Local produce needs strategic positioning

08/23/2013 10:19:00 AM
Denise Donohue

Denise Donohue, Donohue AssociatesDenise Donohue, Donohue AssociatesRecently I was shopping with my hubby when I shouted, “Look at that!”

It stopped him in his tracks because usually when I erupt like that there’s imminent danger — like a spider or a very odd person to gawk at.

This time, I’d noticed an entire end-cap of locally grown foods on clearance! Obviously it was a display that wasn’t earning its keep in this store.

Every single product was discounted well below the normal profit margin.

I thought to myself: I hope the retailer doesn’t blame this failure on the shopping public not being interested in locally produced items.

Because the truth is article after article and survey after survey shows that people want to buy the locally produced version of items.

The Packer’s Andy Nelson wrote earlier this year about the survey by A.T. Kearney, a Chicago-based management consulting firm, that reported 70% of shoppers surveyed would pay more for locally grown. Of them, 66% buy local to support the local economy, 60% say it’s a better product assortment and 45% believe it’s more healthful.

Almost one-third of those polled said they’d shop elsewhere if their favorite store didn’t have (or identify) local products. The local aspect is an important driver of customers and purchasing decisions.

But you have to do local right, which means thinking about the type of store/type of customer, price position within the store and getting shoppers to try new products.

Locally grown as a purchasing driver does not trump the type of products a family already prefers. Shoppers want to buy local versions of items they already like — sometimes that may mean simply calling out the local content in a regional or local market (micro-targeting your customer).

Know your brand

When offering local produce and products for sale, the retailer must understand his own brand, also known as his position in the marketplace or the type of store he runs.

Is this a store that sells the consumers’ main monthly grocery run?

Is it a gourmet shop that sells the new, the unusual, the expensive and the giftable? (This is where new products often begin.)

Or is it a bargain/value food store?

With the store’s brand firmly fixed in mind: Is your product appropriate to this type of store and its typical shopper?

For the produce packer-shipper, this means matching the item to the buyer regardless of whether it is locally grown or not. Stem-on tart cherries probably don’t belong in a value store.

And if they get there — and they don’t sell — it is not a proper conclusion to say consumers don’t want fresh, stem-on tart cherries. They were just positioned incorrectly in a value store.

Which brings me back to my shout-out at the local grocery.

In this particular case, the retailer, aided by a well-meaning study, brought on a line of at least 50 items that I dubbed not-ready-for-prime-time items. The products were expensive and boutique-ish. They had names like “Cherries Foster,” which left my husband and me whispering amongst ourselves (so as not to appear like rubes) to determine if it was jelly or preserves or ice cream topping.

Turns out it contained rum — a good thing, but it sure didn’t belong on the kids’ breakfast toast, if you know what I mean. Alcohol before school is not, to paraphrase Martha Stewart, a good thing.

Nor would you pay $6 (the original price) to put this before kids. Pearls before swine, you know.

As a shopper, I want mostly familiar products. I don’t want off-brand potato chips, and I sure don’t want soda pop of an unknown variety. But I would like to know if my regular chips and pop have local content. It’s not that I don’t like the local aspect of off-brand chips — it’s my fear of the unknown and wasting money.

If you’re launching something new (a.k.a. not-quite-prime-time-but-hoping-to-be products), you’d better launch in the right stores and put some demos in place.

Addressing consumers’ fear of the unknown through proper market placement and position gives your item a much better opportunity to succeed.

Denise Donohue is founder of Donohue Associates, DeWitt, Mich., a marketing and public relations firm specializing in agriculture. Before that, she was director of the Michigan Apple Committee, Lansing.

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