Natural Foods Merchandiser

Taking a SKUd view of reality

With the sheer number of natural products available today, it might seem there?s no room for innovation. But as the naturals market matures, products that might once have seemed bizarre now seem obvious instead. For example, as more mainstream consumers begin to look for natural alternatives, the demand for natural meat products—once anathema to the industry—has soared.

The market also responds, for better or worse, to trends such as the low-carb craze.

As consumers become more health-conscious and better educated, demand increases for products catering to special dietary needs, including vegan and gluten-free.

And shoppers now expect the same convenience and ease of preparation in natural foods that they receive from mainstream counterparts.

All these factors have driven a huge increase in new SKUs. ?With all the new products being introduced, it?s hard to imagine that there are categories that aren?t being addressed,? says Bob Burke, principal of Natural Products Consulting in Andover, Mass. ?But manufacturers are always looking.?

Retailers, on the front lines of commerce, are often the first to notice when something is missing from the product lineup. Heather O?Dell is the owner of Fruitful Seasons Natural Foods in Pulaski, Va., a store specializing in dairy-free and gluten-free natural offerings. ?The last two years, it?s become extremely easy to find gluten-free foods,? O?Dell says. There are scores of baking mixes and prepared foods available. ?But I wish I could find premade frozen cakes and cupcakes that are gluten-free. I have people ask me for something like that all the time.?

There are other categories still growing—often with input from retailers. ?Each year I poll buyers, retailers, distributors and others, and ask them what?s missing,? says Burke. ?The last time I did this, for the [Natural Products] Expo East show, a couple of the things requested were more seafood products and more ethnic food.?

One company listening to both retailers and consumers is Fairfield Farm Kitchen in Brockton, Mass. Both its Moosewood line and Fairfield Organics Classics line have been shaped by input from these groups, says President and Chief Executive Officer Frank Carpenito.

?When we first introduced our Moosewood entrees, they were all pasta-based and pretty domestic in nature,? Carpenito says. ?Consumers said, ?We love these products, but in the future we?d like to see some nonpasta offerings as well as ethnic offerings.? When we launched the next section of the line, we included a Moroccan stew with strictly vegetable components.? Input from retailers also has been invaluable in shaping new product offerings. When the company launched its Organic Classics chicken entrees, Whole Foods suggested introducing some organic beef entrees as well. ?We had extensive input and dialogue,? Carpenito says. ?This summer we launched four organic beef entrees, two with pasta and two without.?

One suggestion retailers have for new product possibilities is to integrate the world of gourmet foods, which overlaps more and more with natural foods. ?A lot of gourmet products are natural, but not marketed that way,? says Marc Friedland, president of Tally?s Green Grocery in Charlotte, N.C. ?With just a little change in the ingredients, they could be great natural products.?

Products from the world of direct marketing present another opportunity for manufacturers, according to Matt Murray, store manager of Green Acres in Wichita, Kan. ?Often there?s a huge demand for these products before anyone has them out in a retail version,? Murray says. ?Years ago, it was noni juice. In the last year it?s been xango, a kind of mangosteen and gogi juice.? These fruit-derived functional foods, touted for their antioxidant and anti-aging benefits, have created a consumer buzz but aren?t yet represented at the retail level.

Of course, there are reasons why consumers buy food, retailers sell food and manufacturers make food. Retailers have little to lose in stocking trendy products, but manufacturers must be careful that the products they formulate will last for the long haul.

Annie Christopher, president and namesake of Annie?s Naturals, based in North Calais, Vt., says, ?We don?t respond to fads. However, because our products do meet the special dietary needs of some consumers, we have a loyal following of consumers who call with suggestions?particularly those on a gluten-free diet.? Annie?s does take consumer demand into account when formulating new products. For example, the company received an overwhelmingly positive response to a vinegar-free dressing. ?Since then, I have developed other vinegar-free dressings,? Christopher says.

Manufacturers ?may float ideas by retailers: ?We?re thinking of doing this, what do you think???
Because retailer support can be key in successfully launching new products, manufacturers also involve retailers in more subtle ways. ?They may float ideas by retailers: ?We?re thinking of doing this, what do you think??? Burke says. ?Retailers may be invited to company headquarters to talk about new product ideas or marketing programs before a product launch. There?s a dual benefit to this approach—great input from retailers and advanced buy-in on the idea, so the buyer has some sense of ownership and is supportive when it comes to fruition.?

Now that both retailers and distributors are involved in private labeling, they have the ability to create their own offerings. Retailers Whole Foods and Wild Oats and distributors UNFI and Tree of Life have all created private label brands. ?Having extensive private label programs allows these companies to fill a lot of the underserved categories,? Burke says.

Finally, many companies have multiple methods of gathering consumer and retailer opinion and ideas—through 800 numbers and Web comments, for example. Both Fairfield Farm Kitchens and Annie?s Naturals respond to every comment. ?When we see a repetitive recommendation for a product, we put it into our development mix and try to incorporate consumer comments,? says Fairfield Farm Kitchens? Carpenito.

So, if your store has a nagging hole on the shelf where you think there should be an organic this or gluten-free that, pick up the phone and call a manufacturer. You just might get what you ask for.

Mitchell Clute ([email protected]) is a writer, poet and musician in Crestone, Colo.

Natural Foods Merchandiser volume XXVI/number 4/p. 20, 24

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