Dairy Business View
It's simple. To get consumers to buy more cheese, offer them more varieties in more places. One such place is the deli, which today is so much more than a person standing behind a counter. And the best news, deli counter operators want to offer consumers more cheese options. Are you prepared to deliver?
According to InStore Buyer (May 2005), in 2004, department sales of the in-store deli averaged $15,312 per week per store nationally. Of this figure, which encompasses the categories of deli meat, deli cheese, deli prepared foods and deli beverages, deli sandwich cheese sales had about 9.3% share. Average weekly sales of deli sandwich cheese per store were $1,428. You can help them double that figure.
There's definite room to grow the light deli cheese business.
According to research by the International Dairy-Deli-Bakery Association (IDDBA), Madison, Wis., 75% of deli customers surveyed are concerned about the nutritional content of foods they buy from supermarket delis. This includes 36% who are very concerned. Those concerned about nutritional content most frequently mention fat content (48%) and salt content (22%) as their top concerns.
Opportunity awaits youAccording to the IDDBA study, three in ten (31%) consumers are shopping more frequently at their supermarket delis than they did five years ago. Forty-five percent are shopping the same amount and 23% are shopping less frequently. Health concerns and changes in household size are the primary reasons given by those who shop less frequently. Convenience (22%) and service (20%) are the two most frequently volunteered reasons for shopping at in-store service delis. As might be expected, convenience is the number one reason consumers shop at self-service delis.
Fifty-two percent of respondents often consume deli products at home (up dramatically from 37% in 1999 but less than the 60% response in 1994). Far more consumers are likely to say they often eat deli products at the store where they bought them (21% compared with 5% in 1999), which is most likely associated with increased availability of seated areas near delis. Among working respondents, 27% say they often eat deli foods at work.
Indeed, today's deli offers consumers so much more than it did just a mere decade ago.
Supermarket deli operators are actively emphasizing convenience, freshness and variety. And they need your help. Cheese marketers need to get their products into the deli-either the service deli, the self-service deli or the typically nearby produce department.
One area of growth is freshly made sandwiches and salads. Companies such as Fresh Express Inc., Salinas, Calif., the recognized leader and pioneer in the fresh, packaged salad industry, continues to lead the value-added salad category through freshness, supply chain efficiencies, new product development and category management. The company's goal is to transform the deli department as it did the produce section into a much bigger contributor to a store's overall sales and profits.
Sargento Foods Inc., Plymouth, Wis., is a leading supplier of value-added shredded cheese to consumer, food service and food ingredient customers. The company is always willing to customize cheese flavors and blends for their customers. "New Bistro Blends provide bold, passionate flavor to salads and entrees, and could potentially have application in the deli," says Brad Flatoff, senior vice president - marketing at Sargento.
Pre-packaged salads continue to increase in popularity, too. Ready Pac Produce Inc., Irwindale, Calif., has expanded its deli/produce department convenience salads with Bistro To Go™ Salads. Unlike Fresh Express' salads, these are all portioned and packaged for easy merchandising in the deli or produce department. Many contain cheese.
Beyond the greensIn addition to salads, deli-prepared sandwiches are becoming increasingly popular. Foodservice chains such as Quiznos, Subway and Panera Bread have made sandwiches convenient, fashionable and, above all, healthy in the minds of consumers. Delis can compete with these operations if they offer customization, freshness and unique, flavorful ingredients. One of those ingredients, of course, should be cheese.
At the Dairy-Deli-Bake 2005, which was held June 5-7 in Minneapolis, ConAgra Foods Inc., Omaha, unveiled its new specialty cheese merchandising program for the deli. The company says the program promises to provide consumers with the ultimate experience in selecting domestic and imported cheeses in the deli, while helping supermarket deli managers broaden their offerings and boost sales.
The new merchandising strategy is based on learnings from proprietary ConAgra Foods Deli research into specialty cheese consumer behavior. According to the research, a high percentage of key specialty cheese purchase decisions are made in store. Seventy-four percent of consumers, for instance, choose the brand of specialty cheese while shopping in the store, while 46% choose the variety in store and 51% decide on the form of cheese purchased. That insight creates the opportunity for effective in-store display and information to help specialty cheese consumers make informed choices as well as introduce them to additional varieties and usage opportunities.
"Specialty cheese consumers are valuable shoppers, and our new cheese merchandising program will help simplify their buying while educating and informing all shoppers about the cheeses," says Bill Klump, v.p., marketing, ConAgra Foods Deli. "The enhanced case design also offers deli managers the opportunity to increase their volume and sales through use of promotions, sampling, recipes and matching cheeses with wine and other foods."
ConAgra is definitely onto something with their specialty cheese efforts in the deli. As presented at Dairy-Deli-Bake 2005, Jeff Gregori, dir., consumer insights, ACNielsen, New York, said that in the deli, specialty cheese segments are very fragmented and require targeted merchandising to get noticed. He explained that aggressive deals do not attract specialty cheese buyers. They are going to buy cheese because they love it, not because it is on promotion.
According to the ACNielsen Homescan Fresh Foods Channel Facts Annual 2004, heavy buyers of specialty cheese spend the most on Mexican cheeses. The target consumer is 35 to 44 or 55 to 64 years old. He or she is generally affluent and either Caucasian or acculturated Hispanic. And, heavy specialty cheese buyers are more likely to buy specialty cheeses in club stores than non-heavy specialty cheese consumers.
New offeringsAt Dairy-Deli-Bake 2005, I was able to find some new cheese offerings for the deli. Blaser's USA Inc., Comstock, Wis., is rolling out Organic Pride. From traditional varieties to unique flavors, this is the first full-line of organic cheese for the deli. Offerings include: Colby, Colby Jack, Colby Jack with Tomato & Sweet Basil, Monterey Jack, Monterey Jack with Jalapeno Peppers, Monterey Jack with Onion & Chives, Monterey Jack with Dill, Medium Cheddar and Muenster.
Swiss-American Inc., St. Louis, Mo., now markets Dutch Garden Chipotle Cheese. This pasteurized process cheese features roasted and smoked jalapeno peppers.
Roth Kase USA Ltd., Monroe, Wis., is introducing Sole!, a line of authentic Hispanic-style cheeses for the deli. The line includes eight Latin American favorites: Anejo Enchilado, Cotija, Oaxaca, Panela, Queso Asadero, Queso Blanco, Queso Fresco and Queso Quesadilla.
Swiss Valley Farms Co., Dubuque, Iowa, now markets 5-lb deli loaves of 19 varieties of cheese-something for everyone's tastes--from Swiss and Sharp Cheddar to Provolone and Hot Pepper Monterey Jack.
For the self-service deli, the Churny Company, a part of Kraft Foods Inc., Northfield, Ill., markets exact-weight 8-oz slices of premium Hoffman's cheeses. Slices are separated by an inner leaf and they are packaged in a re-closeable package. Varieties include Asiago and Vermont Cheddar.
The deli is a real growth opportunity for both the supermarket and the deli case suppliers. Are you prepared to deliver?