Consulting firm A.T. Kearney has released a consumer study, “Buying into the Local Food Movement,” that assesses how shoppers make decisions about buying local versus non-local food. The study found that local food is a trend consumers have embraced.
Among the findings, the report suggests that shoppers will switch stores for a better local food selection. When asked about the availability of local food at their preferred supermarket, 65% say their supermarket offers at least some variety of locally-sourced food. Overall, respondents say their main source for local food is still the local farmers market and farm stores.
Shoppers also don’t trust national and big-box retailers for local food. While most people say they shop primarily at big-box or national supermarkets—where they can get all of their shopping done in one stop—they trust these retailers least when it comes to local food. The study found that across all income segments, a majority of shoppers (70%) would pay more for local food. Freshness is the most important purchasing criteria (60%), followed by price (30%).
When asked how they believe organic and locally sourced products contribute to sustainability, the study reveals that 68% of shoppers say that local food contributes positively to sustainability, while only 50% say the same thing about organic products. In other words, environmentally conscious buyers seek out local foods because of their associated benefits.
Summing up the report’s findings, James Rushing, A.T. Kearney partner and leader of the study observed: “Clearly, local food cannot be ignored as a growing segment for the grocery industry, and we’ve learned that larger-format food retailers still have much work to do to earn the trust of consumers in providing quality local food products. But the additional work and costs are worth the effort in the customer loyalty gained.” A.T. Kearney makes the following recommendations to retailers:
Understand that fresh matters. No matter the format, freshness and quality are paramount, and it’s critical that local food products are adequately presented in terms of shelf space and location.
Convey local products’ authenticity. It’s important for grocers and big box retailers to overcome consumer suspicions and generate trust for local products merchandised in their stores. Developing dedicated sections with in-store signage is a strategy for highlighting local food assortments, as is creating a store brand for local food products.
Consider the implications for buying and category management. Category buyers must establish visibility within each defined region with regard to price and quantities, and make decisions on local assortments.
Don’t underestimate the supply chain impact. Having local farmers supply nearby stores, even in limited quantities, will force a reconsideration and redesign of the traditional supply chain model.