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The Year of the Grocery Underdog

By Rick Stein, Vice President, Fresh Foods, Food Marketing Institute

Percent of Sales Each holiday Represents of Total Holiday SalesCNN recently reported that 2016 was the year of the underdog in sports – baseball, English football, golf, and certainly the Olympics. While there are multiple allusions to sports we make in business, I’m reminded that you don’t always have to be a category captain; the unsung underdog can actually help drive sales, especially during the holidays.

In my world of fresh foods in food retail, there exist predictable seasonal merchandising strategies, specifically across the leading volume areas for meat, produce and seafood. However, there’s a sleeper category that has the potential to signal business growth opportunities in the fresh department over the next three to five years: Floral. In 2015, floriculture item sales at all retail outlets in the U.S. totaled $31.3 billion in 2015, according to the U.S. Bureau of Economic Analysis Personal Consumption Expenditures (2016), and a new study FMI commissioned with the Produce Marketing Association suggests even more differentiation strategies to make this underdog category the Rudy Ruettiger of your perimeter.

When grocery shoppers think ‘fresh,’ they consider all the tastes and aromas associated with the meal they’re ultimately shopping for as well as the experience they’re hoping to create in their homes. I’m confident our research can help companies set the tone for the shopping trip and grow their businesses across the entire mass-market floral supply chain.

My colleague Andrew Harig recently wrote a blog on the deflationary environment and he noted that this is the first time supermarkets have experienced deflation during an economic recovery, which means shoppers have more money to spend – they just haven’t decided where and on what. Food retailers can meet customers in the aisles and inspire impulse sales for floral, which were slightly over 40 percent of total sales, or enhance shoppers’ need for hearth and home during the holiday where holiday sales in 2015 were just over 30 percent. Nearly 70 percent of buyers indicate that holiday sales will be their priority over the next year.

With 89 percent of supermarket shoppers expressing satisfaction with the floral items they purchased in their store, according to Retail Feedback Group, supermarkets are primed to get floral category executives off the bench and into the game.

For a comprehensive snapshot of the U.S. mass-market floral retail business, visit www.fmi.org/FreshFoods