How grocers are drawing millennials, Gen Z to fresh seafood
When Hannaford, a large United States supermarket chain, recently opened its “learning lab” store in Bedford, New Hampshire, it sought the answer to a very specific question: how to sell more food to younger shoppers.
Millennials, defined as Americans between the ages of 20 and 36, are the largest demographic group in the United States, with a population estimated at 75.4 million (for comparison, there are an estimated 74.9 million Baby Boomers in the U.S.). Adding to the youth movement in U.S. consumption patterns is Gen Z (generally defined as Americans between the ages of 7 to 24 years old), which numbers over 65 million people.
Together, millennials and Gen Z-ers have enormous purchasing power, and – as Hannaford has discovered – strong preferences when it comes to buying food. The newest addition to the Scarborough, Maine-based chain of 189 stores is decidedly high-tech – just like millennials and Gen Z shoppers (the latter group was practically born using smartphones and tablets). Computers, touch screens and tablets are available to employees so they can quickly show customers a video about how to prepare bourbon- and maple-glazed salmon at home, for instance, or answer a challenging question on seafood sustainability.
Due in part to growing competition from meal-kit delivery services, online grocers and others, Hannaford’s Bedford store places a signficant emphasis on its perishable departments – and staff interaction with shoppers. For example, at an island in the middle of the produce department, staff slice fruit and vegetables to order and answer customers’ questions about produce.
The fresh meat and seafood department also plays a greater role in this new store. It was moved closer to the front of the store, situated directly behind the fresh produce department. And, behind the fresh seafood counter, the retailer is featuring more local seafood, along with a wider variety of prepared seafood dishes. In addition, Hannaford executives said they recognize that sustainable and local and regional products are very important to millennial and Gen Z shoppers.
“Both of these generations are very concerned about where their food comes from,” Phil Lempert, a supermarket analyst and editor of SupermarketGuru.com, said. “The key to getting these consumers to buy and consume seafood is to really deliver that kind of information in a consistent, truthful way.”
Hannaford isn’t the only grocery store chain revamping its store layout and processes to attract the younger generations. Sunset Foods, a Highland Park, Illinois-based grocery chain, has refurbished its fresh seafood counters to look like traditional fish markets. Each store offers 25 different fresh seafood items daily (excluding prepared foods), steams shrimp for customers and makes prepared seafood items in-house. When shoppers ask about a new type of seafood they ate at a restaurant, seafood staff offer to order it for them.
Sunset Foods seeks to differentiate its seafood departments from competitors such as Whole Foods Market and Kroger by offering “a higher quality product and more knowledgeable staff behind the product,” according to Dan Humphrey, meat and seafood director for the Sunset Foods.
Younger customers ask more questions about their food and appreciate being communicated with, both through person-to-person interactions inside stores and via social media, Humphrey said. Sunset Foods spends a lot of time and money on staff education, preparing staffers to answer shoppers’ questions on where its fish was caught or raised, how to prepare it, and any other seafood-related query that might come their way.
According to Lempert, Whole Foods also does well with social media, touting not just sales, but also sharing recipes and announcing new products as they come into stores. And Hy-Vee, based in West Des Moines, Iowa, has a registered dietitian in every store who communicates with shoppers about the health benefits of eating seafood via in-store conversations, print materials and social media.
Being responsive to millennials questions and concerns is another way Sunset Foods tries to stay ahead of the competition, according to Humphrey. Following up on customer feedback, the chain sources only sustainable seafood and pledges not to sell farmed seafood from China. The chain has also made a preemptive pledge not to sell GMO salmon if and when it becomes available commercially, Humphrey said.
“Millennials are very information-conscious and ask questions such as, ‘Is your salmon non-GMO?’ and ‘Is your shrimp organic?'” Humphrey said. “A lot of our customers are 55 and older, but we realize millennials are also going to be a big group. Besides convenience and prepared meals, they want to know how everything was raised. We go and visit these places and we are knowledgeable about the things we sell.”
Boosting shoppers’ ease with cooking seafood
Hannaford and Sunset are just two of several U.S. grocers making changes to their fresh seafood department to appeal to all shoppers. Losing market share to online grocers from Amazon to Peapod, meal delivery services, and home meal-kit providers such as Blue Apron, executives at many supermarket chains are coming to the conclusion that one of the best ways to compete is by offering the best fresh meat, seafood, produce and dairy. They also aim to present their perishable departments in a way that appeals to the Millennial Generation, which has incredible buying power.
In addition to sustainable and local food-buying preferences, both millennials and Gen Z enjoy cooking at home more than other groups. In fact, millennials are twice as likely as Baby Boomers (49 percent versus 24 percent) to say they plan to cook more dinners at home in 2017, according to a recent survey from online grocer Peapod and ORC International. The same survey found that, while 72 percent of Americans prepared four or more dinners at home per week last year, 34 percent plan to cook at home even more often in the new year.
“Millennials and Generation Z really like cooking and like to be in the kitchen,” Lempert said. “Seafood is one of the most healthful, versatile and easy-to-prepare protein sources. For us to have hundreds of millions of people scared to cook it at home is a shame.”
To help millennials who want to learn to cook seafood at home, retailers may need to simply show them a picture of a seafood dish, rather than a “Betty Crocker recipe,” Lempert said. For example, during demos in a grocery store’s fresh seafood department, Baby Boomers and seniors might want to talk to the demo staff for awhile and pick up the recipe, while millennials and Gen Z will walk by the station – possibly not even stopping long enough to eat a sample – see the composed dish it and get a idea about how they will re-create it home, according to Lempert.
To help millennials and Gen Z with their desire to cook more at home, Hy-Vee added a permanent cooking and sampling station, complete with a wok, between the meat and seafood departments in some stores.
“What’s brilliant is the location: they can see how easy it [seafood] is to prepare and have a taste of it,” Lempert said. “Once they see how easy it is, it will get them motivated to buy it.”
Dinners-in-a-bag, which combine a protein, starches and vegetables in an oven-safe wrapping or container, is another innovative concept that both Cincinnati, Ohio-based Kroger (which operates 2,778 stores) and Lakeland, Florida-based Publix Super Markets are utilizing to show young shoppers how easy and fast seafood is to cook at home.
“Consumers don’t really understand and are nervous about cooking seafood at home. Giving the free bag to people to bake the seafood in their oven so it comes out foolproof – we need more tools like that,” Lempert said.
The 1,136-store Publix chain has seen great success with its “Fresh Seafood Cook-in-Bag Dinners” since launching them in the summer of 2015. Flyers in each store’s fresh seafood department invite shoppers to first choose a fresh fish or shellfish item, and then select the ingredients and seasonings they would like to accompany their fish. Flavors include Caribbean mango sauce with orzo, spinach and bell peppers; Mediterranean sauce with pearl couscous, Kalamata olives and feta cheese; Dijon cream sauce with quinoa blend, spinach, sundried tomatoes, artichokes and bell peppers; and sweet chili sauce with rice and Asian vegetable medley.
Seafood staff assembles the ingredients into a special cooking bag. Then, “All you do is pop it in the oven when you get home, following the time and temperature guide provided with each meal,” according to the Publix flyer.
“We anticipate this becoming a significant category for our seafood department,” said Maria Brous, spokesperson for Publix.
Prepared seafood sales rise
Despite millennials and Gen Zs’ desire to cook more at home, grocers and consultants say that sales of prepared seafood meals are booming.
“Prepared seafood meals are a solution for Generation X, Baby Boomers and seniors,” Lempert said.
For example, Sunset offers three different types of stuffed tilapia, teriyaki-marinated fish, house-made ceviches, fish burgers and hot soups, among other prepared items in its seafood departments. Its deli departments also promote a variety of dishes such as grilled salmon and tilapia, along with seafood salads.
“We have expanded on things that we offer that are breaded, marinated and prepared. In addiiton, the biggest increase in seafood sales are items in the deli that are cooked already,” Humphrey said.
Steven Johnson, grocerant guru at Tacoma, Washington-based consultant Foodservice Solutions, has noticed more prepared seafood dishes – both packaged and in hot bars – at many U.S. retailers. Whole Foods Market has featured several prepared dishes in its hot bar for years, along with sushi, seafood salads and other cold items. And Seattle-based Metropolitan Market, a six-store chain, has carried items such as tilapia piccata with garlic caper aioli, shrimp mango poke salad and “rub with love” plank salmon on its hot bar and other areas of its stores.
This year, Johnson expects to see more prepared meals that are higher in protein and lower in fat than in the past, such as seafood bundled with vegetables, as well as increased offerings of poke, the Hawaiian-themed seafood dish that’s rapidly gaining popularity nationwide. To appeal to millennials who enjoy ethnic flavors, stores also need to offer more options in ready-to-eat seafood meals that reflect Vietnamese, Korean, Philippines and Spanish flavors, Johnson said.
While some bricks-and-mortar grocery stores still haven’t come up with a comprehensive strategy for remaining relevant in an increasingly competitive industry, innovative chains are embracing change and pushing their competitive advantages gained through decades of experience in the sector. For companies leading the way, including Hannaford, Sunset Foods and Publix, the way forward involves better integration of technology, improved effort at communication and a doubling down on freshness and convenience.
“If Amazon wants to come into this space, there’s no way they should be able to handle freshness the way we handle freshness,” Hannaford President Mike Vail said. “We’re excited about innovation, and a focus on the future.”