Progessive Grocer - March 2017

Page 1

Talent Show

Attracting associates and aiding their advance Page 43

Seafood Under Scrutiny Retailers face challenge to keep sales alfoat Page 61

Expert Advice

Supply chain aces on what’s working — and what’s not Page 90

Store of the Month

Harvest Market

Connects the Dots

Niemann Foods’ new concept links consumers back to food makers

Chris Niemann, EVP/CFO; Doris Klenke, bakery manager; Rich Niemann Jr., president/CEO

Page 30

March 2017 • Volume 96 Number 3 $10 •

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OVEN BAKED NOT FRIED • New Ritz Crisp & Thin will help drive new users to the category via the thin & crispy occasion.¹ • 79% Purchase interest across both flavors tested!² • 28% Incremental to salty snacks³

© Mondelēz International group

Sources: 1 IPSOS Brands Live Equity Tracking EDD Wave Nov 2015, 2 Mondelēz International RITZ Crisps CLT Report March 2016, 3Mondelēz International Bases RITZ Crisps Snapshot March 2016.

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WILD WHAT YOU STOCK Consumers know there’s a better blueberry. You should too.

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Volume 96, Issue 3


Cover Story

Harvest Market Connects the Dots New concept links consumers back to food makers. 52 / Refrigerated Foods So Fresh, So Clean Natural, healthful, exotic offerings rule in refrigerated dressings and dips. 61 / Progressive Grocer’s 2017 Retail Seafood Review

43 / Human Resources Talent Issues Solutions to recruitment, training and retention in the grocery industry.

Swimming Upstream The category’s healthy profile, sustainability moves could buoy sales, but pricing may sink them.

73 / Produce Enlightened Eating Grocers give shoppers food for thought with lessons in organic and local produce.


49 / Snacking Solutions Mixing It Up Strategic merchandising can drive occasion sales for innovative snack products.

March 2017 | |




570 Lake Cook Rd, Suite 310, Deerfield, IL 60015 224 632-8200 • SVP, Brand Director 201-855-7621 Associate Brand Director (AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY)

83 83 / Health, Beauty & Wellness Vitamin Hack Value-oriented promos, on-trend offerings and smart merchandising can lift the VMS category.

88 / Technology Treasure Hunt Understand customers by tracking their paths through the store. 90 / Supply Chain Do’s and Don’ts Industry pros weigh in with tips for smarter logistics, warehouse efficiencies and more.


12 / Editor’s Note Closer Than You Think

24 / All’s Wellness Wellness From the Deep

14 / PG Pulse

28 / Industry Events Friends Celebrate Joan Toth

16 / In-store Events Calendar May 2017

20 / Nielsen’s Shelf Stoppers/Spotlight

Dressings, Salads and Prepared Foods

94 / What’s Next Editors’ Picks for Innovative Products 98 / The Last Word As the Food World Turns

22 / Mintel Global New Products

Sweeteners and Sugar


| Progressive Grocer | March 2017

Jeff Friedman Janet Blaney

630-364-1601 EDITORIAL Editorial Director Joan Driggs 224-632-8211 Chief Content Editor Meg Major 724-453-3545 Editor-in-Chief James Dudlicek 224-632-8238 Managing Editor Bridget Goldschmidt 201-855-7603 Senior Editor Randy Hofbauer 224-632-8240 Senior Editor Katie Martin 224-632-8172 Senior Editor Anna Wolfe 207-773-1154 Technology Editor John Karolefski 440-582-1889 Contributing Editors Karen Buch, Jenny McTaggart, Barbara Sax and Jennifer Strailey ADVERTISING SALES & BUSINESS Eastern Marketing Manager Maggie Kaeppel 630-364-2150 • Mobile: 708-565-5350 Western Regional Marketing Manager Rick Neigher (CA, OR, WA) 818-597-9029 Northeast Marketing Manager Mike Shaw 201-855-7631 • Mobile: 201-281-9100 Account Executive/ Classified Advertising Terry Kanganis 201-855-7615 • Fax: 201-855-7373 Classified Production Manager Mary Beth Medley 856-809-0050 EVENTS SVP, Events & Conferences Maureen Macke 773-992-4413 CUSTOM MEDIA VP/Custom Media Division Pierce Hollingsworth 224-632-8229 General Manager, Custom Media Kathy Colwell 224-632-8244 MARKETING VP, Marketing & Communications Bruce Hendrickson 224-632-8214 Director of Market Research Debra Chanil 201-855-7605 AUDIENCE DEVELOPMENT Director of Audience Development Gail Reboletti Audience Development Manager Shelly Patton 215-301-0593 List Rental The Information Refinery 800-529-9020 Brian Clotworthy Subscriber Services/Single-copy Purchases 978-671-0449 or email at ART/PRODUCTION Director of Production Kathryn Homenick Advertising/Production Manager Jackie Batson 224-632-8183 • Fax: 888-316-7987 Art Director Bill Antkowiak

CORPORATE OFFICERS Executive Chairman Alan Glass President & CEO Peter Hoyt Chief Operating Officer Richard Rivera Chief Brand Officer Jeff Greisch Chief Financial Officer Len Farrell Chief Business Development Officer & President, EnsembleIQ, Canada Korry Stagnito Chief Customer Officer/ President of Strategic Platforms Ned Bardic Chief Digital Officer Joel Hughes Chief Human Resources Officer Greg Flores




In the final installment of a three-part series covering Tyson Foods’ Prepared Foods Challenge, four Chicagoland families use their newfound knowledge of prepared foods to put fresh meals on the table.

Lisa Schnurr and her son, Scott, use store-prepared meatballs to simplify a pasta dinner.

For Inspiration’s Sake Connecting with consumers in meaningful ways can enrich their experiences with retail prepared foods. f retailers really want to build loyalty, redefine the deli as a store destination and capitalize on increased demand for fresh prepared foods, they need to get consumers on board.


Springdale, Ark.-based Tyson Foods recently conducted an experiment that suggests retailers can create a more effective shopper’s journey with communication and education tactics that inspire consumers to use the benefits of the entire store for their convenient meal solutions. “We need to focus on consumers and what makes sense to them,” concluded Eric Le Blanc, director of marketing for Tyson Foods. “We need to move away from product-centric thinking and move toward shopper-centric thinking and meal-centric thinking. Focusing our efforts on educating and inspiring the consumer is the most important thing we can do and the execution of that is critical.”

The Path to Inspiration Tyson Foods’ and Redwood City, Calif.-based marketing firm Green Bear Group’s “Prepared Foods Challenge” called upon four Chicagoland families to exclusively use prepared foods from their local supermarkets to assemble seven consecutive family dinners. On days one through three of the Challenge, no help or advice

was given to the Keeley, Ramirez, Schnurr and Gebien families, leaving them frustrated and disappointed by what they considered an overall lack of product variety, freshness and quality in the prepared foods department. Charlie Baggs, executive chef and president of Charlie Baggs Culinary Innovations, visited the families on days four, five and six of the Challenge and quickly changed their perceptions, educating and inspiring them to use prepared foods in new ways and to enjoy the benefits of the supermarket in its entirety. Among other tips, Baggs offered advice on planning ahead for shopping excursions, the best ways to navigate a grocery store, using prepared foods for multiple meals as a cost-saving measure, and taking advantage of what’s available in other store departments to enhance prepared foods and create more complete, cohesive meals. “I’m not here to teach them how to become a chef, but I may be able to teach them how to use prepared products to their advantage and how to complement a prepared food item with other fresh ingredients,” said Baggs. By day seven the four families were on their own again, this time equipped with what they learned about fresh prepared foods on days four, five and six.


“It was sink or swim time, and I’m not sure my family had the highest confidence in me,” said mom June Keeley, as she embarked on the seventh day of the Challenge. “Normally I would dread going to the store on a Saturday, but I had direction. I had motivation. I actually felt happy. I felt like a winner.” Keeley organized her shopping cart following Baggs’ instructions, separating the protein from carbohydrates, and purchased prepared salads and other ingredients for Italian beef sandwiches. At home, she encouraged her family to participate in the meal prep to liven up the dinner experience.

The Keeley and Ramirez families wrap up the “Prepared Foods Challenge” with meals that combine retail prepared foods and other fresh ingredients.

The Schnurr and Gebien families, meanwhile, made pasta and their own sauce, but added store-prepared meatballs as a time saver. The Gebiens further supplemented garlic tomato bread with produce from their home garden.

challenge. It’s a shopper marketing challenge. How do we find a way to speak to the target consumer before they even enter the store, and how do we deliver the right message to activate their purchase intent?”

Ebony Ramirez, a wife and mother of five, said she felt more confident entering the store on day seven because she took Baggs’ advice and developed a purchase plan. Moreover, she had a clearer understanding of how to use the whole supermarket to meet her family’s mealtime needs.

As a first step, Amber Langston, a channel marketing manager for Tyson Foods, suggested that retailers use their existing digital infrastructures, such as Facebook, Twitter, Instagram, blogs, websites or on-line advertising, as low-cost, low-investment options for consumer education and inspiration.

“Today, even though I was using prepared foods, dinner felt like homemade to me.” — Ebony Ramirez

“When I walked into the grocery store today, I already knew what I was buying. I went straight for the vegetable aisle and I grabbed everything in order,” Ramirez said. “The prepared food was almost the last spot I went. I know it’s not from scratch but when I’m putting it together it feels like I’m making it from scratch. Today, even though I was using prepared foods, dinner felt like homemade to me.”

“We’ve noticed that many retailers are underutilizing their digital infrastructure to communicate about the prepared foods department in any way,” Langston said. “And if they are, they certainly are not educating and inspiring the consumer.” Channel marketing manager Brad Bennett added that retailers haven’t scratched the surface in terms of marketing and enriching the shopper’s experience using retail prepared foods. He pointed to department signage, co-marketing opportunities, stronger integration of existing loyalty plans and use of a chef by appointment only as potential tactics to inspire consumers.

Communication is Critical

Le Blanc insisted that retailers’ focus on new equipment, products and store design is misplaced.

Tyson’s Le Blanc stressed that the four families’ success in the aftermath of Chef Baggs’ visits demonstrates the importance of educating and inspiring consumers. Communicating the full benefits of retail prepared foods in the context of the entire store was key.

“All the bells and whistles that we see everyone trying to add to what they do, that’s not where loyalty is won or lost,” he said. “The answer goes back to communication. It’s critical we communicate with the shopper both inside the store and outside the store. We have to not only tell consumers what to do, we need to inspire them to do it.” n

“To start any revolution you must change the conversation,” said Le Blanc. “Once we change the conversation what we find is that the real challenge in prepared foods is a communication

DAYS 1-3

DAYS 4-6


Families make dinner on their own using prepared foods from local supermarkets.

Chef Charlie Baggs educates the families on prepared foods and how to make the most of them.

Families are on their own to make dinner, this time using what they learned about prepared foods and the supermarket as a whole.


Note By Jim Dudlicek

Closer Than You Think


Everyone must be on this journey or risk becoming irrelevant with the shoppers of tomorrow.

ess than a decade from now, food shopping will be an intuitive process seamlessly incorporated into daily activities. That’s according to a new study, “Surviving the Brave New World of Food Retailing: A Roadmap to Relevance for the Future for Food Retailers,” conducted by Kurt Salmon for the Coca-Cola Retailing Research Council (CCRRC), which offers a vision of grocery retailing in the year 2025. It’s a date that sounds futuristic, yet it’s just eight years away. And parts of the picture the study paints are already reality today. “Food shopping will not be a discrete journey,” the study asserts. “It will be disintermediated into myriad touchpoints and events where consumers will have an almost limitless choice in where, when, how and why they fulfill their wants and needs for food.” The shopping journey, the study continues, “will begin more fluidly from lifestyle triggers, including integrated monitoring and management of health and wellness, diet and fitness, and ordering will become increasingly seamless.” Further, consumers will engage with retailers in a highly personalized fashion, receive recipe inspiration from multiple channels, and acquire groceries from several flexible and immediate delivery options. Sound scary? “The sky isn’t falling — the status quo is disappearing,” explains Michael Sansolo, a member of the research council, who led a panel discussion on the future of food retailing at Food Marketing Institute’s Midwinter Executive Conference in January. The panel of retailers discussed how grocers must adapt to ongoing global societal shifts that are changing the way people produce, sell, prepare and consume food. Grocers need “to be progressive in adapting to these changes,” Sansolo told me following the panel discussion. “A lot of the traditional strengths of the food network are disappearing,” such as location and brands, he said, because of changing

Jim Dudlicek

Editor-in-Chief Twitter @jimdudlicek


| Progressive Grocer | Ahead of What’s Next | March 2017

consumers and technology. “We know the ‘what’ of the consumer. We need to know the ‘how’ and the ‘why,’ so we’re fulfilling needs, not just products,” Sansolo added. The extensive Salmon/CCRRC study poses a scenario for grocery shopping in 2025, relating the retail journey of a fictional family. In some ways, their future is already here. “Jessica does her shopping for nonperishables between work meetings on her computer, her iPad or by speaking instructions into her mobile phone while driving carpool in the car. Jessica very rarely visits a brick-and-mortar store. She is enrolled in a subscription service for a number of consumables. ... This cloud-based service leverages a basic replenishment algorithm to maintain Jessica’s perpetual inventory and order parameters … “Dave uses a combination of online purveyors and specialty brick-and-mortar establishments to purchase perishable foods. … He has ‘tagged’ these items in his ‘smart’ fridge, a networked device that identifies items that are running low and uploads a replenishment order to a ‘shopping list mediator’ service. … On Saturday morning, Dave likes to go in person to the multicategory, specialty brick-and-mortar store to personally select fresh produce and unique ingredients. He likes to browse, watch cooking demos and tastetest new products. … When Dave arrives, he pulls out his mobile phone. … The loyalty software engine continuously updates and enhances Dave’s product and delivery preferences by monitoring his shopping behavior. … Dave is able to walk through the store, scanning and bagging the items he is purchasing. … For one item, Dave finds it 20 percent cheaper on Amazon. With the click of a button, he uploads the Amazon price to the app and the price is automatically lowered to the competing price. ... Dave begins to prepare Saturday evening’s meal and he realizes that he does not have enough panko bread crumbs. Dave quickly places an Instacart order to get the bread crumbs from his favorite mass retailer, then, on impulse, adds some homemade guacamole and chips from his favorite ethnic food store. The order arrives 90 minutes later by Uber’s new driverless vehicle service.” The study cautions: “Keep in mind that every company is at a different point in this journey and everyone is moving at a different speed. But everyone must be on this journey or risk becoming irrelevant with the shoppers of tomorrow.” See the complete study at PG

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What’s trending on …

Topping the leaderboard of the most popular news stories on during the Jan.16-Feb. 15 measuring period was the news of Wegmans Food Markets’ new heat-and-eat line of refrigerated Power Meals, which were developed with the company’s nutritionists to set the parameters that each offering needs to meet. Placing in the runner-up slot of most click-worthy online news items was the summary of accomplishments that Albertsons has made as it marked the second anniversary of its merger with Safeway Inc., including workforce growth, new stores, stepped-up donations and a stronger focus on sustainability.

Wegmans Powers Up Prepared Meal Line

4 Food Retailers Poised for Future Ecommerce Excellence

Ahold USA Makes Merchandising Executive Moves

Retailers, CPGs Divided on Assortment Priorities

Albertsons Celebrates Milestones on Safeway Merger’s nd 2 Anniversary

Target Trims Innovation Agenda Due to Slowdown

Walmart Adopts Blockchain Technology

Hy-Vee Embraces ‘Ugly’ Produce


Andronico’s/Safeway Transition Commences

| Progressive Grocer | Ahead of What’s Next | March 2017

May 2017 is...

National Barbecue Month National Mediterranean Diet Month National Hamburger Month National Salsa Month National Strawberry Month




Make sure the store is adequately stocked for spring gift-giving occasions.


Lemonade Day


National Coconut Cream Pie Day



National Chocolate Mousse Day


National Shrimp Day



Are you ready for Cinco de Mayo?



National Hoagie Day. Offer specials in the deli or prepared food area.





National Enchilada Day

The 143rd Kentucky Derby is run today.

Cinco de Mayo

National Crepes Suzette Day









This is a good time to check your Memorial Day and summer grilling inventory.

National Eat What You Want Day. Offer samples of tasty treats throughout the store.

National Nutty Fudge Day

National Apple Pie Day

Moscato Day


National Buttermilk Biscuit Day Mother’s Day


This is the start of American Craft Beer Week. Display local beers, growlers and beer glasses.


National Barbecue Day. Make sure the displays are restocked.

Promote National Mediterranean Diet Month throughout the store.

World Baking Day


National Vanilla Pudding Day


National Hamburger Day


National Taffy Day


National Escargot Day

NCA Sweets & Snacks Expo begins in Chicago and continues through May 25.

In honor of Jewish Heritage Month, offer discounts on kosher products.

Review your summer travel plans.


Memorial Day National Biscuit Day


National Mint Julep Day


National Wine Day

National Quiche Lorraine Day National Pick Strawberries Day Armed Forces Day


Ramadan begins. National Cherry Dessert Day

National Brownbag-it Day. Make sure you have lots of DIY sandwich items available.


In honor of National Salsa Month, hold tastings and demos of traditional and unusual salsa.


National Macaroon Day

National Brisket Day


National Devil’s Food Cake Day

National Hummus Day

National Chocolate Chip Day


It’s No Dirty Dishes Day. Cross-promote liquid soaps, sponges, drying racks and dish towels.

| Progressive Grocer | Ahead of What’s Next | March 2017

Email your calendar submissions to

Turn snacking upside down ChobaniÂŽ Greek Yogurt satisfies your shoppers all day long For more information about Chobani, please contact us via email at

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Front End

Market Intelligence By The Numbers

Shelf Stoppers

Dressings, Salads and Prepared Foods ToTal dressing, salad and prepared food sales reached $6.7 billion in The pasT year (52 weeks ending Dec. 31, 2016)

Top 5 dressing, salad and prepared food categories $3,000,000,000 2,500,000,000

What are the Top influencers of american purchase decisions for prepared Meals?

2,000,000,000 1,500,000,000 1,000,000,000 500,000,000 0

refrigeraTed Meals

52 Wks - W/e 12/31/16

52 Wks - W/e 01/03/15

refrigeraTed sandWiches

52 Wks - W/e 01/04/14

salad dressings

lunch coMbinaTions

52 Wks - W/e 01/05/13

say it’s price


“There’s opportunity across the store to appeal to consumers’ diverse health-and-wellness considerations, especially via prepared foods in the deli section. Taking a look at categories like prepared sushi or lunch combination kits, we see strong sales growth at 17 percent and 13 percent, respectively, for 2016. The store perimeter has largely benefited from consumers’ demand for more healthful foods. refrigerated and prepared meals appear to be meeting consumer needs on both the fronts of convenience and wellness.” —nielsen Vp consumer insights Jordan rost



25% say it’s taste

deli consumers within the $100,000-plus income bracket spend 30 percent more than their expected share on deli products, in proportion to their relative incidence in the u.s. population. deli consumers within the less-than $20,000 income bracket spend 39 percent less than their expected share on deli products, in proportion to their relative incidence in the u.s. population.

Cross-merchandising Candidates Top coMpleMenTary producTs

ProDuct breakfast food desserts, gelatins and syrups pasta cereal cheese

InDex 112 110 110 109 109

Source: nielsen


| Progressive Grocer | Ahead of What’s Next | March 2017


say it’s convenience

Source: nielsen global retail-growth strategies survey, Q3 2015


Mondelēz International is very proud to congratulate Richard Niemann Jr. for winning the 2017 National Grocers Association Thomas K. Zaucha Entrepreneurial Excellence Award. Richard’s work for his stores, his employees and his community has earned him not only this prestigious award, but also the admiration and respect of those around him. Congratulations Richard!

© Mondelēz International group

Mintel Global New Products Database Category Insights

Sweeteners and Sugar Market Overview Sugar’s negative health image has had an effect on growth in the United States and Canada. Both markets have developed a negative average value growth (CAGR) over the past five years. Moving forward, Mintel predicts that the category is expected to remain fairly flat as declines in sweeteners and sugar are offset by growth in honey, and emerging plant-based and other low-calorie sweeteners.

Competition in “natural” sugar alternatives is becoming more intense. According to Mintel research, there’s only a marginal difference in the number of consumers who consider agave, coconut sugar or stevia “natural,” and although monkfruit’s natural credentials are less established, this is likely a result of the product’s relative novelty.

key iSSueS Growing consumer concern about the healthfulness of sugar means that the category is struggling for growth. More focus is being given to the natural qualities of sugar alternatives. Recent growth has therefore stemmed from brands focusing on the natural qualities of sugar alternatives, with 70 percent of the total new product launches in the “other natural sweetener” category positioned with some kind of natural claim in the 12 months to September 2016.

Product innovation within the category has led to the introduction of natural sugar alternatives as consumers are gravitating toward more natural alternatives. Consumers are confused about different types of sweeteners, how they are produced and the best applications. Sweetener manufacturers can help consumers during the purchase process by narrowing choices or directing them to the best sweetener for their needs.


| Progressive Grocer | Ahead of What’s Next | March 2017

For more information, visit or call 800-932-0400.

Although plant-based syrups such as agave, coconut and honey aren’t necessarily lower-calorie alternatives to sugar, they’re often perceived as healthier options, as consumers believe that they’re naturally produced and, as such, are less, or even minimally, processed.

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All’s By Karen Buch

Wellness From the Deep Seafood can be part of a healthy diet.


What About Aquaculture? pproximately 500 types of All in all, seafood are sold annually Globally, aquaculture (fish or shellfish farming) consumers in the global market. In the supplies more than 50 percent of all seafood want help United States, just 10 fish and produced for human consumption, and it’s growfinding the shellfish species account for 90 ing. Experts predict that we’ll need another 40 freshest, percent of seafood consumed: shrimp, salmon, million tons of seafood worldwide by 2030 just healthiest, tuna, tilapia, Alaska pollock, pangasius (basa or to meet current consumption rates. safest, most swai), cod, catfish, crab and clams. Today, U.S.-grown farmed fish and shellfish sustainable Seafood, which includes fish and shellfish, is an represent just 5 percent to 7 percent of U.S. seafood important source of protein, minerals, micronutridemand for seafood. As responsibly practiced ents and essential fatty acids in a healthy diet. aquaculture grows, concerns about wild populachoices they For the general adult population, consumptions of fish and seafood being overfished can can afford. tion of about 8 ounces per week of a variety of be reduced. U.S. farm-raised seafood is subject seafood, including adequate sources of EPA and to some of the most stringent food safety and DHA omega-3s, is associated with reduced risk of environmental regulations in the world. cardiac disease and other health benefits. Unfortunately, fewer than one in What Do Consumers five Americans reaches this Want to Know? goal, with one-third Be prepared to talk in eating seafood once a detail with today’s week and nearly half inquisitive coneating it occasionally sumers. Common or not at all. questions include Experts typithe following: Is the cally recommend 3,500 seafood sourced domesmilligrams of EPA/DHA tically or internationally? omega-3 fatty acids per week. This What can you tell me about sealevel can be achieved naturally by eating two to food safety and sustainability? Was it farmed three servings of oily fish like salmon, halibut, sardines and or wild-caught? If it was farmed, tell me about the fish anchovies per week. Fish oil supplements are also available. feed and use of antibiotics or vaccines. Was it genetically modified? How can I eat more seafood while minimizing exposure to mercury, PCBs, dioxins or other chemicals? Is Seafood Recommended for Look to your seafood suppliers for answers, along with Women and Children? various seafood programs and resources such as Marine Yes. Consumption of seafood choices that are sources of Stewardship Council, Global Aquaculture Alliance, MonDHA omega-3s while pregnant or breastfeeding is associterey Bay Aquarium, National Fisheries Institute, National ated with improved infant health outcomes. Oceanic and Atmospheric Administration, and Fishwatch. Women who are pregnant or breastfeeding should conAll in all, consumers want help finding the freshest, sume at least 8 and up to 12 ounces of a variety of seafood healthiest, safest, most sustainable seafood choices they per week, from choices that are lower in methyl mercury. can afford, along with recipes and suggestions for the This can be a point of confusion, leading some women to best cooking methods to turn their seafood investment unnecessarily avoid seafood altogether. into a stellar meal. PG Children also benefit from eating seafood that is lower in mercury one to two times a week, with a recommended serving size of 1 ounce for ages 2 to 3 years, 2 ounces for Karen Buch, RDN, LDN, is a registered dietitian/nutritionist ages 4 to 7 years, 3 ounces for ages 8 to 10 years, and 4 who specializes in retail dietetics and food and nutrition ounces for children 11 years and older. communications. One of the first supermarket dietitians, she is now founder and principal consultant at Nutrition In January 2017, FDA released a new printable advice Connections LLC, providing consulting services nationwide. chart specifically to address these populations. It sorts You can connect with her on Twitter @karenbuch and at 62 types of seafood into best choices, good choices and choices to avoid.


| Progressive Grocer | Ahead of What’s Next | March 2017

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Industry Events

FMI Midwinter Conference

Friends Celebrate

Joan Toth

Industry applauds former NEW president/CEO. By Jim Dudlicek


oan Toth helped grow the Network of Executive Women (NEW) from a handful of members and partners into the retail and CPG industry’s largest leadership organization. In fact, you’d have been hard-pressed to find a life that Toth hadn’t touched when she was honored on Jan. 28 for her contributions, leadership and friendship at the annual Friends of the Industry dinner during the Food Marketing Institute’s (FMI) 2017 Midwinter Executive Conference, in Scottsdale, Ariz. Toth was treated to a standing ovation, flowers, a silver loving cup and the gratitude of countless folks offering their FonD FarEwEll Top photo: Joan Toth receives congratulations from (l-r) accenture’s Mike Gorshe, nEw’s nancy Krawczyk and nestlé Purina’s Vicki Felker. Bottom photo: Toth is joined at the banquet by (front, l-r) Felker, IrI’s ann raider, (rear, l-r) BizHive’s Kim Feil, acosta’s Tom Duffy, nEw’s regenia Stein, Krawczyk, PepsiCo’s rose Bollman, and american Express’ leslie wims-Morris and Thea McDevitt.

appreciation for her 15 years of dedicated service to NEW. She was elected treasurer of the organization in 2001, named executive director in 2002, and took on the new position of president and CEO from 2011 to the end of 2016. “As founding leader of NEW, Joan leaves a remarkable legacy,” said NEW Board Chair Karen Stuckey, SVP for private brands and general merchandise, Walmart US, at Bentonville, Ark.-based Wal-Mart Stores Inc. “During her 15 years, Joan’s passion galvanized a movement. She built a strong and growing organization representing 10,000 members, more than 100 corporate sponsors and 20 regional groups across North America.” Among other endeavors, Toth previously launched GoTo-Market Strategies, a retail consulting firm, and was VP and publisher of Convenience Store News, a sister publication of Progressive Grocer. The setting for Toth’s celebration was the 16th annual dinner of Friends of the Industry, which, in lieu of gifts or headliner entertainment for the banquet, allocates such funds to local charities and educational organizations designated by FMI members. PG Find full coverage of this year’s FMI Midwinter Conference at


| Progressive Grocer | Ahead of What’s Next | March 2017

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Store of the Month

Harvest Market, Champaign, Ill.

Harvest Marke t

Connects the Dots New concept links consumers back to food makers. By Katie Martin

Photography by Vito Palmisano


| Progressive Grocer | Ahead of What’s Next | March 2017


hen Niemann Foods broke ground on a new location in Champaign, in downstate Illinois, the plan had been to launch the store under its well-known County Market banner. But Rich Niemann Jr., president and CEO of the Quincy, Ill.-based operator, and his team realized that they’d need something different to compete in the university town, so they began playing around with an idea they had for a new concept, one that focused on the growing farm-to-table trend. The resulting 58,000-square-foot Harvest Market, which by its very name harkens back to the land, offers a blend of conventional items and natural/organic products supporting the farm-to-table ideal, with conventional products making up about 40 percent of the selection and natural/organic accounting for the bulk, at 60 percent. “We began with the idea and understanding that we wanted to have a connection for our customers that is unique in the industry and allows them to understand who the producers and makers are,” Niemann says. “Everything flows from this relationship with these producers and makers. That also allows them to understand where their food comes from, what’s in it, what’s not in it. People are very, very interested in that.” The switch to a focus on local or smaller producers had the team rethinking the entire supply process. County Market stores are supplied by traditional wholesaler and DSD vendors, but for the new Harvest Market concept, Niemann says: “We just realized that the food business is changing. Obviously, it’s changing very fast. How can we have something that has a real, true connection?”

Chef inspired The deli and salad bar items were in r&d for a year before the store opened, to work out the best sources for local ingredients in the correct flavor combinations.

March 2017 | |


Store of the Month

Harvest Market, Champaign, Ill.

Beefing uP Several beef products are supplied by President and CeO Rich niemann Jr.’s own ranches, allowing the store to control the product “from hoof to case,” he says.

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Personalized Supply Chain The answer was developing relationships directly with the producers. The team makes an effort to visit the farms or facilities to create that personal connection and document the visits in the store or on social media so customers can also develop a relationship with the makers of the food they’re buying. For example, the produce department features signage with Niemann’s photo when he visited Natalie’s Orchid Island Juice Co.’s facility in Fort Pierce, Fla. All departments feature marketing that highlights the farmers or producers, often accompanied by a photo of a Harvest Market team’s visit. If it’s not on display in the department, Harvest Market has the visit featured on its website. Additionally, the store brings those farmers and producers on site to meet customers directly. “In the bakery, in produce, we’re setting up folks, farmers, throughout the season, to be in here at least once a week to tell their stories and interact with the guests, because that’s what people want,” says Marty Travis, who runs Spence Farms, a Fairbury, Ill.-based aggregator that sources product from about 50 farms to supply Harvest Market. On two occasions before Thanksgiving, Harvest Market had the farmer who raised the turkeys sold in the store take part in a meet-and-greet with shoppers. Producers are often in the store demoing and sampling their products and speaking directly to customers. “Exploring new tastes and the story behind that is so much of what we do here,” Niemann says. “People spend a lot more time in this store than they would a typical store. They’re

Store of the Month

Harvest Market, Champaign, Ill.

probably here a good 10 minutes longer than what we would normally expect, and that’s because they’re interested in what’s going on. “Product is all around us, but for years and years, we’ve participated in the normal grocery system like everybody else,” he continues. “The old model doesn’t work anymore, and we really believe that entertainment is part of the business going forward. Entertainment is food knowledge, and it connects you back to the land and to the producers. This store and our team are a lot more about entertainment and knowledge than they are about pantry fill.”

We wanted to have a connection for our customers that is unique in the industry and allows them to understand who the producers and Food as Entertainment That entertainment component, which supports makers are.” the farm-to-table concept, is on full display at —Rich Niemann Jr., President/CEO, Niemann Foods

Harvest Market, with the scratch bakery associates making products in view of customers, meats that are smoked in the store, and butter churned on site. The USDA-certified butter-churning room is, to Progressive Grocer’s knowledge, the first of its kind in a supermarket. The room features several low windows so that everyone, including children, can watch the process. The idea to churn butter on site began as a way to tell the story of the new concept. “We wanted to do some unique things to show our connections

DEMONStRatiON thEatER harvest Market regularly invites its producers and makers, like Chef Martin, based in Chicago, who crafts sausages using old recipes from the family’s austrian butcher shop.

to the farmer, our connection to the grower, and then straight to the manufacturer,” explains Kevin Walker, foodservice director. The butter is used as an ingredient in several departments within the store in addition to being sold directly to customers. Byproducts also are used in house; for example, the bakery uses the buttermilk to make its biscuits, and the prepared food depart-


| Progressive Grocer | Ahead of What’s Next | March 2017

Harvest Market, Champaign, Ill.

Store of the Month

take a load off the farmhouse Restaurant, which features seating for about 200 both downstairs and in the mezzanine, creates an atmosphere that invites customers to sit, relax and stay awhile.

ment uses it in its finished products. Recently, the store added a variety of compound butters. Demand often outstrips supply, but production is dictated by the availability of the fresh, local cream, and labor. The process is laborious, and it takes a while to train new butter churners. The butter is made from both whey cream and sweet cream, which are pasteurized in-store before being churned and worked by hand to remove the excess buttermilk. The finished butter is sold in 1-pound packages in the dairy department and in a 12-ounce size in the Farmstead Cheese Shop. “We’ve been selling out almost every day,” Walker notes. “It’s been really a good thing.”

Scratch Made To help make the farm-to-table connection even clearer for customers, Harvest Market decided to create prepared food departments that make almost all of its products from scratch, from the deli to the bakery to the restaurant. The prepared food departments use the same suppliers that supply other parts of the store, so customers are buying the same product no matter whether they purchase it to prepare at home or buy it already prepared in store. For example, local eggs that customers buy from the case are the same eggs that the deli, restaurant and bakery use to create their products. The Farmhouse Restaurant is a first for Niemann Foods. “Here at Farmhouse, what’s unique to us is, we’re from scratch,” says Robert Rodrigues, Farmhouse manager. “We’re able to formulate authentic dishes and collaborate with a lot of our local farms. We’re able to source everything within this region and showcase quality at its best: Food

“Trusted Excellence” is more than a phrase, it’s the foundation of what we do. Our customers rely on us for the quality products stocked on their shelves, delivered on time and backed with expert support every step of the way. It’s what we’ve always done…and we’re not stopping now.

Visit to learn more. ®/© 2017 Tyson Foods, Inc.

Store of the Month

Dairy relocation (l-r) Jim cox, SVP/director of operations; tim Fink, VP fresh product; and ron cook, VP/director of marketing stand in the dairy that was moved into the center of the store.

Harvest Market, Champaign, Ill.

that is approachable and recognizable.” The store serves as the supplier for many of the restaurant’s products. “I have the largest pantry in town,” Rodrigues notes. “With all the products at my disposal, really the sky’s the limit.” One of the restaurant’s best-selling products is chicken pot pie featuring house-made biscuits made from locally sourced grain and butter churned on site. “We’re able to collaborate with different departments to showcase something stellar,” Rodrigues observes. “It’s Grandma’s good old chicken pot pie, but just stepped up with quality ingredients.” J.P. Speckman, Farmhouse Restaurant’s chef, notes that the store’s commitment to local sourcing

also ensures that product is as fresh as possible. “If I put an order for my basil in today and it comes on Wednesday, that means he picked it Tuesday

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Store of the Month

SinGle File The store introduced a checkout concept in which customers wait in a single line and are called to the next available cashier through an automated system.

Harvest Market, Champaign, Ill.

and brings it straight to me Wednesday,” he says. “I have the freshest basil right off the plant that I can get.”

Foodies Should Apply The commitment to fresh prepared products also required Harvest Market to change how it hires staff. An interest in food and a willingness to share knowledge became more important than it might be in a typical supermarket. “The culinary conversation here is so much greater than the other stores I’ve been a part of,” enthuses Tim Fink, VP fresh product. “As customers get in here, they experience it; they recognize that we have people that are into food, know how to prepare food and want to talk about food.”

“All of our associates have to believe that they’re on a mission here — this is not a grocery store,” Niemann says. “This is a mission that we’re on to help our customers and provide that information, that interest and that passion for food.” PG

Connecting Through Social Media

EXECUTIVE DIRECTOR ACADEMY OF FOOD MARKETING Saint Joseph’s University, located in Philadelphia, is currently recruiting for an Executive Director for Academy of Food Marketing. The Executive Director will be responsible for the management of all aspects of the Academy of Food Marketing and the Food Marketing Educational Foundation Fund, student placement, student recruitment, cooperative education program, and scholarship allocation for over 200 food marketing majors. Scholarship funds come from an internal endowment held in trust by Saint Joseph’s for the Academy and funds raised outside the university on an annual basis. The Academy is self-funding and the Executive Director will be responsible for the fundraising operations to sustain the program. Qualified candidates must possess a Bachelor’s Degree in Food Marketing or Business or a closely related field of study, Master’s Degree Preferred; 10 years administrative, marketing or sales experience in the food industry; 10 years in supervisory capacity; and intimate knowledge of the make-up and structure of the food industry, and a broad scope of industry networking/ relationships and connections. For a complete description of position responsibilities, benefits information and to apply, please visit our website at; click on Employment and follow the instructions. All applications must be submitted on-line through the employment site. Saint Joseph’s University is a private, Catholic, Jesuit institution and expects members of its community to be knowledgeable about its mission and to make a positive contribution to that mission. Saint Joseph’s University seeks to recruit, develop and retain a talented and diverse workforce. EOE M/F/D/V


| Progressive Grocer | Ahead of What’s Next | March 2017

Harvest Market, in Champaign, Ill., is a new concept from Niemann Foods that’s focused on connecting customers with their food through the supermarket. To connect shoppers to the store, the company is largely using social media to get out its message. The store doesn’t use advertising in the traditional way that most supermarkets do — no weekly ads in local newspapers (fliers are printed and available in store with weekly specials); instead, social media plays that role. “This store lives and dies in social media, because that’s how the stories really get told,” says Rich Niemann Jr., president and CEO of Quincy, Ill.based Niemann Foods. Ron Cook, VP/director of marketing, notes that the company started spreading the word about the new store several months in advance of its debut. “We introduced what we were doing two months before we opened, and we had 5,000 people in our community already engaged with our local brand that were talking about it,” he adds. The store also is recruiting its suppliers to spread their own messages via social media. “As they’re harvesting wheat or corn, we’re filming that and posting it to our site,” Cook says. “It’s talking to our customer and saying, ‘This is what we’re doing. We’re a part of the story.’”



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Human Resources




Solutions to recruitment, training and retention in the grocery industry. By Joan Driggs


ach year in our Annual Report of the Grocery Industry, Progressive Grocer asks retailers about the issues they wrestle with. Without fail, labor issues, including recruitment, training and retention, are among the chief struggles. The good news is that retailers, educational institutions and associations are responding. Most notably, grocery retail is attempting to be relevant to a young workforce demanding more than a paycheck.

Getting Them in the Door What other industry has better recognition among Americans of working age than grocery? From an early age, grocery stores are part of our everyday existence. Yet, to a one, retailers indicate that they’re challenged with finding talent to hire. Clearly, there’s a disconnect between familiarity and allure. “The industry doesn’t do a lot to make itself ” attractive, says Robert Paul Jones, associate professor of marketing at the University of Texas at Tyler (UTT). That lack of attraction hits applicants as they make their first pass at a store, according to Harold Lloyd, president of Virginia Beach, Va.-based grocery consultancy Harold Lloyd Presents, and author of “Supermarket Rules! 52 Ways to Achieve Supermarket Success” and other books for the grocery industry. From lack of personal interaction with applicants to broken or unkempt application kiosks, retailers don’t roll out the welcome mat for new hires, he says. “Assess your first impression,” Lloyd urges. “What worked in recruitment and engagement five years ago doesn’t work now,” affirms Terra Powers, Norcal human resources and education manager at Pleasanton, Calif.-based Safeway (part of the Albertsons family of stores). “We have to move with the times. The industry has to be flexible March 2017 | |



Human Resources

and change and adjust to make sure we’re reaching our employees, our market, [and] the people we want to keep engaged.” But the grocery industry relies too much on the tried and true, Powers believes. “Millennials want more flexibility and balance, and an understanding of their path and their options,” she says. “In previous generations, it was, ‘Put your head down and good things will come.’ Today, we need to advertise the opportunities; the new workforce wants to be reached this way.” Today, job applicants want to know that they’re a fit with the company. In a word: culture. If a retailer

People Power

wants to create a unique, delightful experience for its shoppers, it should start by creating one for its store associates. Regional grocery chain Raley’s, based in West Sacramento, Calif., starts with its Raley’s Way to attract talent with its mission, vision and values. The Raley’s Way, explains Mark Foley, EVP of human resources for the Northern California grocer, strives “to give you a good picture of our purpose, and how we get talent to come to us and stay with us.” The Raley’s Way includes the “why”: to infuse life with health and happiness; the “what”: to make shopping easier, better and more personal; and the “how”:

greater employee engagement are as follows:

High marks for engagement in CCRRC employee study.

Hiring for personality characteristics that predispose employees to become engaged, including stability, conscientiousness, openness, optimism and extroversion. Through leadership, building a culture that encourages and supports employee engagement provides a vision of success, sets clear expectations and fairly recognizes performance.

A new study from the Coca-Cola Retail Research Council North America (CCRRC) confirms that improving employee engagement can make a significant, positive difference in business performance, including profits, reduced turnover, and more satisfied and loyal customers. While the study focused on the convenience channel, including 20,000 c-store employees and managers across 11 banners, Progressive Grocer believes that the findings are relevant and beneficial to the grocery channel, and that they further support previously published academic research findings on the same topic.

Providing a safe and trusting atmosphere in which to work. Providing the resources that employees need to fulfill their responsibilities, including equipment, tools and information to do the job successfully. Reviewing job demands to ensure that they’re clear and realistic, and that they offer challenges and ways to make meaningful contributions.

Engaged Employees = Better Business Results

Encouraging a culture of support among co-workers at all levels, and providing regular feedback.

According to the CCRRC report, the building blocks for

Key Engagement Drivers Brand cares about my well-being I have consistent opportunities to use my strengths I know what is expected of me Encouraged to find better ways to work I have opportunities to learn and develop I feel safe working at this location Equipment helps me do a great job

7% 7%

Recognition for work Work well as a team I get the information I need to perform well I am satisfied with scheduling notice Managers’ timely feedback helps me improve

5% 0%


Source: Coca-Cola Retail Research Council


| Progressive Grocer | Ahead of What’s Next | March 2017



9% 9%

12% 11% 10% 10%

6% 6%






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What worked in recruitment and engagement five years ago doesn’t work now. We have to move with the times.” —Terra Powers, Safeway

Human Resources

FAMILY, an acronym for attributes that Raley’s supports in its people: Fearless, Accountable, Memorable, Inspiring, Learning and You (make the difference). “If people are connected with our purpose, they’ll stay with us,” Foley asserts. “That’s how it ties back.” The Raley’s approach of hiring for personality and passion, and then training to tasks, is supported by findings from a recent Coca-Cola Retail Research Council North America study. The report recommends that retailers should look for people “with emotional stability, optimism, self-efficacy, openness and who express conscientiousness” (see the sidebar on page 44 for more on the research).

Train ’em Up Retailers are more likely to lose those valuable candidates early on when they don’t demonstrate a willingness to invest in training. “If there’s nothing between ‘congratulations’ and ‘now get to work,’ there is no orientation,” notes Lloyd. This lack of onboarding is reflected in the industry average, which is just eight hours. “The best [retailers] provide 40 hours of training,” he says. They also keep it up with store meetings, department huddles, paycheck stuffers, bulletin boards, and more.


| Progressive Grocer | Ahead of What’s Next | March 2017

The lack of training and development is a likely factor in the high turnover rates in the retail industry. According to the Bureau of Labor Statistics (BLS), retail turnover was an estimated 55 percent in 2016. Industry experts indicate that grocery retail is closer to 60 percent. Many in the industry claim that the turnover is due to the large percentage of young people in grocery jobs. BLS data support this, reporting that 30 percent of grocery store employees were between the ages of 16 and 24 in 2015. Retailers are likely the first employers that many of these young people will have. Raley’s embraces the responsibility that comes as a first-time employer. “We understand that [for] many who work for us, it’s a first job, and we play a role mentoring these young people in life,” says Foley. “We mentor on how to work, dress for work, interact with customers, manage a checkbook, manage personal lives. It’s a responsibility to help them find their path. We know the path might not include us. But we also want to find those who are interested and show them the path within the company and show them that there are opportunities here.” Unfortunately, many retailers don’t see the value of investing much time in training young talent, many of

whom won’t last at a store for a year. But it’s a cycle of inefficiency in an industry tied to slim margins. According to 2012 research published by The Center for American Progress, even for positions that pay less than $30,000 a year, retailers will spend more than 16 percent of an employee’s salary replacing them, so hiring and investing in good

candidates supports the bottom line. “High turnover lowers the quality of work, lowers productivity, and morale of employees is affected,” says Mary Kay O’Connor, VP of education at the Madison, Wis.-based International DairyDeli-Bakery Association (IDDBA). At the same time, it’s hard to account for training’s benefits. “Training management doesn’t always have a seat at the c-suite table,” admits O’Connor. “Training can be underrepresented, underfunded or not funded at all. Training can be the first thing to go in some groups.” Competency-based training is essential, O’Connor says. “People need to feel comfortable with what they’re asked to do every day on the job.”

If people are connected with our purpose, they’ll stay with us.” —Mark Foley, Raley’s

Continued on page 96

March 2017 | |





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Snacking Solutions


Mixing it Up Strategic merchandising can drive occasion sales for innovative snack products. By Jim Dudlicek


t’s no secret that snacks are meals now. Changing consumer habits have transformed the old 21-meals-a-week model into 14 meals plus 14 to 21 snacks, as Leslie G. Sarasin, president and CEO of Arlington, Va.-based Food Marketing Institute (FMI), noted at the trade group’s recent Midwinter Executive Conference, in Scottsdale, Ariz. So, in their ongoing mission to turn center store from a drag to a destination, retailers need to tap the many opportunities within.

Elite Meat With strong growth in the trail mix segment and growing demand for protein snacks, combining the two shows great potential. Meat-laced trail mixes are gaining traction, Chicago-based market researcher Mintel notes in its June 2016 “Nuts, Seeds and Trail Mix US” report. “These products frequently contain high-protein claims and simple ingredients, both of which are especially important to consumers,” Mintel notes. “Strong innovation in the trail mix segment, including segment-blurring products like meat snack trail mix, will help the segment evolve.” Mintel does acknowledge that current interest is low due to their niche nature, but strategic positioning of products from several companies could boost trial and usage. Among them is disruptor Dick Stevens, which claims to be the first brand to combine jerky and trail mix. “Most of the category buyers we talk to are excited

about our brand,” says Christopher Neil, VP of sales for Charlotte, N.C.-based Dick Stevens Jerky Trail Mix. “We support our growth in the retail vein with in-store demos, temporary price reductions and advertisement, as well as through social media. This consumer engagement is vital with a new product.” Dick Stevens Original Blend Beef Jerky Mix offers lightly seasoned beef jerky, raw almonds, macadamia nuts, cranberries and dried blueberries. Because the product stands apart from the singular categories of jerky and trail mix, placement in either set is complementary, “generating add-on sales for each category,” Neil explains. Other such products include General Mills’ Epic Hunt & Harvest Mix, combining beef or pork with nuts and dried fruits; Tanka Trail Turkey & Buffalo Jerky with Cranberries and Mango Pepper Trail Mix; and Oberto Trail Mix in Original Beef, Spicy Sweet Beef and Teriyaki Chicken. With savory snack category sales projected to reach $45.9 billion after 2.8 percent growth over the past five years, according to Euromonitor International, legacy brands are leveraging demand for protein snacks, like Jack Link’s, which has added pork, chicken and turkey jerkies to its lineup, along with Small Batch Bacon Jerky and trendy flavors like sriracha, and Conagra Brands’ Slim Jim Turkey Sticks in Original, Barbecue and Habanero flavors. “We are seeing spicier flavor innovation capturing the Millennial consumer, and we’re giving our teen consumers new ways to challenge themselves with extreme options like Habanero,” says Adam

“We are seeing spicier flavor innovation capturing the Millennial consumer, and we’re giving our teen consumers new ways to challenge themselves with extreme options like Habanero.” —Adam Beane, Conagra Brands

March 2017 | |



We’ve done crosspromotional partnerships where there are synergies, such as cheese and produce. We are developing partnerships with other snack products to foster the idea of a snack regimen in consumers’ minds.” —Dan Kelly, Musco Family Olive Co.


Snacking Solutions

Beane, Conagra senior brand manager, citing data showing turkey consumption has tripled in the past four years and that 40 percent of Millennials buy poultry to increase their protein intake. “We work with each specific retailer to maximize their shelving efficiency as well as their consumer demographic.” Meanwhile, the crew at Duke’s — the Boulder, Colo.-based craft meat snack arm of Thanasi Foods — says that all of its products, including Smoked Shorty Sausages and Grass-Fed Brisket Strips, can be described as protein-based snacking solutions. “In a world filled with ‘me-too’ meat sticks and whole-muscle jerkies, we are disrupting the category,” asserts Brand Director Randy Gilbride. Duke’s boasts small-batch production using pasture-raised beef, which responds to key trends, including demand for simple ingredients, craft products, meal replacements and, of course, protein. “We have had a lot of success merchandising Duke’s with craft beer and other beverages,” Gilbride says. “We’ve also done cross-merchandising in deli, since our meats are more like snackable butcher meats versus typical meat snacks. We’ve cross-merchandised with lunchbox snacks and … with cheeses and crackers for tailgate and party platter thematics.”

Pit Stop With demand rising for healthy snacks, olives are continuing to catch on among snackers, thanks to pouch and cup packaging that ditches the unwieldy brine-filled jar for on-the-go convenience. “Healthy snacking is outpacing the entire food and beverage market in sales growth, which gives our liquid-free olive pouches unlimited potential,” says Keli Roberson, marketing director for Hollywood, Fla.-based Gaea North America, maker of gluten-free, vegan and kosher snacking olives. “We’ve heard from moms putting them in lunchboxes, and adults grabbing them for a quick, healthy snack on the go. They also pair well with other healthy snack items such as nuts, cheese and hard-boiled eggs.” Tracy, Calif.-based Musco Family Olive Co. has enjoyed similar success among adults and kids with its Pearls Olives To Go cup line since the item launched three years ago. “We know that consumers view olives as a wholesome snack with multiple health benefits. This includes good fats, high antioxidants and vitamin E,” says Dan Kelly, Musco’s VP of sales, noting that the company is “now developing a new olive snacking category to launch in 2018.” Musco’s sales teams collaborate with retailers to develop snacking sections within the olive shelf set, Kelly adds. “It’s important for us to share our

| Progressive Grocer | Ahead of What’s Next | March 2017

insights and research with retailers and optimize the shelf space,” he says. “We’ve done cross-promotional partnerships where there are synergies, such as cheese and produce. We are developing partnerships with other snack products to foster the idea of a snack regimen in consumers’ minds.”

Chip Shot Innovation is also bringing health to traditional salty snacks, with companies like Lake Success, N.Y.-based Hain Celestial Group leading the way. Trumpeting claims like non-GMO, gluten-free, less fat and simple ingredients are brands like Garden of Eatin’, with its new Nacho and Ranch tortilla chips; Terra, debuting plantain chips; and Sensible Portions, which recently introduced Salt & Vinegar Stacked Veggie Chips, made from potatoes, sweet potatoes, carrots and pumpkin, in convenient on-the-go canisters. “Our goal is to build awareness and drive trial at retailers through in-store activation such as sampling and couponing,” says Brett Hartmann, Hain Celestial’s director of marketing for snacks. Minneapolis-based General Mills is driving trial of products like its Food Should Taste Good tortilla chips via digital coupons, FSIs, on-pack IRCs and TPRs. “Additionally, we provide out-of-aisle shippers that prominently display our product offerings and provide a little more context as to what the brand stands for,” says spokesman Mike Siemienas, opening up cross-merch opportunities with, say, avocados in the produce aisle or near the fresh salsa and spreads. “Dipping is an engaged form of snacking and can include that fresh, colorful produce,” Siemienas continues. “This is also a great way to sample instore and in different areas of a supermarket where you can bring different consumers into the aisle.” Conagra is driving its own dipping solutions, creating a recipe that pairs its Ro-Tel Diced Tomatoes and Green Chilies with Avocados from Mexico, notes Matt Pabst, director of shopper marketing. “We’ve been working to give shoppers confidence in the kitchen,” he says, “by cultivating and sharing recipes that pair items from center store with items from the perimeter of the store, especially fresh produce.” PG From granola bars and nut mixes to pudding and popcorn, learn more about snacking solutions available to retailers at

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Refrigerated Foods

Dressings & Dips

So Fresh,

So Clean

Natural, healthful, exotic offerings rule in refrigerated dressings and dips. By Randy Hofbauer


ake one look at salad dressings and dips, and, as with so many other categories today, it’s not hard to see the potential for fresh, clean offerings. Chicago-based market researcher Mintel shows in its May 2016 “Sweet & Savoury Spreads” Category Insight that 30 percent of Americans who buy chips or dips agree that “no artificial ingredients” is an important nutritional attribute. Additionally, in its September 2016 “Table Sauces and Seasonings” Category Insight, Mintel notes that refrigerated options are likely to drive growth in condiments — including salad dressings — due to consumers’ increased interest in chilled foods for fresher, more healthful options. Data from Schaumburg, Ill.-based market research firm Nielsen correspond with this finding, at least on the salad dressing side. While shelfstable dressings saw flat to declining dollar sales during the 52 weeks ending Jan. 14 — creamy down 3.9 percent, liquid flat, and reduced- or low-calorie down 7 percent — refrigerated offerings enjoyed 1.9 percent sales growth. Dips, however, saw flat sales in the shelf-stable sector and a 2.1 percent decline in refrigerated — the sector more likely to have fresher, cleaner options. While consumers could be dipping less, their continued penchant for snacking could also suggest that they’re trading over to other products — such as refrigerated dressings — for their dipping needs.


| Progressive Grocer | Ahead of What’s Next | March 2017

Naturally Cool Still, opportunities definitely exist in both dressings and dips on the refrigerated side. Camille Balfanz, brand manager with Litehouse Inc., a Sandpoint, Idaho-based manufacturer of refrigerated dressings, dips and more, notes that the overall trend of shopping the perimeter and opting for fresh food over shelf-stable brands has spilled into these areas, creating growing interest. Moreover, shoppers are continuing to read and analyze nutrition panels before making purchases, searching for cleaner and better ingredients. Campbell Fresh is one such brand owner working to include better ingredients in its dressings and dips, according to Todd Putman, general manager, CPG at the division of the Camden, N.J.-based Campbell Soup Co. For instance, in February, Campbell Fresh introduced a line of organic refrigerated Bolthouse Farms dressings that are lower in calories and fat while maintaining a rich, creamy flavor. Artificial anything also counts, as food retailers

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have myriad preservative-free options in refrigerated dips and dressings. Take Litehouse, for example, which features such claims as “no artificial flavors, colors or preservatives” and “no high-fructose corn syrup” on its products. And don’t discount the importance of origin when sourcing refrigerated dressings and dips, as consumers want to know more about the foods they consume than ever before. According to Mintel, brands can better appease consumers in this regard by communicating regional sourcing, with “manufacturers indicating on pack where ingredients and recipes are from.” Retailers, too, can promote origins via in-store marketing materials. As for flavors, premium products naturally tend to go the route of “artisan” and “exotic,” which happen to be huge in dips and dressings right now, points out Brittany Nikolich, a registered dietitian with De Pere, Wis.-based grocer Festival Foods. With dips, Festival has had success catering to today’s adventurous Millennials and “foodies” with

meze (Mediterranean pre-meal snacks) dips from Norwich, N.Y.-based Chobani, as well as hummus varieties made with veggies and beans besides chickpeas — such as white and black beans, carrots, beets, and edamame. Campbell Fresh, too, is going for more artisan flavors with its recently launched “restaurant-style” salsa, which it touts as more “savory-tasting,” in conventional and organic varieties. With dressings, Balfanz says that Litehouse and its retailer partners have seen great success with its

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Dressings & Dips

newer Opa by Litehouse Greek Yogurt dressings. Hot flavors in the line include Tzatziki Ranch, Strawberry Poppyseed, Avocado Cilantro and Roasted Garlic.

Proper Placement, Promos Of course, whatever the new product is, communication counts. Whether it’s a fresh salsa or a Greek yogurt-based dressing, as long as consumers don’t know it exists, they might not be looking for the hottest new item, according to Eric Greifenberger, VP of marketing with White Plains, N.Y.-based Sabra Dipping Co. Grocers can help in-store by making sure staff knows to point anyone seeking dips or dressings to the deli section for refrigerated and fresher options. With dips, showcasing items near carriers is important to create a streamlined, solution-based shopping experience for consumers. Baby carrots and pita chips, for example, work well alongside dip options in displays. Nikolich agrees, noting that Festival’s deli packages fresh-cut produce such as

| Progressive Grocer | Ahead of What’s Next | March 2017

carrots, broccoli and celery with individually sized cups of Sabra hummus as a grab-and-go snack item. “By packaging these dips with ‘dip vessels,’ these snack-pack items have proven to be a convenient way for guests to try new dips while enjoying a portable snack,” she says. Dips and dressings also promote well via coupons, Campbell Fresh’s Putman notes, as well as through “dietitian-approved” listings, which Nikolich says Festival does frequently. “Whether through promoting the product on its own or featuring it in a recipe and showing how

certain dressings and dips can be paired with a variety of foods, it helps our guests understand the versatility of the dips and dressings, and encourages them to explore their own favorite way to incorporate the dip or dressing into their weekly meal plan,” she observes. Seasonal promotions for refrigerated dressings and dips help, too, and offer an opportunity for grocers to brainstorm new ways to push products with their supplier partners. Litehouse, for instance, created a highly effective retail campaign around football season, Bring on the Heat, which featured Litehouse Blue Cheese and Homestyle Ranch as the “perfect cool dip complement to hot wings,” according to Balfanz. “We created an integrated marketing campaign that included on-shelf promotion, on-pack instantly redeemable coupons, in-store signage and POS materials, and secondary-display support,” she says. “In addition, consumers could enter a sweepstakes for a football party-in-a-box when they voted for their favorite dip. … We amplified the promotion by reaching out to our 400,000-plus Facebook fans and across our other digital platforms.” And whether it’s a dressing or dip — or even a sauce or condiment — versatility can be a boon for sales. Nearly three-quarters of U.S. consumers use condiments and dressings as a dip, while 68 percent use them with a snack, Mintel notes. Meanwhile, 60 percent mix condiments and/or dressings together, while 73 percent add their own seasonings or ingredients. Hybrid products could be important for grabbing shoppers’ attention. But food retailers looking to sell more refrigerated dips and dressings also might find it easier to simply select products for their shelves that lend themselves to customization, or marketing these items as creative outlets, possibly even with other condiments and sauces. PG

Whether through promoting the product on its own or featuring it in a recipe and showing how certain dressings and dips can be paired with a variety of foods, it helps our guests understand the versatility of the dips and dressings, and encourages them to explore their own favorite way to incorporate the dip or dressing into their weekly meal plan.” —Brittany Nikolich, Festival Foods

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2017 Retail Seafood Review

Swimming Upstream The category’s healthy profile, sustainability moves could buoy sales, but pricing may sink them. Analysis by Bridget Goldschmidt Research by Debra Chanil


n common with many other departments throughout the supermarket, the trends of nutritious eating and cleaner ingredients are having an impact on the seafood section, creating plenty of potential. Indeed, Schaumburg, Ill.-based market researcher Nielsen Perishables Group asserts, “Growing consumer concern for health and wellness gives the seafood department an opportunity to reposition itself for growth.” This is especially true given that, despite its currently fashionable healthy halo, Americans’ consumption of seafood remains well below the recommended amount of at least 8 ounces weekly for an average 2,000-calorieper-day diet, according to the USDA Economic Research Service last October. Overall, grocers seem optimistic about future profits in the seafood section. According to Progressive Grocer’s 2017 Retail Seafood Review, a substantial 55.8 percent of respondents expect seafood sales to increase this year, while just 3.8 percent anticipate a downturn. Some 40.4 percent of the supermarket seafood executives surveyed by PG for its annual state-of-the-category report believe that sales will remain the same. Although these results convey a continuing confidence in seafood’s ability to deliver the goods, they sound a note of uncertainty unheard in last year’s poll, when not a single respondent predicted that sales would drop. March 2017 | |


2017 Retail Seafood Review Is the Price Right? This more tempered view of the category perhaps arises from actual performance over the past year. During that time, 39.2 percent of respondents saw seafood sales rise, while the majority — 52.9 percent — observed no change and 7.8 percent experienced a sales decline. By contrast, in the previous year, 44 percent saw seafood sales grow, 52 percent said

they remained the same and only 4 percent logged a decrease in sales. One key reason for this is price, with respondents citing it as a factor in the department’s slower sales. When asked how prices affected the section’s sales, one respondent noted “a downward slide in certain areas of higher-price … fish,” while others observed that “seafood sales have been down due to higher prices,” and that “seafood retails are lower” as a result. Another respondent, although acknowledging that “higher prices on some varieties of fish have resulted in decreased sales or trading off to less expensive fish,” and that “foreign seafood, especially [from] China, has fallen,” also observed that “demand [for] U.S.A., Alaska, Canada [and] Gulf of Mexico country-of-origin [seafood] has increased, no matter the price.” This indicates there’s a segment of loyal consumers willing to pay more for seafood they deem superior. Shrimp, thanks to an average retail price decline of 8.9 percent, drove total fresh seafood volume, according to Nielsen for the 52 weeks ending Dec. 31, 2016, while crustaceans in general also posted high volume increases from


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| Progressive Grocer | Ahead of What’s Next | March 2017

Progressive Grocer’s Retail Meat & Seafood Review survey was fielded by electronic and telephone interviews in December 2016 to supermarket retailers involved in the meat/seafood category. A total of 100 responses are included in these results. Fifty-three percent of respondents represent chains, while 47 percent are independent operators. By region, 32 percent are from the South, 30 percent from the Midwest, 21 percent from the Northeast and 17 percent from the West. By title, 46 percent are meat/ seafood executives, category managers and buyers; 42 percent are store-level department managers and store managers; and 12 percent are from the c-suite. Among these respondents, the meat/seafood department averages 19.6 percent of their total store sales.

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2017 Retail Seafood Review the previous year and the largest average dollar sales increase compared with the prior year. Another reason for last year’s lower-than-expected sales could be basic lack of consumer knowledge about seafood. Nielsen notes that “consistent consumer education concerning seafood’s benefits and preparation is [a] hurdle to clear” in growing category sales. Similarly, Jeff Brammer, business unit manager

of North American seafood operations at Ann Arbor, Mich.-based product testing, inspection and certification organization NSF International, points out in a recent white paper, “Unraveling the Mystery of Seafood With Transparency and Education,” that the category, “with its supply chain complexity and its lack of familiarity in many markets, is often labeled as risky and mysterious despite the health benefits touted by the medical profession.” As a result of this, Brammer believes, “Many consumers often walk away from seafood as their protein choice because they feel it is too complicated.”

Supplying the Demands When it comes to what customers are demanding from seafood departments, this year’s Retail Seafood Review recorded some interesting shifts. For one thing, U.S. wild-caught seafood swam straight to the top of the chart, with 57.4 percent seeing increased demand for it, from its fourth-place spot last year. In its wake were value-added products (up from fifth place), value-priced items (down one spot), free-from products (also down a rung), and smaller portions/ pack sizes (last year’s No. 1). The triumph of wild-caught seafood may well have something to do with its perceived higher quality among certain consumers, in keeping with the finding of a 2015 Omnibus survey by New York-based market researcher Edelman Berland that 53 percent of those who prefer wild-caught seafood believe that it tastes better than farm-raised options. Indeed, farm-raised seafood came in at sixth place, with 26.5 percent of respondents noting more demand for it, while 19.1 percent said that demand had fallen.




| Progressive Grocer | Ahead of What’s Next | March 2017



Our commitment to real, premium ingredients continues with the introduction of Non-GMO oil in every Marie’s dressing, including our fresh new flavors.

2017 Retail Seafood Review Seafood department SaleS performance 12 months ending Nov. 30, 2016

52.9% 39.2%

increaSed decreaSed Stayed the Same

7.8% net change: 1.6%

Seafood department SaleS proJected for total 2017

40.4% 55.8%

On Promotion In the area of effective promotional activities, temporary price reductions continue to rule the waves, with seafood executives giving them a 4.40 rating — a slight decline from last year’s 4.90 — on a 1-to-6 scale. Otherwise, respondents have been rethinking the efficacy of their core strategies over the past year, as BOGOs have shot up to second place from fifth, and product demos/sampling events have descended a notch to the third most successful promo. Rounding out the list are mix-and-match bundles (up from No. 10 last year), flash sales (down two rungs), social media (up a notch), point-of-purchase information (down from fourth place), direct mail (holding steady at No. 8), cross-promotion within the store (down from sixth place) and online marketing (down a spot). Among other tried-and-true approaches, a number of respondents cited advertising, particularly in newspapers; in-store signage; and couponing, both digital and traditional, as important parts of their promotional budgets. Although it wasn’t mentioned by Retail Seafood Review survey participants, communicating a product’s sustainability would appear to be a wise move, since a 2016 survey by London-based nonprofit Marine Stewardship Council (MSC) found that 72 percent of seafood consumers agreed

increaSe decreaSe Stay the Same

3.8% net change: 3.4% Source: Progressive Grocer Market Research, 2017

conSUmer demand



Stayed the Same


In the past year, here’s how retailers report that consumer demand has changed: U.S. Wild-caUght Seafood 57.4% ValUe-added prodUctS 54.3 ValUe-priced 53.1 free-from prodUctS (antibiotic-free, hormone-free, msg-free, additive-free, etc.) 51.6 Smaller portionS/pack SizeS 444437.5 farm-raiSed Seafood 26.5 imported Wild-caUght Seafood 25.0

4.4% 12.0 5.2 4.4 9.4 19.1 20.6

38.2% 33.7 41.7 44.0 53.1 54.4 54.4

Source: Progressive Grocer Market Research, 2017

March 2017 | |


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2017 Retail Seafood Review that to save the oceans, shoppers should consume seafood only from sustainable sources, 68 percent said that people should be prepared to switch to more sustainable seafood, and 54 percent asserted that they would pay more for a certified sustainable seafood product. To that end, although he concedes that “[f]or sellers at the end of the chain, [adopting a sustainability program] becomes more challenging when trying to align ecological scheme parameters with company goals and objectives,” NSF International’s Brammer notes, “Price may be the No. 1 factor today for consumers, but with proper communication and knowledge provided at the point of sale, this pendulum can shift toward sustainability, social accountability and quality.” One real-world example of this is West Des Moines, Iowa-based Hy-Vee’s well-publicized sustainability-focused Seafood Procurement Policy, instituted in 2013 with input from Santa Cruz, Calif.-based nonprofit FishWise and recently expanded to cover shelf-stable tuna products, and the program’s manifestation on shelves via the grocer’s Responsible Choice seafood-labeling program.

Fish Wish List Not surprisingly, when asked what they would request from suppliers to improve their seafood departments, many partici-

EffEctivEnEss of Promotional activitiEs

Rated on a scale of 1-6, where 6=most effective

tEmPorarY PricE rEductions Bogos Product dEmos/samPling EvEnts mix-and-match BundlEs (i.e. four for $20) flash salEs social mEdia Point-of-PurchasE information dirEct mail cross-Promotion Within thE storE onlinE markEting


YEar ago

4.40 4.23 4.17 4.05 3.89 3.86 3.80 3.70 3.67 3.58

4.90 4.09 4.69 4.00 4.75 4.28 4.62 3.93 4.47 4.13

Source: Progressive Grocer Market Research, 2017

pants in PG’s survey responded that they wanted better pricing, as well as greater promotional support. One respondent specifically requested “lower pricing on less popular fish to get

March 2017 | |


2017 Retail Seafood Review Seafood department Category performanCe Total U.S., 52 Weeks Ending 12/31/16


Fresh Seafood Fin Fish Shrimp Crustaceans Mollusks Other Seafood Sauces and Seasonings Seafood Side Items Seafood Dips and Spreads Other Seafood Prepared Seafood Other Prepared Seafood Surimi Seafood Meals

Dollars per Store/Week

Dollars per Store/Week Percent Change vs. Year Ago

Volume per Store/Week Percent Change vs. Year Ago

Volume Percent on Promotion

Volume Percent on Promotion Change vs. Year Ago

Average Retail Price Percent Average Change vs. Retail Price Year Ago

$2,611 2,107 768 227

-2.1% 2.1 -0.5 -4.1

-3.8% 12.1 -0.7 -5.1

19.8% 26.9 36.4 22.5

0.0% -0.8 -5.2 -0.8

$5.88 7.98 9.64 6.80

1.7% -8.9 0.2 1.1

$121 105 31 17

4.2% -4.0 -2.6 -17.3

3.0% -4.0 -1.3 -20.5

18.4% 15.3 18.5 26.3

-1.0% -0.9 -1.2 -3.3

$2.47 5.43 3.73 9.12

1.2% 0.0 -1.3 4.0

$1,176 126 15

3.4% -6.1 1.7

3.1% -4.1 -5.9

23.9% 21.8 19.5

0.2% -2.6 -2.2

$6.96 2.87 7.40

0.4% -2.2 8.1

Source: Perishables Group FreshFacts® Powered by Nielsen

people to try more and build sales slowly.” Additional asks included in-store associate product training, consistent quality, fewer out-of-stocks, and what

one respondent called “ironclad control of country-of-origin (COOL) labeling,” since “too much outright fraud exists in COOL due to unscrupulous foreign suppliers.” PG

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| Progressive Grocer | Ahead of What’s Next | March 2017

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Fresh Food



Grocers give shoppers food for thought with lessons in organic and local produce. By Jennifer Strailey


ocal” and “organic” remain powerful selling points that drive double-digit sales in the produce department. In the past five years, dollar sales of organic fruit have increased by 123 percent, while organic vegetables have grown by 92 percent, according to the Organic Trade Association (OTA). “Organic fruits and vegetables remain the biggest of all organic categories, with sales of $14.4 billion in 2015 [including frozen and canned], up almost 11 percent,” says Maggie McNeil, director of media relations for Washington, D.C.-based OTA, with fresh produce alone accounting for $13 billion. “Almost 13 percent of the produce sold in this country is now organic. We don’t see this trend slowing down.” While opportunities for continued growth abound, at the same time, consumer research shows that some shoppers are confused about the benefits of natural and organic products. What’s more, they’re hungry for knowledge about how and where their food is grown. “Consumers are looking to farmers’ markets and local, specialized retailers as destinations for learning about natural and organic products, and as a way to connect with local producers,” notes Bellevue, Wash.-based The Hartman Group in its “Organic & Natural” 2016 report. “Those are two areas that food retailers might consider focusing

on as a way to make themselves more unique when it comes to organic and natural products.” Two rapidly expanding grocery chains in the United States are doing just that — delivering as destinations for organic and local produce while at the same time offering in-store and online nutrition education that helps shoppers eat and live more healthfully. The fast-growing Lakewood, Colo.-based Natural Grocers by Vitamin Cottage, which operates more than 135 stores in 19 states, employs a health coach at every store. In addition to providing ongoing nutrition classes on topics ranging from eating more organic fruits and vegetables to healthy proteins to alternatives to sugary beverages, the coaches lead a variety of classes at local schools and businesses in their communities. On a mission to establish itself as “America’s Health Education Expert,” Natural Grocers recently redesigned its Good4u Health Hotline monthly circular. Available in print and online

People are taking charge of their health, and taking charge of their diet is an important part of that.” —Karen Falbo, Natural Grocers

March 2017 | |


Fresh Food

CirCular loGiC Natural Grocers redesigned its circular with the goal of becoming “america’s Health Expert.”

Consumers are aware of how important organic is for their health, and the health of the environment.” —Shauna Martin, Daily Greens



versions, the magazine is distributed to consumers via direct mail and in-store. Circulation is expected to exceed 750,000 by year’s end. This health-expert-meetsretailer model is resonating with consumers. According to Natural Grocers, its net sales increased 12.9 percent to $705.5 million in fiscal 2016, and sales were up again, by 9.4 percent, for the first quarter of fiscal 2017, compared with the same period in 2016. Anticipating continued growth, Natural Grocers has signed an additional 16 leases on stores set to open in 2017 and beyond. With more than 1,600 stores in 35 American states, German hard-discount grocer Aldi, with U.S. headquarters in suburban Chicago, is thinking organic and fresh as it expands its reach. “We have increased our fresh produce offerings across all of our stores over the years, and currently carry a wide variety of fresh fruits and vegetables, including organic bananas, tomatoes, avocados, apples and salad mixes,” notes Aldi spokeswoman Liz Ruggles. All of Aldi’s organic products are clearly labeled with easy-to-spot organic seals. “Due to our great-quality groceries and everyday low prices, we’re one of the fastest-growing retailers in the U.S.,” continues Ruggles. “By the end of 2018, we will have nearly 2,000 stores from coast to coast, bringing the Aldi experience — and our fresh and organic produce — to 45 million customers.” To educate and encourage customers to get

| Progressive Grocer | Ahead of What’s Next | March 2017

off to a healthy start in 2017, Aldi launched Hello, Healthy, an online resource available through this month, to introduce customers to the many betterfor-you foods found at its stores. Shoppers can access meal plans, recipes, tips and inspiring videos at The grocer also works with a team of dietitians, known as the Aldi Advisory Council of Registered Dietitians, who share their Dietitian’s Picks, including organic produce, gluten-free options and kid-friendly choices that are handpicked for their nutritional value. These products feature the Dietitian’s Picks emblem on the supermarket’s website.

Burgeoning Beverages While organic sales are strong, certain subcategories like organic beverages are soaring to stratospheric heights. “The demand for fresh organic was most evident in the continued growth of fresh juices and drinks, which saw explosive growth of 33.5 percent in 2015, making it the fastest-growing of all the organic subcategories,” according to OTA. “Over the last five years, sales of all kinds of organic beverages, from juices to nut milk to hemp milk and kombucha, have increased dramatically as consumers seek healthier options,” affirms Karen Falbo, director of nutrition education for Natural Grocers, where produce-based beverages are gaining exposure through educational outreach. For the past three years, the company’s nutrition coaches have visited area schools to educate middle and high school students about the health consequences of consuming sugary drinks. The program, which presents healthy alternatives to soda, challenges kids to give up all sugary beverages for one week. Coaches return at the end of the week to discuss the kids’ experiences and award prizes. Whether encouraging kids or adults to make healthy beverage choices, convenience is critical to success. “Products like Daily Greens offer such amazing convenience,” enthuses Falbo. Daily Greens is a line of organic cold-pressed juices containing 4.5 pounds of vegetables in every 12-ounce bottle. “People are taking charge of their health, and taking charge of their diet is an important part of that,” Falbo asserts when asked what’s fueling the

Fresh Food

By the end of 2018, we will have nearly 2,000 Aldi stores from coast to coast, bringing the Aldi experience — and our fresh and organic produce — to 45 million customers.” —Liz Ruggles, Aldi U.S.



organic beverage trend at Natural Grocers. “Personal stories, like Shauna Martin’s story, are also coming to the forefront more and more.” Martin, CEO and founder of Daily Greens, in Austin, Texas, discovered her passion for green juice and its health benefits while battling breast cancer some years ago. “Consumers are aware of how important organic is for their health, and the health of the environment,” says Martin. “The [organic juice] category overall continues to grow — not the crazy growth of a few years ago, but at a steady rate for a more mature category.” Who is the organic green juice consumer? Daily Greens recently hired a consumer research group to find out. “We learned that once people buy Daily Greens, they are super-loyal,” notes Martin. “We also learned that the entire family is drinking it. Our consumer is the whole family, not just the yoga mom.” The research additionally found that education, sampling, accessibility and affordability are essential to increasing sales. A new study from Jacksonville, Fla.-based Acosta Sales & Marketing, “Back to Our Roots: The Rise of the Natural/Organic Shopper,” similarly

| Progressive Grocer | Ahead of What’s Next | March 2017

supports the need for greater education in organic categories. The study notes that while price is still the biggest barrier for natural/organic shoppers, the next significant barrier across all channels is “conflicting information/studies about products.” “Shoppers are confused about exactly what is good for them,” the Acosta study reveals. This makes product labels — a shopper’s No. 1 source of product information — and in-store signage important tools in simplifying the grocery experience. On the price front, Daily Greens works directly with organic farmers to keep costs down. The company’s juices retail for between $3.99 and $4.99, a price point that Martin notes is still “a far better deal” than juicing at home. With the pounds of vegetables per serving clearly touted on bottles of Daily Greens, the message of health is also resonating loudly and clearly.

Banana Boom There’s double-digit growth in organic produce, which is going bananas, among other fruits. “Bananas, berries and salads drive organic velocity,” OTA observes, finding that the organic banana market has reached $165 million, soaring by more than 30

Fresh Food

Grow and tell organics Unlimited’s Grow organic banana stickers tell an ecofriendly story.



percent in 2015 alone. With organic shoppers increasingly demanding healthy organic snacking options, OTA reports that sales of organic dried figs, dates, baby carrots, Pink Lady apples, blackberries and bananas are all posting double-digit sales increases. “As consumers become more aware of their health and the changing environment, we envision the demand for organic products grown in a sustainable manner will continue to rise,” notes Mayra Velazquez de León, president and CEO of Organics Unlimited, in San Diego. Since its inception in 2005, the GROW Fund, a nonprofit program developed by Organics Unlimited, has raised more than $2 million in aid for communities in Mexico and Ecuador through retailer and distributor support. A percentage derived from the purchase of each box of GROW organic bananas is earmarked for the GROW Fund. Organics Unlimited believes that success depends on education and effective messaging.

| Progressive Grocer | Ahead of What’s Next | March 2017

“Because it’s such an important part of our mission and vision, we integrate our social-responsibility messages into all aspects of our marketing and branding, including banana stickers, POP, trade advertising, social media and more,” explains Velazquez de León. Last year, the company revised its messaging so that banana stickers for both Organics Unlimited and GROW communicate the core values of cultivating communities and farming in a responsible, sustainable and eco-friendly way. “One of the most important things that retailers can do is educate their employees on the benefits






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of organic produce so they can communicate that to customers in stores,” affirms Velazquez de León. The company offers POP materials to help retailers and buyers educate sales teams and customers about the benefits of GROW organic bananas.

On-trend Tastes When it comes to the country’s hottest vegetable trends, beets, artichokes and Brussels sprouts are gracing restaurant menus from coast to coast. With an eye on trending tastes, Ocean Mist Farms, in Castroville, Calif., launched its Ocean Mist Organic brand in 2015. “Demand for organic produce continues to grow and is a key indicator for why Ocean Mist

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Farms includes organic production in our strategic plan,” says Diana McLean, director of marketing for Ocean Mist, which has grown organic artichokes since 2004. Ocean Mist’s most recent additions to its organic line include Gold Beets and Romaine Hearts. “Romaine Hearts continue to be a top seller, and the demand for Brussels sprouts, asparagus and spinach are on the rise,” notes McLean, who sees sales of these items driven by consumers seeking to replicate at home what they experience dining in trendy restaurants.

Organic Salad Tradition When Fresh Express Inc., in Salinas, Calif., decided to expand its salad line to include organic salad kits, tradition was top of mind. “Consumers are demanding products in the organic segment that have been available in the conventional segment for years,” asserts Michael Golderman, Fresh Express marketing brand leader. Specifically, this means products like organic chopped kits and complete bowls. Knowing that Caesar is the top-selling kit in the value-added salad category, ranch is the overall best-selling salad dressing, and balsamic vinaigrette is the No. 1 organic salad dressing, Fresh Express took an educated guess that its recently introduced organic kits and chopped salads would be a hit. The line of Organic and Chopped Kits consists of Classic Caesar, Pomegranate Cranberry, Sweet Dijon Onion, Sunflower Ranch, Balsamic Vinaigrette and Asian Sesame Ginger. “Organic has gained four share points since 2012 — going from 20 percent of value-added salads to 24 percent,” notes Golderman. “Organic value-added salad blends has been a $1 billion-plus business for three years in a row.” PG

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| Progressive Grocer | Ahead of What’s Next | March 2017

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Health, Beauty & Wellness


Vitamin Hack Value-oriented promos, on-trend offerings and smart merchandising can lift the VMS category. By Barbara Sax


romotions dominate the vitamin/mineral/supplement (VMS) category, and if retailers aren’t careful, the practice can erode profitability. “About one-third of sales volume in the category is during times when products are sold on promotion, price cut, display fixtures with ads or with coupons,” says Sue Viamari, VP of thought leadership at Chicago-based IRI. “Retailers are constantly promoting the category, especially in the first quarter of the year,” notes Jana Vyleta, health and personal care analyst at Mintel, also based in Chicago. For example, at Broulim’s Fresh Foods in Idaho, the entire department is promoted during the month of February. Wakefern Food Corp. is taking a more measured approach to promotion. The category ranks second in HBC dollar sales at the Keasbey, N.J.-based retailer cooperative, whose members operate stores mainly under the ShopRite banner, and is likely to grab the top spot this year. According to Chris Skyers, Wakefern’s VP of corporate merchandising and marketing, the co-op’s stores are making changes to further strengthen the department. For instance, Wakefern has partnered with Northridge, Calif.-based Pharmavite on a customized program to educate ShopRite nutritionists. The co-op is also increasing the VMS set by 5 feet this year and will expand its selection of natural vitamins to keep margins strong. “We’ll lead off the natural section with Sundown, since it’s a lower-price brand that can bring consumers over to the category,” explains Skyers, “but we’re not going to be deep discounting in the category.”

Skyers is passionate about balancing promotion with on-trend healthy margin products. “We never want to rest on half-price,” he says. “You have to resist the temptation to put multiple brands on sale, since that can be a slippery slope to death for the category. We’ve forced ourselves to promote only one brand and private label a week, and we balance that by following trends. “We’ll bring in gummies or specific products that are on-trend, such as PreserVision Eye Vitamins,” he adds. Bausch + Lomb’s PreserVision, which retails for $31.99, is the top-turning item in the department, with 150 to 200 pieces sold a week. “We never want to run out of PreserVision,” says Skyers. While he’s careful to protect the core of the department, experimentation with new products and keeping tuned to consumer trends are important in keeping the category profitable, Skyers stresses. For instance, the chain recently added essential oils to its mix.

Innovative Items Kent Shepard, buyer at Rigby, Idaho-based Broulim’s, recently added the Nature’s Truth’s line of essential oils to his VMS set. “We brought in oils for immune health and joint relief,” he says. “Diffusers are also doing well.” Retailers willing to hop on new trends have the strongest category performance. “Adding ancillary categories gives consumers another option for treatment, and retailers a great opportunity to cross-merchandise and cross-promote,” notes Viamari. March 2017 | |



You have to resist the temptation to put multiple brands on sale, since that can be a slippery slope to death for the category.” —Chris Skyers, Wakefern Food Corp.

Health, Beauty & Wellness

According to Shepard, Broulim’s recently reset its VMS category and brought in several new lines, including Olly Nutrition and Irwin Natural. “We should see the results of that reset in a few months,” he adds. San Francisco-based Olly, which concentrates on popular gummy formulations, has gained significant traction with its gummy versions of one- and two-letter vitamins. Gummy products continue to gain traction in the category overall; for instance, Miami Lakes, Fla.-based Mason Vitamins recently introduced a sugar-free probiotic gummy. Varied delivery systems are providing novelty and giving consumers more options. “New delivery systems, such as gummies, powders and a mint formulation introduced by Centrum, ... help consumers migrate to the category,” affirms Mintel’s Vyleta. In 2015, New York-based Pfizer Consumer Healthcare launched Centrum VitaMints, an easy-to-take multivitamin in the form of a mint. Food-based vitamins, such as Palm Beach

Gardens, Fla.-based Garden of Life’s Raw line, which derive their nutrients directly from foods, are showing an uptick. “People have some skepticism about the effectiveness of vitamins and supplements, but products which come directly from food, which consumers know to be a source of vitamins and minerals, give them more confidence,” says Vyleta. Durham, N.C.-based personal care brand Burt’s Bees, a division of the Clorox Co., is moving into the functional food category with Burt’s Bees PlantBased Protein Shakes, which feature vitamins extracted from fruits and vegetables, including spinach, shitake mushroom and strawberry. In addition to dairy-based whey and soy proteins, rice and pea proteins have crossed over from the alternative protein category to the mainstream. “The penetration of rice and pea proteins onto shelves over the past five years has been exponential,” affirms Kay Abadee, VP of marketing at Growing Naturals. “Many people don’t get the recommended daily value of protein and need to supplement. Protein powder is more filling and enjoyable than

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Adding ancillary categories gives consumers another option for treatment, and retailers a great opportunity to crossmerchandise and crosspromote.” —Susan Viamari, IRI

Health, Beauty & Wellness

supplementing nutrition with pills.” The Marina Del Rey, Calif.-based company will soon launch four condition-specific Benefit Blends products, including AM and PM formulas. Condition-specific supplements continue to fuel VMS sales, and more retailers are merchandising accordingly. “According to IRI scan data, condition-specific supplements accounted for around 32 percent of all supplement sales in the last 52 weeks as of Dec. 25, 2015, a 10 percent increase over the prior 52-week period,” says Patricia Jones, senior manager of new business development at Mason. “Organizing by condition makes it easier for customers to compare different brands of the same type of product,” continues Jones. “In larger stores, brand blocking should be reserved for private label and discount brands for the bargain shopper.” Wakefern’s Skyers says the chain is likely to move to organizing the category by specific use over time. Jones suggests merchandising similar categories next to each other, such as mood support products next to sleep aids and baby care products next to

women’s products, to create a “power set.” “Good merchandising prompts consumers to put more in their carts than they originally intended,” she observes.

Probiotics Still Strong IRI data show that at least seven of the top 20 supplement dollar sales performers were probiotic products. Broulim’s Shepard notes that while joint supplement sales have slowed, probiotics continue to pick up steam at the chain. He’s also seeing growth in kombucha, which could be taking a bite out of the supplement category. Other supplement categories, such as heart health and brain health, have experienced increases, while products positioned as beauty supplements are also showing growth. “Condition-specific formulas geared toward women, such as those who promote beauty from within, relieve menopause symptoms, strengthen bones or are formulated for pregnancy/ prenatal supplementation, are selling well,” says Mason’s Jones, adding that products aimed at women’s health challenges, specifically diet, fatigue and stress, are gaining momentum. PG

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Shopper Behavior

Treasure Hunt

Understand customers by tracking their paths through the store. By John Karolefski

H These new technologies enable traditional grocery retailers to have the same level of understanding about their shoppers as online retailers such as Amazon.” —Rajeev Sharma, VideoMining Corp.


annaford Supermarkets has embedded RFID chips into the shopping carts of its 68,000-squarefoot store in Bedford, N.H. The Scarborough, Maine-based grocer, a division of Ahold Delhaize, wants to track the paths of shoppers around the store. This is just the latest example of grocers using sophisticated technology to study shopper behavior. For several years, special cameras in the ceilings recorded customer movements in many stores around the country. Why track shoppers? According to Hannaford President Mike Vail, the information gathered from the chips will help improve the placement of products throughout the chain’s stores. Technologies that anonymously track shoppers can help in optimizing almost all aspects of store design, merchandising and marketing, adds Rajeev Sharma, founder and CEO of State College, Pa.-based VideoMining Corp., which studies instore shopper behavior for retailers and brands. “Given the changing competitive landscape that is spilling over from the brick and mortar to online channels, it is especially important for grocery retailers to develop capabilities for understanding the in-store behavior of their shoppers,” explains Sharma. “In essence, these new technologies enable traditional grocery retailers to have the same level of understanding about their shoppers as online retailers such as Amazon.” According to research by the Chicago-based trade association Shop! (formerly POPAI North America), three out of four of all purchase decisions (76 percent) are made in the store. Obviously, engaging shoppers along the path to purchase is one of the most important challenges facing retailers and consumer packaged goods manufacturers. Many analysts believe that the best way to do so is to start by tracking the shoppers’ paths, which provide clues about where to place products and displays in the store’s layout. “Understanding a shopper’s path through the store high-

| Progressive Grocer | Ahead of What’s Next | March 2017

lights opportunities to cross-merchandise products and allows retailers and potentially branded CPGs the opportunity to tailor offers based on a shopper’s in-store behavior,” says Randy Burt, who leads the Americas grocery practice at New York-based consultancy A.T. Kearney. “Video analytics and direct observation are the more mature methods to determine the path shoppers are taking.” “The path of your shopper can tell you what areas you need to grow or reduce, and provide insight into the motivations and interests of your customers,” notes Bharat Rupani, president of San Diego-based Interactions Marketing, a firm specializing in product demonstrations and experience marketing. “For example, if you’re finding most shoppers shop the perimeter of the store in the evenings for dinner and never touch the center store, you likely have a location in an area of the store with busy shoppers who respond best to convenience. There are several ways to determine this path, including department and category analyses, shopper intercept surveys, and mystery shops.

Following the Shopper’s Virtual Path One way to better understand and predict the paths of shoppers is by studying both their behaviors and attitudes, according to Rich Scamehorn, chief research officer at InContext Solutions, a Chicago-based provider of virtual-reality solutions for trading partners. When evaluating new concepts like store layouts, packaging or point-of-purchase displays, it’s important to understand both the shopper’s behavior and why they made the choices they did, notes Scamehorn. He gives the example of testing new packaging, and outlines a two-step process: Observe the Shopper Reaction: Did they pass right by the new packaging, did they stop and observe the packaging but ultimately decide on a different brand, or did they see the new packaging and make the decision to purchase?

“Understanding how a shopper interacts with the store — which aisles they enter, how long they spend in different aisles, which types of products they spend time reading labels — can help retailers determine, for example, optimal placement of demos and special display locations, where to place product to encourage impulse purchases, cross-merchandising opportunities, and overall flow,” adds Rupani.

Benefits of Tracking Julie Schlack, SVP of innovation and design at Boston- and New York-based brand adviser C Space, believes in the strategic use of shopping-path data that let grocers identify all of the discrete factors that precede a product purchase. For example, video tracking and beacons can create heat maps depicting how many people are walking through each aisle, where they’re pausing, how long they’re spending in front of each product category, and the like. Schlack and Curtis Tingle, chief marketing officer of Livonia, Mich.-based Valassis, list several benefits of tracking the paths of shoppers other than the proper placement of displays and sampling stations: Helping grocers reorganize the product layout to boost traffic in undervisited aisles Knowing where shoppers go in-store — and don’t go — and how often they visit specific departments Understanding where in the store they linger versus where they breeze by, which assists retailers in making layout, planogram and assortment decisions “Knowing a typical shopper’s path informs the store of what shoppers want and need,” says Interactions’ Rupani. “If they’re shopping the perimeter and you want to grow center store, enticing end cap displays or product demonstrations featuring

Ask Follow-up Questions: Why did they make the choices they did? Were the new colors and fonts too muted so they didn’t notice the brand? Was the brand not in their line of sight on the shelf set? Did they notice the new packaging, but made a selection of a different brand due to price, loyalty, personal preference, etc.? “You can evaluate these behaviors and attitudes in teststore environments, but setting up and resetting shelves can be costly and time- and labor-intensive,” says Scamehorn. “By using virtual reality, you can conduct these same tests in a more efficient way by setting up virtual environments, asking individuals to shop as they normally would, and then prompting them with questions to better understand their behavior afterward.”

center store items can help alter the shopper path to improve areas with flat or declining sales. Additionally, the knowledge of what drives shoppers — be it value, convenience, health and wellness, or luxury — must be a key part in planning any store set or refresh. There is a positive correlation between how well a store reflects the needs and behaviors of the community it serves and its sales, shopper satisfaction and loyalty.” Not everyone agrees on the use and value of sophisticated technology to track the paths of shoppers through a grocery store. Dr. Billie Blair, an organizational psychologist and president/CEO of Murrieta, Calif.-based Change Strategists, a large international management consulting firm, opts for the simple approach. “If a grocer wants to know about which store layouts are preferred by customers, then ask them,” Blair says. “Don’t do anything ridiculous like ‘tracking customer trips.’ How could that possibly tell them anything, other than the customer is forgetful or the store layout is confusing? How could this possibly be known without asking the customer? It’s a very simple matter to design a quick questionnaire for querying customers. Good grief! Why all the pseudoscience guesswork? Just ask the customers already!” While such opinions have value in the overall discussion of tracking shopper paths, they’re outliers among grocery analysts. Most of them see the value of using technology to depict how many people are walking through each aisle, where they’re pausing, how long they’re spending in front of each product category, and so on. “While these methods may help grocers boost category sales,” says C Space’s Schlack, “they’re only beneficial if they enhance the overall shopper experience.” PG

There is a positive correlation between how well a store reflects the needs and behaviors of the community it serves and its sales, shopper satisfaction and loyalty.” —Bharat Rupani, Interactions Marketing

March 2017 | |


Supply Chain


Do’s and Don’ts Industry pros weigh in with tips for smarter logistics, warehouse efficiencies and more. By Jenny McTaggart


he tried-and-true grocery supply chain sounds simple enough in theory: Get products from the field or manufacturer to the warehouse, and finally to the store, as quickly and efficiently as possible. But today’s retail executives aren’t finding the task easy at all, as they’re constantly challenged with planning pitfalls, often unpredictable delays in shipping, important safety regulations that must be adhered to, and even trials in consumer marketing, particularly as it relates to how they can reach and satisfy mobile consumers who have more choices than ever before. To help make things a little more manageable, Progressive Grocer has rounded up a quick list of “do’s and don’ts” from professionals who work in various


| Progressive Grocer | Ahead of What’s Next | March 2017

areas of the supply chain, including overall strategy and planning, transportation and logistics, and technology. Their insights will hopefully inspire you not only to solve some of your most pressing problems, but also to discover some innovative ideas.

Demand Planning First and foremost, successful supply chain management requires thoughtful planning. Mike Griswold, research VP at Stamford, Conn.-based Gartner, offers the following advice to retailers as they contemplate their initial courses of action:

Do ensure supply ownership of the demand-planning process. Mature retail supply chains centralize the demand-planning process within the supply chain for the following reasons:

Objectivity: Buyers and merchants tend to have an emotional investment relative to the performance of an item, and therefore tend to show a bias toward over-forecasting. Ownership by the supply chain provides an objective, impartial view of demand expectations. End-to-end perspective: Visibility of all three levels of demand gives the supply chain the complete end-to-end picture of expected demand aligning from the shelf back, across all sales channels, and improves the ability to effectively match demand and supply. Skill set alignment: Buyers and merchants typically focus on assortment rationale, category strategy and the alignment of shopper preferences with merchandise selections, which are more qualitative skill sets. Demand planning requires a more quantitative focus that’s more closely associated with work conducted by the supply chain. Centralization within the supply chain leads to higher forecast accuracy and improvements in onshelf availability and inventory productivity.

the process, be sure to inspect: Product temperature prior to loading Trailer precooling condition Condition of equipment prior to loading Proper container air flow while loading.

Don’t forget to weigh all

of the pros, cons and price of each transportation service before ruling any out — each comes with its own unique set of risks. Just because it’s more expensive doesn’t mean that you should abandon it immediately.

“Continuous optimization is vital as stores open/close, supply networks change and transportation rates adjust to market conditions.” —Gregg Lanyard, Manhattan Associates

Don’t overlook even

the smallest details while planning. Bring every detail to the table — from acceptable temperature ranges and continuous temperature versus cycle settings to proper seals, contingency plans and equipment expectations, along with processes for returns and rejections. Even before product is loaded, every leg of the journey must have clear expectations to mitigate the added risk that comes with temperature-sensitive products.

Getting Logistics Right Whether navigating the latest regulations of the Food Safety Modernization Act (FSMA), or evaluating specific modes of transportation, the job of getting food and other grocery items to stores, or directly to consumers, seems more daunting than ever. Here are a few tips from the pros: Mark Petersen, director of global sourcing at Eden Prairie, Minn.-based Robinson Fresh, provided the following guidelines for transporting goods by air, land and sea:

From Gregg Lanyard, director of product management for transportation and logistics at Atlantabased Manhattan Associates:

Do mitigate risks with all parties involved in moving temperature-sensitive product — shippers, carriers, vendors, providers, etc. — by making sure they all understand the importance of maintaining a cold chain.

Do optimize continuously. Look for inbound backhaul opportunities with suppliers, and use transportation management system (TMS) technology for full visibility into inbound and outbound operations.

Do think strategically about carrier and shipper needs. If a shipper transports full truckloads of cheese to local retailers, they may be able to arrange for the same carrier to move empty cartons on the backhaul. The shipper not only solves a reverse-logistics problem, but may also reduce transportation costs now that the carrier has eliminated otherwise empty miles.

Do measure performance. Today’s TMS offerings provide a plethora of data to ensure that you’re tracking against a plan, and will allow you to drill into exactly what may be causing speed bumps in the supply chain.

Do have a system of checks and balances in place during loading/unloading to minimize problems. With the implementation of the Sanitary Trans Rule of FSMA, many of these best practices are requirements for certain commodities. Throughout

Don’t assume that your store delivery schedule

from last year is the right delivery schedule today. Do a continuous evaluation of store delivery routes, including dynamic versus static delivery options, store delivery days, and time windows to optimize outbound operations and reduce mileage.

Don’t treat outbound transportation as a “one March 2017 | |


Supply Chain


From Tim Smith, EVP at Irvine, Calif.-based Lineage Logistics:

Do implement automated stretch wrappers that allow pickers to drop pallets onto a conveyor, which moves a completed pick pallet to the wrapper and out the other end for another operator to retrieve and stage the wrapped pallet. This allows the picker to continue picking and eliminates the wait time it takes for the wrapper to finish.

Do use lean logistics ideals and procedures to optimize operations and save a significant amount of money.

Do set up a picking productivity incentive program with safety and accuracy qualifiers to motivate pickers to be more efficient.

Don’t ignore small details, such as tempera-

Don’t set up pick aisles with pick slot pallets

and done.” Continuous optimization is vital as stores open/close, supply networks change and transportation rates adjust to market conditions (i.e., fuel costs).

ture variations on receiving docks and infrequent activities like driver strikes, when conducting supply chain“There’s a tendency planning exercises. They’re for operators to among the most likely causes of disruption. leave wide aisles to

reduce congestion; however, the savings are greatly offset by the additional steps taken by the pickers.”

—Doug Bloss (pictured) and Alex Korcsmaros, Ryder

From Doug Bloss, director of supply chain solutions for consumer packaged goods, and Alex Korcsmaros , director of customer logistics for consumer packaged goods, at Miamibased Ryder:

Do optimize commodities within an outbound trailer by delivering dry grocery, frozen and perishables with multitemp trailers to mitigate stops per trailer and receiving dock resources at the stores. Do implement a temper-

Don’t chimney- or column-stack pick pallets,

as this will cause cases to fall over, especially as the picker is maneuvering through the pick aisles. The picker should always interlock the cases to ensure increased stability of the pallets.

In-store Success Once product arrives at the store, there are still some important supply chain issues to address, including tie-ins to planograms and promotions. Here are a few tips to consider: From Graeme McVie, general manager at Precima, in Toronto, with a U.S. office in Chicago:

Do include marketing and merchandising teams in supply chain-planning meetings so you can integrate price, promotion and assortment modeling into the overall product fulfillment processes.

ature-monitoring device to track the integrity of the cold chain, and proactively identify products exposed to unsafe temperatures that could result in a recall.

Don’t forget to constantly measure supply chain

Don’t drive down transportation rates to the point where your core carrier partners are less likely or unable to be responsive during peak seasonal demands, causing service and delivery issues.

Do consider backroom space availability when designing delivery method, order size and delivery frequency.

Regarding the warehouse, they offer this advice:

Do limit the width of the pick aisles to reduce the number of steps each picker has to take. Aisles should be just wide enough to allow for a narrowaisle-reach truck to turn. There’s a tendency for operators to leave wide aisles to reduce congestion; however, the savings are greatly offset by the additional steps taken by the pickers.


elevated from the ground. This increases the safety risk of pickers tripping over crossbeams. Having to maneuver over the crossbeams creates inefficiencies for the pickers.

| Progressive Grocer | Ahead of What’s Next | March 2017

performance and keep a moving baseline as service rates improve. From Ryder’s Bloss and Korcsmaros:

Do align slot case pick slots with the store planogram, making allowances for movement and stackability. It’s important that the retail stores have consistent store planograms for this layout to be effective. PG For the supply chain do’s and don’ts of data accuracy and technology, visit

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Food, Beverage & Nonfood Products

Don’t Have a Cow

The most common food allergy among infants and young children is to cow’s milk, with about 2.5 percent of kids younger than 3 affected. Goat milk can offer a way around this allergy, including products such as Kabrita USA’s latest variety in its Goat Milk Yogurt and Fruit pouch line, Sweet Potato Apple & Cinnamon. Made with organic sweet potato, organic apple purée and organic cinnamon, as well as antibiotic-free whole goat-milk yogurt, the 3.5-ounce product is high in vitamins A and E; contains no artificial colors, flavors or preservatives; and comes in squeezable BPA-free packaging. The 70 percent organic product has an SRP of $1.99 per 3.5-ounce pouch.

Matchmaker Marinades

Because not all marinade flavors are suitable for all types of meat, McCormick & Co. has launched Stubb’s marinade mixes specifically created to flavor different types of meat with “big Texas taste.” They are Beef Marinade Mix (with soy sauce, garlic and red pepper); Texas Steakhouse Marinade Mix (with ancho chili and garlic); Chicken Marinade Mix (with citrus and onion); and Pork Marinade Mix (with chili, lime and ginger). Consumers add pantry staples such as oil and vinegar to marinade up to 2 pounds of meat. The marinades come in 1-ounce packs with an SRP of $1.79 each.

Exotic Charcuterie

With charcuterie and cured meats continuing to grow in popularity, D’Artagnan has introduced two additional flavors of its shelfstable saucisson sec: Wild Boar and Duck. The former is made with wild-boar meat, red wine and black pepper, while the latter contains rich Rohan duck meat and such aromatic spices as clove and nutmeg. The sausages are air-cured and made the traditional way: by hand, all naturally, in small batches, and without the use of additives or preservatives. The heritage-bred ducks from which the duck sausage is made come from small farms that never use antibiotics or hormones, while the boars are humanely trapped and said to offer a “true taste of the wild.” The SRP is $10.99 per 6-ounce sausage.

Plant Power

Today, more than half of Americans believe that plants are the best source of protein, according to research firm Packaged Facts, suggesting that Hain Celestial’s Yves Veggie Cuisine Falafel Balls and Kale & Quinoa Bites have arrived on shelves at an opportune moment. The Falafel Balls are Middle Eastern mainstays made from chickpeas, onions, carrots, and a blend of herbs and spices, while the Kale & Quinoa Bites contain their two eponymous superfoods and feature crispy edges and a soft, hearty center. Both are vegan, made without soy or GMO ingredients, kosher, and free from gluten, cholesterol, trans fat, and artificial flavors and preservatives. The SRPs range from $5.81 to $6.80 per 8.4-ounce package.


| Progressive Grocer | Ahead of What’s Next | March 2017

Smart Snacking

Given that so many popcorn snacks today are drenched in butter-like substances that can be far from natural, it’s understandable that today’s health-conscious consumers might have a hard time finding a more authentic option. Enter LesserEvil, a snack company that has partnered with artisanal ghee brand Fourth & Heart to introduce Oh My Ghee!, an organic butter-flavored popcorn made with Himalayan pink salt and premium grassfed ghee. The latter ingredient, a type of clarified butter, is loaded with vitamins A, D, E and K, as well as butyric acid. The popcorn is touted as a great source of fiber, as well as kosher, USDA Organic-certified and Non-GMO Project-certified. The SRP is $3.99 per 5-ounce bag.

Orange Blossom Special

With orange among the top three flavors driving growth in flavored spirits, not to mention hard cider currently being in vogue with today’s consumers, Strongbow Orange Blossom is a timely arrival on grocers’ shelves. The flavor is said to deliver a fresh, spring-like orange-blossom aroma with a touch of sweetness and a juicy apple finish, and contains no artificial colors or flavors. The 4.5 percent ABV cider retails in 6-packs of 12-ounce bottles, as well as 12-bottle variety packs alongside Gold Apple, Honey and Cherry Blossom flavors. The SRPs are $9 per 6-pack and $15 per variety pack.

Whip it Good

Sunscreen is necessary to stay safe in the hot summer sun, but applying it can be a messy, uncomfortable ordeal. Understanding this, Bayer, under its Coppertone brand, has launched two waterproof offerings that provide broad-spectrum UVA/UVB protection. ClearlySheer Whipped Sunscreens, in SPF 30 and 50 varieties, feel clean and light on skin, glide on easily, and don’t clog pores or cause breakouts. Additionally, WaterBabies Pure & Simple Whipped Sunscreen, with SPF 50 protection, is free of fragrance, parabens, PABA, dyes and oil, giving parents peace of mind when using the product on their little ones. Each item retails in 5-ounce bottles for an SRP of $10.99-$13.99.

Far From Average Pizza

Consumers looking to cut carbs and calories or avoid gluten while still enjoying pizza Fridays need look no further than Caulipower’s line of ready-to-cook cauliflower-crust pizzas. The gluten-free frozen products are made with real cauliflower and contain lower sodium, calories and sugar, while being higher in vitamins than most conventional and gluten-free frozen pizzas. Ready in 15 minutes, Caulipower pizzas come in three varieties, Three-Cheese, Veggie and Margherita, and also as a plain crust. The SRP is $8.99 per 11.6-ounce box. March 2017 | |



Human Resources

Continued from page 47

Define the wider impact of their role and how important they are for the successful accomplishment of the company’s mission.” —Mary Kay O’Connor, IDDBA


That’s where IDDBA steps in. “We have a bevy of programs we’ve put in place for retailers and manufacturers, including competency training and creating engagement of the employee,” she notes. “Make them feel good about coming to work, and help them stay motivated.” Given that about half its workforce are Millennials, Raley’s is adopting an approach to training and retention that reflects how people want to work in 2017, according to Foley. “Instead of strictly classroom training, we have some done on tablets. It might be a five-minute video, but that’s the expectation of younger people. They don’t want to sit in a classroom for two hours. We have a sanitation module that’s done in a fun, almost game-ified way.” “Cross-training … is a brilliant strategy that no retailer has exploited,” suggests Lloyd. “It’s great for the company, great for the employee and great for the customer.” His next book, “Employee Retention Rules,” slated to be released late this spring, will address hiring and retention in grocery retail, including how to build relationships, cross-training, progression mapping, orientation, communication, discipline and “success plans.” Raley’s has created its own version of the 10 characteristics of servant leadership that focus on people, results, thought and personal leadership. Associates identified as aligned with the company’s business values are tested to determine “if they have the agility to adapt and change and take on a larger role in the organization,” says Foley. Using a practice sometimes referred to as “upskilling,” retailers should focus on identifying employees with potential and training them along a more structured, transparent career path, which allows store associates to recognize the skills that they’ll need for the next step. “There’s lots of conversations about the reality of working in a store or warehouse, but not a lot about the path and trajectory of what a career in retail looks like in one, three or five years,” says UTT’s Jones. Cynthia McCloud, executive education director of food industry programs at the USC Marshall School of Business, in Los Angeles, has noticed that, in just the past several years, retailers are adopting a development style common among CPG manufacturers. “They invest in people and develop them, not just teaching them or sending them off to class, but move them around the company into different roles and different departments,” explains

| Progressive Grocer | Ahead of What’s Next | March 2017

McCloud — for example, working from a store and then operations before moving to marketing, taking on a district manager role, analysis and finance. She’s seen this particularly among companies that have a succession-planning process. “We’re seeing more of that from retailers who recognize that these future leaders need to know that the company cares about them and the company is willing to invest in them,” says McCloud.

Retention In the forthcoming “Employee Retention Rules,” Lloyd writes that employees are looking for five things from their employers: orientation, communication, discipline, recognition and evaluations. Unfortunately, according to Lloyd, the industry selfrates at about a 44 on a scale of 100 when assessing its retention efforts. Raley’s success with “retention is based on how well we communicate and [implement] change management, demonstrate opportunity for growth and provide support,” says Foley. “We believe in promoting from within, but we look for certain competencies rather than technological expertise. ...We’re looking for people who live the values. … We look for informal leaders who exhibit servant leadership and respect their peers. Before they’re a leader, they’ve demonstrated these traits.” Safeway has several programs that help employees identify their paths within the retailer, starting with Career Advancement Workshops designed for all store employees. The retailer has the equivalent of “a city of jobs,” notes Powers, and the workshops provide an opportunity to describe jobs throughout the organization and shine a light on executives who’ve worked their way up to the top. “People are always surprised that [senior executives] often started as courtesy clerks and cleaned urinals,” she says. “They see [these executives] as people like them.” Another feature of the workshops is to promote the Retail Management Certificate, an accredited community-college program established by the Western Association of Food Chains, comprising eight courses deemed critical to managerial success. Retention isn’t all about the paycheck, insists IDDBA’s O’Connor. “Millennials, in particular, want to work for a purpose in their job, and for the business’ entire organization,” she says. “Define the wider impact of their role and how important they are for the successful accomplishment of the company’s mission,” she advises. Safeway’s Powers concurs: “When you invest in people, they feel valued and they want to give it back to you.” PG Visit to read additional articles on the topic.

Index Airius Anheuser-Busch Bare Snacks Beaver Street Fisheries Bland Farms Blount Fine Foods Boston Beer/Samuel Adams Brewery Tour Line C&S Wholesale Grocers Campbell Soup Company Chobani Creekstone Farms Crown Imports LLC Domino Foods Enjoy Life Natural Brands, LLC General Mills Inc. Giorgio Foods, Inc. Gold Medal Products Heineken USA Inc. Inline Plastics Corp International Deli Dairy Bakery Association International Paper Retail Display and Packaging Iovate Health Sciences Int’l Inc. Jack Link’s Beef Jerky Johnson O’hare Company, Inc. Johnson Ventures JTM Foods Karen’s Naturals Litehouse Mason Vitamins Inc. MasonWays Indestructible Plastics Mondelez International National Confectioners Association National Restaurant Association NBTY Nestlé Nutrition U.S. Ole Mexican Foods Organic Valley Family Of Farms Peri & Sons Farms Pfizer Consumer Health Robbie Flexibles Saint Joseph’s University Save-A-Lot Siggi’s Dairy Smithfield Fresh Stonefire Authentic Flatbreads TH Foods Thanasi Foods LLC The Happy Egg Company Trion Industries Inc. Tyson - IBP Trusted Excellence Tyson - Star Ranch Angus Tyson Foods Ventura Foods LLC Wild Blueberry Assoc Of North America - Canada Windsor Foods/Discovery Foods

62 9 56 63 77 26-27 69 68 41 17 39 45 29 15 18-19 80 38 36, 71 76 Cover Tip 33 86 42 93 81 46-47 54 57 82 70 3, 21, 60 51 Insert 67 Inside Front Cover, Inside Back Cover 23 53 25, 48 78 85 64 40 Insert 83 Back Cover 55 66 79 72 75 13, Insert 35 37 32 10-11, 58-59 65 6 4-5

Progressive Grocer (ISSN 0033-0787, USPS 920-600) is published monthly by EnsembleIQ, 570 Lake Cook Rd. Deerfield IL 60015. Single copy price $10, except selected special issues. Subscription: $135 a year; Canada $164 (Canada Post Publications Mail Agreement No. 40031729. Foreign $270 (call for air mail rates). Periodicals postage paid at Deerfield, IL 60015 and additional mailing offices. Printed in USA. POSTMASTER: Send all address changes to Progressive Grocer, P.O. Box 1842 Lowell, MA 01853. Copyright ©2017 EnsembleIQ All rights reserved, including the rights to reproduce in whole or in part. All letters to the editors of this magazine will be treated as having been submitted for publication. The magazine reserves the right to edit and abridge them. The publication is available in microform from University Microfilms International, 300 North Zeeb Road, Ann Arbor, MI 48106. The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

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advertiSing SaleS & BUSineSS Staff Peter Hoyt President & CEO 773-992-4456 Richard Rivera Chief Operating Officer 973-264-4380 Jeff Greisch Chief Brand Officer 224-337-4029 Ned Bardic Chief Customer Officer/President of Strategic Platforms 224-632-8224 Jeff Friedman Senior Vice President/Brand Director 201-855-7621 Janet Blaney Associate Brand Director (AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY) 630-364-1601 Rick Neigher Western Regional Sales Manager (CA, OR, WA) 818-597-9029 Maggie Kaeppel Eastern Marketing Manager 630-364-2150 • Cell 708-565-5350 Mike Shaw Northeast, Marketing Manager 201-855-7631 • Cell 201-281-9100 Jackie Batson Advertising Manager 224-632-8183

March 2017 | |


The Last By Meg Major

As the Food World Turns

There is a plethora of equally pressing, albeit lesserdiscussed, issues that will have a profound bearing on the next chapter yet to be written about the tumultuous present-day grocery derby.


ith ecommerce, Amazon, Walmart, Lidl and Millennials dominating the majority of conversations in the extended retail food world, it’s easy to see how the perception exists that there’s little else to debate or discuss. However, as significant as the aforementioned topics are, the reality is that a plethora of equally pressing, albeit lesser-discussed, issues will have a profound bearing on the next chapter yet to be written about the tumultuous present-day grocery derby. Among the foremost formidable forces grocers will continue to grapple with in the near term: Lingering deflation, which continues to compound competitive pressures, including those on the food-at-home Consumer Price Index (CPI), which decreased 2 percent during the 12-month period ending January 2017. Grocery CPI, which measures channel inflation, remained flat compared with the previous month, largely as a result of the 5 percent decline in the fruit and vegetable index. Profound uncertainty with two of the Trump administration’s top policy priorities, uppermost being immigration reform, which threatens to strip farms and meatpacking and processing plants of labor. Next is the controversial Border Adjustment Tax (BAT) proposal, which sparked a coalition of some 100 industry trade groups — including associations like FMI, NGA and NRF, and retailers such as BJ’s Wholesale, Meijer, Target and Walmart — to unite in opposition as Americans for Affordable Products (AAP). The coalition is gearing up to launch a national campaign to spread the word that BAT will lead to significantly higher costs for everyday items, including food, gas and clothing. If BAT is enacted, NRF estimates that it will cost American families as much as $1,700.

Meg Major

Chief Content Editor Twitter @Meg_Major/@pgrocer


| Progressive Grocer | Ahead of What’s Next | March 2017

While these looming issues will undoubtedly command considerable attention and resources from affiliate industry cohorts in the months ahead, additional watch-worthy developments include: Kellogg Co.’s disbandment of its DSD network for its $3.2 billion snack business to the warehouse model already in place for 75 percent of its North American portfolio. Set to be complete by Q4 of this year, the transition sets the stage for other manufacturers to potentially follow the lead of the Battle Creek, Mich.-based company. Dollar General’s expectation to create 10,000 new jobs this year as a result of 1,000 planned new store openings and two new distribution centers. The 9 percent overall increase to its workforce marks the largest one-year employee increase through organic store and distribution center growth in the company’s 78-year history. Further, after cutting the ribbon on its first small-format DGX store in Nashville in January, Dollar General is also eying additional compactfootprint models to add to its store fleet in 2017 and beyond. Aldi’s $1.6 billion cap-ex remodeling and expansion purse earmarked for an overhaul of 1,300 U.S. stores by 2020. Aiming to shore up its turf and broaden its appeal, the Batavia, Ill.-based chain will focus on more robust produce, dairy and bakery sections with design tweaks such as open ceilings, natural and LED lighting, and upgraded refrigeration systems. Albertsons’ quest to become a publicly traded company, which has been in the works since July 2015 after acquiring Safeway six months earlier, may finally come to pass. Indeed, with investors giddy about the Dow, S&P 500 and Nasdaq posting new record highs on continued optimism regarding President Trump’s pending pro-business reforms, the timing certainly seems right for the Boise, Idaho-based retailer — which operates 2,200-plus stores across the country under 18 banners — to make its long-awaited IPO leap. The industry truly is at the tipping point of major change, which will threaten the position of many existing players, but will also prompt others to become shrewder and better equipped to compete in an increasingly disruptive ecosystem where there will be no room for mediocrity. PG


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Beverage Category

March 2017




How to Drink Like a Millennial P.4

How Sweet It Isn’t P.6

Spin the Bottle


New Products P.13

March 2017 | |



How to Drink Like a Millennial

Nutrition, innovation and naturalness rule — but don’t forget price. By Barbara Sax


illennials are avid beverage consumers. These consumers drink a much wider range of beverages than any other consumer group, are willing to pay for added nutritional value or health benefits, and are early adopters of new products and flavors. Global discovery and flavor experimentation are big motivators for this group. “Spicy flavors are popular among Millennials, and from alcohol to kombucha, more and more levels of heat seem to be popping up,” says Kimberly Kawa, senior nutrition researcher at Chicago-based SPINS. “Millennials are interested in exploration through the bottle,” notes Christina Bowden, director of consulting services at The Hartman Group, in Bellevue, Wash. “That can mean a ready-to-drink Southern-style organic coffee with chicory or golden milk, flavored with turmeric that has anti-inflammatory benefits.” Exotic fruits and unique flavor combinations — cucumber mint or coconut kiwi — appeal to them, especially if the products offer added health benefits.

Water Wins While they crave new flavors and beverage experiences, water remains the big winner among Millennial consumers. A recent study from Digsite, a Madison, Wis.-based social media market research platform, found that 53 percent of Millennials


| Progressive Grocer Beverage Supplement | Ahead of What’s Next | March 2017

age experiences that make them “feel healthy,” so it’s surveyed cited bottled water as their most recent bottled no surprise that functional beverages are a big hit with beverage experience. these consumers. A majority of Millennial study respondents said that “Millennials want their beverages to do more for they chose water because it’s a healthy option, and cited them,” says Bowden. “They want beverages to give them taste and concern about sugar as the No. 2 and No. 3 most more energy for their busy, active lives, but those products common reasons they opted for water over other beverages. have to align with their health-and-wellness goals.” Digsite’s research shows that while Millennials aren’t As early adopters, Millennials have been fueling totally opposed to sweetened beverages, they’re consales of beverages that promote healthy digestion, scious of high levels of sugars in drinks and are careful and are enthusiastic consumers of drinking vinegars, about what they’re choosing. “They don’t like artificial artisanal tonics and kombucha. New products aimed at sweeteners,” observes Monika Wingate, co-founder and this consumer group include Fire Brew, an apple cider CEO of Digsite. “They will drink carbonated beverages, vinegar-based health tonic, and Wild Tonic Jun Kombut they want them to be flavored with natural ingredibucha, fermented with honey instead of the sugar used ents so they don’t feel so bad about it.” in traditional forms of the beverage. Alternative waters, such as coconut water and watermelon water, offer a sweeter option without added refined sugars and should continue to see growth with this demographic. Energy Surge According to Wingate, Millennials are clear about Natural energy boosters also rank high on Millennials’ what they don’t want in their beverages. “Chemical, list of benefits. FONA research shows that 64 percent artificial taste was a big negative with these of Millennials consume energy drinks and half-drink consumers,” she asserts. “They say artificial energy shots. These consumers say that they’re drawn to sweeteners can give them a headache, and energy-boosting options made with natural ingredients, they don’t like the sugar crash they can get so energy beverages with healthier profiles and that are from an overly sugary beverage.” infused with vitamins and supplements Millennials are inherently wary, read are winning this demographic. labels and look for a short ingredient panel. Wingate notes that consumers sur“Chemical, “Consumers want five or six ingredients, and veyed indicate that they’re interested in artificial taste they are interested in the narrative behind immunity-boosting beverages. “Conwas a big negative a product,” says Hartman’s Bowden. “They suming functional beverages aimed at with these like to know where ingredients came from.” immunity boosting wasn’t a current consumers.” Product narratives play to this audience. behavior, but that was one benefit they —Monika Wingate, “Millennial consumers crave authenticity,” rated highly and [that] seemed to generDigsite affirms Wingate. “They know they are being ate significant interest,” she points out. marketed to, but they like to know how Millennials also want their healthy something is made and where it is made. The beverages to be satiating. They seek story really resonates with them.” beverages that can fulfill a snack craving, such as options Natural products are more important than organic, containing raw fruits and vegetables. Fresh-press juices and simple, straightforward messaging connects with this and smoothies are significant categories for Millennial generation. They also react to unique packaging that sets a consumers, and they’re willing to pay a premium for product apart from similar offerings on the market. products they view as fresh and natural. Despite that, there’s a limit to their spending. “Millennials are generally cash-strapped, so there are times Highly Functional that they will pay a price premium for quality and Functional beverages are a critical beverage category for uniqueness, but price will often trump a good narrative Millennials. Research from FONA International, based and social cause,” cautions Bowden. in Geneva, Ill., shows that Millennials are the consumer For a generation that has grown up with Starbucks, group with the highest consumption of functional bevercoffee is also a significant category. According to ages, with 57 percent of consumers age 25 to 34 demonChicago-based researcher Datassential, people age 19 to strating interest in these products. 34 currently make up about 44 percent of the U.S. coffee “Millennials are heavy users of functional beverdemand. Chilled beverages, from frozen blended drinks ages, but it’s hard to pinpoint which beverage they to iced coffee, are highly popular gourmet products with consume most often, because throughout the course of this generation. Research from Chicago-based Mintel a day, they consume multiple products,” notes Pamela shows that more than half of Millennials drink cold Oscarson, consumer insights manager at FONA Inlattes, and that this group drinks iced coffee almost ternational. “They use functional beverages to replace twice as much as Gen Xers. Millennials are driving meals, energize and even just for refreshment. It is the the growth of new segments, such as cold-brew coffee, convenience and no-brainer nutritional aspects that which meet their expectations of premium ingredients draw Millennials to these products.” and coffee-culture experiences. PG Digsite’s survey shows that Millennials want beverMarch 2017 | |


Sweeteners SupplEmEnt

How Sweet It Isn’t

Evolving tastes and preferences are affecting the sugary beverage segment. By Barbara Sax


f not outright souring on them, shoppers are certainly rethinking their relationship with sweeteners. “Consumers have a love/hate relationship with sugar,” admits Christina Bowden, director of consulting services at The Hartman Group, in Bellevue, Wash. “Consumers want sweetness and still want indulgent foods, but they are more conscious about where the sweetness is coming from.” According to Bowden, shoppers are moving to more natural, less processed sweeteners with better nutritional profiles. “Consumers are tapering away from refined sugars and artificial sweeteners such as sucralose, aspartame and saccharine,” she adds, pointing to research from Hartman’s “2015 Health and Wellness Study.”

Ongoing Experimentation Carbonated beverages, particularly boutique brands, have steadily been slashing sugar content. “Consumers are looking for less sugar, so we have to adjust to the market,” asserts Kevin Li, marketing manager at Bruce Cost Ginger Ale, made with cane sugar. The Brooklyn, N.Y.-based company launched a 66-calorie version of its ginger ale, sweetened with a comNatural Options bination of cane sugar and monkfruit, and then introduced a As artificial sweeteners fall out of favor, natural sweetsugar-free stevia-sweetened optin. “We’re always looking for eners such as monkfruit, yacón, sorghum, and raw or new sweeteners that don’t have an aftertaste,” says Li. unpasteurized honey are all showing up on consumers’ Manufacturers are also blurring the division between soft radar. Stevia, for one, is still on the rise in the United drinks and water by adding juice to sparkling and still waStates. “Since it’s plant-based, not chemiters, using the natural sweetness of the juice as a sweetener. cally derived, and has a low-calorie profile, Further, manufacturers are experimenting with savory juices, it is popular as a beverage sweetener,” notes and that segment of the category has grown. “Entrepreneurs Bowden. are bringing new products out every day Kevin Sherman, CEO of Irvine, that arena that experiment with ingrebased True Drinks, maker of AquaBall, “Consumer palates dients,” says Bowden. “We’re seeing more says that an all-natural positioning was imare changing. As savory juices, such as beet juice, entering the portant to the development of the product. market, and more green juices that are like a “We chose stevia as our preferred sweetener people think about salad in juice form.” to keep the product as natural as possible,” how much sugar Products in other categories leave the he explains. “We spent extensive time dethey are consuming sweetening to the consumer — enabling veloping the formulation to ensure the right and where it’s them to personalize their beverage experibalance that would be palatable for kids.” coming from, they ence. “Cold-brew coffee consumers can According to experts, shoppers who are accepting turn those beverages into DIY by adding have already accepted the tart tastes of less sweetness. the sweetness in the amount and form they kombuchas and drinking vinegars are Eventually, the desire,” observes Bowden. adjusting their expectations of what sweet palate will adapt The Atlanta-based Coca-Cola Co. is tastes like. “Consumer palates are changand less sweetness identifying and nurturing brands with ing,” affirms Bowden. “As people think will become the billion-dollar potential. Hansen’s and Blue about how much sugar they are consumSky, brands operated by the soft drink giing and where it’s coming from, they are norm over time.” ant’s Venturing & Emerging Brands busiaccepting less sweetness. Eventually, the —Christina Bowden, ness unit, both use natural sweeteners in at palate will adapt and less sweetness will The Hartman Group least some of their offerings. PG become the norm over time.”


| Progressive Grocer Beverage Supplement | Ahead of What’s Next | March 2017

An exclusive invitation-only networking and education event designed by and for retail dietitians

June 3-5, 2017 Hyatt Regency Orange County • Anaheim, CA Three days of valuable content, continuing education credits, interaction and invaluable peer networking. Get inspired and connect with retail dietitians and solution providers! This year’s event will include: • NEW: Training session presented by RDBA • NEW: Free admission to the IDDBA Show for a guided trade show floor tour • Networking functions • Keynotes & valuable content • Roundtable discussions Qualified retail dietitians and nutritionists can request their invitation to attend the 2017 Retail Dietitian Symposium. Please contact Joan Driggs at or at 224-632-8211. Sponsorships packages are available, and they are selling out fast! Contact Maggie Kaeppel at or at 630-364-2150.

September 27–28, 2017 Rosemont (Chicago O’Hare), IL

Building the Grocerant Experience Progressive Grocer invites retailer executives to learn more about strategies and solutions for fresh prepared food and how it can boost store loyalty and profits. • Participate in an assessment of shopper insights, the competitive landscape and case studies • Learn about key trends plus operational and tactical concerns • Network with other retailers who share your interest in grocerant opportunities For more information, contact Jeff Friedman at or at 201-855-7621.


Spin the Bottle

Packaging can help convey to consumers the attributes they want in a beverage. By Barbara Sax


ig food” has become a negative food perception for many consumers, and manufacturers are using packaging to help position their beverage brands as natural and healthy. “Consumers want something that is simple and crafted,” says Chris Lowery, president of Chase Design Group, the New York- and Los Angeles-based design and brand consultancy that worked on Califia Farms’ iconic bottles as well as other products in the natural arena. According to Lowery, manufacturers communicate their beverage brands’ healthier profile through crafted, minimal typography and graphics, as well as muted colors. “Design, whether graphical or structural, is paramount to communicate a brand’s unique point of difference in a category,” asserts Vilma Livas, VP of marketing at Los Angeles-based Califia. “As we’ve continued to enter new categories with innovative products, we challenge ourselves to consider how the packaging will disrupt the shelf set so a consumer can easily identify that ‘something different, something better’ has arrived.” “We challenge When it came to its botourselves to tles, the company “wanted consider how the a package design that stood packaging will out against the traditional disrupt the shelf sea of cartons on the dairy set so a consumer shelf,” explains Livas. To can easily identify meet that goal, Chase crethat ‘something ated an iconic matte molded plastic bottle for Califia’s different, alternative milks that’s ergosomething better’ nomic and easy to pick up and has arrived.” pour, as well as communicat—Vilma Livas, Califia Farms ing the quality of the product. Califia has adapted the bottle’s basic shape and language as it moves into other beverage categories. More recent introductions in the alternative-milk category, such as Emeryville, Calif.-based Ripple Foods, a maker of plant-based milks, have opted to package in molded plastic bottles over classic March 2017 | |


Technology Enabling Path to Modern Retailing June 13-14, 2017 | Chicago, IL Food Retail Is Racing Towards A New Future… ….with the exponential pace of change in both technology, and food retail, opportunities and challenge arise. From the advent of mobile shopping to the rise of online food culture, our industry is undergoing a fundamental transformation. Join us at Pulse June 13-14, 2017 in Chicago Illinois for vital idea exchanges, trends and innovations that’ll enhance the consumer shopping experience

Packaging beverage segments depend on transparent packaging to position their brands. A recent “Within ready-tostudy from Chicago-based Mintel revealed drink, glass has that when asked to point out the strongest always represented indictors of quality in beverage packaging, a higher level of respondents cited chilled, glass, resealable quality.” and clear containers. Glass is often the packaging material of —Josh Groff, choice for organic/natural products that aren’t Commitment to Recyclability Stumptown Coffee Roasters light-sensitive, since it has no molecular, Plastic also helps manufacturers up their chemical possibility of contaminating product recyclability game as post-consumer waste and cues freshness in consumers’ minds. becomes a bigger issue in packaging. “We Retro glass bottles dominate the coldchose plastic because we’ve been committed brew and kombucha segments. “Within ready-to-drink, to 100 percent recyclability from the very beginning, and glass has always represented a higher level of quality,” says chose our plastic polymers to ensure that the entire package Josh Groff, VP of marketing at Portland, Ore.-based Stumpas a whole is compatible with the PET stream,” notes Livas. town Coffee Roasters. “It feels more substantial to the touch, “It is critical that the materials we use are combined and at $3.99 to $4.99 for a single-serve coffee, you need [it] to with the infrastructure to recover and recycle those materilook like it’s worth it. We chose the stubby bottle because of als,” says Lowry. “That’s why we are advocating for greater its old iconic image, plus the brown glass protects the coffee recycling infrastructure, and doing our best to encourage from light and heat, which degrade the quality.” consumers to use that infrastructure. One troubling trend we “Glass has a key role to play in cold-brew coffee packaging,” see in packaging is the widening use of ‘compostable’ plasagrees Livas. “Our recently launched Black Label Cold Brew tics. Without industrial composting infrastructure available Coffee line is packaged in amber glass screw-top bottles.” at any meaningful level, these plastics are simply landfilled. Translucent glass or plastic packaging allows conWorse, they create a false sense of responsibility for consumsumers to see the texture of juice and kombucha beverers that their plastics are ‘biodegradable,’ when these materiages. When Monrovia, Calif.-based Evolution Fresh, a als are just perpetuating our plastic-waste problem.” subsidiary of Starbucks, redesigned its recyclable plastic More manufacturers are adapting packaging to bet(PET) bottle and labeling, the company made sure that ter ensure recyclability. “Consumers want to recycle, but it was easy for consumers to see what was inside the sometimes we make it really difficult for them to do this bottle. “Our clear bottle showcases the vivid colors of easily,” admits Livas. Shrink-wrapping, for example, affects our juices and allows consumers to see every drop of recyclability. “When recyclable bottles are shrink-wrapped, juice, including the natural separation that may occur in they aren’t recyclable,” explains Chase’s Lowery. “We’re cold-pressed, high-pressure processed juice,” notes Anne seeing more shrink-wrapping with perforations so they are Williams, VP, Evolution Fresh marketing. easy to remove, and instructions on removing the labels.” Aluminum cans may be getting a second look, since they have the highest recycling rate of any beverage Greater Transparency, and More container, with 70 percent recycled content on average — While opaque plastic is important in protecting the integrity more than three times the recycled content of glass or PET of ingredients in the alternative-milk category, other healthybottles. Craft beer manufacturers are showing renewed interest in aluminum, and Califia opted to package its Nitro Cold Brews in matte aluminum cans. “Our disruptive, eyecatching RTD aluminum bottle for Nitro Cold Brew is unique to the category,” says Livas. “It’s not only a standout on the shelf, but is uniquely suited to Nitro Cold Brew, so we anticipate that others will likely follow suit and adopt aluminum for packaging.” If past is a precedent, Califia is likely to lead the charge in that direction. PG gable-top laminated cartons, creating a new look for the products in the alternative-milk category. “The Ripple bottle is a fun reminder of the old glass milk bottles that would be delivered to your doorstep,” says Ripple cofounder Adam Lowry. “It helps communicate that Ripple is a great alterative to dairy.”

March 2017 | |


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New Products Sweet Treat

Natural Recovery

Americans’ love affair with sweet products is as strong as ever, even as they look for more healthful alternatives to satisfy their cravings. Just a drop or two of SweetLeaf Sweet Drops Caramel-Flavored Stevia Sweetener can liven up a variety of products made at home, or it can be added to beverages such as coffee or smoothies for an extra hit of sweetness without any extra calories or unpleasant aftertaste. One 50-milliliter squeeze bottle contains 50 servings of the natural stevia sweetener, which contains only five ingredients and zero calories. The SRP is $3.99 per bottle.

Some Like It Cold

Tea drinking is on a continual rise — not a surprise, considering the health benefits that come from the beverage. And with the trend of coldbrew coffee at its highest, it’s no surprise that Pure Steeps has finally added two varieties of cold-brew tea to its Secret Squirrel line of cold-brew coffees: Rwandan Black and Sencha Green. The ready-to-drink organic teas are available in 12-ounce varieties, with SRPs starting at $2.89 per bottle.

A super-challenging workout demands to be followed by a superhydrating beverage. And considering consumers’ current desire for clean ingredient decks, more natural solutions are preferred for replenishing the body’s lost nutrients. Body Armor SuperDrink’s latest addition, Blackout Berry, provides not only natural ingredients — flavors, sweeteners and electrolyte-rich coconut water — but also the contents needed to recover from strenuous activity, with vitamins A, E, B6, B12 and C, in addition to the electrolytes. Retailing for a suggested $1.49 per 16-ounce bottle, the beverage is made in partnership with star athlete Kobe Bryant.

Cool Beans

Cold-brew coffee is refreshing and trendy right now, which Steep 18 Cold Brew Coffee realized when it recently launched its line of eclectic cold-brew coffee varieties. Sourced only from the highest-quality, 100 percent Arabica beans and then steeped for 18 hours to ensure a smooth, full-bodied flavor without bitterness, the line consists of Breakfast Blend, Colombian, Donut Blend, Guatemalan, Signature and Sumatran varieties. All are packed in 36-ounce aseptic cartons with an SRP range of $4.49-$5.99 each.

Natural Hydration

Today’s busy Americans need to stay hydrated to maintain their packed schedules, and a beverage with a lot of artificial ingredients isn’t going to make the cut in their diet, nor will one with a bland flavor. In response, Zola has added a pineapple variety to its 1-liter Tetra Pak coconut water line. The flavor pairs slightly sweet coconut water with pineapple juice, and also includes natural electrolytes, making it naturally hydrating. The not-from-concentrate, no-sugaradded, vegan and gluten-free coconut water comes from only the best-tasting coconuts from Thailand, according to Zola. It contains 410 milligrams of potassium per 8-fluid-ounce serving, and has an SRP of $4.99. March 2017 | |


New Products On-the-go Aloe

Now available for health-and wellness-minded consumers who identify with the “beauty from within” mindset, Aloe Gloe is an organic aloe water that comes in four flavors: Crisp Aloe, Coconut, Lemonade and White Grape. The beverage is considered part of the enhanced-ingredient water category. The Venturing & Emerging Brands unit of Coca-Cola obtained a minority equity stake in Aloe Gloe in June 2016. Aloe Gloe is available in 15.2-fluidounce bottles with an SRP of $2.49 each.

Fruity and Floral

Freshness takes center stage as Blossom Water LLC combines fruit and floral botanicals in its namesake all-natural essence water. Available in four flavors — Lemon Rose, Plum Jasmine, Grapefruit Lilac and Pomegranate Geranium — the beverages contain 45 calories and 11 grams of sugars per 16-ounce bottle, and are free from fat and sodium. The SRP is $1.99 per bottle.

Natural Energy

Today’s on-the-go, health-conscious consumers are looking for ways to get a little more energy and refreshment without all of the calories and artificial ingredients in many carbonated soft drinks (CSDs). In response, Zevia, a manufacturer of zerocalorie, stevia-sweetened CSDs, has added Energy and Sparkling Water to its lineup. Available in three flavors — Mango Ginger, Raspberry Lime and Grapefruit — the Energy line contains 120 milligrams of natural caffeine from coffee extract, and no additional supplementation. The SRP is $1.99 per 12-ounce slim can. The Sparkling Water line, meanwhile, is slightly sweet and comes in Lime, Blackberry, Cucumber Lemon and Mandarin Orange flavors, with an SRP of $5.99 per 8-pack of 12-ounce cans. Both lines are Non-GMO Project-verified.

Vinegar Vigor

Drinking vinegars are said to promote good gut health, and Live Beverages has entered the category with four flavors of ready-to-drink vinegars under its Live Sparkling brand: Tart Cherry, Concord Grape, Pomegranate & Elderberry, and Blueberry & Ginger. Each 12-ounce bottle contains 2 tablespoons of raw, unprocessed apple cider and coconut vinegars, and is blended with organic fruit juice and water. Effervescent, refreshing and guilt-free at only 2 to 3 grams of sugar per serving, these vinegars aspire to be part wellness tonic, part tart refreshment and part “cure what ails ya.” The SRP is $2.59 per bottle.

Light and Leafy

Americans are trying to pack more veggies into their diets. These juices aren’t always refreshing, however, which can make drinking them more of a chore than a pleasure. Expanding on its Green Lemonade flavor, organic cold-pressed juice manufacturer Daily Greens has launched the Green Ade line, comprising four flavors: Watermelon-Hibiscus Ade, Lime-Basil Ade, Jicama-Blue Majik Ade and Orange-Turmeric Ade. Highlighted in all flavors are some of the most nutrient-dense algae-based superfoods, including chlorella and Blue Majik spirulina, with each of these “green” superfoods packing more than 65 nutrients. The beverages have just 20 to 40 calories each and 7 grams of all-natural sugar or less. Pricing is at the retailer’s discretion.


| Progressive Grocer Beverage Supplement | Ahead of What’s Next | March 2017

Slimming Refreshment

Losing weight while feeling great is the dream of many consumers, and Celsius has added a few varieties to its line of beverages that do just that, including Pineapple Coconut (noncarbonated), Watermelon Berry (noncarbonated) and Sparkling Grapefruit. With Celsius’ proprietary MetaPlus formula that combines green tea with EGCG, ginger and guarana seed, the beverages turn on thermogenesis, a process that boosts the body’s metabolic rate. Drinking Celsius beverages prior to fitness activities is said to energize the body, accelerate the metabolism, and burn body fat and calories. The beverages are kosher, non-GMO, certified vegan and gluten-free, and contain 0 grams of sugar. Each 12-ounce can has an SRP of $2.49.

Boosts for Now — and Later

With Americans’ busier-than-ever schedules, beverages that give longerlasting energy boosts are critical to getting through the day. Avitae USA LLC’s Zum XR by Avitae line of lower-calorie energy drinks features timerelease beads with caffeine that provide long-term energy to imbibers. The all-natural beverages offer an initial caffeine boost equivalent to that from one-and-a-half cups of coffee (125 milligrams) before the beads slowly release another boost of the same strength. The drinks contain 70 calories per can and come in three flavors: Orange, Mixed Berry and Lemon Lime. The line’s SRP is $2.99 per 12-ounce PET can.

Easy Tea-sy

The tea category is expected to enjoy strong, continuous growth in the coming years, driven by interest in the beverage’s health benefits and convenient options. Made from organic whole tea leaves, Pique Tea Crystals answer that interest, containing no sugar, artificial flavors or artificial preservatives, and instantly dissolving in cold or hot water. The crystals are made using a slow-brew process that extracts the fresh flavor and natural antioxidants from the leaves, and come in the following varieties: Organic Jasmine, Organic Earl Grey, Organic Sencha, Organic English Breakfast, Organic Mint Sencha and an Organic Variety Pack with all flavors. The crystals’ SRP range is $7.34-$7.99 per pack, each of which contains 14 single-serve sachets.

Bringing Water to Life

Americans in 2016 were projected to purchase, for the first time in a while, more water than carbonated soft drinks, showing a growing interest in pushing aside sweetened, caloric beverages for natural refreshment and replenishment. Just because it’s water, however, doesn’t mean it has to be boring: PepsiCo’s new Lifewtr premium bottled water fuses creativity and design with hydration. The purified water is pH-balanced, with electrolytes added for taste, and packaged in a bottle that serves as a canvas for art and design, featuring rotating label motifs created by emerging artists, including mural artist Momo, transatlantic duo Craig & Karl, and large-scale artist Jason Woodside. The SRPs are $2.06 per 700-milliliter bottle and $2.70 per 1-liter bottle, with the former topped by a convenient sports cap.

Make Me a Matcha

Naturally energizing products are in vogue right now with busy but health-conscious consumers, so Ito En’s Matcha Love Sweetened Matcha Green Tea Powder Mix comes to market at just the right time. A convenient way to enjoy the flavor and energy boost of coffee-shop matcha lattes, the mix is made with a pure blend of 100 percent Japanese matcha and sugar, so that each scoop boasts the rich, savory taste of matcha with just the right touch of sweetness. The product retails in resealable 8-ounce packages with an SRP range of $12.99-$14.99 each. March 2017 | |