Produce Sales Among Millenials are Dipping—How Can Grocery Retailers Win Them Back?

Millennials are finding alternative sources for buying fresh produce. According to a 2019 Power of Produce survey by the Food Marketing Institute, only 34% of millennials stated that a supermarket was their primary source for fresh produce. Millennials represent a fairly large demographic, spanning from approximately ages 24 to 39-years old.    

The survey states that the $60 billion grocery category is losing momentum to other retail options, including subscription services, farmers’ markets and convenience stores:

●     Subscription services such as Blue Apron, Hello Fresh, Dinnerly and others are sprouting up both nationally and locally. Such meal delivery services have become popular lately because of the COVID-19 pandemic, particularly because they alleviate fears about risking exposure at the grocery store. Fortunately, retailers have mobilized quickly to offer or increase grocery delivery services. Grocery delivery popularity may remain high as consumers of all generations are getting used to the convenience of having everything delivered.

●     Farmers’ markets, however, compete with local supermarkets. Many millennial consumers want to support local farms and visit the farmers’ market to purchase the freshest produce and other local products.

●     Convenience stores are gaining popularity among millennials and Gen Z.   The grab-and-go appeal, along with minimal to no checkout lines and simplified options, makes convenience stores a triple win for younger consumers. Typical convenience stores, however, do not have the produce inventory as a supermarket does—at least not yet. With the introduction of Amazon Go, convenience stores could take a cue from that business model and take advantage of a new and more profitable model that serves this growing unmet need.

So what do millennials actually want from grocery retailers?    

Emphasize local produce

Fifty-three percent of survey respondents want expanded local assortment at the stores.

The definition of “local” typically refers to items coming from within an 88-mile radius. However, consumers who prefer local may be unaware that some produce is regionally grown. In California, for example, the Coachella and San Joaquin Valleys are home to generations of table grape growers, producing 99% of the table grapes grown in the United States. In a California Table Grape Commission survey, the majority of consumers polled prefer California grapes over imported grapes. The study, which spans five years, reveals an average preference of 92% over 8%, respectively.

 
Courtesy of the California Table Grape Commission 

The takeaway? Retailers can emphasize both local, and, where applicable, regionally grown produce. As described in CUESA’s 10 Reasons to Support Farmers Markets, “Shopping and cooking from the farmers market helps [consumers] reconnect with the cycles of nature in our region.”  

Retailers can play up their seasonal produce offerings with signage. For example, grape displays throughout the summer and autumn months might pique more interest from shoppers with “California Grape Season is Here!” signage, positioned alongside or above a colorful and vibrant display of grapes.

A grower’s card is another example of signage that can connect consumers with the cycles of nature, right in the produce aisle.  

With consumer consciousness on the rise about how produce is grown on the rise, food safety (amidst produce recalls) and the grower’s carbon footprint, each of these concerns can be addressed in bullet points on the grower’s card, while adding a friendly “face to the farm.” 

Beyond signage, there are creative measures a retailer can take, such as installing a “grow wall” exhibit that might enhance the shopper’s experience and encourage healthy buying habits.

As shoppers’ interests continue to expand, it’s important to understand what topics are truly the most important to consumers. By learning more about what consumers want—particularly millennial consumers, grocers can strategize how best to attract them.