80 Million Consumers Want You to Reset Your Department!
Most of you, having read the title of this column, are asking where are those 80 million customers, and when will they be visiting my store? The 80 million figure describes the number of Millennials - those consumers, for sake of discussion, between 20 and 35 years of age - who have become not only the largest segment of our population but an incredible buying force as well. In a recent thepacker.com article, editor Greg Johnson speaks of “The Produce Age Gap” and how it is impacting what we sell - or should sell - in our fresh produce departments. “As a member of Generation X,” begins Johnson, “I used to get upset about all the attention the younger Millennial generation gets when it comes to food marketing. But the more I read the research, the more clear it becomes: Millennials offer so much more growth.”
Greg Johnson then cites some valuable information from The Packer’s Fresh Trends 2018, which shows examples of how Millennials shop differently for fresh fruits and vegetables. As part of the Fresh Trends study, 1,000 consumers—primary shoppers in their households—were asked what fresh produce items they buy each year. For the sake of reporting those results, those consumers were grouped in the following age brackets: ages 18-39 (very close to the Millennial age range), ages 40-49, ages 50-58, and all those 59 years of age and older.
The results of the Fresh Trends 2018 shows that, perhaps, our produce departments are set in a manner that does not reflect the way those 80 million consumers shop. And, despite the fact that there are other important generations shopping our stores, it would be wise to make some changes that could appeal to that vast consumer movement.
MERCHANDISING TIP OF THE WEEK. Listed below are the fresh produce categories that showed declined purchases from Millennial consumers:
Bananas. Of the four age groups listed, Millennial consumers reported that only 64% of them purchased bananas, as compared to 81% (ages 40-49), 82% (ages 50-58), and 82% (ages 59+).
Carrots. Carrots were purchased at the lowest frequency by Millennials shoppers: only 49% reported buying them during the previous year, while the other three age groups each exceeded 70%.
Celery. The difference in celery purchases are dramatic: only 33% of those 18-39 years of age reported buying celery in the past year, while the other groups reported these results: (40-49 years of age) 54%, (50-58) 60%, and (59+) purchased at a 66% rate.
Cucumbers. Here’s the breakdown for annual purchases of cucumbers: Only 38% of those consumers 18-39 years of age bought cucumbers in the past year. (40-49) bought at 63%, (50-58) bought at 55%, and (59+) bought cucumbers at a 58% frequency.
Onions. The annual purchase of onions is a bit closer than other categories, but Millennials still fall behind other age groups. 56% of Millennials bought onions in the previous year, while (40-49) bought at a 76% frequency, (50-58) purchased at a 70% clip, and an outstanding 81% of those 59+ years of age purchased onions in the previous year.
Peppers. Here’s the breakdown: 41% ages 18-39, 61% ages 40-49, 71% ages 50-58, and 65% ages 59+.
Potatoes. The potato category, although closer, still shows a decline among Millennial consumers. 58% of Millennials bought potatoes during the previous year, while 74% of those age 40-49 bought potatoes. Older consumer definitely favor their “spuds”, with 79% of those age 50-58 and 81% of those age 59+ having purchased potatoes in the previous year.
Sweet Potatoes. Although it seems that sweet potatoes, in their commodity form, do not widely appeal to any age group, once again the Millennials were the least impressed. Only 29% reported purchasing them in the previous year, while the other three age groups ranged from 44% - 53%.
Tomatoes. It was surprising to find that only 54% of Millennials said they purchased tomatoes in the previous year, while the other three age groups had results ranging from 75% - 79%.
Does this simple survey forecast a “gloom and doom” era for fresh produce sales? Certainly not! It should be understood that the survey was based on choices limited to fifty fruits and vegetables—value-added fruits and value-added vegetables were not among those choices. Looking at those nine declining categories, at least five are significantly impacted by value-added offerings, with three impacted to a lesser degree. Only bananas seem to be completely missing the mark with Millennial consumers, showing a result that could be affected by a lack of value-added alternatives as well as some Internet “bad press” that recommends using lower sugar fruit as a banana alternative.
But this speaks volumes about how your produce department should be redesigned. First of all, look at space allocations currently given to the nine declining categories listed, and see where you might be giving up too much precious real estate. And the space you gain by “tightening” should be dedicated to value-added fruits and vegetables, as well as to more convenient potato offerings. And one more important consideration: should you be offering bananas at an SRP that sacrifices profit? Keep in mind that selling bananas at a skimpy profit forces you to raise the profit level on a category that is performing much better and is embraced by those 80 millions consumers. Better to direct your promotional efforts to categories that resonate well with all consumers, like berries, grapes, salads, Organics and, of course, those value-added fruit and vegetable alternatives.
The future is still very bright in the fresh produce industry. But our departments need to address a changing consumer. Happy Selling!