes, onions, chili peppers, corn chips and beer. Or offer pre-washed salad greens with nuts, prepared chicken tenders, salad dressing and croutons. Advanced refrigeration systems allow for unique pairings of shelf-stable and perishable items.
* Consider the kids. Getting children to eat more fruits and vegetables is a win-win for everyone. You can help encourage sales and support the health of the next generation by featuring tempting displays of kid-size fruit and packaged veggie snacks for school lunches on lower shelves and displays at their eye-level. You may also want to experiment with child-friendly informational materials and cooking demos.
* Make the health connection. Healthful products can be healthy sellers. When asked which factor, other than taste, would make them more likely to purchase a fruit or vegetable they'd never bought before, 36 percent of consumers said "nutritional value." Highlight the nutritional value of your produce in ads and department signs. Simplify it for customers by awarding stars to the most nutrient-dense. A similar program at Hannaford Supermarkets boosted sales of starred products anywhere from 150 percent to 500 percent over the items' unstarred counterparts.
* Join the local food movement. Locavores believe that the best-tasting and most eco-friendly foods fresh, seasonal and grown close to home. Consider tapping into this trend by cultivating relationships with local farmers and highlighting local produce with prominent labeling or a special section. You might even consider hosting a greenmarket in your parking lot. You will draw new shoppers to the store who will need items beyond what the greenmarket offers.
* Educate and empower your staff. Nearly two-thirds of consumers said that a produce clerk's recommendation influences them to purchase a new item; yet almost half of shoppers said that that they have no contact at all with produce department staff. A few minutes of training each week on new and special items will empower friendly, helpful, well-informed supermarket staff that add to your bottom line.
* Sample like crazy. Handing out free product is an especially good idea during tough economic times. Research has shown that 80 percent of consumers would prefer a free sample to a coupon. What's more, one-third of them would be willing to come back and pay for something they had tasted and liked.
Retailers often look to their competition to establish standards for themselves. If you do, you're handicapping yourself. Break out of the box and look to your customers to create the strategies that will ensure your supermarket's success. Don't sacrifice your margins to attract customers. Leave the loss-leading price cuts to other departments, and turn your focus to improving the quality of your produce and the customers' experience.
(Jason Stemm is an account group supervisor at New York City-based Lewis & Neale Inc., a full-service marketing communications firm that is totally focused on food. A consultant to food commodity boards, consumer product companies, foodservice companies and retailers, he has also worked for Kroger Co. in both the produce and grocery departments.)