Fuel prices, stratification challenge retailers
When it comes to trends in retail seafood purchasing, 2011 may look a lot like 2008.
On Tuesday at the International Boston Seafood Show, Steve Lutz of the Perishables Group painted a challenging year ahead for seafood retailers in his presentation “Supermarkets 2011: Looking Ahead at Seafood Retail Performance & Consumer Trends.” The Perishables Group conducted the research from a database of 13,000 supermarkets in 48 U.S. markets.
Lutz said although big events like 9/11 and the Iraq War can cause major drops in consumer confidence, the biggest drop since 1985 came in 2008 when gas prices rose up to USD 4 a gallon. With gas prices rising again, seafood retailers face the challenge of selling consumers on the value of a product that they perceive as a secondary, pricey food.
“There’s a limited amount of dollars,” said Lutz. “When gas goes up it takes a greater percentage of those dollars, which forces consumers to be more selective with what they buy.”
And for some consumers, seafood is never on the grocery list. While 89 percent of households bought beef and 84 percent of households bought chicken last year, only 58 percent bought seafood.
“Four out of 10 households never picked up a seafood product from a grocery store in 2010,” said Lutz.
If retailers want to sell more seafood, they need to understand the great amount of stratification in seafood consumers. While affluent, suburban consumers are the biggest seafood spenders — purchasing 43 percent — there are very significant differences when you look at who’s buying what type of species.
For example, consumers picking up tilapia and catfish are more likely to have a lower income and live in an urban environment. On the other hand, people who eat salmon are highly educated, wealthy and live in suburban areas.
The implications are that it’s important for retailers and suppliers to work in partnership to match the product with the right demographics.
“It’s really important to get the right product in the right store at the right price,” said Lutz.