Job Offers

Specials more

Top 5 -yesterday

Top 5 -last week

Top 5 -last month

"It's a really tough environment when the single largest barrier to purchase is that people find the product too expensive"

The importance of providing value to consumers and increasing demand for Australian berries

With price points a significant barrier to berry sales, the industry has a huge opportunity for growth by looking at the value of the product and the sector to better appeal to consumers.

Hort Innovation's Consumer Insights Manager, George Margin explains that people are shopping less frequently than they were a few years ago, and while consumers see berries as a healthy and refreshing product, they also find the retail prices too high. He says it is important for the industry to continue to appeal to consumers but still make a profit.

"It's a really tough environment when the single largest barrier to purchase is that people find the product too expensive," he said. "We see that households appear to be price sensitive; when we see prices higher than what they were a year ago, we see that sales are lower. But we have been doing work with Fiftyfive5, where we are tracking consumer attitudes over time. Generally (across all fruit categories), consumers believe the products they purchased were worth what they paid - this is just due to the generally positive attitudes associated with fresh produce, as they know it's healthy and good for them. What is raising red flags is that berries are ranked the lowest among the top fruit commodities; with only 71 per cent thought berries were worth what they paid."

It comes as production-wise; berries have been doing a "fantastic job", with value and volume increasing significantly - although there has been a slight plateau in recent seasons. In the latest year, berry volume has declined by 7.5 per cent, driven by the two biggest commodities: strawberries and blueberries. Over the past three years, berries have performed slightly better than the entire fruit category overall in terms of value and volumes - but sales are pretty similar to where they were two years ago.

He added that the Australian berry category has lost around 50 million dollars in retail value in the past two years, and around five million kilograms (5kilotonnes).

"Berries as a whole has declined by five per cent," Mr Margin said. "Where that decline is coming from is seven per cent in volume, but we are actually seeing average retail prices increase. This is a consistent story that we are seeing across all berry varieties. We are seeing prices increase, and volumes decrease. What we can see is the decline is coming from frequency, so people are shopping for berries less frequently. When we look across the different varieties, the berry varieties that are driving it are blueberries and strawberries, and people are shopping less for them; strawberries are declining by 5.8 per cent and blueberries are declining by 13.5 per cent. There appear to be unique challenges with blueberries."

So, while price and quality are the two barriers, Mr Margin explains that giving consumers more value does not simply mean lower prices.

"Value can come in many different forms," he said. "It can come through better quality and consistency, it can come through product innovation or improved Environmental Social Governance (ESG) credentials. I was happy to see the Eureka (blueberry) brand donate five cents to charity with every box sold. We need to understand as an industry how we are going to deliver value to the consumer. We also need to understand consumer price elasticity, in other words how consumers are reacting to different prices, not only at different points of the season but also across the different varieties. So, if strawberry prices increase what happens to blueberry sales and so on? We need to understand pack sizes and what quality means to consumers."

Publication date:

Receive the daily newsletter in your email for free | Click here

Other news in this sector:

Sign up for our daily Newsletter and stay up to date with all the latest news!

Subscribe I am already a subscriber