Produce of the Generations
Retailers must modify their marketing approach to appeal to consumers of all ages.
Produce has grown into a mature and profitable retail market, and has been a consistent driver of growth in the grocery perimeter. Studies have found that practically all consumers eat some type of produce, so for retailers, it is not a matter of drawing shoppers to the category, but rather driving them to purchase even more. Grocers must understand their shoppers’ history and habits, particularly across the generations, to modify their marketing approaches toward each demographic.
Omnichannel data company, V12 Data, based in Red Bank, N.J., defines Baby Boomers as those born between 1946 and 1964, who grew up during the era of rock ‘n roll and social change. They have the most disposable income compared to other generations, though they are still fans of coupons and sales. Generation X, born between 1965 and 1980, was raised during the transition period from print to digital. Though often excluded from the conversation, this group should not be discounted as it accounts for 31 percent of the nation’s total income dollars, per V12 Data. Millennials were born between 1981 and 2000, growing up in a fast-paced digital world that has set their standards for engagement and access to information.
Despite their apparent differences, when it comes to produce purchases, these generations are more similar than one may assume. According to the Food Marketing Institute’s (FMI) The Power of Produce 2017 report, price is the key factor in driving store trips across all generations. However, each group’s spending power still varies.
“While price is important for Baby Boomers, it’s not to the same degree as the Millennials and the Gen Z because they have less money,” says Rick Stein, VP of fresh foods at Arlington, Va.-based FMI. “Millennials on the whole have to be very efficient in how they spend their money and where they spend it.” Yet, while price is important for Boomers and Gen Xers, it is not paramount, Stein adds, as they typically have more disposable income.
A Look Through the Consumers’ Eyes
Though price draws store traffic, appearance is the ultimate deciding factor in consumers’ purchasing decisions. FMI’s The Power of Produce 2017 report found that this is particularly true among older generations who place a greater emphasis on overall value rather than low prices alone. “All the purchases happen at store level, and that’s based on the quality—the perceived quality and freshness,” Stein says, noting that appearance does not necessarily determine a product’s quality or freshness, though it does in the eyes of the consumer.
“If you walk up to the peach display, maybe you’ll see three or four bruised peaches that are kind of soft—and typically bruised peaches will also manifest fruit flies—so despite the fact that the peaches were 99 cents a pound, you walk away from that display not purchasing anything,” Stein explains. “And then what the consumer is doing, not only do they not purchase the peach, they shut down in terms of their purchasing across the department.”
Attractive, fresh in-store displays not only finalize these consumers’ purchase decisions, but could also inspire new purchases that were never on their shopping lists. According to FMI, 50 percent of shoppers tend to purchase the same items again and again, but 83 percent are open to purchasing items outside of their norms with the proper merchandising, including eye-catching displays, sampling, recipes and cooking demonstrations.
While Millennials, too, are drawn to quality appearance, they tend to look toward product knowledge and price as their determining purchase factors. “Price has the greatest influence on consumers, above all other factors,” says Jacob Shafer, senior marketing and communications specialist at Mann Packing Co., based in Salinas, Calif. “This is in part due to the fact that Millennials have the ability to instantly price compare and geo-locate product availability, so if something is too expensive at one store, they can locate a sale on that same product in their area with relative ease.”
With an insatiable appetite for information, Millennials are turning to both in-store and online resources to subdue that hunger. While offering inspiring point-of-sale material, cooking instructions and knowledgeable employees on the floor can drive this generation to a purchase, digital outreach allows for a more targeted approach to promotions, such as geotargeting by store, according to FMI. Plus, digital can be used for recipes and product or grower information.
“The consumer is looking for a lot of transparency,” says Karl Smith, SVP of member value at the Produce Marketing Association (PMA), based in Newark, Del. “They want to interact directly and I think that’s a huge opportunity, but that will manifest itself a lot in digital.” Technology is evolving to meet this demand with innovations like in-store sensors that can identify a product when it is held up to a smartphone, or having the shopper receive a push notification upon entering the store, altering to items on sale, Smith adds.
“No surprise, but smartphones are a dominant method of connection to the web for Millennials,” says Shafer, “with 89 percent of them using the devices to connect versus 75 percent who use laptops, 45 percent tablets and 37 percent desktop computers.”
According to a recent report by consumer research firm Nielsen, based in New York, Millennials are the top smartphone users in the U.S. Penetration is the highest among those aged 18-24, 98 percent of whom are smartphone owners, with 25- to 34-year-olds right behind them at 97 percent. Even 96 percent of Gen Xers own smartphones, though that percentage drops to 89 percent and 80 percent for those aged 45-54 and 55-64, respectively.
But that is not to say that print is dead. According to FMI, the paper circular remains the lead resource for checking promotions, though usage has dropped from 73 percent in 2015 and 68 percent in 2016 to 56 percent today, with most of its paper users among Baby Boomers and seniors. However, the importance of digital and social use among Millennials suggests retailers must expand to a more sophisticated and frequent outreach, as this trend will likely accelerate in years to come.
Appealing to the Masses
While targeting particular demographics is important, specified marketing can be unintentionally appealing across generations. For instance, California Giant Berry Farms, based in Watsonville, Calif., in August launched its College Edition promotion, designed toward those aged 18-25 to help them budget and eat healthy when they are away for school. The company provided young adults with an e-book of simple food ideas and hacks, and gave away two $150 Visa gift cards and one $500 gift card in a sweepstakes. Though geared toward college students, the e-book appealed to parents and busy families who are also budgeting and seeking quick, easy-to-make recipes.
Retailers must also provide high-quality, innovative products that meet consumers’ needs. Millennials may drive new product innovations, but the latest convenience, value-added and health trends resonate with Baby Boomers and Gen Xers, as well.
Stemilt Growers, based in Wenatchee, Wash., has experienced success across all generations with its Lil’ Snappers product line, featuring kid-sized fruit in different flavor varieties. While appealing to young parents and their children, the snack also attracts older generations who are looking for portion control. “Baby Boomers like them because they are smaller, so it’s a good serving size for them,” says Brianna Shales, communications manager at Stemilt. “Parents obviously love them because they can throw them in their kid’s lunch box and not worry about them not eating the whole apple because it’s perfectly sized for kids.”
Similarly, Crunch Pak, based in Cashmere, Wash., recently launched its Apple Rings, featuring round, sliced circles of fresh apples with the cores removed. The product won a United Fresh Innovation Award for Best New Fruit Product at United Fresh 2017.
“We end up marketing to both the mom and parents, as well as to the children,” says Tony Freytag, EVP of sales and marketing at Crunch Pak. “It exposes the parents to our product and they in turn become a customer as well. As far as Boomers go, one of the things that’s very appealing is that it’s portion controlled.”