There’s Never Been a Better Time for Brands in the Produce Department

January 3, 2018
7:00 pm

Posted by DMA Solutions Team

During 2017, branded produce dollar sales grew by 8% while unbranded and generic label produce sales fell, according to Nielsen.

If you were to ask your friends and family who work outside of the produce industry to name their favorite fresh fruit & vegetable brands, you may hear crickets. I know when I ask my friends this question, they often sputter briefly before exclaiming the name of a retailer like “Central Market!” or “Kroger!” While this may be the typical reaction you get from consumers, the reality is that sales data indicates that they’re choosing branded produce over non-branded items whether they realize it yet or not. And as branded produce sales continue to grow, so will consumers’ awareness of the brands they are gravitating towards.

The Branded Produce Market

Branding is Working

For fresh produce marketers, this is a sign of exciting times ahead. If you’re eager to have products that stand out against your competition and amongst non-branded and private label equivalents on the shelf, branding should be one of your top focuses for 2018. Stemilt’s Communications Manager, Brianna Shales, recently shared some insights with AndNowUKnow about how Stemilt’s focus on branding has been a game-changer for the company: “By stocking brands, you are able to tighten the relationship between your company, the store, and the consumer’s brand recognition. There is a sense of authenticity and familiarity that can be created with well-branded, quality produce items.”

Based on recent data from Nielsen, Brianna’s approach to branding on behalf of Stemilt is spot on, especially when it comes to snacking. Representing a $1.1 billion market, branded produce snacks represent 72% dollar share of the total produce snacking category. Nielsen notes that’s a $44 million growth from the previous year!

Marketing Spend is Still Disproportionate

All of this paints a pretty incredible picture of opportunity for produce brands at the start of 2018. Yet media and marketing spend on fresh produce is still disproportionate to fresh dollar sales. In fact, less than 10% of produce brands (with at least $1 million in sales) spent any budget on advertising in 2017. We get it – the reality is that fresh produce does not need marketing. This may be surprising to hear coming from a fresh produce marketing agency, but that’s the reality of perishable products with an established demand. Fresh produce is going to sell with or without branding, however that doesn’t mean branding won’t turn the dial for fresh produce as we move further away from being a commodity-centric industry to become more relevant to both buyers and consumers.

Why invest in creating a stronger brand and/or more branded products in 2018?

Branding Sells MORE Produce

We believe that branded produce has the unique ability to captivate consumers with a deeper story and create an emotional connection to your products, which will ultimately inspire them to buy more of them. So while your produce can sell with or without branding, branding can lead you to selling more produce and inspiring more consumers to choose your fresh food over a center-store alternative.

Plus, branding doesn’t have to only benefit your consumer relationships. Stemilt shares that they’ve enhanced their customer relationships through their branding by creating tools like display bins and POS materials that drive consumers to engage with the brand through their digital activities. California Giant also recently shared how they’ve spent years building brand loyalty with consumers through various digital marketing activities, which they’ve now turned into a valuable data resource for their trade partners. Because of their focus on branding, California Giant can now offer value to their customer relationships beyond what even Nielsen data can provide.

Relevance Requires Branding in a Competitive Marketplace

In our experience working with marketers in this industry, committing to a rebrand is one of the most difficult decisions for a company to make. Many of you can attest that there is a great deal of nostalgia around your brand and added layers of family history create emotional attachments within the company. The truth is, if people can’t also feel or connect to those same layers of nostalgia, then your brand may not be serving your company’s overall growth in 2018 and beyond. No matter how big or small, we applaud companies who decide to update their branding to improve their relevance in today’s competitive marketplace.

So in 2018, don’t just be a “lettuce grower.” Create a brand that can be “a mealtime solutions provider that brings families together” that just happens to grow lettuce. Figure out what your brand’s core theme is and use it as a navigational beacon in the year ahead to guide your marketing and branding activities forward. Whether it’s a new logo, a focus on brand consistency, smarter packaging, messaging, a more strategic digital presence or all of the above, make 2018 the year your brand stands out on the shelves in the produce aisle and has consumers reaching for it time and time again. As soon as you’re ready, we’re here to help!

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