Processor Looks To Capitalize on Demographic Trends With Innovation

A demographic shift and emerging consumer trends are playing big roles in the continued growth of the fresh-cut produce industry, according to at least one industry member.

“Fresh-cut is one category in which just about all consumer trends are in our favor,” said Steve Dickstein, vice president of marketing for Ready Pac. “The wind is clearly at our back with trends.”

There are five key trends, which Dickstein said make fresh-cut more relevant than ever. Those trends are:

• Higher incomes – when more convenience items are used;
• An aging baby boomer population – where healthful foods are important;
• Shifting population demographics – encouraging the rise in ethnic foods;
• Higher population numbers – more buyers means more items sold; and
• More people pursuing higher education – which, Dickstein said, means more fruit and vegetable consumption.

“I’ve worked in many categories where trends are not your friends,” he said. “Clearly, in this category they are.”

Though many say that people are eating fewer meals at home, Dickstein doesn’t think that’s entirely true. Rather, he said, 50 percent of meals are still prepared at home – with most of them having side dishes. That’s where fresh-cut naturally fits in.

“People are looking for no-preparation foods,” he said. “Consumers still look to grocery stores to provide ready-to-heat, fresh offerings – but I think it’s an area that’s still untapped.”

Bagged salads are pretty widely distributed, and most consumers know they exist. It’s in innovative fresh-cut product offerings, such as those ready-to-serve side dishes and ingredients, that Dickstein sees fresh promise.

When consumers first were introduced to bagged iceberg salad, Dickstein called it an “a-ha” moment where consumers’ lives were changed. But over time, those bagged salads became part of the retail landscape and were an expected item. Processors continued to innovate, adding new salad greens – even ingredients and dressings – to the bagged items.

Currently, Dickstein said, bagged salads have a household penetration of 80 percent, with consumers buying bagged salads about once per month.

“It’s our challenge to come up with products to make (consumers) stop dead in their tracks and say ‘I’ve never thought of that before,’” he said. “There’s a huge opportunity to expand people’s usage of the products to get away from one time a month. Innovation will be needed to unlock the value propositions.”

That’s what Ready Pac is working on right now.

Dickstein mentioned the Bistro-To-Go salads, which are individual-sized salads served with everything the consumer needs for a complete salad – including the fork.

The different salads include everything: salad greens, cheeses, meats, dressings and other vegetable toppings. Nestled on top of the salad in the plastic bowl is a small, plastic fork.

There are five different varieties of Bistro-To-Go salads: Chef, Cobb, Chicken Caesar, Spinach Bacon and Greek.

Product Development

So, what did it take to develop, market and sell these products? It all starts with looking at what consumers want that they aren’t getting, Dickstein said.

“It was clear the consumer wanted health, taste, convenience and freshness,” he said. “And they wanted it all – no compromise.”

Usually, consumers are made to choose among the four, but the staff at Ready Pac decided they wanted to give consumers everything.

The next step was finding the right audience.

“Clearly, it could be anybody,” Dickstein said. “But the target audience doesn’t mean the potential audience.”

So Ready Pac aimed Bistro-To-Go at women, ages 25 to 54, who are working.

Once the team decided on a target audience, they looked at making just the right salads, so they played around with different ingredients, sizes, prices and tastes.

“What we realized is that we had a neat idea but had to do a lot of work on taste to get it right,” Dickstein said.

To do this, the tasters were asked a series of “just-about-right” questions: Is there too much spice? Is there too little spice? Or, is it just about right?

“It starts with insights, moves into the target market identification, then into concept ideation, then into refinement and then into roll-out,” Dickstein said.

When Ready Pac’s marketing team is ready to roll out a product, it uses several methods of promotion – both to the retailers and to the end consumers.

“Even the largest brand in the salad business only has 40 to 50 percent distribution – no brand has national distribution – which prevents you from using old-school media techniques,” Dickstein said. “That causes us to use street-fighter tactics.”

Ready Pac markets to its customers – the retailers – and once the product is in distribution the company uses consumer programs to pull products out of the stores.

“We have to convince our customers that our product appeals to the right consumers,” Dickstein said.

One way Ready Pac does this is by using in-store scan data analysis. This allows the company to see what customers have purchased at a particular store in the past.

“It gives us a real good feel for not only how much of our products are being purchased, but when they’re being purchased,” Dickstein said.

For instance, bagged salads tend to sell more in the late afternoon, close to the dinner hour. But the Bistro-To-Go salads sell during the lunch hour.

After stores start stocking the salads, Ready Pac goes after the consumers.

“The biggest buying activity happens in the store,” Dickstein said. “Most consumers make their decisions there.”

Point-of-sale materials, packaging and special displays all play a big role in drawing customers to a product.

Ready Pac also uses coupons in Sunday newspaper advertising supplements as well as customer-specific fliers that come out once a week.

“Ready Pac has a unique tactic that we use,” Dickstein said. “We use a banner coupon on the bag of our package that’s applied in the factory. It’s one inch wide and is produced at mass speeds so we can have all of our bags supplied with the same coupon.”

Once consumers make that buying decision, quality will keep them coming back.

“Like most foods, you’re on trial for your life with every single purchase,” he said. “If you’re not fresh and you don’t taste great, you have a problem with the next purchase.”

Quality assurance goes back to the team at Ready Pac – from grower/suppliers to the people working distribution to someone working in the produce department at a retail location.

Ready Pac uses Good Manufacturing Practices and has strict HACCP guidelines in place, Dickstein said. The company also checks shelf life every week at levels that are harsher to the product than the distribution chain would be.

“When it succeeds at that level, we know it’s in pretty good shape,” he said. “It starts at the supply of produce into our plants through the typical, and very stringent, GMP and HACCP programs. It also goes out to the customer via in-store merchandising steps.”

After supplying consistent, high-quality product, innovation plays the next most important role in keeping customers – and consumers – loyal. It’s all about keeping the brand fresh, Dickstein said.

“You have to be in touch with what the consumer is looking for tomorrow – not just yesterday,” he said.