Brands are having a big impact in the produce department
It’s a good time to be a fruit or vegetable brand. The overall produce category grew $13.2 billion, up to $68.8 billion in 2016 from $55.6 billion in 2012, according to a new Nielsen report. Branded products’ dollar share gained 7.7 percentage points in that time period, lifting the group to 38.5 percent of the total. Unbranded, meanwhile, lost 8.6 percentage points, shrinking its share to 49.9 percent of the total. Consumers want to eat more fruits and vegetables, and brands are successfully evolving to meet their changing needs, said Matt Lally, client director at Nielsen Fresh. That includes innovation in terms of the actual form, like dicing and slicing vegetables, and messaging, like including the vitamins and nutrients inside the produce and how that can help consumers. “It’s no longer enough to say produce is healthy, but consumers want to know does this have the right vitamins and nutrients for the specific type of diet I need based on whatever my health state is,” Lally said. “So that’s really an area that brands can play a critical role and one they’ve started to embrace.” One trend that has swept across the food industry is the growth in snacking. Fruits and vegetable brands have harnessed that to create portable packages of their products, sometimes paired with other foods like dips and cheeses. And it has found success. Branded produce represents 72 percent of the $1.1 billion produce snacking category, according to Nielsen. “The produce department was a little late to the game, but it’s rapidly increasing products specifically with those individual, on-the-go packaged items. Brands are playing a key role in that” Lally said. Nielsen’s findings should show brands that it’s critical to keep their innovation and packaging decisions focused on what consumers are looking for, Lally said. Plus, he said, they should realize there’s still plenty of room to grow. Fresh produce accounts for 33 percent of perishable dollar sales, yet fresh produce companies only account for 10 percent of all media dollars. “So there’s a disproportionate amount of what’s invested and communicated between what’s realized in dollar sales,” he said. “I see that as a key opportune way to continue to latch onto the growth that’s occurring.” Fruits and vegetables could share their success with other categories. Lally sees opportunities to use fresh food to promote nonperishable food products that have struggled as consumer preferences shift. For example, a packaged salad could include a label on top promoting a specific brand of packaged dressing with a coupon. “Produce has so many natural connections and people are incorporating it into so many other elements,” he said. “Why not leverage that to help drive growth across the store?” Source cnbc.com Author: Angelica Lavito Image: Robert Nickelsberg | Getty Images Read the article in cnbc.com
- The overall produce category grew $13.2 billion between 2012 and 2016, according to a new Nielsen report. Branded products’ dollar share gained 7.7 percentage points in that time period, lifting the group to 38.5 percent of the total.
- Unbranded produce, meanwhile, lost 8.6 percentage points, shrinking its share to 49.9 percent of the total.
- Branded produce represents 72 percent of the $1.1 billion produce snacking category, according to Nielsen.