FRESH FOOD: Ethnic/Specialty Produce: Protecting the perimeter

With cultural and ethnic preferences turning the old notion of mainstream American cuisine on its head, shoppers are increasingly turning to supermarkets for the raw materials that will help them experiment with new fruits and vegetables.

The phenomenon is menu globalization, fed by growing cultural diversity in markets across the country -- and in response most supermarkets have begun to carry a wider array of ethnic and specialty produce. Smart merchandisers are also increasing assortments and shelf space for tie-in products that speak to the flavor trends that are hot, both literally and figuratively.

Still, some grocers appear confused by the trends, and in some cases are downright reluctant to think big in terms of ethnic and specialty produce. Without a fuller understanding of the appeal of the segment and its benefits to consumers and the overall assortment, skepticism about ethnic/specialty becomes a self-fulfilling prophecy.

Clearing up this confusion and tempering this reluctance are among the primary jobs of Robert Schueller, director of public relations for Los Angeles-based Melissa's World Variety Produce, which ranks among the largest providers of specialty produce in the country.

"Yes, some retailers are afraid of carrying a large variety of specialty produce, in view of their concerns that they don't have the customer for it, it's a perceived high shrink risk, and it's too expensive," admits Schueller. "The retailers most reluctant to fully embrace it don't have a full understanding of the value of what specialty produce can do for their total store image."

To help retailers get more comfortable with taking the leap into a more aggressive ethnic/specialty program, Melissa's is gathering some hard evidence of instances where plunging in is paying off. Schueller says the company is showing grocers "real-time data" that includes consumer profiling related to specific stores, and then matching the right type of specialty/ethnic items to that profile, based on success in similar markets.

"The big key here," says Schueller, "is a boost in total store image by providing a one-stop-shop experience for the consumer, and actually providing a more profitable produce department."

Another key to understanding and exploiting the trends is realizing that, while the terms "ethnic" and "specialty" are essentially interchangeable, there are some subtle differences between the two, notes Schueller. While specialty can be ethnic, ethnic isn't always specialty.

"The things that both specialty and ethnic produce share are that they are typically misunderstood by the average person, they are often more difficult to find than the average produce item, and they are often not locally or domestically grown," explains Schueller.

Their differences are tied to their origins. "Ethnic refers more to items that have greater cultural and/or regional ties, such as ginger to Asian foods, and jalapeno chilies to Hispanic foods. Specialty, on the other hand, can simply be a twist on a common fruit variety, such as a Saturn peach. Although most people know what a peach is, for instance, not everyone has tried a flat Saturn peach," he adds.

The nature of the segment is that it's trend-driven, and over the past 18 months, one of the most important of those trends has been organics. Schueller says organic products have been a "very hot ticket" for Melissa's. Convenience and value-added items have also been big contributors to the segment, including "some of our newest items, such as shelled and unshelled organic edamame, peeled baby red beets, and steamed lentils, which have really made a mark on our product line," he notes.

Also factoring heavily as one of Melissa's standout categories of late is seasonal fruit, "focusing on top-tasting seasonal varieties." Indeed, Schueller says seasonal represents the most rapidly changing category in the company's specialty lineup.

As for what ethnic/specialty products have the greatest crossover appeal, Schueller cites edamame, a Japanese-based, cross-cultural item that's already well integrated into mainstream America; fresh chilies, a cross-cultural, Hispanic-based item prominently making its way into mainstream America; and mangos, the top-selling fruit everywhere around the globe but in the United States, where it ranks 16th on the produce hit parade.

The nutrition story

Another obstacle to the segment is that the average supermarket isn't telling the story that it needs to about the nutritional values of many ethnic and specialty produce items, according to Steve Harrold, director of whole health and organics for Indianapolis-based Caito Foods.

"Many items that may be considered ethnic and/or specialty have great potential health benefits that consumers need to be made aware of," says Harrold. "Changing verbiage in ads, store signs, and informational brochures can be used to effectively educate consumers and increase consumption of these products. Stores that do the best job in education, and showing that they really care about the health of their customer base, will earn their loyalty and sales."

Harrold cites recent consumer studies that portray ethnic consumers, and especially Hispanics, "as regular or growing organic users, and very concerned about healthy alternatives. Because Hispanic consumers use a lot of fresh ingredients while preparing meals," he says, "they are a great segment to market and reach out to."

Harrold tips his hat to the savvy retailers that are making the effort to bring high-visibility nutritional information to market, which benefits all consumer groups, including ethnic populations. He praises Scarborough, Maine-based Hannaford, which earlier this year launched its "Guiding Stars" initiative, which features shelf tags grading the nutritional value of some 27,000 items throughout the store.

"Consumers [want] straightforward nutritional information," he notes.

Other retailers can latch onto information sources such as the Organic Center's recently released book, Core Truth, which Harrold says "is full of recent scientific studies establishing the benefits of organically grown food. Information such as this needs to be used at store level, to educate consumers to make confident choices."

That's the type of support that could make the role of ethnic/specialty produce special in real terms to the produce department's bottom line.


Emeril’s Gourmet Produce breaks out

One of the most recognizable celebrity chefs of our day, Emeril Lagasse, along with Pride of San Juan and the Produce Exchange, have restructured the Emeril's Gourmet Produce brand.

Under the new structure, the Produce Exchange, based in Livermore, Calif., is the exclusive sales, marketing, and distributing agent, while its new product development arm, Pride of San Juan, continues to manage the primary farming operations, with Emeril doing what he does best: brand management and recipe development.

"From the very start, this venture has been about our passion for quality produce and to make it available to folks at home," says Lagasse. "I am looking forward to adding new products to my line and creating new promotions with the Produce Exchange."

Since its inception, Emeril's Gourmet Produce has launched over 30 fresh produce products focusing on flavor, first with spring mix blends, then onward to fresh herbs and next, heirloom tomatoes. In 2005 the Produce Exchange became involved and has since developed several new products in other categories for the brand.

Missed opportunities when taste falls flat

It comes as no surprise that consumers place a premium value on the taste of fresh produce. What might surprise, however, is that many consumers say they're willing to pay more for great-tasting fruits and veggies, but don't get the chance because their supermarkets are failing to deliver.

That's the conclusion of recent research shared by the Newark, Del.-based Produce Marketing Association (PMA). The trade group says the industry is probably missing golden opportunities to boost sales, because of consumer dissatisfaction.

In the survey -- conducted by telephone in late April by Cambridge, Mass.-based Opinion Dynamics Corp. -- a whopping 92 percent of 1,000 primary shoppers ranked taste as somewhat or extremely important. However, only 30 percent of shoppers reported middle-of-the-road satisfaction with the taste of the produce they purchase, and an even smaller proportion (25 percent) said they're very satisfied.

Nearly 70 percent of shoppers surveyed for PMA reported that they would pay at least a little more for better-tasting produce, and 10 percent said they're willing to pay a lot more. Further, shoppers who reported they're not satisfied with their produce most often pointed to a lack of freshness.

Dave Corsi, PMA board secretary-treasurer and v.p./produce and floral operations for Rochester, N.Y.-based Wegmans Food Markets, adds that better-tasting product will benefit from well-executed communication. "Educating consumers about produce availability, handling, and use is a tremendous opportunity to drive sales that is frequently underutilized," says Corsi. "It's really a win-win situation -- showcasing flavorful, ripe products at their peak satisfies consumers' taste buds and inevitably leads to increased sales."

Taste apparently goes hand in hand with other attributes shoppers seek in their produce. When consumers were asked how important taste was compared with some other produce characteristics, such as health, 38 percent reported making decisions to purchase produce for both taste and health reasons, vs. just one or the other.

The gap between consumers' taste expectations and their experiences is probably having its biggest negative impact at the supermarket checkout, says Lorna Christie, PMA's s.v.p./industry products and services, as shoppers say freshness and taste are both key influencers in decisions to purchase locally grown produce.

Christie says what surprises her most about the results of the latest consumer research is that taste turns out to be even more important to consumers than year-round availability, "particularly in our instant-gratification society. We're not paying attention" to the high priority consumers place on taste.

Christie also draws a distinction between taste and flavor. As opposed to the basic tastes of salty, sweet, bitter, and sour, flavor involves both taste and smell, she says, as well as "cultural differences, regional preferences, and personal experiences," not to mention the inherent variations that arise depending on where the food was grown or produced.

"Survey after survey after survey indicates that the issue of flavor and taste has long been a popular topic among consumers when it comes to fresh produce," she says. But given the melting pot of flavors and tastes abounding in our national palette, the fact that retailers are struggling to meet such varied expectations is understandable.

To overcome this perceived "taste void," Christie advises retailers to "stop guessing and ask your customers about their specific expectations." Sales will increase only once the industry does a better job of "delivering on expectations," she says.

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