As any meat manager, fishmonger or store director can tell you, finding ways to make seafood a key seller in your store is never easy. With myriad forms, tastes and styles, piecing together a winning strategy can be as elusive and catching the “big one.”
However, through 2020 and now in 2021, clear patterns have emerged and continue to grow, which bring new strategies in seafood, which can truly grow your sales and customer base.
Why focus on seafood sales and growth?
Seafood is a $12.5 billion category that can serve a unique role of impacting consumers’ perception of quality throughout your store. While not as large as meat or produce, the seafood department is growing at a faster pace (+4%) and attracts a lucrative and affluent customer base.
Growth in seafood sales prior to COVID-19 (4.0%) had exceeded that of produce (2.6%), meat (1.9%) and deli (2.0%) and had been comparable to foodservice (4.4%). However, there is significant potential for AWG retailers to continue to grow the seafood market.
- Fresh (44%) and frozen (39%) seafood account for more than 80 percent of the seafood revenue for food retailers. Both of these segments of the seafood market have been experiencing solid growth in revenue and units sold over the past 24 months.
- Seafood revenue, when taking into account fresh, frozen and grocery, increased almost five percent (4.6%) for the 12 months ending September 7, 2019, but the unit change increase was slightly less at only 1.7% as a result of unit price increases.
- When fresh seafood was part of the basket, the average amount spent by the shopper is $98. This was almost three times the average basket size for groceries ($34.91) based on FMI’s The Food Retail Industry Speaks 2019 report.
THE COVID IMPACT
- Recent COVID related growth (March 2020-current) has shown that frozen processed/packaged seafood increases are in the range of 35 percent over the previous year and are projected to continue that pattern into 2021.
- Regularly performing seafood category leaders (shrimp, salmon, tuna) benefitted and grew the most during COVID, with frozen shrimp and frozen salmon increasing 50-70 percent over pre-COVID same store sales periods.
- Additionally, all types of seafood are experiencing tremendous growth as well with consumers, as witnessed by their shopping patterns in fresh and frozen in terms of frequency.
- Consumers actually miss and craved seafood second most of all types of food during the COVID shutdowns, thus giving retailers the opportunity to increase offerings and sales potential, as well as retain more seafood sales long term by becoming a destination for the category.
Where do they shop?
- Retailers are in a powerful position to address their consumer’s desires for seafood. Over 80 percent of seafood is “sometimes or often” purchased at grocery stores. Simply put, you’re their preferred destination for seafood buying, so you need to be able to accommodate that desire.
- Additional surveys indicate that supermarkets are overwhelmingly the preferred destination, with price, quality, freshness, variety, and service the leading factors in their choice.
Who is regularly shopping for seafood?
Seafood consumers (defined as those who eat seafood at least once a month) represent 57 percent of the shopping public and represent valuable demographic segments of shoppers. Some specifics include:
- Higher household income. Average household income among seafood consumers is $65,500, with frequent seafood consumers having an even higher average household income ($67,300). In contrast, non-seafood consumers report an average household income of only $52,000. IRI’s Shopper Loyalty data supports these findings as households with incomes of $100,000 or higher index at 114 or higher for seafood purchases.
- More formal education. One-half of seafood consumers (50%) have a college degree, while only 35% of non-seafood consumers have a college degree. IRI data also supports this finding as college graduates index at 106 and those with a graduate degree index at 112 for seafood purchases.
- Male leaning. Males (61%) are more likely to be seafood consumers than are females (54%). Males (28%) are also more likely to frequent seafood consumers than are females (23%).
- Gen Z lags behind. A majority of Baby Boomers (60%), Gen X (56%) and millennials (58%) are seafood consumers, while only 47 percent of Gen Z are seafood consumers. IRI data has Baby Boomers indexing at 107 and Gen X indexing at 103, while millennials and Gen Z index in the low 90s (92 and 93, respectively) for seafood purchases.
- Minorities. Seafood consumers (35%), particularly frequent seafood consumers (41%), are more likely to be minorities than are non-seafood consumers (27%).
- Occasional seafood consumers impacted by price. Those who are occasional seafood consumers are more likely than frequent seafood consumers to rank total price (52% vs. 39%) or price per pound (41%vs. 36%) among their top three most important factors when shopping for seafood. In contrast, frequent seafood consumers are more likely than occasional seafood consumers to rank nutritional benefits (25%vs. 20%) or sustainability (26% vs. 20%) among their top three factors when purchasing seafood.
- Difference across the generations were minimal. The younger generations, millennials and particularly Gen Z, are more likely than seafood consumers in general to rank nutritional benefits (31% Gen Z, 25% millennials vs. 22%) or preparation time or ease (26%, 21% vs. 18%) among their top three factors when shopping for seafood.
- Quality and nutrition valued by affluent shoppers. Seafood consumers with household incomes of $100,000 or more are more likely than less affluent seafood shoppers to include product quality (75% vs. 69%) and nutritional benefits (27% vs. 21%) in their top three factors, while being less likely to rank total price (35% vs. 49%) in their top three factors when shopping for seafood.
- Quality and nutrition also valued by big spenders. Like the more affluent shoppers, those seafood consumers who spend more than $125 per week on groceries are more likely than lower spenders to rank product quality (76% vs. 66%) and nutritional benefits (25% vs. 20%) in their top three factors, while lower spenders are more likely to rank total price (49% vs. 44%) or price per pound (41% vs. 35%) in their top three factors when shopping for seafood.
- Online grocery shoppers not price driven. Those who do not shop online for groceries are more likely than those who do shop online for groceries to focus on price factors such as total price (52% vs. 41%) or price per pound (42% vs. 35%). Meanwhile, those who shop online are more likely to rank nutritional benefits (26% vs. 18%) or sustainability (26% vs. 20%) among their top three factors when purchasing seafood
What are they shopping for?
For current seafood consumers, price, product and information are key to increasing seafood consumption. Seafood consumers are not necessarily looking for the lowest price but the best value. Thus, better quality and more variety of product have an impact, particularly for the valuable frequent seafood consumers. Seafood consumers are also seekers of information from recipes and ways to prepare seafood to nutritional benefits and sustainability information.
- Shrimp, salmon and tuna generate the most in food retail revenue and units/pounds sold. This big three account for more than 60 percent of total seafood revenue.
- Other types of most popularly consumed seafood includes cod, swai, pollock, tilapia, catfish, crab and clams.
How to take advantage of your sales opportunities!
Savvy AWG retailers take advantage of AWG offerings of key products from all promotional offerings (Web blasts, strategic sales, lent promotions, event calendar offerings, breaking news and text blasts). They also use AWG cross dock programs to expand their fresh selections beyond catfish and salmon.
The AWG private label seafood program offers a full lineup and great potential to capture that value-minded shopper, which we’ve shown can be a valuable group to attract. Private label items are positioned perfectly to capture existing demand as well as increase sales looking forward, according to historical patterns from recessionary periods.
AWG retailers should also take advantage of the power of domestic offerings, such as Gulf shrimp or Alaskan seafood. These groups have great marketing materials that you can also take advantage of to help promote the offerings.
Host seafood selling events on the sales floor!
The AWG Meat/Seafood corporate and division teams are your resource to capitalize on the seafood trend and turn that into real sales. Make sure to ask questions and engage them – it’s their goal to make your store succeed.
