Broken down, russets, reds and whites experienced the largest declines. Fingerlings, purples and medleys — bagged mixes of colored specialty potatoes — experienced significant increases, although they still represent a small fraction of the overall category.
Consumers also seem to be moving to smaller packaging, with sales of 10- and 5-pound bags and bulk off significantly, he said. On the other hand, 1- to 4-pound-bags and 8-pound bags saw growth.
In a December meeting with Kroger Co., Ladhoff said company representatives told him the potato industry should focus on two areas: innovation and digital.
“The industry has been over-reliant on a single type of potato for a long period of time, and they, as retailers, want to embrace more opportunities,” he said about the Kroger feedback.
That means new and different potato varieties as well as convenience packaging, such as microwavable steamer pouches.
Digital media, such as quick-response codes and social media, makes information more accessible to consumers, Ladhoff said.
Cary Hoffman, CEO of MountainKing Potatoes, Monte Vista, Colo., compared the potato industry’s current situation to that of the U.S. auto industry the past decade.
Two of the Big Three companies continued to produce large pick-up trucks and SUVs because those were the vehicles that made them the most money. But they ignored consumers, who wanted more fuel-efficient vehicles.
As dealer lots filled with unsold cars, the industry resorted to deep discounts, attractive loans and other come-ons to move the vehicles.
“We have an advantage over the car companies,” Hoffman said. “We can turn this around faster starting now with what we intend to plant for 2013.”