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Merchandising tips for shaping consumers’ perception of freshness

Fresh Food Display_Lg_032619A new study from Culinary Visions finds that retailers can get a product’s freshness across to customers with a few merchandising tips.

“Freshness is affected by a long list of different factors beyond the food itself. These factors include packaging, store perceptions and service style,” said Sharon Olson, executive director of Culinary Visions. “Consumers gravitate towards fresh merchandising cues such as clean and fully stocked display cases. Uncluttered shopping, dining and ordering spaces are also important aspects to consumers’ perceptions on freshness.”

According to the Culinary Visions Fresh Perspectives Study, 76 percent of consumers surveyed reported that a fully stocked shelf or display case is important to determining freshness.

The cleanliness of merchandising displays is also important to more than 90 percent of consumers. In addition, roughly two-thirds of consumers surveyed said that a clean display case was extremely important to consider food as fresh while 28 percent of consumers described that factor as a moderately important.

Clutter is also counterproductive to perception of freshness. According to the study, 90 percent of consumers surveyed said it was important to have a clear and uncluttered shopping, dining or ordering space when buying fresh food. Further, nearly half of consumers surveyed said it was extremely important while 41 percent of consumers said it was moderately important.

Looking specifically at on-site foodservice, consumers indicated cleanliness and presentation of a service counter, salad bar or an action station is significant, transparency also plays an important role in defining freshness.

Eighty-five percent of those surveyed said that transparent packaging was “moderately important” or “extremely important” to them when considering freshness of food. In addition, 88 percent agreed that a label stating when the food was prepared was an important factor in their consideration of the freshness of food.

However, looks aren’t everything. As Culinary Visions found, consumers also allow online and word-of-mouth assessments of stores and restaurants to influence their decision to purchase fresh foods. Specifically, 88 percent said the reputation of a retail store is important when buying fresh foods and 84 percent of consumers reported that a restaurant’s reviews and ratings were important when making dining decisions to eat fresh foods.

The Culinary Visions Fresh Perspectives Study surveyed 1,500 consumers to gather comparable data about the key influencing factors impacting fresh food purchasing decisions at home and away from home. This comprehensive report explores fresh perception between age demographics, as well as topics such as merchandising, flavor preferences, customization and convenience.

Originally published at Convenience Store News. 

Campbell sells Bolthouse Farms for $510 million

The Campbell Soup Company has signed a definitive agreement for the sale of Bolthouse Farms to an affiliate of Butterfly Equity, a Los Angeles-based private equity firm specializing in the food sector, for $510 million USD, subject to customary purchase price adjustments.

Upon the completion of the sale of Bolthouse Farms, which is expected by the end of fiscal 2019, Campbell will have divested its entire Campbell Fresh division. Campbell recently announced the sale of Garden Fresh Gourmet and the company’s Everett, Washington, refrigerated soup plant. In fiscal year 2018, Campbell Fresh recorded net sales of $970 million. Proceeds from the divestiture of the Campbell Fresh businesses will allow the company to reduce debt by approximately $570 million. The transactions are not expected to impact the company’s fiscal 2019 guidance.

Mark Clouse, Campbell’s president and CEO, said in a release: “The sale of Bolthouse Farms supports our strategy to focus on our two core North American businesses, Campbell Snacks and Campbell Meals and Beverages, where we have iconic brands and strong market positions.”

Acquired by Campbell in August 2012, Bolthouse Farms is a leading producer of organic beverages, dressings and carrots. Bolthouse Farms is based in Bakersfield and Santa Monica, California, and operates facilities in Hodgkins, Illinois; Wheatley, Ont., and Prosser, Washington. The company has approximately 2,200 employees.

Energy segment stirring up c-store beverage category

Energy Drinks Generic_Sm_041219The latest look into the cold vault by Wells Fargo Securities LLC is finding a shakeup may be coming to the energy segment.

The first quarter Beverage Buzz survey noted retailer concern about disruption among energy drinks as a result of new products.

“The disruption taking place in the energy category is clearly top-of-mind for our retailers as new entrants such as Bang [Energy Drink] continue to disrupt established players such as Monster Beverage Corp. at an alarming rate,” said Bonnie Herzog, managing director of tobacco, beverage and convenience store research at Wells Fargo Securities.

“As such, we’re increasingly cautious on Monster and concerned that the core energy category is being upended by an onslaught of ‘healthier’ competition,” she said, adding Monster’s pricing is not sticking and a  small minority of retailers suggested the beverage company’s prices could come back down in 2019.

Beverage Buzz surveys beverage retailers representing approximately 20,000 convenience stores.

According to Herzog, 90 percent of retailers either carry Bang or plan to carry it. As she noted, “Bang has evolved from a looming threat to a very real threat.”

In addition, many retailers are increasingly wondering if Monster’s own entry into the burgeoning fitness energy category with Reign “is too little too late,” she added.

Furthermore, while it’s still very early days, some retailers indicated that the early response from consumers to Reign has been underwhelming, Herzog said.

In addition to buzz around the energy segment, other the key survey takeaways, according to Herzog, included:

  • Overall total beverage sales were up a solid 4 percent in the first quarter, ahead of the 2.9 percent in the fourth quarter of 2018.
  • Promotions were elevated in the first quarter, up 2.5 percent year over year and ahead of the 0.5 percent year over year in the previous quarter.
  • Retailers’ outlook for 2019 is more muted with sales likely to be up “a somewhat reticent” 3.2 percent year over year. This is compared to the 3.7 percent in the prior survey.
  •  Retailers’ outlook for the total energy category has moderated, up only 6 percent in 2019 vs. prior expectations of 7.8 percent.

Looking at specific beverage companies, the survey found retailers’ commentary for The Coca-Cola Co. was generally positive, with some exceptions, Herzog said.

However, retailers were “decidedly more cautious” on Keurig Dr Pepper and are still concerned that PepsiCo Inc. is struggling to gain traction despite stepped-up investment spend, she added.

The outlook for Constellation Brands remains strong, with retailers still expecting increases in both sales and shelf space in 2019.

Treat trends: The frozen explosion

A few months back, Whole Foods Market predicted “trailblazing frozen treats” would be one of the top trends for 2019; it turns out that forecast is right on the mark. A proliferation of new, low-calorie/high-protein ice cream brands—with California’s Halo Top leading the way—as well as plant-based and globally-inspired treats are hitting freezers in a big way.

Screen Shot 2019-04-08 at 1.08.20 PM“There’s been a huge influx [of new frozen desserts] here, especially in the last year with Halo Top coming in from the U.S.,” says Adam Tully, director of grocery operations at Calgary Co-op. Indeed, Halo Top’s name comes up frequently when speaking with grocers and industry experts about recent trends in frozen desserts.

“A trip to the grocery store reveals innovation in the permissible indulgence space; Halo Top, in particular, with its low-calorie claim, has garnered lots of attention,” says Joel Gregoire, associate director of food and drink at Mintel.

Founded in 2012, Halo Top really only began to explode in popularity across the U.S. in 2016, and entered the Canadian market to great fanfare in 2018. With a range of fun flavours like Birthday Cake, Pancakes & Waffles and Oatmeal Cookie, Halo Top boasts just 80 to 100 calories per serving (and 280 to 360 calories per entire pint), along with low sugar and high protein content. “I think people have always loved ice cream, but it became hard or sometimes impossible to fit ice cream into any diet or lifestyle,” says Doug Bouton, president and COO of Halo Top Creamery. “Halo Top provided an option so people can enjoy ice cream every day without feeling bad about it or breaking the calorie bank.”

But Halo Top is, by no means, the only successful player in the fast-growing low-cal/high-protein ice cream space. Startups like CoolWay, founded by three young Montreal entrepreneurs are doing well in the market, while the large traditional players are also getting in on the trend. Nestlé, for instance, has launched a high-protein/low-cal brand called Goodnorth; Breyer’s has launched Breyer’s Delights, featuring 16 grams of protein and between 280 to 360 calories per 500-mL package; and Ben & Jerry’s recently launched its low-cal Moo-phoria line. “Low-calorie, high-protein frozen desserts are here to stay in 2019,” says Rob Luscombe, Ontario grocery buyer for Whole Foods.

Luscombe adds that a number of dairy-free and plant-based options are also showing up on Whole Foods’ shelves, including those from Daiya and the Chufa Co., which makes frozen desserts based on tigernuts.

Calgary Co-op’s Tully agrees: “everyone is conscious about the plant-based proteins now.” Innovations in plant-based frozen treats are coming from all directions including major traditional players: Ben & Jerry’s got in on the action early, launching vegan varieties starting in 2016, while Häagen-Dazs has launched a non-dairy collection of ice cream and ice cream bars, and Magnum Bar just debuted a non-dairy, vegan-certified bar in the United States in February.

That said, a great deal of innovation in the dairy-free frozen dessert space is coming from smaller players and start-ups, such as Peterborough, Ont.-based Chimp Treats. Founder Brooke Hammer started Chimp Treats while still a student at Trent University. As a vegan and a varsity athlete, “I was all about health and nutrition,” she explains, so she set out to develop an ice-cream-like treat made solely from fruit. The result was Nice-cream, a frozen dessert made from 100% fruit (no other ingredients) available in three flavours: Banana, Mango Banana, and Strawberry Banana. First launched in 2017, Nicecream quickly gained traction and is now available in stores across the country, ranging from smaller independent and niche retailers to major chains like Sobeys, Metro, and Loblaw.

Hammer says her customer base is broader than she initially imagined. “When I started I really thought it would be niche to vegans, and you know, people whose ethics in terms of sustainability were kind of the driving forces behind their purchasing behaviour,” she says. “But the majority of our customers aren’t vegan or even lactose intolerant. It’s typically women aged 20 to 35, they have an interest in health and nutrition, they’re working, educated, on the go.” Parents of babies and young children are fans as well, she says, as kids enjoy the taste while parents like the health aspect.

Still, despite increased demand for “permissible indulgences” in the frozen dessert space, the truly indulgent, full-fat ice cream products continue to be popular. “Let’s not kid ourselves, the Häagen-Dazs of the world and all those indulgences are not going away,” says Calgary Co-op’s Tully. Frank Yunace, operations manager at Pete’s Fine Foods in Halifax, agrees: “People are buying the ‘true’ ice creams—we still sell a ton of that stuff.”

Gregoire says Mintel’s data suggests classic indulgent ice creams remain in demand. “When asked what characteristics [people] associate with ice cream, ‘good tasting’ (57%), ‘satisfying’ (39%) and ‘indulgent’ (37%) rank at or near the top,” he says. “What these figures indicate is there is indeed room for indulgent and, particularly, quality ice cream.”

Canadians are interested in trying innovative flavours as well, says Gregoire, noting that Mintel research shows interest in premium-flavoured ice cream (such as burnt toffee or olive pistachio), internationally inspired flavours (like green tea or mango) as well as flavours that are based on alcoholic beverages like rum or liqueur. “Two of these three areas, in particular, convey opportunity for more adult-based flavours that provide a sense of sophistication,” he says.

READ: The Japanese ice cream treat heating up the freezer aisle

In terms of international inspiration, grocers say new Asian-inspired frozen treats like mochi are becoming popular. Originating in Japan, mochi is a small, round, sticky rice dumpling filled with ice cream. A number of Canadian retailers are starting to add self-serve mochi bars in their stores, but packaged mochi products are hitting the market as well such as My/Mo Mochi, which offers boxes containing six mochi desserts in flavours such as Green Tea, Ripe Strawberry, Sweet Mango and Dulche de Leche. “Mochi has gained a lot of traction,” says Whole Foods’ Luscombe. Pete’s Yunace agrees: “We sell a lot of mochi.”

Yunace says the brightly coloured packaging typical of mochi products, and some of the other new products on the market, helps attract people to the frozen dessert section. “So it’s all about using that colour, and keeping the freezer full … that’s what brings people to the freezers, because you need to get them to open the door.” His store does in-store sampling of new products to promote sales as well, primarily in the spring and summer, and mostly with local suppliers.

According to Calgary Co-op’s Tully, working with local suppliers is a smart move, as a lot of his customers prefer to support local. “Here in Calgary alone, we have tons of [local ice cream and gelato makers],” he says, pointing to Fiasco Gelato and Made by Marcus as examples. “The more you can be in the local game, the more traction you’re going to get with your customers.”

Markdale, Ont.-based Chapman’s Ice Cream takes pride in being a Canadian company, emphasizing its Canadian-ness in much of its marketing—particularly that it’s made with 100% Canadian dairy—in part to attract those people who prefer to buy Canadian. “Consumers do want to buy Canadian,” says Mary Breedon, sales and marketing director at Chapman’s. “We will continue to do our part to make sure that Canadians know that we’re out there, that we only use 100% Canadian dairy, and that we are committed to that.”

Breedon says Chapman’s range of ice creams and frozen novelties focus on value for your dollar, which makes them popular with families, as does the fact Chapman’s aims to offer options for families with dietary restrictions, too. “Chapman’s, in general, meets a lot of specific dietary needs—peanut and nut free, gluten free, we have the ‘no sugar added’ line, which is also lactose free, so we are essentially a one-stop shop,” she says.

Yunace says the variety of frozen treats for people with special dietary needs has increased across the board, which he feels helps boost sales. “Now, it’s 100% of the population that we’re catering to … we’re able to meet the needs of people with special dietary needs so they can indulge as well.”

Have all of the new product innovations in the category affected sales of frozen treats in general? While long-term data from Mintel shows, overall, people are eating less ice cream than they were a decade ago, Nielsen’s data reveals dollar sales of “ice cream and related products” in Canada were up by 11% in the last year. And according to Yunace, sales of frozen desserts are booming at his store: “Especially last summer—it was like, ‘Wow, we’re selling a lot more ice cream this year than we have in the past!’”

Originally published at Canadian Grocer.


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