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Case Study: Consumers want to eat more seafood

Research says quality, freshness and convenience are top purchasing criteria

Quality counts with shoppers - Food Marketing Institute, U.S. Grocery Shopper Trends 2005
By Lisa Duchene
April 01, 2006

Town & Country Markets knows what Seattle’s consumers want in a seafood department. For the third quarter of 2005, seafood sales at each of the company’s six stores, three of which operate as Central Markets, were 17 to 55 percent ahead of the prior year, says Chris King, seafood specialist.

“Celebrating fresh is our theme,” says King. “Since seafood is a big part of the Northwest, in our Central Markets, [seafood departments] are large and go out front and center, because that’s who we are in the Northwest. We’re all about fish.”

What customers want from their grocery store seafood departments varies by region and by individual store demographics. But a few things are clear: Successful seafood grocers like Town & Country understand their customers’ needs. U.S. consumers are interested in eating more seafood and want fresh, healthful and convenient products.

The Central Markets in Mill Creek and Shoreline, Wash., have 35-foot service seafood cases filled with 20 to 30 species, bulk-frozen bins of 54 items, four live fish tanks and large live-shellfish displays.

These departments and a new one opening late this summer in the remodeled Poulsbo Central Market are designed to interact with customers. Display cases are positioned so that shoppers can easily watch the staff at work and talk to them. Workers mingle with customers and toss fish, à la Pike Place Market, says King, a veteran of the famed Seattle fish store. “Everything is geared to the customer,” says King. “The whole idea is to hear echoes of ‘May I help you?’”

“Consumers are really getting the message about healthful eating,” says Fran Carpentier, senior editor of Parade magazine. Carpentier oversees “What America Eats,” Parade’s annual survey of 2,000 American adults. In the 18th annual survey, published last November, consumers reported eating 31 percent more fish than in 2004.

In an International Food Information Council survey of 1,012 adults conducted in May 2005, consumers named seafood, including fish oil, as the No. 1 “functional food,” a disease-fighting food with health benefits beyond basic nutrition.

“You have an overwhelming majority of adults who say they really should be eating more seafood,” says Karen Bundy, VP of food, beverage and nutrition marketing for Multi-Sponsor Surveys in Princeton, N.J., which in 2005 conducted a Gallup Study on seafood in which 1,529 adults were interviewed. Fifty-nine percent said they eat too little seafood. Price, more than any other factor, keeps them from eating more, found the Gallup Study.

Appearance and healthfulness are the most important factors when consumers shop for seafood, according to Gallup. When asked which purchasing attributes were “very important,” 65 percent of respondents said appearance; 55 percent said healthfulness; 51 percent mentioned price; and 34 percent cited ease of preparation. (Respondents could choose more than one; these attributes scored the highest.)

Whether the fish is fresh or frozen, wild-caught or farm-raised or organic was considered “very important” by about 10 percent of consumers, says Bundy. Sixteen percent rated country of origin as “very important” when buying seafood.

The Food Marketing Institute’s 2005 report “U.S. Grocery Shopper Trends” found similar results. Sixty-two percent of the 1,001 consumers surveyed cited quality as the most important factor when purchasing seafood, followed by price at 19 percent and country of origin at 2 percent.

Consumers are looking for convenient ways to eat more fish, says Parade’s Carpentier.

“They want it as easy and convenient as possible,” she says. “I think, by and large, Americans are still a little fearful of cooking fish.”

But convenience can’t come at the expense of the product’s freshness, says Carpentier, who named Whole Foods as a stand-out grocery seafood department. Consumers want to know how long a ready-to-eat item has been sitting in the case and want assurance that it has been properly refrigerated.

“I think people think about that when it comes to fish more than they do with other foods,” says Carpentier.

According to Multi-Sponsor’s Gallup Study, 50 percent of consumers say fresh seafood is better than frozen, and 48 percent say the quality of fresh and frozen seafood is about equal. But 43 percent of consumers consider frozen seafood, a category that has seen strong sales growth in the last five years, more convenient than fresh.

“People want fresh seafood, but they don’t want a supermarket that smells of fish,” says Dr. Christine Bruhn, director of the Center for Consumer Research at the University of California’s Department of Food Science and Technology. “This may seem obvious, but I have encountered many markets where the [seafood] odor hits you as you walk in the door.”

For all foods, consumers’ perception of fresh is key, says Laurie Demeritt, president and COO of the Hartman Group, a Seattle consumer-research firm. The Hartman Group’s “2005 Shopper Insights” study found that consumers’ view of foods as either fresh or processed influences what they buy. Consumers still buy processed foods but perceive fresh as better.

“Fresh” typically means a chilled, healthful product with an expiration date. The perception often has more to do with a product’s packaging and location within the store than with the actual taste, says Hartman.

More than ever before, grocery stores must understand what their customers want, says Nick McCoy, senior consultant at Retail Forward, a Columbus, Ohio, retail consulting firm. McCoy authored the firm’s April 2005 “Food Channel Industry Outlook.”

Grocery stores can no longer operate in a cookie-cutter, all-things-to-all-people format, McCoy says. Management must be in the stores, talking to customers to understand their needs, and they must use tools like customer loyalty programs to understand the demographics in their market.

Age, for example, matters when it comes to buying fish. The Gallup Study found health to be driving seafood purchases among Baby Boomers, but ease of preparation was the driver among younger generations. Sixty-one percent of consumers 18 to 34 years old said they weren’t very knowledgeable about how to cook fish.

Grocers who tailor their formats and offerings to their market will do better, says McCoy. Publix, for example, in the last year opened two Publix Sabor stores in Kissimmee and Hialeah, Fla., designed to broaden the chain’s reach to the Hispanic community. Ads and product information are in both English and Spanish, and the store carries a large number of Caribbean- and Central- and South American-influenced products.

“Companies that seem to be doing well are those that seem to be willing to try new things, new approaches,” says McCoy.

Knowing what your customers want and tailoring the seafood department to their needs is key to a successful operation.

Contributing Editor Lisa Duchene lives in Bellefonte, Pa.

 

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