To maximize sales of fresh categories, a CPG-style of targeting consumers begins to take hold.
Lady Gaga wouldn’t don an overcoat before strutting on stage. That would conceal part of the showy spectacle that fans adore.
It’s the same with fresh foods. Why cover up the natural appeals of meat, produce and deli in packages? The answer lies partly in the need to target consumers.
F3 sees why Nielsen Perishables Group president Bruce Axtman says, “Suppliers and retailers are slowly but surely transitioning to the CPG style of category management, based on the knowledge of both consumer and performance data to better understand how various consumer groups purchase fresh foods differently, at which stores, and at what price points.”
But when he notes, “Fresh as a commodity market is changing and can no longer just rely on strategies determined by supply and commodity prices,” this suggests a move underway from supermarkets’ edge as fresh merchants towards the efficiency of big-box formats of supercenters and wholesale clubs.
Will the art of merchandising fresh take a back seat to data insights? Will fresh lose some of its emotional appeal? How accurate is this data mining anyway? These are some questions F3 ponders with the issuance of Nielsen’s report, Why Retailers Are Keeping It Fresh.
In it, the latest Nielsen Global Survey on Fresh Food forecasts that U.S. supermarkets’ command of fresh food sales will soon start to diminish. Their share loss won’t be great at first—a decline of two points from 66% in 2012 to 64% by 2016, while wholesale clubs escalate from 10% in 2012 to 12% in 2016, and supercenters rise from 14% in 2012 to 15% by 2016.
There’s much at stake for supermarkets—the perimeter fresh foods differentiate stores and are their most healthful, colorful attractions. Fresh generates trips and drives significant spend. Here are some specifics from the report:
The report urges retailers to link fresh foods with complementary products from other departments, to spark ideas for meals and entertaining through recipes, and to offer ample selections of pre-cut, washed and packaged vegetables and salads.