Retailers and Suppliers Look to Maintain Seafood’s Surge
As with so many other categories across the store, seafood — whether fresh, frozen or shelf-stable — saw sales swell as consumers turned to home cooking in greater numbers during the pandemic.
“The coronavirus has had a positive impact on seafood sales and units sold,” affirms Lisa Guinther, seafood category manager at Landover, Md.-based Giant Food, an Ahold Delhaize USA banner. “Recent surveys have indicated that less customers are going to restaurants for their seafood, causing them to buy and prepare more at home. While we have seen an uptick in all seafood categories; Snow crab, shrimp, and fresh salmon are among the items with the largest growth. Another area that has seen sufficient growth is frozen value-added seafood: fish sticks, breaded fish and fried shrimp. This is mainly due to kids being home, and parents are looking for a fast, convenient item for lunch and dinner.”
To meet current demand, Giant Food is “partnering with our vendors to secure product and promotions to pass onto our customers,” notes Guinther. “We are utilizing data and analytics to make sure we have the items our customers are looking for, while working closely with our marketing and e-commerce teams to keep our online platforms current with selection at a great value.”
In the future, she says, “with more customers making seafood at home and [it] becoming part of their meal-planning routine, we are hopeful to maintain some of these new customers after the pandemic is over.”
Over at Seattle-based PCC Community Market, a 15-store cooperative, Meat and Seafood Merchandiser David Sanz observes, “We have seen an increase in seafood year over year, with a double-digit increase in sales,” due to the same factors mentioned by Guinther. In fact, having witnessed the devastating impact of restaurant closures on local fishermen, PCC worked to purchase some inventory that used to go to foodservice, according to Sanz, who goes on to note that the co-op grocer continues “to see wild Alaska and local salmon as top drivers across our stores. They remain as popular now — if not more — as they did pre-COVID. We are also seeing the popularity of ready-to-eat items increase, like our wild smoked salmon, wild smoked scallops, wild local cooked shrimp meat, wild cooked shrimp and wild cooked crab.”
Once the pandemic has passed, “[i]t will be key that we can have a strong assortment to meet online demands, in addition to in-store shopping,” asserts Sanz. “Providing our members and shoppers with unique recipes online is also something that PCC will continue to do as customers continue to cook more. We think it will also be important to try new things and offer promotions like Surf and Turf that our shoppers see on the restaurant side. Lastly, we will continue the cross merchandising of items like seasonings and sauces with our fresh seafood, in addition to our pre-seasoned ready-to-cook Chef Inspired options.”
PCC has also sought to address consumer uncertainty about cooking such items, he adds: “With the increased demand for seafood, we ensured our online cooking classes included a range of classes to help new cooks and provide new options to those more proficient. Earlier this year, we offered multiple salmon cooking classes, as well as a course on cooking local mussels.”
“For years, the industry was of the mindset that consumption stayed flat because customers did not know how to cook seafood,” says Maria Brous, director of communications at Lakeland, Fla.-based Publix Super Markets, which has similarly experienced a “significant” rise in seafood sales during the pandemic. “With COVID, and maybe additional time available, consumers have taken the time to try new recipes. All seafood items have seen significant growth during these times. Frozen seafood has been indexing higher than others, with customers shopping less, so they are freezer loading. Snow crab has seen the biggest increase,” perhaps due to pandemic-stressed consumers wishing to treat themselves with a luxury item.
Noting that normally, “[j]ust over half of the seafood consumed in the U.S. is consumed in restaurants,” Brous points out that during the pandemic, “[f]or those [shoppers] that wanted seafood, retail may have been the sole option. Secondarily, I believe customers have become a bit more adventurous since they are eating at home more; they are stepping out of their traditional meals to add some variety, and seafood was able to step in.”
So far, so good. But how can grocers and seafood suppliers keep consumer interest in preparing seafood at home at its current level — or even expand it — once the pandemic has passed and restaurants reopen?
James Griffin, director of the Boston-based Chilean Salmon Marketing Council, observes that “grocery sales [of seafood] continue to surge, and we expect this to continue. As the consumer shift away from foodservice and toward grocery continues, this persistence is expected to have a long-term impact on behavior. We expect increased spend at grocery to last beyond the end of the pandemic.”
He notes that grocers have been responding to this trend by “focusing their efforts on the seafood products consumers demand most while also periodically offering specialty items and alternatives. Shrimp and salmon are the category leaders. … At times like this, broadening assortment isn’t always a good idea, but optimizing marketing and merchandising is a necessity.”
The way to maintain higher sales going forward, according to Griffin, is teamwork. “Now that seafood is a rising part of ring, suppliers — in all their complexity — and retailers must continue to work together and collaborate,” he advises. “The rapid increase in online ordering surprised many grocers, and now they are catching up with their user interface, data and analytics, and optimization. Keep an eye on this — in a short time, grocers are going to be digital powerhouses with tremendous real-time data on consumer preference and purchasing patterns. These data will drive breadth and depth of SKUs and overall customer engagement. Suppliers must remain aligned with this shift, support it and be part of the optimization discussion. When the pandemic ends, grocery will be in a position of strength and be more digital than ever. So, too, will suppliers.”
It’s All Good
It’s also important for retailers to bear in mind that there’s been double-digit growth across all seafood categories — fresh, frozen and shelf-stable — and to factor that into their sales strategies.
“Millions of new and lapsed buyers tuned to the shelf-stable seafood category to ensure they had nutritious and delicious food on hand in a period of uncertainty,” observes Dan Hofmeister, SVP of brand marketing at San Diego-based Bumble Bee, perhaps best known for its canned tuna. “In addition to growth across our shelf-stable offerings, we have been pleasantly surprised by how much we are seeing our Anova line of frozen ahi products grow. Prior to COVID-19, the majority of our Anova sales came from foodservice. We have seen that shift, and now more than 60% of our Anova sales are in grocery. We attribute that to a shift in how consumers are satisfying their desire for restaurant-quality, sustainably sourced ahi.”
Rather than changing up its product assortment in response to the pandemic, Bumble Bee took another route. “The consumer shifts we have made have been predominantly to our consumer communication,” says Hofmeister. “We are committed to making it easier for consumers to find and share recipes via social, other digital platforms, and influencers who share the same passion and creativity for cooking with seafood. It clearly is filling a consumer need, as we are seeing close to triple-digit increases in engagement and following on our channels.”
Hofmeister also offers some recommendations for retailers to highlight seafood products.
“As consumers increase purchase size per trip to limit shopping trip frequency, retailers can help their shoppers by prominently displaying relevant shelf-stable seafood products — particularly multipacks — where they are easy to find,” he suggests. “We also recognize that consumer engagement in the category is growing as at-home cooking increases. We would encourage and support finding ways to balance that need for convenience with shoppers’ natural desire to explore new items and new ways to prepare foods. AI online — and even in store — can support these needs. For seafood, because there is so much cooking and preparation being done, we would suggest continuing to lean into sharing of recipes and cross merchandising with complementary products like clams and pasta.”
Now They’re Cooking
Indeed, as Hofmeister mentions, a key component of continued engagement with consumers on seafood is to make sure they have the knowledge they need when they venture into the kitchen to cook their purchases.
Megan Rider, domestic marketing director at the Juneau-based Alaska Seafood Marketing Institute (ASMI) notes that “the Alaska seafood industry works with retailers to help educate shoppers on the best and easiest ways to prepare seafood. Alaska Seafood Marketing Institute (ASMI)’s Cook it Frozen! campaign provides retailers with recipes, how-to videos and other materials to educate the masses of consumers now cooking more often at home on how to prepare seafood directly from frozen, for delicious meals in a matter of minutes.”
According to Rider: “We expect that at-home seafood consumption will remain steady even after the pandemic is over, as consumers have gotten more familiar with home cooking techniques. Alaska producers are continuing to adapt to changes in the supply chain in order to meet increased demand at retail for the growing number of consumers eating wild Alaska seafood at home.”
Ready to Grow
However, since not everyone is going to blossom into a confident preparer of seafood meals, whether using fresh or frozen ingredients, ready-to-eat and -cook (RTE/RTC) meals will remain important.
“In terms of assortment, items that are either pre-cooked or can go directly from package to oven will help expand to customers who are not usual seafood purchasers,” says Bill Hueffner, VP of marketing and development for Clackamas, Ore.-based Pacific Seafood, which offers value-added products with easy preparation instructions. “Beyond RTE/RTC products, programs that educate consumers on preparation methods help drive sales. To support our retail partners, we have several POS options, including window clings, recipe books, videos and more. We also provide product training to retail associates and recently created a proprietary education program for retail partners to become Certified Seafood Professionals, allowing them to better assist customers who are unfamiliar preparing and purchasing seafood.”
Hueffner predicts: “We expect a continued demand for approachable and easy seafood preparations. Post-pandemic, we see continued growth for RTE/RTC products in particular, along with a reimagined fresh case with more grab-and-go items. As consumers become more comfortable with seafood options, we anticipate they will branch out beyond their normal salmon and shrimp dishes by sampling less familiar, but just as delicious and sustainable, species such as black cod, Dover sole and rockfish.”
One segment to pay particular attention to is that of farm-raised seafood, which, according to Guy Pizzuti, business development director — seafood at Publix, people are buying more of since the pandemic. Bluehouse brand farm-raised salmon from Miami-based Atlantic Sapphire is sold at more than 200 area Publix stores.
“During the pandemic, for those that are still uncomfortable with imported seafood, the local aspect can play a major role in the customer’s comfort level,” says Pizzuti. “Long-term benefits would come from the improved availability of seafood, job creation in the local market and reduced carbon footprint due to it being a local product. Atlantic Sapphire’s Bluehouse salmon is local to Miami and leverages the region’s saltwater aquifers.”
Even after the current crisis is over, however, farm-raised seafood is poised for growth. “The demand for seafood is anticipated to increase by 70% by 2050, [and] aquaculture will play a critical role in filling that demand,” he explains. “As you look at existing aquaculture operations around the world, production growth must come from increased efficiency. The growth that is available from farm expansion is limited. We believe that growth from the aquaculture segment will come from land-based operations.”
Expanding the Pie
Whatever the future brings, retailers and retailers are committed to ensuring that consumers continue to see grocery stores as primary seafood destinations.
“Our hope is that we will have expanded the seafood pie and not just taken a bigger piece for a period in time,” observes Publix’s Brous. “Depending on the timing of a return to ‘normal,’ we could see some consolidation on the supply side, especially in the smaller distributor/wholesaler segment that was focused solely on foodservice. I would also see those that were foodservice focused seeking to expand and get a foothold in retail to provide some stability and diversification to their portfolio.”
Looking ahead, Hofmeister describes Bumble Bee’s mission in the following terms: “Our job as a branded supplier is to make sure we watch and deeply understand what the needs of the consumers are going to be for the next ‘new normal,’ and from there develop products and packaging to best serve our consumers.”
He adds: “Our belief is that consumers are rediscovering the delicious benefits of seafood. We don’t see that changing.”
While traditional seafood has seen massive spikes in consumption amid the pandemic, how are plant-based alternatives faring?
“Plant-based seafood delivers the full package for nutrition and environmentally conscious consumers who love the taste of seafood,” enthuses Dan Hofmeister, SVP of brand marketing at San Diego-based Bumble Bee, which recently entered into a sales, distribution and logistics partnership with New York-based Gathered Foods, maker of shelf-stable and frozen plant-based seafood items under the Good Catch brand. “Whether they think of themselves as a seafood connoisseur, vegan or flexitarian, plant-based seafood has a role to play in their diet. Retailers across the country are rapidly taking steps to meet the needs of these consumers by expanding their frozen and shelf-stable seafood assortment.”
Megan Rider, domestic marketing director at the Juneau-based Alaska Seafood Marketing Institute (ASMI), is quick to warn, however, that “many health benefits and key nutrients of wild sustainable Alaska seafood, for example, omega-3 fatty acids DHA and EPA, can’t be easily replaced by plant-based options. For that reason, retailers should ensure that plant-based is clearly marked as such and/or merchandised in locations clearly marked as plant-based, so that those consumers actually seeking wild sustainable seafood are able to identify it easily and clearly.”
Among retailers, the jury is still out as to whether plant-based seafood will catch on in a big way, but early indications at some grocers are promising.
“Plant-based is relatively new in the seafood industry,” notes Lisa Guinther, seafood category manager at Landover, Md.-based Giant Food, an Ahold Delhaize USA banner. “We have recently introduced three new plant-based items from Good Catch: Crab Cakes, Fish Burgers, and Fish Cakes. Since introducing these items back in July, we have seen our sales and consumer base grow on these items. We are continuing to look for additional plant-based items to offer our customers.”
“While we do carry a few options, we are not seeing a big demand for plant-based seafood options at this time in terms of sales or member/shopper request, certainly not in the way we are seeing some people make the shift from beef to products like Beyond Meat,” admits David Sanz, meat and seafood merchandiser at Seattle-based PCC Community Markets, a cooperative with 15 locations.
“At this time, these offerings are only offered at our GreenWise Market locations,” which carry a range of organic, natural and specialty groceries, says Maria Brous, director of communications at Lakeland, Fla.-based Publix Super Markets. “The product is performing well; however, the existing products are out in front of the consumer demand. Brands will need to invest more capital to market to consumers in the way that plant-based meat brands have.”