The seventh annual Saint Joseph’s Food Industry Summit suggested retailers play a bigger part in the health care equation.
By Barrie Dawson
When Jeff Gregori looks into the future, he sees the growth potential of the health and wellness category—and a great opportunity for manufacturers and retailers to engage with their customers.
“All health care needs do not have to be in a medical setting,” said Gregori, vice president of consumer and shopper analytics for Nielsen Holdings, the New York-based global information and measurement company at the seventh annual Saint Joseph’s University Food Industry Summit in March. “It’s going to be an extraordinary opportunity for retailers to drive growth.”
The economy has something to do with that. Many people simply cannot afford to see their physicians every time they do not feel right, so they are looking for retailers and manufacturers to do much more for them than ever before.
Gregori pointed to a Nielsen national survey that shows 19% of households are now using a retail clinic in-store. Three years ago, that figure was only 12%. Younger families and the less affluent are driving that growth. Surveys show that the over-the-counter market grew 4.5% last year because people were taking more supplements and doing more self-medicating.
The problem with in-store clinics is that they tend to be seasonal—they are much more active during cold and flu season than the rest of the year. “The challenge of the clinic is, ‘How are you going to make that space productive during non-seasonal times?’ But that’s where the opportunity is to engage with the manufacturers and do a lot more on the promotional end,” Gregori said.
The health-and-wellness umbrella covers much more than fending off colds and the flu during the winter months. To some people, it is about weight loss. To others it is about vitamins and nutrition. It also can include gluten-free and organic products.
“One of the hottest things going right now is plant-sterol—it’s a cholesterol reducer,” Gregori said. “Sixty percent of consumers don’t know any benefits associated with it—but they’re buying it. There’s a clear opportunity for education at the shelf and consumers are really thirsting for it.”
Gregori was among the 10 presenters at the summit, held on March 7 in Philadelphia. Another was Erik Keptner, Ahold USA’s executive vice president of marketing. Ahold USA, based in Carlisle, Pa., includes the Stop & Shop, Giant, Martin’s and Peapod (online) banners.
One of the ways grocers can promote health and wellness is to join in the fight against obesity. Keptner said Ahold USA is well aware of the obesity epidemic in the U.S., particularly among children. He cited statistics that showed 17% of U.S. children are obese and the number grows to 25% among 10- to 17-year-olds in all but three states.
As Keptner noted, “The U.S. is No. 1 in obesity level and it’s getting worse—rapidly. When you talk about health and wellness, obesity is one of the major drivers of diabetes. It’s linked with cancer, blood pressure—you name it. We’ve got a real call to action, a moment of truth for all of us, whether we’re retailers or we’re manufacturers.”
The centerpiece of Ahold’s call to action is its Healthy Ideas program. It began as a way to identify healthy products at the shelf and has expanded to include health and wellness education and services. The program is based on three core principles: affordability, simplicity and availability.
Ahold’s Healthy Ideas tagging program helps shoppers identify products that meet FDA definitions of “healthy” for sugar, sodium, cholesterol and fat levels. It also touts those products in its circulars and online. Roughly 1.5 million customers receive its quarterly Healthy Ideas magazine, which offers tips, recipes and information from its nutritionists and health experts. An electronic version of the magazine is available via an iPad app.
To help consumers with affordability, Ahold has a program that promotes eating healthy on a budget. Using items that are on sale in its stores, the program creates healthy recipes, which it offers customers online. In hub stores, Ahold has nutritionists who are available for one-on-one and classroom consulting, and they venture out into other stores in the same region as a form of community outreach.
Natural products are Ahold’s fastest growing category, according to Keptner, so the chain has created a store-within-a-store concept to market them. In its pharmacies, it has recently rolled out more and better services and information for customers. “There’s a lot more we can do in linking pharmacy with food,” Keptner said. “Food is one of the most important determinants of your health. We, as food retailers, can play a much bigger role in helping customers make much better choices alongside the pharmacy.”
Catering to Consumer Needs
In Srishti Gupta’s household, there are three grocery shoppers with distinct styles.
One researches products online, then rushes to get in and out of a store. Another buys non-perishables online, then cruises the aisles looking for new foods to try. The third shops infrequently and buys different items at different stores.
One household, three shopping styles: and a big challenge for marketers. If they can separate the shoppers and provide the right stimuli to each, they can enhance each shopper’s in-store experience. “Eight in 10 people are online, but that doesn’t necessarily help the retailers and manufacturers because it’s so fragmented,” said Gupta, the executive vice president and general manager of new media solutions and testing for Chicago-based SymphonyIRI Group, at the annual St Joseph’s University Food Summit in Philadelphia last month.
When considering all the computer and social-networking options available to consumers, who use them in infinite combinations, reaching each shopper can be daunting. Retailers must also remember that some shoppers are not part of the digital world.
The path to purchase, which once looked like a funnel, now looks more like a pretzel because digital communications have created so many points of entry.
Liz Mohr, the director of shopper insights for Omaha, Neb.-based ConAgra Foods, said her company wants to grow its business in lockstep with retailers. To do that, it needs to know how people are using digital technology when shopping.
Although ConAgra could provide retailers with national statistics, it could not provide information about each retailer’s specific shoppers until enlisting SymphonyIRI’s services. “I saw an opportunity—a chance to know exactly what was going on with individual shoppers at individual retailers,” Mohr said.
Gupta said mobile devices are the biggest drivers of change because they are with the consumer at the most points along the path to purchase.
Gupta added that by studying consumers’ purchase patterns and creating consumer focus groups, SymphonyIRI can provide retailers and manufacturers with the information they need to better understand their customers.