trends in fresh products
TRANSCRIPT
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Trends in the Marketing ofFresh Produce andFresh-cut Products
Trends in the Marketing ofFresh Produce andFresh-cut Products
DR. ROBERTA COOK
University of California Davis
Presented September 2007, updated November2007
Dollar Sales
Source:Technomic, Inc.
Quantity Sold
50.2%
49.8%
Retail Foodservice
Foodservice Retail
72.8%
27.2%
Retail Sales Equivalent, US Food System,$998.25 Billion in 2006, and Channel Shares
But 91% of fruit and 80% of veggies consumed at home (USDA).
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U.S. Fresh Fruit and Vegetable* Value Chain,2006 Estimated Billions of Dollars
institutional wholesalersfood service
establishments
supermarkets andother retail outlets consumers
exports
farms shippers integratedwholesale-
retailers
produce and general-line wholesalers
farm & publicmarkets
imports
4.620.1
8.8
44.2
101.9 + 56.3
1.4Source: Estimated by Dr. Roberta Cook, UC Davis, based on numerous public sources, incl.USDA, DOC, Cornell University and PMA
*Excludes nuts
Other B$184.204
Source: Industry Size July 2007 , Technomic Inc.
Total US Food Service $513.186 Billion,Forecast, July 2007, share of dollar salesBars & Restaurants
B$328.982 B
1%
47%52%19% 11%
14%12%21%23%
Limited Service
Full ServiceBars,Taverns
RetailHosts Remainder
Travel,Leisure
Bus. & Ind.Educ.
Health-care
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10.2
3.6
9.1
4.3
7.7
4.3
7.5
4.3
7.4
4.3
7.2
4.3
7.2
4.3
7.3
4.3
7.4
4.2
7.0
4.2
6.8
4.3
6.9
4.4
6.7
4.3
6.6
4.2
6.7
4.4
6.6
4.4
6.2
4.1
5.4
4.7
5.5
4.7
5.1
4.7
5.1
4.7
5.1
4.6
5.1
4.8
70 85 87 89 91 93 95 97 99 2001 2003 2005
Source: ERS/USDA
At-home Away-from-homeAt-home Away-from-home13.413.412.012.0 11.711.7 11.511.5 11.511.5 11.611.6 11.611.6 11.211.2 11.111.1 11.311.3 11.011.0 10.810.8 11.111.1 11.011.0
10.310.3
11.8
13.813.8
9.89.8 9.89.8
U.S. FOOD EXPENDITURES as a SHAREof DISPOSABLE PERSONAL INCOME, 1970-2005
9.79.7 9.99.9
Ingredients to Prepare vs. Meals to Eat
10.110.1 10.210.2
New Trends in the Fresh Produce Industry• Wal-Mart is changing its fresh produce procurement
model: including more opportunity and local buys,rather than using a supplier-assigned DC approach nowthere are “dollar value assignments,” taking intoaccount food miles
• Newer entrants such as Tesco from the UK offerpotentially exciting but uncertain outlooks, privatelabel focus
• Greater shipper emphasis on brands and consumermarketing (especially using websites as a vehicle fordirect consumer communication) changes dynamics
• Disney Garden label offers uncertain potential forchanging demand
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Despite differences between fresh produce andCPG’s*, produce is being asked to conform to
the protocols of CPG’s: – Fresh-cut shows the way, including brands – Channel captains emerge – Contract pricing between shippers and
buyers (both foodservice and retail) – Longer-term relationships less focused on
short-term price instability – Fees and rebates – cost to play grows – Services - data-based sales and marketing
support as well as food safety gatekeeperfunction
*Consumer packaged goods
US Supermarket Fresh Produce Sales,excludes Club stores and Supercenters, 2006
% of Dollar Sales
Dollar Sales 52 Weeks ending 8/27/2006Source: FreshLook Marketing (FLM)
SALADS8.0% TOMATOES
7.6%
BERRIES6.8%
APPLES6.7%
All Other Fruit40.8%
GRAPES6.5%
BANANAS6.0%
POTATO5.5%
MELONS4.9%
ONIONS3.7%
LETTUCE3.4%
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Dollars Current 52wks
%
ChangePackaged Salads $2,726,730,752 3.4%Tomatoes $2,584,623,643 2.0%Berries $2,299,337,337 11.3%
Apples $2,269,224,192 9.0%Grapes $2,202,038,782 2.5%Bananas $2,019,269,314 5.1%Potato $1,870,296,530 13.6%Melons $1,674,382,169 12.8%Onions $1,253,271,556 4.8%Lettuce $1,166,004,589 -0.7%Total Produce $33,879,840,135 6.2%
Dollar Sales 52 Weeks ending 8/27/2006Source: FreshLook Marketing (FLM)
US Supermarket Fresh Produce Sales, excludes Clubstores and Supercenters, 2006
Consumers are trading up, contributing to higher salesin ful l service restaurants and fast casual.Consumers search for VALUE, 62% say they are“ willing to spend more time and money for betterquality food.”Foodservice fresh produce and fresh-cut demandrising. Subway’s is the #1 buyer of f resh tomatoes,McDonald’s now the top foodservice apple buyer and atop 5 foodservice buyer of spring salad mix and grape
tomatoes.Burger King Apple Fries – part of new trend towardmarketing healthier products to children
FOODSERVICE OPPORTUNITIES FOR FRESHPRODUCE – BUT YR-ROUND SUPPLY REQUIRED!
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Source: U.S. Grocery Shopper Trends 2007 , FMI, 2007.
Household TypeChildren 18% 34%No children 11 24
Income Level$35-49.9K 13% 24%Over $100K 6 24
May total morethan 100% dueto rounding
Consumers Reporting Diet “ Could Be A Lot Healthier, ”by Household Type and Selected Household Income
Level, At- vs. –AwayFromHome, 2007Food At Home Away
Mom-2-momchat-room for
idea exchange
Tips & ideasto encouragekids to eatmore fruits &veggies
Recipes,shopping tips
News andinformation –
severalrotating
topics
Opt-in fornewsletter
Fruit & Veggiedatabase
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Eating Out at McDonald’s Changes, in2006 in the US alone it used:
• 80 million pounds of salad greens, incl. spring mix• Plus 100 million pounds of leaf lettuce and iceberg
lettuce on sandwiches• 30 million pounds of tomatoes• 54 million pounds of apples for apple dippers and
Fruit and Walnut salad (~.5% of US apple crop)•
6.5 million pounds of grapes• 4.2 million pounds of walnuts for Fruit and Walnutsalad
Source: McDonald’s, 2006
Source: U.S. Grocery Shopper Trends 2007 , FMI, 2007.
Consumers Reporting Diet “ Could Be a LotHealthier, ” At- vs. –AwayFromHome, 2007
All shoppers 13% 27%
GenerationsGen Y 22% 44%
Gen X 12 32Baby Boomers 13 24Mature/60+ 10 18
May total morethan 100% dueto rounding
Food At Home Away
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Shopper’s Eating Habits – 2007
Eat home cooked meals 78 11 7 3at home
Dine out at full-service 3 15 39 37restaurants
Eat meals at home that aren’t 3 12 38 38prepared at home – takeout
and delivery
Eat out at fast-food 2 11 31 36establishmentsEthnic meals at home or out 4 12 34 33
3+ 1-2 1-3 < thantimes times times once aPercent of Shoppers weekly weekly mo’ly month
Source: FMI US Grocery Shopper Trends 2007
Eating Patterns
• According to the Hartman Group, 88% ofconsumers believe that freshness is the key tohealth
• There is no longer any need to trade-offfreshness for convenience
• Consumers seek a consistent flavor experienceapplied to relevant flavor trends, available in aconvenient form – explains the success ofTrader Joe private label products, Muir Glen,Annie’s, etc.
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Fresh Trends: Eating Out• 60% of consumers sometimes or always consider the
availability of fresh produce on menus when decidingwhere to eat out
• Just 6% of consumers never eat fresh produce whendining out
• 26% of consumers always do• 19% of those 18-39 always do• 31% of those 59 and older always do
• 20% of parents and kids 6 and under do• 28% of those with no kids do
Source: Fresh Trends as cited by The Packer, Feb. 20, 2006.
44%51%
5%
26%
69%
6%
56%
40%
4%
42%53%
5%Main Entree
SaladsVegetarian
EntreesSide Salads Fresh-Cut
Fruid Salads
Yes
No
Other
Over the past 3 months, have you purchased more...
Source: The Dining Out Menu: Consumer Thoughts about Produce , PMA, 2006.
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Source: 2007: The Salad Category Report , Technomic Info. Services, 2007.
Quick Fast Fine FSCasual Food Dining Ethnic
Better variety 33 43 31 35Larger portions 21 23 19 18Smaller portions 10 13 13 9Lower prices 39 45 40 31Server suggest. 12 6 22 20
Better quality 27 41 25 27More health opt. 25 33 23 25
Options that encourage frequent salad orders,by Restaurant Type, 2007
Americans ate 208 meals prepared outside thehome in 2006, but only 81 meals/person werephysically eaten at restaurants vs. 93 in1985.127 of the 208 meals prepared outside thehome in 2006 were take-out of some sort.Today people eat 32 restaurant purchasedmeals/yr. in their cars vs. 19 in 1985.People get 57 takeout restaurant meals forhome vs. 33 in 1985.People today order 22% of restaurant mealsfrom the car, up from 14% in 1998.People buy 27 restaurant meals/person to taketo work vs. 23 in 1985.
Changing Geography of Dining Patterns!
Sources: FIR, Oct. 10, 2005; and NPD
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1996
Source: FMITrends in theSupermarket2003, 2007
Sources of Takeout* Food in the US
2007
2%
38%25%
1%
16%10%
Fast-food rest. RestaurantSupermarket OtherGourmet/specialty store C-StoreDon't know Chinese/Pizza
25%12%
1%4% 48%
3%
6%
Fast-food rest.Fast-foodrest.
Restaurant
RestaurantSupermarketSuper-market
*Takeout only, not all foodservice
Chinese,Pizza
US Estimated Fresh-Cut Produce Sales,All Marketing Channels, $ Billion
Source: DoleSource: Dole
6.03.3
15.915.0
8.9
024
68
1012141618
1994 1999 2003 2005 2007Around 60% estimated to be sold via foodservice channels
Sources: IFPA,IRI, AC Nielsen; 2007
estimated by Cook
$ billion
$6 atretail
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$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
1/9/2005 4/19/2005 7/28/2005 11/5/2005 2/13/2006 5/24/2006 9/1/2006 12/10/2006 3/20/2007
BABY REGULAR TOTALSource: Fresh Look Marketing
Impact of the E.Coli Spinach Incident on Weekly SupermarketSales of Spinach, in $1,000, 1/9/05 through 5/27/07
FDA Spinach Advisory 9/14
Fresh-Cut Produce Retail Sales Stagnate in the Aftermath of
the Spinach E. Coli Incident in Sept. 2006
• 2005 retail fresh-cut produce sales were estimated at$6 billion, the same as in mid-2007.
• Fresh-cut fruit and fresh-cut veggies continued togrow, BUT….
• Their growth merely offset the decline in baggedsalad sales, for no net growth in the total fresh-cut
category.• This is likely the first time that has occurred since the
fresh-cut industry began.
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Supermarket Growth Rates for US Fresh-Cut Segments and AllFresh Produce, 52 week $Sales ending June 30, 2007
3.9
-5.4
4.67.7
-10
-5
0
5
10
Sources: “Fresh Summit 2007 Ripe for the Picking,” Perishables Group presentation at Oct. PMA for fruit,vegetables and all produce; and Perishables Group FreshFacts® powered by Nielsen for salads.
Percent
Cut Fruit Cut Veg Salads* All Produce
Source: Perishables Group FreshFacts® powered by Nielsen.
Fresh-cut Produce Sales via SupermarketChannels, 52 week sales ending June 30,
2007, $6 Billion Total
Packagedsalads
48%Veggies*29%
Fruit 23%
Carrots=45%of vegetables
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US Retail Bagged Salad Sales, by Type, 2007,*in Thousand $, and Segment Share
Source: AC Nielsen; * 52 week sales ending June 2, 2007, projected to national sales.
Fresh-cut Salads $ volume Segmentshare %
Total $2,789,403 100%Iceberg Based (IBB) 660,313 24%Romaine Based 633,288 23%Spring Mix/Specialty 420,301 15%Kits 348,463 13%Baby Spinach/Blends 205,036 7%Romaine hearts 228,984 8%
Mature spinach 116,434 4%Coleslaw 92,645 3%Butter 83,938 3%
May not sum due to rounding.
US Retail Bagged Salad Segments: $ Sales and AnnualGrowth Rates %, 2007*
$0$500,000
$1,000,000$1,500,000$2,000,000
$2,500,000$3,000,000
Total IBB Romaine SpringMix*
Kits RomaineHearts
BabySpinach
MatureSpinach
Source: ACNielsen; *52 weeksending 06/02/07.
-3.8%
+13.6%+1.4%+5.2%-10.7%
-25.0%
Number above barrepresents % change vs.prior yr.
$ Sales(1,000’s)
-2.6%
-19.2%
*Spring mix plus specialty tender greens.
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Estimated US Fresh-Cut Produce/Salads Sold ViaSupermarket Channels, 52 Week Sales ending 06/30/07
• About $6 billion in total estimated fresh-cutsales.
• Fresh-cut was around 16.2% of all produce dept.sales, including 3.7% for fresh-cut fruit, 8% forsalads, and 4.5% for fresh-cut veggies.
• Random weight/bulk is 28% of fresh-cut fruit andveggie (excl. salads) dollar sales vs. 34% of
volume sales, remainder (72 and 66% respectively)is UPC/fixed weight.
Source: Perishables Group FreshFacts® powered by Nielsen.
US Value-Added Fruit Facts, 2007*• 2007 projected national retail sales of value-added fruit
were $1.4 billion.
• Value-added fruit accounts for 3.7% of supermarketproduce dept. sales.
• Packaged fresh-cut fruit growing at 8.2% in 2007,over-wrapped fresh-cut fruit by 3.7%, vs. 18% growth ratefor refrigerated jarred cut fruit.
• 33% of consumers bought fresh-cut fruit in 2007 vs. 55%for fresh-cut vegetables, excluding bagged salads ,(Perishables Group PMA Oct. 2007 presentation).
Source: Perishables Group FreshFacts® powered by Nielsen; *52 week sales ending June 30, 2007.
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21%
46%
6%4%4%
9%
2%3% 6%WatermelonMixed FruitPineappleCantaloupeApplesOther Melons
GrapefruitPeachesOther
Supermarket Mix of Fresh-Cut FruitTypes: Quantity Sold, 2007*
Source: Perishables Group FreshFacts® powered by Nielsen;*52 week sales ending June 30, 2007.
Supermarket Mix of Fresh-CutFruit Types: Dollars Sold, 2007*
7%
23%
35%
6%
5%
14%
3%5% 2%
Mixed Fruits
Watermelon
Pineapple
Other
Cantaloupe
Other MelonsApples
Grapefruit
StrawberriesSource: Perishables Group FreshFacts® powered by Nielsen;*52 week sales ending June 30, 2007.
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Branded Importance to US
Consumers of Fresh-Cut Fruit
Source: “Fresh Summit 2007 Ripe for the Picking,” Perishables Group, Oct. 2007.
No Preference68%
Prefer brand/will pay more
15%
Prefer brand/will not pay more
13%
Prefer store brand4%
74% of Fresh-Cut Veg ConsumersHave No Preference
27.3%3.5%
69.2%
Branded Unbranded Private Label
43%
23%
34%
2007* Supermarket Fresh-Cut Fruit and Fresh-Cut Vegetable Dollar Share by Brand Type
Fresh-Cut Fruit Fresh-Cut Veggies
Source: “Fresh Summit 2007 Ripe for the Picking,” Perishables Group, Oct. 2007; *52 week data ending June 30, 2007.
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Supermarket Mix of Fresh-CutVegetables Types: Dollars Sold, 2007*
6%
19%
45%3% 3%
18%
1%2% 3%
Carrots
Mixed Veg
Mushroom
Peapods
Broccoli
Onion
Celery
Squash
OtherSource: Perishables Group FreshFacts® powered by Nielsen;*52 week sales ending June 30, 2007.
Supermarket Mix of Fresh-Cut VegetableTypes: Quantity Sold, 2007*
3%
11%
55%
3%2%
20%
5%1%
Carrots
Mixed Veg
Mushroom
Peapods
Onion
Celery
Squash
OtherSource: Perishables Group FreshFacts® powered by Nielsen;*52 week sales ending J une 30, 2007.
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Growth of Fresh-Cut Veggies by Type, inQuantity Sold in US Supermarkets, 2007*
12.6%7.9%9.4%5.0%4.1%3.5%
25.5%
0%10%20%30%40%50%
A r t i c
h o k e
s
C e l e r
y
M i x
e d V e g
S o y b e
a n s
O n i o n
O t h e
r
S u g . / S
n a p P e
a
Source: Perishables Group FreshFacts® powered by Nielsen;*52 week sales ending June 30, 2007.
SALAD CATEGORY MARKET SHARES (%) 2006($ sales, 52 weeks ending Oct. 8)
Source: IRISource: IRI
Fresh Express 41Dole 31Private label 12Ready Pac 8Earthbound 6All other 2
Fresh Express 41Dole 31Private label 12Ready Pac 8Earthbound 6All other 2
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U.S. M arket Shares of Fresh CutSalad Firms, Dollar Sales
*Private label share ranked third in 1999 vs. 6th in 1994.Source: IRI
Top 5 firms91.2%
Top 5 firms87.6%
Private labelshare 2.4%
Private labelshare 9.7%
Other share 6.4% Other share 2.7%
1994 1999
US Supermarket Private Label Market Share Year Dollar share Unit share
percent of total sales
1989 11.6 15.3
1995 14.9 19.4
2002 16.2 21.2
2003 16.3 21.1
2004 16.5 21.1
2005 16.5 21.3
2006 16.4 21.3
Sources: Food Institute Report, Oct. 15, 2007; Private Label , March/April various years, compiled by Ed McLaughlin, Cornell University for 1989 and1995.
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Types of Fees & Services Requested
Slotting EDIVolume Rebates DisplaysNon-volume Rebates Private LabelsPromotional Ads ReturnableContainersE-commerce fees Special PacksCapital Improvements Food SafetyCertification
Category Management Case Study From“Mystery” Fresh-cut ProcessorCategory Management Case Study From“Mystery” Fresh-cut Processor
Source: DoleSource: Dole
Northeastern retailer
• ObjectiveIncrease growth and profits ata retailer that replaced acompetitive brand with _____
by implementing CategoryManagement Best Practices
• Results
Prior to ____, the retailer’sgrowth lagged behind themarket; it now exceeds marketgrowth
% growth after vs. prior
18.3% 17.9%
28.1%
9.8%
Mos. 1-6 pre-____ Mos. 12-18 since____ intro
Retailer Market
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Monterey County Head Lettuce
Shipments 1990 vs 2006
Source: Monterey CountyAg Commissioner
Bulk to Process 6.9 17.40 15% 36%
Wrapped 14.2 21.85 30% 46%
Naked 26.1 8.62 55% 18%
TOTAL 47.2 47.87 100% 100%
Million Cartons* Percent ShareProduct Form 1990 2006 1990 2006
* 50 lb carton-equivalent units, maynot sum to 100 due to rounding
Monterey County Leaf Lettuce Shipments, byType, 2006 (* 50 lb carton-equivalent units)
Source: Monterey County AgCommissioner
Romaine 39.87 47%Red leaf 3.77 4%Green leaf 8.83 10%Butter leaf 1.95 2%Endive .74 1%Escarole .28 .3%Leaf/process 29.68 35%TOTAL 85.12 100%
Product Form Million Cartons Percent Share
* 50 lb carton-equivalent units, may not sum to 100due to rounding
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Other Salad-Related Monterey
County Shipments, by Type, 2006
Source: Monterey County AgCommissioner
SpinachFresh 84,300Value-added 18,900Foodservice 22,300
Salad products 293,200
Spring mix 113,300Rapini 14,000TOTAL 546,000*
Product Form Tons
*Down 14% from 2005.
HeadLettuce
Romaine &Leaf
0
5
10
15
20
25
30
35
1 9 8 5
1 9 8 7
1 9 8 9
1 9 9 1
1 9 9 3
1 9 9 5
1 9 9 7
1 9 9 9
2 0 0 1
2 0 0 3
2 0 0 5
2 0 0 7
F
L b s .
P e r
C a p
i t a
U.S. Per Capita Consumption ofLettuce, 1985-2007 F
Source: USDA/ERS, July 2007 Vegetables and Melons Situation and Outlook Yearbook
All - 29.5
18.4
11.2
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05
10152025
1 9 8 5
1 9 8 6
1 9 8 7
1 9 8 8
1 9 8 9
1 9 9 0
1 9 9 1
1 9 9 2
1 9 9 3
1 9 9 4
1 9 9 5
1 9 9 6
1 9 9 7
1 9 9 8
1 9 9 9
2 0 0 0
2 0 0 1
2 0 0 2
2 0 0 3
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7 F
Carrots Bell Peppers BroccoliTomato es Cucumb er
U.S. Per Capita Consumption of Selected FreshVegetables, 1985-2007 F
Pounds per capita
F=Forecast
Source: USDA/ERS, Vegetables and Melons Situation and Outlook Yearbook, July 2007
US PER CAPITA VEGETABLE CONSUMPTION,POUNDS, 1976-2007 F
0
50
100
150
200
250
300
350
400
450
1976 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007F
ProcessedVegetables
ProcessedPotatoes
FreshPotatoes
FreshVegetables
Source: USDA/ERS, Vegetables and Melons Situation and Outlook Yearbook, July 2007
P o u n d s
p e r
c a p i t a
1784284
127
431359
115 150
119
7649
(Excl. potatoes)
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US PER CAPITA FRUIT CONSUMPTION,
POUNDS 1976-2006
0
50
100
150
200
250
300
1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006
ProcessNoncitrus
ProcessCitrus
FreshCitrus
Fresh
Noncitrus
Source: USDA/ERS, Oct. 2007
P o u n
d s p e r c a p
i t a
27398
71
2380
263
55
29
102
78
•Time spent preparing versus shopping (i.e., how doconsumers allocate their time between these activitieson different occasions)•Style of shopping (e.g., perimeter/dart and weave,cart/basket, focused/exploratory, etc.)•Tactics consumers use at store and in the home (e.g.,collecting vs. using coupons; how and when lists are
used, etc.)•Key categories of focus by occasion•Key channels utilized by occasion•Differences between objective and emotional goals•What and/or whose goals are being served
Understanding Consumers Becomes MoreSophisticated
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U.S. DEMOGRAPHIC
I NDICATORS, 2005
U.S. DEMOGRAPHIC
INDICATORS, 2005
Sources: US Bureau of Census; Food Institute Demographics of Consumer Spending 2007
117.4 million households303 million inhabitants (Sept. 2007)2.5 persons average household sizeAverage household income of $58,712Average household food spending of
$5931 (including $3,297 at-home and$2,634 away-from-home)
US Hispanic Metrics• Hispanics now represent 14% of the US population, over 41
million people• Total Hispanic buying power is expected to top $1 trillion in
2007• Hispanics make visits to grocery outlets 26 times/month vs. 9
times for non-Hispanics• Hispanics spent nearly $69.2 billion on food in 2005, of which
60% was spent on food-at-home• Berry and bagged salad sales (in heavily shopped Hispanic
supermarkets) have a contribution of 2 points below thenational ave.*
Sources: FMI El Mercado 2005, and The Food Institute Report, June 13, 2005; and Demographics of Food Spending2007, Food Institute; *Perishables Group 2007.
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$186$177
$121$123
$219$210
284312
White
Black
Hispanic
Asian
US Fresh Produce Consumption by Race2005, $ Per Household
Sources: Consumer Expenditures Survey, Bureau of Labor Statistics,ftp://ftp.bls.gov/pub/special.requests/ce/standard/2005/race.txt ;ftp://ftp.bls.gov/pub/special.requests/ce/standard/2005/hispanic.txt
VegetablesFruits
Vegetables
Veg
Fruits
Fruits
FruitsVegetables
How confident are you that the foodin your supermarket is safe?
Source: FMI Trends in the US Consumer Attitudes and the Supermarket, various years
0%
30%
60%
90%
'96 '97 '98 '99 '00 '02 '03 '04 '05 '06 '070%
30%
60%
90%
'96 '97 '98 '99 '00 '02 '03 '04 '05 '06 '07
Completely or mostly confident66%
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Consumers’ safety concerns related towhere food is consumed
24%
20%
23%
22%
34%
53%
58%
43%23%Eating at
Home
Shoppingfor Food
Eating Out
ConcernedNeitherUnconcerned
Source: N-Depth: Food Safety The Hartman Group, 2007.
Which food-related items constitute aserious health risk?
Source: FMI US Consumer Trends and the Supermarket, 2007
’07Bacteria or germs 49%Product tampering 43%Avian Influenza 38%Terrorist tampering 38%Residues from pesticides 37%
Antibiotics/hormones in livestock 25%Food handling in supermarkets 22%Foods produced by biotechnology 20%Irradiated foods 18% Declining since 1992
Declining since 1992
Declining since 1992
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How confident are you about the overallsafety of the nation’s fresh produce?
4.844.814.61
4.84.874.694.87
1
2
3
4
5
6
7
Sep-06
Oct-06
Nov-06
Dec-06
Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
PMA National Consumer Surveys on Food Safety Issues, various
On a scale of 1 to 7 where 7 equals most confident
3%
56%
41%
Yes No Don't know
Are there certain types o f fresh fruits andvegetables you don’t buy?
Source: PMA Nation al Consum er Survey on Food Safety Issues, March 2007
(Leafy greens mentioned by 40% as item don’t buy now, followed by 6% for bagged produceand turnips/turnip greens and 5% for onions/green onions.)
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200520062007
11938All Shoppers
Made Changes%
MadeChanges
%
Made Changes%
In the past 12 months, have you stoppedpurchasing any food products because of
safety concerns?
Source: FMI US Grocery Shopper Trends 2007
24215OtherN/AN/A4Green OnionsN/AN/A9Bagged saladN/AN/A16Lettuce
200520062007
N/AN/A71Spinach
12884Fruit/Vegetable(Net)
1352Seafood536415Beef/Poultry
Stop purchasing%
Stoppurchasing
%
Stoppurchasing
%Number ofShoppers
What food products did you stop purchasing?
Source: FMI US Grocery Shopper Trends 2007
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0%20%40%60%80%
'96 '97 '98 '99 '00 '02 '03 '04 '05 '06 '07
very concerned about nutritional contentmy diet cou ld be healthi er
Shoppers’ concern about nutritional content
and evaluation of diet
4372
Source: FMI Trends in the US Consumer Attitudes and the Supermarket, various years
62%
28%
4% 4% 2%Very Somewhat Not Very Not at All Don't Know
Fresh Produce: Importance of Nutritional Value
Source: The Dining Out Menu: Consumer Thoughts about Produce , PMA, 2006.
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Most important product attributesinfluencing fresh produce purchases of US
consumers, 2005Attribute PercentQuality 76Price 14Organically grown 6
Country of origin 3Source: FMI US Grocery Shopper Trends 2005
87%
8% 1% 2% 2%Very Somewhat Not Very Not at All Don't Know
Source: The Dining Out Menu: Consumer Thoughts about Produce , PMA, 2006.
Thoughts about Produce: Importance of Taste
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5% 2% 10%
69%
14%
A lot extra A li ttle extraNoth ing Extra Com binationDon't know
In general, how much extra would yoube willing to pay for better-tasting fresh
fruits and vegetables?
Source: PMA Consumer Perception s on Flavor and Taste, April 2007
Should fresh produce items, packages, ordisplays be labeled to identify. . .?Summary “yes” responses
Source: Fresh Trends 2002
Nutritional value 77.1%Country of origin 85.9%Chemicals used in 90.7%Organically grown 86.0%
Irradiated 77.8%Use of biotechnology 78.4%Use of waxes or coatings 84.5%
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US Organic Food Sales, 1990-
2006E
(Billion US$)
0
5
10
15
20
B i l l . $
1 1. 3 1. 5 1. 9 2 . 3 2 . 8 3 . 5 3 . 6 4 . 3 5 6 . 1 7. 3 8 . 6 9 . 2 11 14 17
9 0 9 1 9 2 9 3 9 4 9 5 9 6 9 7 9 8 9 9 0 0 0 1 0 2 0 3 0 4 0 5 0 6
Sources: Organic Trade Association (OTA) , Consumer facts and market information , 4-05-2001 for1990-1996; The Food Institute Report, May 10, 2004 for 1997-2002;The Natural MarketingInstitute for 2003 and 2004; OTA Manufacturer Survey 2007, for 2005 and 2006.
E=Estimate
Estimates of 2007 US Fresh Produce Organic Retail
Sales Vary Greatly!• 2% for fruit• 3% for vegetables• 10% for bagged salads• Totaling $1.5 billion-----------------------------Or 6.2% of retail fresh produce sales or $3.5 Billion in 2006-----------------------------Or• Ca. data: $387.6 Million farmgate value for organic
fruit/veg/nut, suggesting $2Billion final value, plus sales fromimports and other states------------------------------• But this is inconsistent with OTA estimates of fruits and
vegetables representing 40% of organic food sales, or $6.8billion
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Source: UC Agricultural Issues Center, Klonsky and Richter, 2007.
California Organic Agriculture by CommodityGroup, Number of Growers, 2000 – 2005
Row totals do not equal the sum of the columns because of growers in multiple categories.
1,7955051791131,29320520051,7224991771031,24821020041,757525174751,27425120031,847585194651,33226120021,925616190541,40226320011,903643186571,3652452000
Total*VegetableCrops
Nursery,Greenhouse
& Floriculture
Livestock,Dairy,
Poultry & Apiary
Fruit &Nut Crops
FieldCropsYEAR
76,500 total grow ers in Ca.
3%34%
28%35%
Demographically, the most likely to order organicsare consumers under the age of 30.
More Likely Less Likely
No DifferenceDon’t Know
More or less likely to order a fresh fruit orvegetable menu item if it is organically grown
Source: The Dining Out Menu: Consumer Thoughts about Produce , PMA, 2006.
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Why consumers choose to order an organicallygrown fresh fruit or vegetable menu item
Healthier 46%Taste 24%Overall nutritional value 24%Environmentally friendly 20%Less use of chemicals 5%Recommended by friend / family 3%
Local origin / Home grown 1%Other / Don’t know / Refused 4%Source: The Dining Out Menu: Consumer Thoughts about Produce , PMA, 2006.
23%
57%
17%
3%More Likely Less Likely No
DifferenceDon't Know
If the organically grown fruit or vegetable menuitem cost 20% more than a conventionally grownitem, would you be more or less likely to order theorganic item?
Source: The Dining Out Menu: Consumer Thoughts about Produce , PMA, 2006.
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