Retail Fresh Produce Strategy and the Need to Have a Plan

Tar and feather me for the following admission, but I am an ABBA fan from way back. As a result, one of my favourite movies is Mamma Mia. There is one scene in the movie where Meryl Streep’s character says, “Plan. What plan? Goodness knows I have no plan.” I can’t help but feel there is a similarity between that line and retail fresh produce strategy.

I don’t mean to be critical of retail. I’ve never been a produce buyer or head of produce, so I am sure there are multiple challenges I am blissfully unaware of. However, one of the observations I feel I can make, is there are very few men (sorry – it seems to be a role where women don’t get a look in) I’ve met in the role that seem to have a strong, strategic vision for their produce category.

Case in point. A reader shared a story a few weeks ago. He was a fruit grower and had been approached by a retail partner to do a really down and dirty special. The rationale for the special? One of the retailer’s competitors had come out the week prior with a sharp special on the same product and this retailer wanted to ‘show them who could do the cheapest deal.’

There was no discussion of how this sharp price point fit into the retailer’s overall category strategy. There was no discussion about the shopper – are shopper’s moved to purchase more volume or more frequently by such a low price? There was no discussion about the long term message this sharp price point sent about the product…or the retailer. The only thing the retailer could see by wanting the special was the need to beat the competition. (As an aside, I think this need to win, even related to pricing, is a guy thing. I don’t think many women in the same role would approach it the same way!)

The question to be asked is, why does there appear to be a lack of both produce department strategy and individual commodity strategy at retail?

I think it boils down to three issues:
1. Lack of a fresh produce brand/positioning strategy
2. Lack of information regarding consumer drivers
3. Lack of outside the box thinking

1. Lack of a Fresh Produce Brand/Positioning Strategy
Years ago, I did one of the Produce Marketing Association’s retail tours. We went and visited (from memory) a Schnucks Market. The statement on their store signage said, “Everyday low prices” yet inside, we entered into a very modern and upscale store. There were black and white tiles on the floor, a piano with a regular pianist that came in and played and the entire store had a very upmarket feel. At the time, I can remember struggling with the incongruence of their brand strategy. Here I was in a store that felt very expensive, yet the livery was telling me the store was about ‘everyday low prices.” The two just didn’t add up.

This is what I mean by lack of brand/positioning strategy. In my 20+ years of produce marketing, I have never had a retailer review their brand or positioning strategy with me or ask me how my client’s product or produce marketing spend fitted in with their brand strategy.

In the absence of clear brand strategy and positioning, the easiest fall-back position is price competitiveness. This is why retailers often feel the need to employ a “me too” price strategy to keep up with the competition. “If they go low, we’ll go lower” seems to be their mantra. It is an easy strategy to employ…but I would question whether it is successful in the long term.

2. Lack of Information Regarding Consumer Drivers
In the fresh produce industry, until quite recently, there has been a real lack of consumer insight. It is challenging to create a shopper driven strategy without shopper insights. Successful produce strategy, whether the overarching category strategy or the commodity level sub-strategy, has to be driven by both retailer brand/positioning strategy and grower supply strategy. By melding these two, a strong consumer offer can be created that drives both commodity and category growth.

3. Lack of Outside the Box Thinking
Not to push my own barrow, but I think it is helpful to bring in outside the box thinkers to strategy sessions. Bringing in someone outside the ‘internal team’ or someone who is not a supplier with a vested interest adds new insights to the brand development, brand strategy or brand positioning process. Outsiders with expertise bring new thinking to the table, challenge conventional thinking and unexpected results are often the outcome.

I am an optimist at heart and I believe there is significant growth potential still untapped in the fresh produce industry. However, strategies beyond price and “me too” are required.

Your Turn:
Do you have a successful strategy/positioning that permeates your organisation? Have you worked with companies where you felt there was a real congruence in their strategy – and you were able to make this work for your business? I welcome your comments.