Media fuels consumer messages
Tuesday,27 March,2012 21:29:24
Safeway and Supervalu dropped ground beef with “pink slime” filler ingredient this week after public pressure quickly mounted. Pink slime is the term for a filler ingredient used in some low cost ground beef. The filler is OK per the USDA, but public pressure led these huge U.S. supermarket chains to stop selling ground beef with the filler ingredient. McDonald’s, Wendy’s, and Burger king stopped using pink slime filler in their burgers last year after a similar public backlash. It didn’t hurt that the filler was tagged with the name, pink slime.
There are important learning points from this news for seafood professionals.
The movement towards natural, organic, and chemical free food continues to get stronger. I see no let up in this trend. Some processed foods will remain in U.S. diets for a long time to come, but more and more processed foods will come under media and public scrutiny. Thankfully, most seafood is chemical free. We need to keep our natural seafood natural, and evaluate if we need chemical processing in the products that do have it.
The customer is king. It doesn’t matter how safe or wholesome a product or ingredient is, if public opinion lines up against it, it is dead.
The power of the media and the Internet is massive. Jamie Oliver got the fast food restaurants to drop pink slime added to burgers. ABC’s Dianne Sawyer was the driving force behind the latest media push and public outcry. Mainstream media sources have learned to effectively use social media to amplify their message.
Keep your finger on the pulse, and be nimble. Watch out for such stories from traditional media and social media. The big difference between now and when Chevy stopped making the Corvair due to safety concerns, is that public outcry can become deafening in just a couple of days, when it used to take months or years.
Insights from the show floor
Thursday,15 March,2012 08:35:18
The International Boston Seafood Show is useful for so many reasons. It is a way to connect with current suppliers, find new suppliers, learn from the conference sessions, and of course, discover new items. For me, one of the best experiences of the show is to learn about seafood products, and learn what is happening in the various markets and in the industry in general. I learn just by asking questions from the experts at the booths.
As I walk the show floor, I chat with colleagues and buyers I have known for years. I ask them how the show is going, and have they seen anything new or learned anything special. Most say yes, and they tell their stories of high potential new items, or new suppliers they have discovered. It reminds me of window shoppers at the mall talking about the great deals they found at X or Y store. There are always a few who say no, I have not seen much new this year. I figure these people are coy and don’t want to tell me about the goodies they found, or they are blind. I have walked the seafood show every year for over two decades. I always find useful new products, and insights into the markets. I always learn about new issues, people, and companies that I never knew before. I learn about future trends and direction for the industry, or product categories. There is so much seafood knowledge and talent in one place during the seafood show, and most of these experts are just dying to tell their story. Here is just some of what I learned this year at the show.
Snow crab prices may be coming down a little this year. Alaska had a good year with heavier than expected production of 8oz up clusters, causing heavier inventories of large size crab. With high snow crab prices last year, production of deep water crab species picked up, such as angulatus from the Sea of Ohotsk, and japonicus from the Sea of Japan. The extra supply may help soften the market. One importer said 3 to 5 ounces angulatus can be had for under USD 3 per pound. Canadian supply is expected to be about the same as last year, and Russian export volume available to the U.S. market is expected to go up with the production ramping up in June. Plus the high prices for crab this year, slowed demand significantly. Global farmed Atlantic salmon production will be up 12 percent to 35 percent in 2012, depending on who is projecting. Farmed salmon should remain a bargain and a sales driver. Farmed shrimp production also looks good for 2012 and may foretell of lower shrimp prices.
I learned that gluten free is hot, and getting hotter. U.S. and global sea scallop production is expected to be flat this year. Scallop prices are expected to remain strong as Chinese buyers were active during the show at the booths of the major US and Canadian scallop producers, and touring scallop plants in New Bedford. Swai keeps getting easier to find at the show. Value added seafood now accounts for about 17% of sales at U.S supermarkets. Value added seafood keeps getting easier to find at the show. Chinese exporters and Chinese produced seafood are hard to avoid at the show. More Asian and European producers and exporters were at the show than ever. It seems they are concerned about flat or declining demand from Europe and are looking to sell more seafood into North American and South American markets.
All natural is hot and still getting hotter. Organic would be hot, and getting hotter, if it were legal in the U.S. Sustainability advances and traceability are more expected than requested now. The sustainability related conferences are still the most attended at the show. There are fears that higher fuel prices and increased global demand will keep most wild harvested seafood prices firm or moving up. While the feel is that the economy is improving, there is concern that high gas prices will start to impact consumer spending like it did in 2009. There is quiet concern in Alaska about slower growth rates in wild fish stocks, and not just some stocks but almost all fish stocks. With the exception of king crab, most fisheries seem to be harvesting smaller fish including herring, salmon, cod, pollock, and halibut.
NOAA is proud of the updated Fishwatch.org site. I liked the old one very much, but NOAA should be proud of the new site. It has accurate product photos of most species, and is more user friendly, with less technical jargon. The FishWatch site is packed with great info about the sustainability, or lack thereof, for about 85 U.S. seafood products. It is an excellent source of objective science on U.S. fisheries. What I learned is that NOAA is planning to add 6 farm raised species to the site within two months. Katie Semon, FishWatch Program Manager, also indicated they may be adding portals to other countries web pages about their major seafood products. One of those countries is Canada. Canada DFO has a pretty good site, sustainable-seafood.ca which highlights what Canada is doing about maintaining fisheries and has specific info on some species. DFO is also working on an update to their web site. They will have more species covered including aquaculture species. Both NOAA and DFO reps indicated that other countries they work with are also working on rolling out more user friendly, sustainability based web pages for their top seafood species. As much as I like all of the info available on a site like Monterey Bay Aquarium, government run web sites have more credibility with many seafood buyers and customers. After all, it is government that tracks stocks and manages fisheries and aquaculture policy.
That is just some of what I learned at the show, when some said there is not much new this year.
Looking for the next big thing in Boston
Wednesday,14 March,2012 15:14:31
Day 3, and the final day of the seafood show is always my favorite, and this year did not disappoint. The crowds are a little thinner, so it is easier to get around to more booths. There are not as many corporate heavy hitter buyers around. That means sales people at the booths are more interested in people like me, that don’t have the right color badge, or a black “Key Buyer” badge holder. I spend more time learning about detailed issues around various fisheries and markets, in addition to just looking for new products.
On the show floor, I was on the prowl for new items with sales potential. I was especially keen on unique, or innovative, high quality, high end items, at a decent value. I was also on the lookout for very good quality, value items at great price points that appeal to everyday seafood consumers that earn USD 20,000 to USD 40,000 per year. I got to wear my buyer hat for a day, and think like a supermarket seafood director or a food service category manager. There are several retail and food service buyers I know that could not travel to the show this year. I figure I can score some brownie points with them if I can find a couple of gems at the show to share with them.
Some of the most interesting products I found include Chef Big Shake Tilapia burgers by CBS Foods, value priced tilapia from vertically integrated Chinese producer Gourmet Aquatic, Louis Kemp snack kits with 4-ounce packs and cocktail sauce, sunray venus clams sustainably raised in Florida in recirculating indoor systems from Scientific Associates, all natural seafood pot pies from Maine Fresh, retail box MSC salmon with leek crust and MSC salmon lasagna form a German company named Delimar, unique flavors of all natural marinades and sauces in jars and 2-ounce cups from Cindy’s Kitchen, tasty Treasures of the Sea gluten free retail items from Odyssey, and sweet potato breaded pollock from American Pride. These are some of the better items I found at the show that are new, or I may have missed last year. These items all have good sales potential if the pricing is right, and are matched with the right selling channel. There are more items I found that may not have wide appeal, but may be a perfect fit for select distributors or retailers.
Mining for gems requires spending quality time on the floor at booth of known companies as well as lesser known or new companies. Products or conversations from one booth can spark a new item development request or an innovation discussion with another show exhibitor. The show floor can and does create synergy, creativity, and innovation. Sometimes, the best items are not found at the show, but are born at the show. Gem mining tools include looking at every booth, taking extra time when needed, asking what is new, asking what is working, and what is not, thinking out of the box, and an open mind. Maybe the most important tools are listening, and thinking like end user customers.
Boston: Take 2
Tuesday,13 March,2012 13:21:02
Day 2 of the seafood show was busy as usual. Attending the seafood show is always busy, but trying to experience the show on top of the usual work day phone calls and problems is another level of busy. One good thing is that half of the people that often call me are just as busy running around at the show.
For me, it started before 6:00 a.m. leading tours through the Boston Seafood Display Auction and the Sousa Seafood fresh seafood processing plant. After a breakfast meeting, the highlights of my day were the seafood conferences and meetings with key buyers.
I attended the conference about running killer demos. It provided lots of tips, ideas, and examples of well executed in-store product demonstrations for supermarkets. I will have a separate detailed recap of that seminar.
Another conference I attended was performed by Steve Lutz from the Perishables group. I always learn so much from Steve’s presentations. The Perishables Group does consumer surveys, and analyzes scan data information from all retail food channels across the U.S. In a nut shell, Lutz said the numbers show the economy is getting better, and consumer confidence is growing. He points out that we seem to be seeing a polarization of the U.S. consumer, meaning that there are more affluent shoppers, and more value shoppers, and fewer middle class. He called it bifurcation. That is a new word to me too, but I think we will hear it more often in the future, because that trend could continue to grow. He said retailers can take advantage of that information by tailoring assortment and promotions to high end and value customers. Lutz said the affluent suburban shopper continues to be the best seafood shopper and is twice as likely to buy seafood than other customers. Lutz also says seafood shoppers are the shoppers supermarkets should want the most in their stores. The average shopper nationwide buys about USD 38 worth of groceries per trip, but the average shopper with seafood in their basket buys USD 76 worth of goods. That is higher than any other department in the store.
I heard more feedback on new items from supermarket executives. I heard good feedback or outright interest in carrying L’Essence shrimp scones, from Dish Hospitality. Simple Salmon’s smoked salmon bacon is very tasty said a west coast retailer’s seafood director. One retailer said they loved the flavor of the shrimp burgers from Chef Big Shake, but another told the packaging look out of date and cheap. A retailer told me the worst new item was the tuna cabbage roll form PT Toba. It did not look like an item for the American consumer to me either. Another retailer liked the Maristellas shrimp gumbo pot pie. I went by the boot to get a taste. I really liked the small samples they made. Instead of cutting up the 10-ounce pot pies for samples, they made mini versions of the pot pies in 2-ounce aluminum cups. Those could be a nice holiday appetizer item on their own. Overall, there are a lot of new prepared seafood items made with salmon, tilapia, and swai. New Swai items may be the most abundant. Finding the right ones is the key.
On Tuesday, I will be on the show floor most of day looking for new products, interesting concepts, talking to the experts, and looking for sales driving items. I like Tuesday, because the crowds are smaller, I have fewer meetings, and can take more time at the booths of interest.
Killer demos and merchandising
Tuesday,13 March,2012 10:10:53
About 50 attendees enjoyed a lively and well delivered conference titled Killer Demos and Merchandising Magic. Chef Rick Tarantino says growing seafood sales starts by knowing your customer. He offered the following tidbits about today’s seafood customers. He quoted a variety of sources and lots of data. Seventy-one percent of retail customers are looking to buy more private label products. Consumers are less brand loyal and 26 percent are looking for more organic food choices. Seventy percent avoid buying brands they don’t like, and 61 percent are annoyed if the product label does not say who is the owner of the brand. Rick says 56 percent of customers research the brand owner over the Internet. So brand is less important than ever, but customers want private label brand owners to be responsible and respectable. That is why he says it is critical to be honest with customers. “It’s all-about education and honesty.”
Chef Risk says customers will pay more for sustainable seafood. He likes Boston restaurant Taranta that uses QR codes on the menu so customers can look up the traceability of the seafood ingredients right from the table.
Rick quotes surveys that indicate many customers think seafood is expensive whether it is or not. The issue he says is a lack of knowledge and that high prices of many seafood products are slowing consumption.
Warren Thayer of Frozen and Dairy Buyer Magazine along with Chef Rick offered their solutions to overcome customer concerns and lower seafood consumption. No. 1 is that education is key. Educating demonstrators, seafood managers, and in store chefs is essential they said. The presenters explained that demonstrative selling means showing how to handle, how to cook the product, and allowing the customer to taste the product. It is not just handing out samples.
I love this next tip from Warren. Execute promotions well ahead of the holiday. It is too late to perform demonstrations the day before or even the week of a holiday event such as Passover, Christmas, etc. Plan and run promotions 3 to 4 weeks ahead of the event. This lets customers know you are the place for the seafood. It encourages customers to plan their events. The suggestion of preparing seafood at home to support a holiday or event will increase consumption, they argue. I think that tactic takes the wind out of your competitors’ sales. If the customer has already bought the product frozen or planned the event through you, the competition's last minute efforts are fruitless. Warren also recommends testing recipes and promotions months ahead of the holiday or event. This gives the retailer the chance to test the recipes and the promotion with real customers.
They suggest that offering more than just a product demonstration is key to successful promotions. Encourage purchases with demos that include special prices or value added offerings, which might be free lemons or a discounted spice or sauce.
Staff training is key in seafood says Rick Tarantino. Train seafood staff to engage and educate customers. Demonstrators need to come out from behind the table or out from behind the case. Getting “in the face” of the customer makes it personal. It also makes it harder for the customer to say no, says Rick. “Get the barrier out of the way. Train demonstrators to be little ambassadors."
Chef Rick says merchandising is passive interaction. Using passive merchandising and active demonstrations is a “call to action” for the customer.
Good demonstrations should show how easy the recipe is to prepare. Be simple, using 5 ingredients or less. Recipes should usually be 30-minute preparation time or less. Always offer samples to taste. Set up displays of condiments, sauces, wines, rice, pasta, and recipes as part of the promotion.
For foodservice, the presenters said that wait staff has to be able to tell why a menu choice is special. Can they tell the story? Such as where is it from, and how it is prepared. If a chef or waiter brings out a sample of the special of the day, it will generate purchases at least 50 percent of the time.
Chef Rick pointed to Wegmans as a good example of a retailer that does product demonstrations right. They also offered a Sweet Bay markets promotion as an example of doing it right. Rick suggests combining coupon offers with the demo as Sweetbay does. He added, if the average seafood sale is USD 13, make a coupon offer for USD 5 off a USD 25 purchase to drive higher sales per customer.
Other suggestions were to make point of sales sign that communicate more than item and price. Customers want to see cost per serving, health benefits, product attributes and flavor profiles. Free cooking classes will drive weekend sales when executed on a Wednesday or Thursday, Rick said. Think about offering a “Try it guarantee.” If the customer doesn’t like it when they make it at home, give them a product replacement coupon.
The highlight of the conference was an example of an actual integrated promotional event they helped execute with a retail supermarket. Warren and Rick said this event created lines of customers 3 isles long and over 500 customers. The event promoted shellfish, shrimp, and crab products. The key was contracting a personal appearance from two Deadliest Catch crab boat captains. It is expensive, but they say it had a positive ROI, not to mention huge PR and residual sales benefits. They had Sig Hansen and Andy Hillstrand in store for autographs and photos. The event was promoted well ahead of time online. The event in store included whole cooked king crabs for excitement and wow factor. The event also included a cocktail event the night before for local dignitaries that generated donations for a local charity. The free publicity from the pre event helped make the event a success. The event included a recipe contest for customers that generated over 1,000 online entries.
Warren said is critical to be honest with customers. It’s all about education and honesty. I couldn’t agree more with that statement. I think the attendees came away with many useful, easy to execute ideas to execute killer demonstrations.
Buyers looking for value in Boston
Monday,12 March,2012 08:59:05
The vibe of this year’s International Boston Seafood Show is positive. Last year, we were still in the throws of recession. Sales were flat or down for many in the retail and foodservice seafood sectors. Last year, the show started just after the Japan earthquake and tsunami. No one knew what the impact would be. Most commodity seafood prices were higher and the mood and atmosphere did not feel positive.
This year feels different. I walked a good portion of the show on Sunday, but I wasn’t looking too hard at products yet. I talked with retail buyers, distributors, and foodservice buyers. What I heard was positive. The buyers are encouraged by good sales over the last year, and especially strong sales in recent months. The feedback is that the economy is getting better, which is helping seafood sales. I heard about positive sales increases over last year of 5 percent, 10 percent, and more. The reasons given for the good sales range from better operations, more training of front line staff, and more fresh wild species available all winter due to the mild weather. Foodservice has been having a field day with lobster products due to another excellent year of harvests, as well as good availability this winter of live product. Farm raised shrimp sales have been strong. The biggest positive is lower farmed salmon prices. With Chile back on line, farmed salmon prices have come down to earth and that is driving a lot of sales in retail and foodservice, along with a more optimistic atmosphere at the show.
Not everyone is bragging about higher sales. I did hear about the challenge of sourcing affordable crab and scallop products because there aren’t many. The companies that produce and sell crab and scallops products are diversifying quickly. I saw these companies pushing more fish products, and other species. I also saw more value added, ready to cook, and ready to eat products from these producers. It seems like everyone is coming out with new value added items. Manufacturers are looking to increase sales with these items, but also trying to increase margins and develop signature items that are not commodity based. Retail buyers were talking about success with these products too. I did not hear about “home run” value added items, but several good “singles or doubles” that are helping to drive sales.
What are buyers looking for? Buyers seem to be looking for compelling new items, especially value added items. The new products showcase was a very popular area on Sunday. I heard positive comments about the Limoncello smoked salmon from Wild Waters. Kings Seafood Director, Tony Ruccio, was one of the new product panel judges and said it was delicious and unique. That product won best new retail item. I overheard “oohs” and “ahs” over the Handy oysters on the half shell.
The L’essesnce shrimp scones were turning heads, and I liked the look of the Marstellas shrimp gumbo pot pie. American Pride’s crunchy sweet potato pollock looked like a unique product for the value conscious customer.
Buyers are looking for sustainable, traceable products. This means buyers are chasing the same products and the same origins. Buyers are looking to secure supply and are willing to build long term partnerships to guarantee supply of their key products. The other thing I hear from buyers is the need for unique, signature upscale items for affluent customers. I also heard buyers are searching for good value, good quality products for what seems like an ever growing value conscious customer.
That what I heard buyers are looking for during Day 1 at the show. I will spend much of the next two days to see if the exhibitors are listening, and providing the solutions that buyers are searching for.
It’s show time
Sunday,11 March,2012 08:47:51
The International Boston Seafood Show is here. The Westin bar and lobby area was abuzz with activity on Saturday with a who’s who in the seafood industry meeting, chatting and dealing.
The big news thus far is the Phillips Foods announcement to partner with Sustainable Fisheries Partnership (SFP). Phillips is donating USD 0.03 per pound of all finfish sales towards Fishery Improvement Projects. I like the strategy. Phillips wants to grow their business beyond their core crabmeat products. The USD 0.03 per pound donation gives retailers one more reason to try Phillips fish products. I think retailers could get good PR mileage by matching the USD 0.03 pound donation. Phillips has been a leader in stewardship initiates already by helping found the NFI Crab Council which works to make southeast Asian crab fisheries better managed and more sustainable. Phillips is writing the template for how processors can and should be involved in Seafood sustainability. Hats off to the Phillips Foods.
I will be attending several conferences and writing blogs of what happens at the sessions. I love to attend IBSS conferences. I learn a great deal about a wide variety of subjects. I also learn about the speakers. I hope to write about the content of the conferences, but also hopefully provide a little feel for the speakers as well. I plan to attend the Retailers Guide to Sustainability. I may try to sit in on a little of the seafood summit about menu trends too. Aquaculture 101 looks interesting, and so does Brand Presentations that Matter.
Kudos to IBSS for making the cost of the conferences reasonable. A silver passport was USD 150 for early registration, and USD 250 at the door. The silver passport allows attendance to 4 conferences. It is possible, but difficult to attend more than 4 conferences during the show, and still get through the show floor. I still wish the conferences were even more affordable. Some conferences are pretty well attended, but every year I will attend a conference or two and think, wow, so many people could learn so much from this presentation, and I wish there were more attendees here to benefit. I will work my way through the new item showcase too.
See you at the show!