New potato varieties, smaller packages and value-added offerings are attracting a new generation of consumers.
By Elizabeth Louise Hatt
At one time, the typical potato purchaser was a woman cooking for her family. Over the past several years, younger men and women living in one- or two-person households have joined her at the potato bin in search of the perfect spud.
To capture the attention of these new potato shoppers, retailers and growers are working together to offer creative promotions and provide shoppers with meal ideas, whether it is through cross-merchandising displays, in-store demonstrations or online contests. The russet potato isn’t the only one getting the attention; specialty potatoes, such as reds, yellows and fingerlings have found their way to the dinner plate.
This shift in demographic has changed the way potatoes are delivered. Experts say the 10-lb. bag is becoming a thing of the past while smaller packages and convenient value-added options that can be cooked in under ten minutes claim more shelf space.
“People are willing to pay a bit more for value-added products,” says Ted Kreis, marketing and communications director for East Grand Forks, Minn.-based Northern Plains Potato Growers Association. “Ten to 15 years ago it was more common to have a large family and prepare more meals at home but we’ve evolved as a society. Many households are only one or two people and those with kids are rarely more than three or four. Potato growers need to target convenience and offer smaller package sizes.”
Jim Richter, executive vice president of sales and marketing for Wilcox Fresh, attributes the quick growth in value-added potato products to two things: “Cooking at home is back in vogue and time pressures are still dominant,” he says. Officials for the Rexburg, Idaho-based company recognized this trend a few years back and introduced the Potato Jazz line of potatoes that come in microwaveable trays with seasoning and can be steamed in five minutes. The potatoes, which sell for $2.99 to $3.99, come in Fingerlings, Medley and Russet varieties.
“Value-added items have grown in popularity because the holy grail of our industry is meal replacement. It’s about getting restaurant quality at home—that’s what makes it fun,” says Richter.
Klondike Potatoes, a brand of Idaho Falls, Idaho-based Potandon Produce, has responded to the demand with a line of value-added potatoes packaged in microwaveable steam bags that come in four unique flavors. “The packaging gives it an exceptionally long shelf-life—25 days compared to seven or eight days that other options typically offer—and they only take four and a half minutes in the microwave,” says Ralph Schwartz, director of category management. “It is a tremendous improvement in the value-added category; there is minimal shrink for retailers.”
Fueled by television cooking shows and restaurant dishes, specialty potatoes are experiencing rapid strong growth. “People go into a restaurant, have a meal prepared with a new kind of potato and say, ‘This is good, lets try this at home,’” says Kevin Stanger, senior vice president of sales for Wada Farms in Idaho Falls, Idaho. “New food trends tend to start in the foodservice arena and as they grow and develop they cross over into the retail arena.”
Reds and yellows gained market share last year. Kreis believes people are looking to change it up. “They are much more versatile to prepare because the skins are tasty and easy to incorporate into dishes—most of the vitamins and minerals are in the skins,” he says. “They cost 75% to 100% more than russets but they are worth it.”
The NPPGA has been trying to educate consumers on the virtues of the red potato as a baking potato. “They have a unique flavor and a wonderful texture. Russets have been sold individually in shrink-wrap for years and now one of the shippers we work with is shrink-wrapping red potatoes and marketing them as baking potatoes,” adds Kreis.
Fingerlings are another variety that has shown constant growth. With three different fingerling varieties under its product offering, Heyburn, Idaho-based Southwind Farms has seen a 30% growth in the category each year.
“They seem to be popular among higher-end customers,” says Robert Tominaga, president. “The United States Potato Board showed that when a specialty potato is placed in the cart, the customer spends about 30% more on other things. They more specialized potato pairs up instead of pairing down. The shopper probably buys a better cut of meat, more expensive vegetable and sauces and they might buy wine.”
To cater to this consumer, most specialty spuds come in smaller bags. Southwind, for instance, sells their fingerlings in a 1.5-pound bag with a recipe on it. “We want to educate the consumer. We don’t want customers to be apprehensive to purchase them if they never prepared them before so we include a recipe,” adds Tominaga. Colored varieties and heirlooms have higher antioxidant levels and lower starch than russets, making them a popular choice for health conscious consumers.
Bancroft, Wis.-based RPE, previously the Russet Potato Exchange, has also seen growth in their specialty variety, Tasteful Selections, a line of small potatoes that can be prepared quickly and have great flavor. “Russets and reds continue to be volume drivers, but consumers are looking for more specialty type products like fingerlings and small size potatoes that cook quick and have great flavor,” says Randy Shell, vice president of marketing.
Experts advise retailers to merchandise all varieties of potatoes together. “People go looking for potatoes and when they see something different, the curiosity factor comes into play. I think it’s the beginning of a dynamic that’s going to change the industry,” says Schwartz. “If you take a look at the European model you see a lot of different varieties for sale in small single-use bags.
Organic potatoes are another category that claimed itself shelf space, although industry observers say organics’ popularity varies significantly by location. To address the difficulty retailers run into ringing individual organic potatoes —organics are typically identified with a sticker or tag that can easily fall off or be removed—Idaho Falls, Idaho-based Eagle Eye Produce introduced an individually-wrapped microwavable organic potato that is easily scanned at the cash register. The company also has a 2.5-lb. bag of baby organics on the market. “It’s a new thing for us and we’ve had great luck with it in the Northeast,” says Lance Poole, vice president of sales.
Potato displays can be exciting, just ask the Idaho Potato Commission (IPC) whose 20th annual Potato Lover’s Month retail display contest kicks off next month. The contest not only puts potatoes at the forefront of the produce department, it connects them with complementary products. IPC, based in Eagle, Idaho, coordinates many cross-promotions, says Seth Pemsler, vice president of retail and international. “We’ve done several tie-in promotions with wines, pork and beef. A lot of the companies will put coupons for Idaho potatoes on their product.”
Meal deals are popular in most grocery categories. Traditionally, retailers have taken a ‘buy a lot and stack them high’ approach to potato inventory, says Stanger. “Groceries who put together meal deals, such as a roasted chicken, salad mix and bag of potatoes for $10, are finding it works.”
“We learned from the Marsh Super Study that not every customer shops every department during their trip,” says Richter. “The study also showed that produce has the highest penetration of purchase success of any department.”
Cross-merchandising brings in impulse sales, but getting on the consumers shopping list is even better, and experts are recognizing that the best way to do so is talk to them directly. Richter, who used to work in retail as a produce manager, recognizes the value of communicating with the consumer to get them excited for his product. “When retailers get new item requests from customers, they take it very seriously. They want to be responsive to their shopper.”