For the past two years, growth in fresh lagged behind center store, making it clear that the methods of old are no longer enough to succeed. The disruptions the industry is facing are all converging to blur and irrevocably change the established norms of fresh strategy and merchandising. Retailers who want to win in the perimeter must adapt to change and listen to their customers in the form of Private Brand development, innovation, and customization.
Daymon’s latest report reveals the key trends driving change in fresh and the action steps retailers must take to innovate and lead in 2020 and beyond:
Private Brand is a trademark of best-in-class fresh retailers
Leading retailers generate 43% of their overall sales from perishable foods vs. the industry average of 32%, top performers use their Private Brands to own fresh.
Plant-based growth is necessitating new approaches to strategy and merchandising
Plant-based has moved beyond a fad to an industry movement. More than 50% of meat-eaters purchase plant-based proteins, large manufacturers are acquiring plant-based startups, and food service is all-in on plant-based. Retailers must rethink their approach to fresh strategy and merchandising to champion this trend and make it easy for shoppers and their manufacturing partners to know where and how to buy and engage.
“Craft” sets the new standard for quality across the fresh department
Most retailers are lagging in “craft” quality and need to quickly adapt to the changing landscape by applying it to all areas of the fresh department, not just in produce. By taking a total store approach and multiplying “craft” touchpoints throughout fresh, retailers can successfully address and offer Private Brand solutions that drive differentiation in the perimeter and beyond.
Foodservice provides new opportunities in the digital age
More consumers than ever are treating their grocery store’s prepared foods and foodservice departments as extensions of meal planning, and sales at top retailers are responding in kind. The growth potential and subsequent Private Brand halo presented by a strong foodservice program create new opportunities that retailers cannot afford to ignore in their battle to drive traffic in the digital age.