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On-the-go produce industry growing by 10% each year
On-the-go produce snacking has become a billion-dollar business, and while some areas of the grocery store have struggled to find growth, that hasn’t been the case for this sub-category of the larger “snackable” fruit and vegetable segment, according to a new Consumer Insights report from The Nielsen Co.
In its report Nielsen said that the on-the-go snacking sub-category — defined as a set of packaged items sold in the produce department for the purpose of snacking — has posted a compound annual growth rate of more than 10% every year between 2012 and 2016.
During that same period 900 new snacking items have been added to grocery shelves, including 600 individual servings of fresh cut fruit, Nielsen noted. Overall, the category now exceeds $1.1 billion in sales, Nielsen said.
Nielsen noted that 32% of U.S. homes purchase on-the-go produce snacks an average of 3.1 times per year.
In terms of category breakdown, fresh fruit is the stand-out winner, according to Nielsen. As part of its Nielsen Perishables Group FreshFacts research for the 52 weeks ended May 27, fresh snacking fruit accounted for 44% of all on-the-go snacking produce dollar share, up 17% from the same period a year ago. Fresh smoothies accounted for 27% (up 0.3%), snacking vegetables for 17% (up 4%), dried fruit/nut snack mixes for 7% (up 8%) and fruit cups for 5% (down 10%), according to the survey.
Nielsen attributed some of the disparity in the percentages to “four times more snacking fruit items on the shelves than their vegetable counterparts.”
So, where should retailers focus to reach consumers?
“For starters, having options and variety is key,” Nielsen said. “Healthful snacking transcends all retail outlets and can serve as a key point of differentiation within the produce department. Second, they should stay tuned in to potential mismatches between snacking and produce consumption trends.”
Nielsen noted that its data show that private label and unbranded options are somewhat underrepresented in the on-the-go snacking space.
“This represents a possible opportunity to produce options in house to build market share and sales,” Nielsen said.
The research firm’s data also indicate that brands are growing at a faster rate in the produce department compared with on-the-go snacking, which suggests room for improvement in branded snacking sales.
“As with every category across the F.M.C.G. landscape, consumers have myriad options to choose from when it comes to snacking,” Nielsen said. “Fresh produce items play a critical role in delivering on this need, but many fruits and vegetables still are not offered as an ‘on-the-go’ snack — a $1.1 billion market that continues to grow. Understanding who, how, where and why shoppers choose different items for snacking can help uncover new opportunities for distribution, innovation and marketing to ensure success on an already crowded shelf.”
Publication date: 8/21/2017
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