Retailers Aim to Strengthen Food-Health Link

DAVID ORGEL

SCOTTSDALE, Ariz. — Food retailers are striving to position themselves on the front lines of health and wellness now that the trend is becoming more established, according to a new study and a retailer panel presented during the FMI Midwinter Executive Conference here.

Panelists stressed the need to act quickly, as consumers increasingly link food with health.

“If we become the solution for health issues, we will benefit from more frequent shopper trips,” said Paul Boyer, vice-chairman, Meijer. “Yet, there will be lots of competition, so we can't just take our time on this trend.”

“The health trend offers many food cross-merchandising opportunities related to heart disease, diabetes type 2, cancer and other diseases,” said Kenneth Waller, executive vice president, Hy-Vee.

The panel was convened to highlight a new report by the Coca-Cola Retailing Research Council. The report is called “Expanding the Market for Retail Grocery: Connecting the Dots Between Food and Health.” It is based on research conducted last year by the Institute for the Future, Palo Alto, Calif.

The information, which focuses on North American consumers and retailers, will be published as a series of chapters on the CCRRC website (www.ccrrc.org) now through May of this year. Installments will include forecasts and action steps, marketplace trends, consumer behavior analysis and details on a forecast map tool that can be used for strategic planning purposes.

“Consumers are shopping for health more aggressively, and it's translating into new business,” said session moderator Bill Bishop, chairman, Willard Bishop, Barrington, Ill., and advisor to the CCRRC.

For an example, he pointed to the growing category of probiotics, which is expected to be a $1 billion business by 2010, focusing on digestive and immune-system health.

Panelists at the FMI session were members of the CCRRC.

Shelley Broader, president and chief executive officer, Sweetbay Supermarkets, who chairs the CCRRC, observed that the shopper base for this trend is extensive.

“Our early research shows that health and wellness crosses income and educational levels,” she said in remarks relayed through a prerecorded video. “This is no fad; it's here to stay.”

Oscar Gonzalez, chief operating officer, Northgate Gonzalez Markets, said he was surprised that his operation's Hispanic shoppers, who tend to be first- or second-generation Americans, show such a strong interest in health.

“I was at first skeptical regarding our Hispanic consumer base,” he said. “Yet, we can make this actionable with them. Our consumer needs help with health.”

He added that he also found many grocery stores in Mexico are already far along with the health trend. “You'd be surprised,” he said.

Archie McGregor, owner, McGregor Stores, said in-store guidance for consumers, such as special icons or signage that points to healthy foods, would be a good solution.

“That has power in connecting the dots,” he said. “We also need to identify where these products are in the store, and inform employees so they can explain it to consumers.”

Supermarket pharmacies need to consider expanding their roles through services such as medication therapy management, Waller said.

“These are great opportunities for pharmacies to have additional income and service, which could include things like bone density screenings,” he said. “This would bring significant service revenue for pharmacies.”