Natural Foods Merchandiser

Nimble independent retailers adapt to modern natural products shopper

Americans are interested in food, but they're cooking less. Here, retailers share how they cater to this modern consumer phenomenon while nurturing relationships with their passionate, perceptive and even persnickety shoppers.

Given the flurry of cooking shows on TV today, countless how-to videos circulating online and foodie pics and recipe links dominating social media feeds, it seems paradoxical, but the truth is Americans are increasingly less inclined to cook. In 2014, less than 60 percent of dinners served at home were cooked there, according to market research firm NPD Group.

Perhaps food pundit Michael Pollan conveys this odd-but-true trend best in Cooked (Penguin, 2013):

How is it that at the precise historical moment when Americans were abandoning the kitchen, handing over the preparation of most of our meals to the food industry, we began spending so much of our time thinking about food and watching other people cook it on television? The less cooking we were doing in our own lives, it seemed, the more that food and its vicarious preparation transfixed us.

Here, a handful of natural products retailers share how they cater to this modern consumer phenomenon all the while nurturing relationships with their passionate, perceptive and even persnickety shoppers.

Prep team

Kevin Cotter New Earth Market

Many natural retailers know America's recent diversion from cooking all too well, thanks to strong sales in their prepared foods sections. According to Natural Foods Merchandiser's annual retailer survey, from 2014 to 2015, packaged and prepared foods experienced 6 percent sales growth. This increase slightly outpaced other categories, such as bread and grains, which grew a paltry 2.2 percent. Plus, National Co+op Grocers finds that deli and foodservice continues to command more and more of the total pie, now accounting for roughly 16 percent of members' sales.

Keying in on this trend, New Earth Market already had a robust foodservice section at its Yuba City, California, location. But when co-founder Kevin Cotter was designing his new Chico store, which also has a full-service kitchen, he opted to blow out the size of the prepared foods section. His team designed the salad bar to be accessible from all sides, separated the beverage bar from the deli bar, doubled the area allotted to hot pizza slices, and offered gelato, kombucha on tap, hot food and more unique offerings. "Our model is interesting," Cotter says. "When you walk in the store, produce is to the right, and immediately in front of you is the deli. We put our foodservice front and center."

If you can't go all-out…

For retailers who don't have the space or resources to launch a prepared foods program, Cotter recommends at least adding a salad bar, since New Earth Market garners more sales from its salad bar than any other section in the store—including all of grocery. "You don't need a full kitchen for this," Cotter says. "You're just pulling and chopping. It still takes people to do it, but you don't need a huge prep area." (Don't have room in your store for a prep station of any size? You're not out of luck. Check out page 13 for convenience food options that can buck hunger quickly.) 

Consumers flock to natural groceries for breakfast, lunch and dinner for the convenience factor—but also for the trust and transparency you provide. Whether it's a full-fledged list of banned ingredients, as in New Earth Market's list of 100-plus "no-no's" or San Diego–based Jimbo's … Naturally's strict non-GMO policy, shoppers are increasingly looking to natural retailers to provide convenient meal options that align with their values. They want foods made without preservatives or artificial ingredients, ample special-diet options and sustainably sourced meats, cheeses and produce. By keeping your prepared foods and grab-and-go items congruent with your store's rigid standards, you'll continue to stand out from the competition (and from most restaurants).

Cotter recommends sharing this transparency with your customers by making the foodservice prep station as visible as possible. "One thing we messed up on is we put our kitchen where no one can see it," he says. "I would have put it front and center where everyone can see the show. If you're going to do foodservice, don't be afraid to put it out in front."

Product procurement

Expanding your prepared foods section is a solid way to attract hungry, discerning shoppers to your store. But is that enough to compete with mainstream supermarkets, big-box stores, membership clubs and other larger retailers that, according to the Organic Trade Association, are stocking their shelves with evermore organic produce, dairy and grocery items?

Not quite. Larger stores have the luxury of offering lower price points because they can buy in bulk. And because big-box and conventional stores typically have more shelf space, they can carry a wider array of products. So given these facts, how can natural retailers differentiate from these hefty competitors? Many are smartly spending a considerable amount of time, energy and creativity sourcing specialty, hard-to-find items.

Amy Soergel of Naturally Soergel's

Amy Soergel, founder and manager of Naturally Soergel's in Wexford, Pennsylvania, stocks interesting products that cater to allergen-free and special-diet consumers. She tracks down these unique new items by attending trade shows and combing social media groups organized by highly engaged leaders of food tribes. "I find items that are trending on Facebook and Instagram groups," Soergel says. "I also reach out to our own Facebook group and ask what our followers would like." She says consumers also frequently request items recommended by influential special-diet bloggers.

Soergel admits her prices might be higher than other stores in her region because she is an independent. But she's also nimble, having the freedom to order a small volume of a product to give it a trial period. "I have the opportunity and luxury of ordering items from these smaller and independent companies that Whole Foods Market wouldn't have because they aren't going to buy just a case," Soergel says. "I don't have any reservations about trying a new product. I'm happy to try anything."

Showcasing your goods

Along with tracking down new items and stocking unique products, Soergel also actively promotes her offerings on social media. Her multipronged tactic is clearly working. Soergel recalls a time when she got in a new vegan mozzarella for a trial period, posted about it on Instagram and Facebook, and six customers came in that same day to ask for it.

But the best way to convince consumers to buy a new product, says Soergel, is definitely through sampling—especially since a lot of special-diet foods are made with expensive ingredients such as organic nuts. "Consumers aren't going to pay $9 for a box of crackers or granola if they don't know what it tastes like," she says. Sampling new products moves inventory and gives Naturally Soergel's a solid reputation for always stocking new, innovative products for special-diet shoppers.

In many cases, just as sampling programs are beneficial for retailers, they're also a big boon for smaller, newer natural products brands that don't have the budget for multilayered advertising campaigns. Food companies are typically thrilled to provide a small amount of sample-size products to natural retailers, or if they have the capacity, to send a brand ambassador to conduct in-store demos.

"Being carried and even touted by those small natural retailers is a huge credit to our brand," affirms Kristy Lewis, co-founder and CEO of Quinn Popcorn. "All the mom-and-pop shops we've worked with over the years have incredible integrity and deep roots in their communities. They are often the trusted resource for natural and organic for miles around."

Likewise, sampling helps consumers become familiar with unique products that are just starting to gain traction in the U.S. Nabbing consumers' attention and taste buds in the store, where "they go through the whole experience of discovering our products and taking them home, is the most surefire way of turning them into longer term, loyal customers and brand ambassadors," says Hannah Barnstable, founder and president of Seven Sundays, a muesli brand. "Our retail partners have been some of our biggest champions in getting us in the store to demo product."

Finally, remember that a key part of mastering this mix in today's ultracompetitive environment is flexibility. If one aspect of your store isn't working, improve it. Continue to push the dial on sustainability or authenticity. What sets natural retailers apart from conventional grocers is mindfulness and, above all, showing customers that you care—through every aspect of your business. "We're always learning," Cotter says. "Something that works today might not work tomorrow or the next day. That's a big thing for us—not getting stuck on where to go next."  

How do retailers build authenticity? Read more here...

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