Why produce is more attractive than ever to shoppersWhy produce is more attractive than ever to shoppers

The fresh produce sector is providing merchandisers with a plethora of sales opportunities.

A wide range of consumer segments are increasing their purchase of fruits and vegetables as healthy eating becomes top of mind and prices stabilize. By utilizing the appropriate marketing tools for their specific customer bases, retailers can boost interest and activity, analysts said.

Fresh produce volume sales totaled 50.3 billion for the 52 weeks ending 12/1/24, a 3.6% increase from the year-earlier period, reports Circana, a Chicago-based market research firm. Dollar sales were $92.7 billion, up 3.8%, with an average price per volume of $1.84, a 0.2% increase.

Fruit volume sales were 27.6 billion, up 4.3%, and dollar sales totaled $47.6 billion, a 5.7% gain. Fresh vegetables had volume sales of 22.5 billion, up 2.8%, and dollar sales of $43.9 billion, a 1.9% increase.

Among the products registering strong volume increases were grapes (9.9%), cucumbers (9.4%), apples, (8.6%), and berries (8.2%)

While boomers (persons born between 1946 and 1964) and Gen X shoppers (born between 1965 and 1980) purchase the majority of produce, all segments are ripe for activity increases, said Anne-Marie Roerink, president of 210 Analytics LLC, a San Antonio-based market research and marketing strategies firm and author of the Power of Produce 2024 report, published by Arlington, Va.-based FMI—The Food Industry Association.

Related:Walmart continues to be ripe with ideas for produce

Older shoppers are hungry for produce

Many consumers are searching for the best produce values and are willing to shop at a variety of retail channels, including mass merchandise, club, and dollar stores, said Chris Costagli, vice president of food thought leadership at NielsenIQ, a New York-based consumer intelligence firm.

“These channels offer greater affordability for essential items,” he said. “As budgets tighten, this trend is expected to continue. More consumers are planning to cut back on snacks, confectionery, and frozen foods in favor of fresh produce, dairy, and meat.”

Older shoppers are especially prone to purchase produce, due in part to established cooking habits and a preference for home-prepared meals, Costagli said. “They often have more time to cook and are making fresh ingredients a staple in their diets,” he said.

Retailers can help spur greater activity from the less active buyers, particularly those from Gen Z (persons born between 1997 and 2009), by leveraging merchandising technologies to reach the tech-savvy group, Costagli said. That includes QR codes that enable consumers to receive product information via their smart phones, and by using the store app to offer personalized discounts, he said.

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“Gen Z tends to shop more frequently but plans less, and that presents an opportunity to use creative in-store strategies and digital engagement,” Costagli said. “The shoppers value sustainability and ethical sourcing, so highlighting product origin and environmental impact, as well as using innovative packaging with freshness indicators, can build trust and loyalty.”

By selling produce in smaller packages, merchandisers also can entice the large base of consumers who are increasing their shopping trips but are purchasing fewer items during each excursion, along with the ample segment of one- and two-person households, said Jonna Parker, Circana team lead, Fresh Foods Group. “People don’t want to stock up and risk having to throw away items,” she said.

Lean into the impulse buyer for produce sales

Situating produce displays near store entrances is yet another way to spur sales by generating activity from impulse buyers, said Jonathan Raduns, founder and partner of Greenville, S.C.-based Merchandise Food Retail Consulting. Effective units will have angled and flat bin tops, while mobile multi-deck refrigeration displays and well-lit perimeter upright vertical reach-in coolers will also attract attention in different store locations, he said.

Related:A war against produce waste

Produce department signage can be effective sale triggers too, Roerink said, and particularly placards that emphasize freshness. Such messaging, for instance, might detail the speed at which merchandisers transport selections from the field to store or highlight money-back quality guarantees, she said.

Messaging can communicate value as well, Raduns said, including postings that emphasize volume discounts like “10 for $10.” “We are seeing aggressive high impact colored and boldly placed stickers on items to drive margin,” he said.

Providing information on the produce growers and unique product attributes can be effective purchasing lures as well, Parker said. “Produce can grow like gangbusters if the parties work at telling a story,” she said. “It is food entertainment, and many retailers are not participating.”

Additional measures, including situating produce on secondary displays and marketing different items together, will further interest shoppers, Roerink said. “Cross-merchandising selections and presenting the items as value priced when purchased in tandem can increase margin dollars,” Raduns said.

Moving forward, greater product marketing will help boost shopper interest in a wider range of produce options, said Sherry Frey, NielsenIQ, vice president of health & wellness thought leadership.

“Fresh produce remains a cornerstone of nutritional goals,” she said. “Consumers are increasingly seeking out fresh fruits, vegetables, and minimally processed foods. Organic and clean-label options are also gaining popularity as more shoppers are willing to pay a premium for transparency, fewer additives, and sustainable farming practices.”

Fresh organic volume sales rose 7.2% to 4.06 billion over the last year, with fruit up 10.1% and vegetables increasing 4.1%, Circana reports. Dollar sales grew 5.1% to $11.5 billion. The average volume price was $2.82, down 1.9%.

“Consumers are finding value in the produce department and are balancing cost and promotions with the benefits of purchasing organic, value-added, and locally grown produce,” Roerink said.

A focus on value will keep consumers shopping at a greater variety of channels for the best deals, she said. “That means the produce dollar will be more widely distributed than ever and, as such, conversion should be a top priority in 2025,” Roerink said.