Sprouts goes all in on organic produce merchandisingSprouts goes all in on organic produce merchandising

Sprouts Farmers Market is betting on the organic produce consumer.

The Phoenix-based chain of more than 430 stores in 24 states, which specializes in fresh, natural, and organic food, has had three consecutive years of double-digit organic produce growth and expects that trend to continue because of its wellness-oriented customer base, said Daniel Spivey, director of fruit for produce.

“Shoppers are focusing on food attributes, and organics is one of those attributes,” he said. “They are looking for unique and flavorful varieties to support their healthy lifestyles.”

Sprouts’ main organic customers are younger millennials (persons born between 1981 and 1996) and Gen Z shoppers (born between 1997 and 2012). “Those consumers also care more about the environment and sustainability,” Spivey said at the 2024 Organic Produce Summit in Monterey, Calif.

The retailer is focusing on consumers who are willing to pay more for organic produce, he said. “Younger customers are facing inflationary pressures but are still willing to spend a little more for what they perceive as value,” Spivey said. “That value does not necessarily mean price. It is ‘am I getting a good quality varietal that I can take home and feed my children?’”

Stores can better generate organic produce sales by providing data on the origin of products and the health benefits, he said, along with marketing selections both in-store and online.

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“After customers come into the store, we have from 5 to 10 seconds of attention span to get them to make the purchase decision and place items in their baskets,” Spivey said. “Attention is a little longer in the e-commerce space and if you educate the customer there, you are going to win.”

Sprouts’ online purchasing activity is increasing as its younger target audience “leans more into e-commerce because of the convenience factor,” he said.

The grocer also is responding to customers’ interest in sustainability by considering how to reduce its use of plastic packaging, Spivey said. “We have a long way to go but are looking at recyclable compostable bags,” he said.

Such packaging also can be effective vehicles for providing fruit and vegetable information to shoppers, yet many operators are missing that opportunity, Spivey said.

“It is telling a story about the product while showing customers that we care about the environment,” he said. “But stores are not using the vessels consistently and well enough to educate the consumer about the product, organics, or both.”