Local and Fresh Foods in the U.S.

Published: May 1, 2007 - 226 Pages

Table of Contents:

Chapter 1: Executive Summary
  • Scope and Methodology
    • Scope of Report
    • Definition of “Fresh Foods”
    • Definition of “Local Foods”
    • Report Methodology

  • Market Overview
    • History of the Local Foods Movement
    • Media Spreads Global Green Culture
    • Retail Sales of Fresh Foods Total $230 Billion
    • New Sales Tracking Estimates Perishables Department Sales at $87 Billion
    • Table 1-1: U.S. Retail Sales of Perishable Products by Category, 2006 (in millions of dollars)
    • Market Size and Growth of Local Foods
    • Consumers Equate Freshness with Higher Quality
    • “Freshness” also the Top Reason Consumers Buy Local Foods
    • Consumer Attitudes Toward Fresh Ingredients

  • Straight from the Farm
    • Smallest Scale Farms on the Ups
    • Figure 1-1: Share of U.S. Farm Production: 1997 vs. 2003 (percent) Organic Farming
    • Farmers Band Together to Market Their Products
    • Farmers Pursue Direct-to-Consumer Sales
    • Farmers’ Markets Are Flourishing

  • Retail Channels
    • Fresh Foods Showing Up in All Retail Channels
    • Local: The Next (Challenging) Step
    • Supermarkets Looking to the Perimeter
    • Supermarkets Shifting to Fresh Foods Formats
    • Convenience Stores Get Fresh

  • Foodservice Channels
    • “Fresh” and “Local” Also Important in Restaurants
    • Fresh and Local Cross All Levels
    • Institutional Foodservice: The New Frontier of Sustainable Dining
    • School Foodservice a Growing Market

  • Trends in Fresh Packaged Foods
    • Market Leaders Include Major Conglomerates
    • Smaller Marketers Also Find a Place at the Table
    • Natural, Fresh, and Organic Among Top Packaged Food Claims
    • Figure 1-2: Number of New “Natural,” “Fresh,” and “Organic” Packaged Food Introductions by Package Tag/Claim, 2004-2006
    • Branding Adds Cachet to Commodity Products
    • Pre-Prepared Products
    • Better-for-You Products
    • Getting Kids to Eat More Fruits and Veggies

  • Looking Ahead
    • Trends and Opportunities

Chapter 2: Market Overview

  • Scope of Report
  • Focus on Four Key Areas
  • What Is “Fresh”?
  • Definition of Local Foods and History of the Movement
  • How Local Is “Local”?
  • Local Also Embodies Seasonal
  • Media Spreads Global Green Culture
  • It’s Hard to Be a Locavore
  • Is “Locally Grown” the Next “Organic”?
  • The “Food Miles” Concept
  • Backlash to Bottled Water
  • The Slow Food Trend

  • Market Trends
    • Retail Sales of Fresh Foods Total $230 Billion
    • Fresh Foods Make Up 43% of the Supermarket Basket
    • Tracked Perishable Foods Sales $66.5 Billion in 2006
    • Table 2-1: IRI-Tracked Sales of Perishable Foods Categories, 2002-2006 (in millions of dollars)
    • Fast-Growing Fresh and Refrigerated Categories in Mass-Market Channels
    • Table 2-2: Highest-Growth Perishable Foods Categories by IRI-Tracked Sales Gains, 2002-2006 (in millions of dollars)
    • New Sales Tracking Estimates Perishables Department Sales at $87 Billion
    • Table 2-3: U.S. Retail Sales of Perishable Products by Category, 2006 (in millions of dollars)
    • Packaged Salads Lead Produce Department Sales
    • Figure 2-1: Top 10 Produce Department Categories, 2006 (% share of dollar sales)
    • Beef Accounts for Over Half of Fresh Meat Sales
    • Figure 2-2: Top Meat Department Categories, 2006 (% share of dollar sales)
    • Entrees Are 30% of Prepared Deli Sales
    • Breads Are 27% of In-Store Bakery Sales
    • Seafood Includes Both Fresh and Frozen Products
    • Market Size and Growth of Local Foods
    • Figure 2-3: U.S. Retail Sales of Locally Grown Foods: 2002, 2007, and 2011 (in billions of dollars)
    • A Broad Spectrum of Distribution Channels
    • Consumers Equate Freshness with Higher Quality
    • Freshness as a Perception
    • “Freshness” also the Top Reason Consumers Buy Local Foods
    • Benefits of Buying Local Foods
    • A Way of Romancing Food
    • Fresh and Local Foods as a Competitive Strategy
    • Retailers Shifting to “Fresh Format” Stores
    • Are Consumers “Fresh Stressed”?
    • Consumers Still Shopping Organic
    • The Wellness Factor
    • Food Safety Under Fire
    • Repercussions from the E. Coli Outbreak
    • Controversy Over Raw Milk
    • Farmers’ Markets Also Under Scrutiny
    • States Lend Marketing Support to Local Foods Movement

  • The Consumer
    • Simmons Consumer Data
    • Consumer Attitudes Toward Fresh Ingredients
    • Homemakers Most Likely to Seek Fresh Ingredients
    • One Out of Four Shoppers Seek Both Fresh and Organic/Natural
    • Figure 2-4: Top 10 Demographic Groups Who Look for Both the Freshest Ingredients and Organic/Natural Foods When They Cook, 2006 (index)
    • Table 2-4: Shopper Indexes by Retail Channel: Look for the Freshest Ingredients When They Cook, 2006 (U.S. adults)
    • Table 2-5: Shopper Indexes by Retail Channel: “Agree a Lot” That They Look for the Freshest Ingredients When They Cook, 2006 (U.S. adults)
    • Table 2-6: Demographic Overview of Consumers Who Agree That They Look for the Freshest Ingredients When They Cook, 2006 (U.S. adults)
    • Consumer Shopping Behavior
    • Consumers Scout Around for Fresh Produce
    • Table 2-7: Consumer Preferences for Food Purchasing Locations, 2006 (U.S. adults)

    Chapter 3: Straight from the Farm

    • Local Farms and Farmers’ Markets
      • Smallest Scale Farms on the Ups
      • Table 3-1: Number and Share of U.S. Farms by Type: 1995 vs. 2003
      • Figure 3-1: Share of U.S. Farm Production: 1997 vs. 2003 (percent)
      • Organic Farming
      • Farmers Band Together to Market Their Products
      • Farmers Pursue Direct-to-Consumer Sales
      • USDA Adds Support
      • Farmers’ Markets Are Flourishing
      • Figure 3-2: Growth in Number of Farmers’ Markets, 1994-2006
      • Two Types of Farmers’ Markets
      • Farmers’ Markets Benefit Consumers, Farmers, and the Community
      • Benefits to Consumers
      • Benefits to Farmers and Small Producers
      • Benefits to the Community
      • The Markets in Off-Season
      • Farmers’ Markets Face a Crop of Challenges
      • Whole Foods: If You Can’t Lick ‘Em, Join ‘Em
      • Trend Profile: NYC’s Greenmarket
      • Trend Profile: Seattle’s Pike Place Market
      • Community Supported Agriculture Programs (CSAs)
      • Organic Buying Clubs

    Chapter 4: Retail Channels

    • The Competitive Landscape
      • Fresh Foods Showing Up in All Retail Channels
      • Local: The Next (Challenging) Step

    • Focus on Supermarkets
      • Supermarkets Looking to the Perimeter
      • Table 4-1: Top-Index Supermarket/Food Store Chains for Consumer Agreement with Statement: I Look for the Freshest Ingredients When I Cook, 2006 (U.S. adults)
      • Supermarkets Shifting to Fresh Foods Formats
      • Trend Profile: Safeway
      • Other Chains Also Following the Fresh Format Path
      • Independents Have Local Advantages
      • Key Perishables Departments Are Signatures for Supermarkets
      • Fresh Produce Produces
      • Meating Expectations
      • In-Store Bakeries
      • Dairy and Baked Goods Aisles
      • Deli Is Hot, as Supermarkets Build Up Takeout
      • Turning Grocery Stores into Restaurants
      • Table 4-2: Shopping Patterns by Supermarket/Food Store Chain by Agreement with Statement: I Look for the Freshest Ingredients When I Cook, 2006 (U.S. adults)

    • Focus on Natural Food Stores
      • Natural Foods Tap the Mainstream Consumer
      • Trend Profile: Whole Foods Market
      • Aggressive Expansion Spearheads Growth
      • Criticism Moves Retailer Toward Locally Grown Foods
      • Corporate Drawbacks to “Buying Local”
      • Local Initiatives Are Competition Driven
      • Wild Oats Also Emphasizing “Local”

    • Focus on Specialty Food Stores
      • Many Stores a Natural for Fresh, Local Appeal
      • Trend Profile: Stew Leonard’s

    • Focus on Value Players
      • Supercenters and Mass Merchandisers
      • Trend Profile: Wal-Mart Stores Go Upscale and Local
      • Wal-Mart Goes Local
      • Target Emphasizing Fresh, Organics, and Meal Solutions

    • Focus on Warehouse Clubs
      • Warehouse Club Units Proliferating Rapidly
      • Costco the Strongest Player in Fresh Foods

    • Focus on Convenience Stores
      • Convenience Stores Get Fresh
      • Fresh Food Challenges
      • Emerging Competition from Britain and Japan
      • Trend Profile: 7-Eleven
      • Trend Profile: NexStore Marketplace

    • Focus on the Internet
      • A Renaissance for Online Grocers
      • Trend Profile: FreshDirect

    Chapter 5: Foodservice Channels

    • Restaurants
      • “Fresh” and “Local” Are Important Marketing Attributes
      • Fresh and Local Cross All Levels
      • In the Restaurants
      • Chez Panisse and Alice Waters
      • Blue Hill and Dan Barber
      • Frontera Grill and Rick Bayless
      • Wolfgang Puck
      • Lettuce Entertain You
      • Ruby Tuesday
      • Chipotle Mexican Grill
      • Buying Local Is Challenging But Beneficial
      • Report Highlights Drawbacks and Advantages to Foodservice Sourcing of Locally Grown Products
      • Trend Profile: Burgerville
      • Table 5-1: Restaurant Chain Usage by Agreement with Statement: I Look for the Freshest Ingredients When I Cook, 2006 (U.S. adults)

    • Institutional Foodservice
      • The New Frontier of Sustainable Dining
      • Trend Profile: Bon Appétit Management Co.
      • Trend Profile: Google’s Café 150
      • Trend Profile: Kaiser Permanente

    • School Foodservice
      • A Growing Market
      • Trend Profile: Yale University

    Chapter 6: Trends in Fresh Packaged Foods

    • Overview
      • Market Leaders Include Many Major Conglomerates
      • Smaller Marketers Also Find a Place at the Table
      • Natural, Fresh, and Organic Among Top Packaged Food Claims
      • Figure 6-1: Number of New “Natural,” “Fresh,” and “Organic” Packaged Food Introductions by Package Tag/Claim: 2004-2006
      • Branding Adds Cachet to Commodity Products
      • Pre-Prepared Products
      • Better-for-You Products
      • Getting Kids to Eat More Fruits and Veggies
      • Package Sizes Suit Different Family Sizes and Channels
      • Trends in Fresh Produce
      • Salad Days
      • Ready-to-Cook Vegetables Use Advanced Packaging Technologies
      • Other New Produce Items
      • Pre-Cut Fruit
      • Superpremium Fresh Juices
      • Meat and Poultry
      • Deli Department
      • Deli Meats Go Natural
      • More Marketers Offering Refrigerated Side Dishes
      • Dairy Department
      • Yogurt
      • Cheese
      • Refrigerated Make-it-Yourself Pizza
      • Eggs
      • Orange Juice
      • Bakery Department

    • Trend Profiles
      • Casa Sanchez
      • Chiquita Brands International
      • Kraft Foods
      • Fresh Salads a Fresh Focus
      • Oscar Mayer Extending its Lunch Equity to Adults
      • Jazzing Up Cheese and Dairy Products
      • La Brea Bakery

    Chapter 7: Looking Ahead

    • Freshness Is Crucial for the Food Industry
    • Reorganizing the Store for Fresh Foods
    • “Eating Local”: Trend or Fad?
    • How to “Go Local”
    • Targeting Hispanic Consumers
    • Meal Preparation Stores: Cooking Out—Eating In
    • Gunning for Whole Foods
    • Advances in Technology Will Aid Freshness

    Appendix: Addresses of Selected Marketers, Retailers, and Restaurants and Foodservice Providers

    Abstract:

    Surveys repeatedly show that U.S. consumers believe fresh and locally grown products are tastier and healthier than their packaged/processed counterparts. High-quality perishables including fresh fruits, vegetables, and meats are in fact among the top three reasons consumers choose a primary store for food purchases, and nearly half of shoppers changed supermarkets during 2006 in their quest for better produce. Accordingly, led by Safeway’s success with its “Lifestyle Format” stores, an increasing number of mainstream supermarkets are remodeling their stores to focus on freshness, while also expanding their perishables and prepared foods departments. Also reflecting the growing interest in fresh and local fare, farmers’ markets are booming across the nation, with their count swelling 40% between 2002 and 2006 as consumers increasingly seek out local foods in a desire to get the freshest products available and support their local economy.

    Freshness also rates high with restaurant patrons, leading the list of menu marketing claims in 2006, with more than 40% of consumers saying that fresh produce offerings are “very much” a factor in which restaurant they chose. “Local” foods are also being viewed in an increasingly positive light, in a backlash to “industrial food” production’s negative environmental impact, including excess packaging/waste and the high level of fuel emissions stemming from the long distances many products travel to reach consumers (aka “food miles”). Food safety concerns are mounting as well, especially in light of the recent negative publicity surrounding the contamination of much of the national spinach crop with E. coli.

    As a result of these trends, fresh and locally grown foods are fast becoming issues that promise to provide compelling new marketing angles—but also significant challenges—national food retailers, restaurants and other foodservice providers, and packaged foods marketers, all of which are already clearly intent on using these themes to position, romance, and market their products.

    Report Methodology
    The information in Fresh and Local Foods in the U.S. is based on both primary and secondary research. Primary research involved on-site examination of the retail milieu, interviews with marketing, public relations and industry analysts within the dairy market and consultants to the industry. Secondary research entailed data-gathering from relevant trade, business, and government sources, including company literature. Packaged Facts has derived mass merchandiser sales figures from Information Resources, Inc. (IRI) InfoScan sales-tracking data. Figures provided on national consumer advertising expenditures are based primarily on data compiled by TNS Media Intelligence, the leading provider of strategic advertising and marketing communications intelligence. The analysis of consumer demographics derives from Simmons Market Research Bureau survey data for fall 2006. New product information is gathered via literature research, personal interviews and data compiled by Productscan, a service of Datamonitor.

    What You’ll Get in this Report
    Fresh and Local Foods in the U.S. makes important predictions and recommendations regarding the future of this market, and pinpoints ways current and prospective marketers can capitalize on current trends and spearhead new ones. Fresh and Local Foods in the U.S.—an all-new report from Packaged Facts—provides an in-depth look at these major trends and examines their implications from every angle:

    • Overriding food industry trends and consumer attitudes toward “fresh,” identifying relevant marketing issues and strategies.
    • Farms, farmers’ markets and community-supported agriculture programs (CSAs).
    • The full retail spectrum, from mainstream supermarkets and Whole Foods to Wal-Mart, convenience stores, and e-commerce.
    • Foodservice, from restaurants at all levels to institutional settings like company cafeterias and colleges.
    • Marketing and new product trends among packaged foods marketers, and what the future holds for this booming business.

    Throughout the report, case histories illustrate the many success stories in positioning and marketing foods on the basis of fresh and local appeal. Profiles include New York City’s Greenmarket, Seattle’s Pike Place Market, Safeway, Whole Foods Market, Stew Leonard’s, Costco, Wal-Mart, 7-Eleven, FreshDirect, Bon Appétit Management, Google’s Café 150, Kaiser Permanente Hospital, Yale University, Chiquita Brands International, and Kraft Foods.

    Plus, you’ll benefit from extensive data, presented in easy-to-read and practical charts, tables and graphs.

    How You Will Benefit from this Report
    If your company is already competing in the food market, or is considering making the leap, you will find this report invaluable, as it provides a comprehensive package of information and insight not offered in any other single source. You will gain a thorough understanding of the current market, as well as projected sales and trends through 2012. Contributing to that understanding will be a complete analysis of sales data from IRI and other published and trade sources, a detailed discussion of the consumer for fresh and local foods based on Simmons data.

    This report will help:

    • Marketing Managers identify market opportunities and develop targeted promotion plans.
    • Research and development professionals stay on top of competitor initiatives and explore demand for fresh and local foods.
    • Advertising agencies working with clients in the food industry understand the product buyer to develop messages and images that compel consumers to purchase fresh and local foods.
    • Business development executives understand the dynamics of the market and identify possible partnerships.
    • Information and research center librarians provide market researchers, brand and product managers and other colleagues with the vital information they need to do their jobs more effectively.

    Get full details about this report >

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