Research Reports
Home Grown Appeal
Some of North America’s biggest supermarket chains, including discount giant Wal-Mart Stores Inc., Bentonville, Ark., and natural foods retailer Whole Foods Market, Austin, Texas, have jumped aboard the bandwagon with their own buy-local strategies.
A successful strategy depends largely on the ability to spread the word about the category, says Gretchen Nurse, a research fellow in Colorado State University’s department of psychology.
In other words, she says: “How do we tell the customer in the best way?”
The key, she says, is fine-tuning your marketing to capitalize on the factors that drive consumers to seek out local produce.
Deciding factors
The 2009 edition of the Food Marketing Institute’s U.S. Grocery Shopping Trends lists some of those factors.
Overall, the report found that 72% of shoppers say they buy locally grown products on a regular basis. Reasons given were freshness (82%), to support the local economy (75%), taste (58%) and the environmental impact of transporting foods across great distances (35%).
It’s your job to determine what factors motivate your customers and then develop a marketing program based on what you learn, Nurse says.
If your customers are concerned about the environment, emphasize the sustainability practices your growers use, Nurse suggests. Point out the total acreage of local fruits and vegetables that you support, and talk about the distance produce travels from farm to your stores.
For shoppers who make supporting the local economy a priority, indicate how many of your sales dollars go to area farmers, and list the percentage of produce you source locally.
For those obsessed with freshness, put up chalkboards letting shoppers know when the product was harvested.
Other consumers prefer local products because they want to “reconnect with their food system,” Nurse says. You can appeal to them by posting photos of local farmers you work with and sharing information about them and their farms.
On-package tie-ins
Susan Futrell, director of marketing for Red Tomato, a nonprofit, Canton, Mass.-based organization that helps 40 local farms market their product in the Northeast, goes a step further.
She suggests that retailers and farmers work together to put some sort of farm identification – a sticker, perhaps – on the packages to help cement the farmer-consumer relationship.
She also encourages retailers to educate shoppers about the seasonality of local fruits and vegetables.
“People get used to having produce year-round,” she says. “They don’t really know what the season for local strawberries is.”
One way to call attention to local produce is to set aside a part – maybe an island – of the produce department for homegrown items, as with organic fruits and vegetables, says Robert King, a professor in the department of applied economics at the University of Minnesota-St. Paul.
Products and suppliers may change, but it would be a place shoppers could check each week to see what’s new on the local scene.
A social occasion
And don’t overlook social media.
Build a community of local buyers by forming Facebook partnerships with local growers, Nurse suggests. This also will ingratiate your store with “foodies” and fans of the growers.
Use Twitter to promote upcoming store appearances by local farmers.
You also can host farmers market events at your stores and arrange tours of your growers’ farms.
Perhaps most important, Nurse calls for plainly labeling local products so consumers can spot them easily.
“The locally grown label is a powerful one,” she says.
In a study in a Minnesota supermarket, 48 of 52 shoppers chose red round tomatoes that were labeled locally grown over those that were not.
“Once people knew the tomatoes were local, the sales did increase,” Nurse says, “and it was regardless of price.”
“Many retailers view locally grown programs as important parts of their differentiation strategies,” says Roberta Cook, Cooperative Extension marketing economist at the University of California-Davis. “In some cases, it also benefits their cost of goods due to lower freight costs.”
Nurse also suggests tying in with state agriculture departments’ locally grown programs.
In 2000, fewer than half the states had agricultural marketing programs. Today, all 50 states have programs, with slogans such as “Grown Fresh with Care in Delaware,” “Fresh from Florida,” “Go Texan” and “Pride of New York.”
The How-tos
Savvy retailers already have implemented many of these practices.
Selected Vons and Pavilions stores, part of the Pleasanton, Calif.-based Safeway Inc. chain, hosted a series of weekend events last summer to let shoppers know that they carry locally grown produce.
Rick Cruz, manager of division operations for produce, set up booths outside the stores and invited California producers like Kingsburg Orchards, Kingsburg; heirloom tomato grower Tutti Frutti Farms Inc., Lompoc; and melon grower Dulcinea Farms LLC, Ladera Ranch, to tout their wares.
“The promotion was a big success in educating our customers on the vast variety of locally grown produce in our stores,” Cruz says, adding that he plans to repeat the promotion this summer.
Portland, Maine-based Hannaford Supermarkets has offered its customers local produce for 128 years, says Wendy Ward, local sourcing specialist.
The chain works with more than 220 growers and offers its Close to Home program in 175 stores in five Northeastern states.
Hannaford Supermarkets promotes its program with Close to Home signage that includes a map of the state and farmers’ photos. Produce managers have erasable boards on which they write the names and the towns of their growers so that “customers can relate in a deeper way,” Ward says.
The chain also has a Close to Home section on its website that includes an interactive map that allows visitors to click on a state and see a list of all the local growers.
Expanding displays
Dorothy Lane Markets, a group of three stores based in Dayton, Ohio, starts the summer with a small display of local produce, which expands to three or four displays in various areas of the produce department as the season progresses, says Jose Manzano, director of produce.
As much as 20% of the stores’ produce may be locally grown during the summer.
Each of the three stores sets up a farmers market promotion from 11 a.m. to 2 p.m. one Saturday during the summer where customers can visit with local growers.
“The parking lots are packed,” Manzano says. “(Shoppers) love to buy the stuff directly from the farmer.”
To reach maximum potential, the whole store – including the meat and dairy departments – should be involved in promoting local products, Manzano says.
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Pamela Riemenschneider |
“When you have a lot of local offerings in other departments, it really complements your produce department,” he says.
Market of Choice, a group of eight stores based in Eugene, Ore., includes grower videos on its website, and veteran produce buyer and merchandiser Gene Versteeg keeps customers apprised of his latest local offerings through his blog on the stores’ website.
He’ll tell consumers when local fruits and vegetables will be available, how much they’ll cost, whether they’ll be on sale, what the quality is like, who grows them and where.
Schnuck Markets Inc., a chain of 105 stores based in St. Louis, Mo., uses its weekly ad, in-store signs and its website to let customers know where their produce is grown, says Mike O’Brien, vice president of produce.
Rather than label its products locally grown, the store simply tells consumers where they’re grown, he says.
“If we can identify the farm, we do that,” he says. “I think that means more to a customer because you’re showing the face of the farmer.”
In-store farmers market
King Super Markets Inc., a chain of 24 upscale grocery stores based in Parsippany, N.J., sets up a farmers market display in the middle of the produce department where the produce manager displays local produce in baskets “to enhance the visual appeal,” says Futrell of Red Tomato.
The company also sponsors a Community Supported Agriculture program by offering shoppers an opportunity to sign up for produce from local growers. Participants pick up a box of local produce in the stores and often do additional shopping while they’re there, she says.
Wal-Mart announced in October that the company planned to double the sale of locally grown food through its Heritage Agriculture program, which focuses on sourcing produce from states and regions with long histories of agricultural production.
The company also has introduced a “Food Miles Calculator” that buyers can use to help determine product pickup locations and select which of the company’s 38 food distribution centers the product will reach.
Finally, Whole Foods Market profiles local producers on its website and identifies on in-store signs where every produce item is grown.
“We feature local produce in season,” the company says on its website.
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