At the onset of the pandemic, grocery e-commerce jumped forward about five years on its natural growth trajectory. It was the full growth trifecta: more people, more trips and greater spending online. Fresh produce partook, but not to the same extent as center store grocery — a gap that still exists.
Across all food and beverage sales, between 10% and 12% are sold online. Fresh produce sits well below that. People are comfortable buying some items online, but for many items, they want to do the selecting. This argues for better website or app functionality, where consumers can indicate whether they are looking for a glow-in-the-dark green banana or one ready for eating. Or, finding ways to leverage the trust people have in the in-store produce department to the online environment.
We have an opportunity to do a better job at merchandising online, much like we do in store. I’ll give an example. If we think about a typical in-store apple display, many stores have quite a variety of apples, but also signage that shows the apples on the range from tart to sweet. This same sign educates the consumer which apples are good for baking versus good for snacking. Packaging often reinforces these ideas, as well, with texture and taste descriptions.
Now, try buying an apple online. I tried upward of two dozen retailers and struck out each time. All have description and nutrition fields, but, at most, I found a UPC number, or, the very profound “apple” in the description field. I never once found any nutrition information or health benefits/callouts.
It is the online picture and description that have to replace the in-store visual, smell, squeezing and thumping people do while in the produce department. The better the description, the more chance we have to land in the online basket.
In a survey just a few weeks ago, I asked online produce buyers what they want to see when making their selections. And from the list, it is clear we need to step up our game.
What consumers want to see:
- 72% Clear picture of the product
- 53% Detailed product description
- 42% Nutritional information
- 34% Recipe(s)
- 32% Cooking suggestions
- 30% Source (farm, location, etc.) details
- 27% “Also buy” suggestions
More than seven in 10 want to see a clear picture of the product and more than half want to see a detailed product description, together with 42% wanting nutritional information. All these things are hard to do in-store, where we want the natural beauty of produce to pop out instead of endless signage. But online, it is not only easier, but a must to give people greater confidence to buy produce.
Most growers and brands have beautiful pictures and descriptions readily available. We have to make sure this information makes it into the hands of the marketers behind the website. We have to make sure when a consumer wants to make an apple pie, they can go online and figure out which apple to buy, just like they can in-store. Together, with cooking and “also buy” recipes, this will start to close the gap between the produce items bought in-store only versus those bought online as well.
About one-third of online buyers want to see cooking suggestions or “also buy” suggestions. Consumers are still cooking significantly more than they did prior to the pandemic and many say it’s not the meal preparation that is the hard part, but it is coming up with things to make for breakfast, lunch and dinner, day after day. Today’s technology allows retailers and brands alike to suggest recipes and add all items to the cart with one swift click.
In addition to more nutrition information, descriptions and beautiful pictures, it’s also important we don’t lose the power of new and seasonal that we see in the in-store environment. About half of consumers never look for new items when they shop online. In the summer, most stores lead with regional and seasonal crops. During cherry season, you can’t enter a store without seeing the new crop prominently displayed. But online, 82% of consumers start with their past purchases. How will they know it is cherry season?
E-commerce has also opened the door to a lot more consumer-direct selling in fresh produce and they are taking dollars out of traditional retail. One powerful example is The Peach Truck. While shoppers spend $4.15 on peaches in store, The Peach Truck sells its customers 25 pounds for $50 in one swoop. In the name of research, I was one of them. I had every intention in the world to share my 25 pounds of peaches with friends and family. But The Peach Truck did a tremendous job in giving recipes on making anything from peach cobbler to peaches on the grill to peach popsicles. They also taught me how to freeze peaches or perhaps can them. And at the end of the day, my family of four ate every single one of the 25 pounds of peaches.
There’s a big learning opportunity in this. People will buy bulk if you tell the beautiful story of the family farm peach that is going to taste like the best peach you’ve ever had, and if you provide tips on what to do with it.
We’re also seeing retailers use e-commerce technology to move into areas where they do not have a physical presence. Kroger is a good example of this. I do not have a Kroger within 200+ miles of my house, yet can order online and have it delivered the next day.
This all means e-commerce is still a growth opportunity for fresh produce, but also be aware of others leveraging e-commerce to sell to your consumers directly. Delight in-store and replicate this online.
Anne-Marie Roerink is the president of 210 Analytics, a San Antonio, TX-based research firm. Working closely with retailers, wholesalers, grower/shippers and trade associations, Roerink understands the challenges and opportunities in the food and produce businesses today, as well as the drivers of success tomorrow. She works in many different areas, uncovering the trends in an ever-changing marketplace.
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Need More Than Product Information to Sell Online Produce
By Jim Prevor
Here is a secret. In the midst of the pandemic, my family began ordering online from our grocery store and we haven’t stopped. It is a large order — 63 items, many with more than one package of the same product ordered, and it originally cost $515.90. Here is the secret. We don’t have the time or patience to study the order every time, so we just reorder. Sometimes we add something new that we know we want or delete something that we already have. Though we are embarrassed to say this, we often buy duplicates of things we don’t need, because we didn’t take the time to review the 63 items!
One of our sons has an apartment in college. He orders groceries almost exclusively online. It is a smaller order, and our son does edit it. But when it comes to fresh foods — meat, poultry, seafood, produce etc. — the market has never once actually fulfilled a whole order. And it is often the differentiated products, the main reason for shopping at that store, which are the ones out of stock.
Anne-Marie Roerink is 100% correct in pointing to many ways retailers can, and should, improve their online offerings — though we are not sure stores often do a great job in-store of defining the nature of, say, different apple varieties.
A related question is whether providing more product information increases total produce sales. In other words, does a detailed description explaining a particular variety is good for snacking increase apple consumption? Or does it make the shopper simply switch the variety being purchased? And if it does increase apple consumption, does that sale come from other produce items or, instead, reduce sales of snack foods?
The research here is brilliant, and the list of things consumers claim they would like to see when purchasing produce is almost certainly on the mark. And yet, the whole scenario reminds us of that old nursery rhyme:
If wishes were horses,
Beggars would ride:
If turnips were watches,
I would wear one by my side.
There is little question that, if asked, consumers can come up with lists of things they would like to know about produce they are thinking about purchasing. Yet here is the rub: If you pull up the Instacart site Publix (in the U.S.) has for online shopping, a banana — the No. 1 selling produce item — costs 39 cents for a single banana or 77 cents a pound. A pricey item, like fresh raspberries, is $2.77 for a six-ounce container. A pound of sweet onions? That is $1.89. A five-pound bag of Russet Norkotah potatoes — $5.67. Produce is so inexpensive and the variety so vast… how likely is it consumers will really review the seven-point checklist they claim to want to see?
Here is a bigger problem for the produce industry: If consumers do a search because they would like to buy some potatoes, what do you think comes up first? The “featured items,” which typically are paid promotional items, come up first. So, on this Instacart page, a search for “potatoes” highlights Ruffles Potato Chips and Hormel Meatloaf and Gravy with Mashed Potatoes!
Here is a job for IFPA: Why doesn’t the association reach out to Instacart and to each retailer, asking them to make a commitment that when people search for produce items, they will actually get fresh produce and not ads that de facto are pulling them away from the produce department?
We thank Anne-Marie for introducing us to The Peach Truck. We instantly ordered two separate things. We ordered the 25-pound box of peaches Anne-Marie describes. But that is as much an event as it is food for consumption. It reminded me of my days back in school where we raised money for teams and events by selling Florida citrus when it was in season. As an experiment, we ordered a Fresh Peach Box from the same organization Anne-Marie mentioned. This came with 13 peaches and cost $50 plus an $8 UPS charge. In 11 states, they charge $28 shipping, and they can’t ship at all to California, Arizona, Alaska or Hawaii.
The peaches arrived at our office and were delicious, in part because they arrived super ripe. In two days, three max, they had to be consumed or thrown out. Or, as Anne-Marie mentions, they had to be canned, grilled, turned into cobblers or ice cream, etc. Again, here is the question: If consumers were somehow motivated to buy these items, would their purchase result in more fresh produce consumption? Or would people buy fewer nectarines and plums because they are oversupplied with peaches? Or, maybe, it is a different business and people buy for fun, and it has very little to do with what they buy in grocery stores, physical or online.
Technology is definitely going to change things. Kroger won’t be the last retailer to want to sell in areas without investing in stores. Again, will this change produce consumption?
The scary thing is that, so far, our sense is that fresh produce sells itself in stores with attractive product, a nice scent, the variance from week to week that makes it more interesting than canned goods, etc. The sale online transforms the product into standardized, packaged item, and it seems very hard to entice consumers to feel that “this week” they should buy something that they didn’t buy “last week,” and this is a big challenge for the industry.
Anne-Marie Roerink and 210 Analytics are pointing to many things that might help us move in the right direction. It also may be true that there is another route entirely. Maybe consumers will look for online shopping to buy canned, frozen and otherwise standardized items, and supermarkets will serve as a kind of hybrid fresh and foodservice outlet where consumers can relish the taste, the variety and the culinary experience. Maybe we will sit down with friends and family and try a peach grilled right in the store. Maybe the flavor of the grilled peaches and the joy of the camaraderie will entice us to buy some more to give our family the very precious experience of sharing it together at home. Maybe this new fresh experience will help move the needle on overall consumption.