The Power of Produce: Lessons from 2020
It’s no secret that the pandemic has fueled massive growth in the fresh produce category, led in large part to more at-home meal preparation among consumers. This in turn has helped the industry post record retail numbers close to $70 billion in sales over the past year. This was an increase of 11.4 percent, of which vegetables at 14.7 percent outpaced fruit at 8.6 percent.
“Over the last year, the first thing I learned is to say, ‘I don’t know a lot,’” Mike Roberts, director of produce operations for Harps Food Stores, said at the Power of Produce educational session during the Southeast Produce Council's Southern Exposure. “I’ve always prided myself on knowing what’s going on and how to react, so I had to humble myself. We learned early on to have a backup plan.”
Communication and cross training were cited as playing an important role in being nimble in the produce department. According to Gary Baker, senior director of fresh for Merchants Distributors, “the number one factor has been communication between all the parties. Early on people were pretty much panicking, and learning how to adjust, maybe how to move product with different pack sizes than we’re used to was a part of our success.”
Over the past year the fresh produce category has lost ground to frozen and self stable produce, and 62 percent of those currently buying frozen produce say they are likely to continue. This means that now more than ever marketers must find ways to increase the value of fresh.
“Recipes with fresh fruit and vegetables as the ingredients are a good example,” said Price Mabry, director of produce and floral for Homeland Stores. “Take meat, if you’re selling, say ground beef you’ll often see a hamburger — with all the elements that go along with that — in the ad, so how do we find opportunities like that in produce? Providing recipes and inspiring food preparation is a great way to increase sales.”
Baker believes consumers will still want to pursue at-home preparation post pandemic and sees it it as an opportunity for fresh produce. “Fifty percent of all eating occasions fall into the category of snacking, so anything that can be a small, consumable snack size, like grab and go should help the category,” he said.
As Roberts put it, “Produce is the one dept in the store where you can buy with all your senses. With having those advantages over the center of the store, we need to get back to what we were doing before the pandemic, with presentation, sampling, building up displays.”
During the pandemic, Harps went five months without a circular. “When we got back into writing ads, we presented fewer items in the ad, and have been doing more with BOGO sales, we do think people will be looking for ways to save money,” said Roberts, who noted that was a trend they were looking to continue.
“We use special signage to draw attention to the health benefits of items,” Roberts continued. “Packaging can be a great way to tell a story and express this message to the consumer. Produce for Kids has been a great partner for us on this sort of thing.” A sentiment which was echoed by his fellow panelists.
A hot topic of discussion was the explosive growth of online produce sales, and how to leverage ecommerce platforms to drive sales in the category. “For us,” said Mabry, “we had about 20 percent of online sales being produce and during the pandemic it peaked at 50 percent of online sales, and its since leveled off at about 30 percent. Potatoes, onions, and lettuce are really the drivers.”
Baker and Roberts noted similar numbers of online produce sales. “A lot of people learned to trust ecommerce over the last year,” said Baker. “They trust the process more than they did before, and it changes the way we interact with them.”
“Ecommerce sales can be tricky for everyone in produce, because you can lose the impulse purchase,” explained Roberts. “I think we can learn from other industries and how they tackle ecommere and I think we can grow from that. We need to attack it online like we do a produce department, and recreate that experience and seasonal excitement.”
As moderator Anne-Marie Roerink, of 210 Analytics said, “Points of interruption, cross-merchandising, being creative and having fun are so important, as well as giving shoppers tips on new flavors, or inspiring them to cook with a new fruit or vegetable. In produce, variety is our superpower!”
Photo: Mike Roberts, director of produce operations for Harps Food Stores, Gary Baker, senior director of fresh for Merchants Distributors, and Price Mabry, director of produce and floral for Homeland Stores.