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Expert Column: 4 Ways Grocers Can Compete With Farmers’ Markets

September 29, 2014, 11:25 am By Rick Miller, Networked Insights

With the leaves changing and temperature dropping, farmers' markets will soon pack up their tables for the season. Consumers who have driven a growing demand for organic, locally sourced food will be back in traditional grocery stores for the winter. This segment of consumers isn't trivial. In fact, the number of farmers' markets in the United States has grown by 362 percent over the past 20 years, according to the USDA, and we found that online social conversations about farmers' markets are 30 times more positive than those of grocery stores.

It's possible, however, for grocers to learn some tricks from farmers' markets, and it starts with understanding what motivates consumers to visit them. Close analysis of online discussions around farmers' markets reveals the answers. As summer winds down, now is the time for traditional grocery stores to turn to online conversations and make changes to their in-store customer experience, based on those findings.

Recommendations for Grocery Stores

Looking at online conversations about farmers' markets and grocery stores (see slide 9 of this SlideShare), a few trends stand out. First, farmers' market shoppers enjoy the festivity and seasonality of the events. Supporting local businesses is also important to these consumers. On the other hand, certain purchase values, such as price and nutrition, aren't reasons that consumers choose farmers' markets over grocery stores. Based on these insights, grocery chains looking to compete with farmers' markets next spring should consider the following:

·         Go Local. Local is trending. Not only is it perceived as fresher, but purchasing locally sourced goods supports local businesses. Data show that farmers'-market shoppers value both. Grocery stores can address those values by expanding their selection of locally grown goods and clearly labeling them as such. Don't be afraid to get specific; consumers want information and transparency from their food sources. Including the specific apple orchard's name on the label, for example, would appeal to farmers'-market shoppers, who seek a deeper relationship with farmers.

·         Embrace the Seasons. Fifty years ago, grocers touted their stores as places where consumers could buy produce year-round. According to consumer conversations, farmers'-market shoppers actually want to purchase peak-season produce. Grocers should emphasize seasonality in produce departments by featuring and educating consumers on produce that's in season. Stores can also host seasonal events, such as fall festivals and cooking demonstrations, showcasing in-season products. These sorts of activities and displays create a sense of festivity and seasonality for shoppers.

·         Make a Spectacle. Farmers'-market shoppers enjoy the activity of visiting the market. Grocery stores can experiment with replicating that festivity. For example, they can host mini-markets in their parking lots that include meet-and-greets with local farmers and food samples. This turns the chore of grocery shopping into a family-friendly event.

·         Know What Doesn't Matter. Just as important as knowing what drives consumer shopping behavior is knowing what doesn't. Despite the move toward healthier lifestyles, this isn't a key differentiator of farmers' markets. Those shoppers see grocers as comparable in terms of health and nutrition. Price and availability of goods are also considered equal in the eyes of consumers. Grocery stores should keep this information in mind as they adapt their marketing strategies to compete with farmers' markets.

Now is the time for grocers to make these customer experience changes. Farmers' markets are retiring for the season, so grocery stores won't be competing with them for consumer attention. Supermarket operators can add characteristics of the farmers'-market shopping experience to their stores now to show farmers'-market loyalists that they can get the same experience from their neighborhood grocer.