Here we are, December, with all its celebrations, parties, gatherings, Christmas and New Year’s Eve. Yes, December has a lot packed into 31 days, but does December still have the impact it once had in retail grocery?
Years gone by
I can vividly recall December as being the No. 1 month for sales in the produce department, but this was before the advent of large-scale counter-season production from Mexico, Central America and South America, which today we don’t think about much. The original North American Free Trade Agreement had a lot to do with making fresh produce commodities more widely available in the months when U.S. production of these same commodities was limited, or nonexistent seasonally. That was then …
Planning for the holidays
Most retailers make their holiday plans months before, and in some cases, holiday plans for the next year are set immediately after the current holidays are over. With technology and analysis of dollar sales, volume and performance, it is much more realistic today to set plans and forecast based on previous performance. But there are always the inevitable challenges around supply and pricing which play into executing a holiday plan.
The importance of December
Unlike apparel, cosmetics, home goods and electronics retailers, grocery retailers don’t have the pressure to make sales a grand slam in December. That said, December is the month retailers target to make up gaps in sales or margin before the year ends. So, it is critically important to have a strong plan and execution of the plan throughout December. And the holidays provide the perfect opportunity to do so.
Filling the basket
As consumers fill out their holiday shopping lists, whether planning for a party or gathering, they are bombarded with impulse items. And retailers strategically merchandise to capture and captivate customers, leveraging on the holiday mood to entice them to purchase additional items. Full disclosure: I am one of those impulse shoppers. Generally, I am good for three to five impulse purchases while on a holiday shopping trip. And this is exactly what retailers are counting on, but for foot traffic.
The digital dilemma
What we’ve learned the past two years is that retailers have become extremely aggressive with their digital platforms, and the numbers bear it out. Digital engagement has become more of a primary experience for consumers than just a couple years ago. However, the digital engagement experience with consumers has been somewhat different for fresh produce. Over and over, the trends show that while consumers enjoy the convenience of curbside pickup or home delivery, many still prefer hand-selecting their fresh fruits and vegetables themselves, in-store.
Maximizing foot traffic
Knowing that consumer sentiment indicates they want to touch, feel and select their fresh produce items presents a great opportunity for retailers to leverage their best offerings and special products just for the holiday season. If retailers haven’t returned to sampling, now is the time to consider doing it. Nothing inspires a purchase decision like having a customer taste the product. And sampling is not possible in the digital world, so creating awareness and maybe even some FOMO will serve retailers well to achieve those highly sought-after holiday impulse purchases.
Why promotional activity matters
During the peak of the pandemic, retailers largely scaled back, or even eliminated, print ads while pushing more promotions to online shoppers. But after more than a year of fresh produce volume pressures, the holidays — and December in particular — present the perfect opportunity to drive customers into their stores with item, price and maybe even a special in-store occasion. Once the customer is in the store, that’s when the magic of merchandising takes over. As we used to say in my retail days, you get one chance to make a first impression. Now is not the time to hold back. The finish line to 2022 is a few weeks away, so there is no reason to not be assertive with messaging and aggressive with in-store activity.
The last piece is most important
The plan is perfect, the execution is spot on, but once customers begin arriving, if the service doesn’t match the plan, much is lost. It takes some of the shine off what should otherwise be a joyous and exciting period. I remember sending communications to my store operations team weeks before Christmas reminding them first and foremost what our service goals were for our company. And that they needed to reinforce those goals with their teams. The job must be done, the work must be completed, but the customer has a choice. You can’t place a price on service. It’s the service that ultimately will be the difference between selling every item the retailer desires and just fulfilling the customer’s shopping list.
The answer to that December question
When the year ends, the holidays have passed and we look back on all that was 2022, we will be able to answer that question: Was December as important to the overall success of the entire year as it once was? I believe the answer will be a resounding yes.
Happy Holidays and Merry Christmas to all.
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This column is part of a series by Joe Watson, who spent 30-plus years as the director of produce for Rouses Markets and was named Produce Retailer of the Year and honored as one of The Packer 25, both in 2014. Joe now serves as a vice president of retail, foodservice and wholesale for International Fresh Produce Association.