Operating In The Real World

As always, Sharon Olson and her Culinary Visions Panel have provided deep insight into the minds of shoppers in the supermarket deli. Now the question is how should the industry take advantage of these insights.

That is a question without clear answers — possibly because the answers are specific to the retail banner, the store or the brand.

One issue posed by all research is that when targets become clear, everyone goes after them, so it is difficult to turn these clear targets into a business edge. For example, for many decades grocery store research has identified three key areas as crucial for consumers when selecting consumer shopping venues: Price, Cleanliness, and Assortment.

Obviously some stores emphasize price a bit more and others focus on assortment; some are even cleaner than others but, basically, there are no mainstream chains that aren’t basically clean, reasonably priced and with a useful assortment. So these characteristics function as a kind of ante – the base necessary to play the game. The fact that 98 percent of consumers say cleanliness is important in choosing a shopping venue does not imply Kroger would boom if it quintupled the cleaning crew.

In addition, sometimes broad phrases mask deeper expectations. Consumers may yearn for local — but that may mean more than geography. In Deli Business’ sister publication, Produce Business, we’ve done substantial research on consumer attitudes toward “local,” and what we found is consumers often prefer local but do so for a complex set of reasons. In produce, for example, they expect locally grown produce will first be more flavorful — pointing to the idea local growers can keep products on the vine or tree longer to ripen and thus produce sweeter and tastier fruit.

Second, they expect local will be cheaper, pointing to the lack of need to transport the produce long distances. Third, they expect local produce will be safer, seeing a local farmer as more vested in keeping the community safe. Fourth, they expect buying local will help the environment, pointing to a lessened carbon footprint due to less transportation, and fifth, they expect buying local will help the local economy by keeping money in circulation in the community.

Now all these points are quite arguable, but for our purposes the question is whether the branding effect of the word “local” is so strong that consumers will sustain a preference for purchasing a local product, even if it does not provide advantages in these areas, especially in readily observable ones such as taste and flavor.

In many cases, we have to surmise the effect on purchasing is weak. For example, although more than 50 percent of shoppers say organic is a strong motivator to purchase in deli/bakery, less than 1 percent of farm and ranch land in the United States is certified-organic. So the math means that not too many consumers are taking home organic pastrami sandwiches on organic bread with some nice organic stone ground mustard from their local deli.

It is not surprising deli customers over-index for many of the hot trends in the food scene today. The very fact that it is a fresh department, where a lot of creativity is exerted, means the department attracts people in sync with today’s trends. But the very fact that words such as “local,” “whole grain,” “all natural,” “no high fructose,” “hormone-free” and “grass-fed” resonate with this shopping cohort makes it hard to discern real-life purchasing behavior. These are all good things, but we can’t be certain to what degree consumers will prefer these choices even in the face of lower-priced alternatives.

Like driving a sports car or a Prius, these choices define people in a positive way. Just imagine someone saying they want to load their children up with hormones and high-fructose corn syrup and get the cheapest food from the cheapest laborers at the end of the earth. So these expressions are not neutral and thus must be interpreted carefully.

Yet real-world concerns — like affordability — actually drive a lot of purchasing behavior. And the fastest growing retailer in America today is Aldi, not Whole Foods.

Interestingly enough, though, even Aldi’s success may point to a thought that could help in capitalizing on Culinary Visions’ consumer research. Lots of consumers are going for private label, and, indeed, Aldi is almost exclusively private label. But it dresses up each product in a private label brand, so a consumer selecting the least expensive items has a cart filled with brands indistinguishable from those of other shoppers. In contrast, many grocery stores offer tiers of pricing in private label, and the cheapest items are often packaged in a distinctive way — such as black-and-white basics. So the cashier and other shoppers clearly see this person is buying the cheap stuff.

Maybe the research tells us consumer aspirations are expressed especially in the deli and retailers need to find ways to help consumers be their aspirational selves, but on a budget, they can handle.