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[11 comments]

Retail's Big Catch: Seafood Thrives as Shoppers Go Healthy

March 18, 2013

The International Boston Seafood Show, held last week, featured the latest and greatest developments in the fresh and frozen fish industry. And it was almost entirely good news for the record-breaking 20,000 attendees at the Boston Convention Center, who reveled in growing revenues and browsed more than 1,000 booths on the exhibit floor.

According to Mary Larkin, group vice president of the organizer of the Seafood Expo and publisher of Seafood Business magazine, the top trends in seafood this year are:

Health Opportunities: A stream of reports advocating more fish in the diet has increased the demand for seafood over the past few years. This is expected to continue as proof that a "Mediterranean diet" that is high in Omega-3 fatty acids and other vitamins found in fish is healthy for the heart and body.

The Economy: The lackluster economy of the last four years has meant a clear move of seafood purchases away from restaurants and to lower priced supermarkets. As the economy rebounds, restaurants should capture back some of their share of the fresh seafood market.

Quick Prepared Meals: An issue facing the seafood industry for years is that consumers don't know how to or are afraid to even try to make fish dishes at home. The industry has responded with a series of innovations that make these dishes almost foolproof.

Snacks: There were dozens of booths on the show floor featuring a variety of snacks, from crackers with lox spread to fried calamari.

Food safety: Retailers have raised their expectations from suppliers in anticipation of the implementation of the Food Safety Modernization Act, requiring inspection of imports and other products.

Global sourcing: As fish become more popular in the U.S., there is a greater demand for imports.

Besides the oyster-shucking contest, there was serious business taking place on the show floor. A quick review of badges showed all of the leading supermarket retailers and the large restaurant chains were looking for new items to offer their demanding customers.

Discussion Questions:

What trends are having the biggest effect on seafood consumption? What steps can retailers take to respond to these opportunities more effectively?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Which trend will have the biggest impact on the growth of seafood in the coming year?

Comments:

With many people so health conscious and concerned how to best translate that to their family's eating habits; seafood and particarly fish has become the paramount resource. There are so many creative ways to prepare it, plus they can be purchased boneless to make it a pleasure to serve and enjoy.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

Whether easy or not, many retailers really need to step up their efforts in their seafood departments. In many areas of the country, even in NYC where seafood is prevalent, too many shoppers, me included, have to go out of their way to buy fresh seafood.

Yes, of course, Whole Foods, Fairway and Stew Leonard's all have great seafood, but why not D'Agostino or Food Emporium or other regular supermarkets? Most New Yorkers will not even think about purchasing their sea food from them. These retailers are sitting on the sidelines of a significant opportunity and, when a supermarket does not have a good seafood department, it tends to cast doubt on the produce and fruit and vegetable departments as well. Maybe this is why these stores tend to charge crazy prices for many items in the center store categories.

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Zel Bianco, President, founder and CEO, Interactive Edge

Hey! Don't joke about the oyster shucking contest. It's not easy!

With regards to the explosion in seafood popularity, the great flavors and benefits of it is not to be overlooked. It's on the menu at our house at least three or four times a week.

But I think we should also acknowledge that some of the negative publicity for feed-lot beef has probably benefited seafood sales as well. Retailers serve their consumers best when they offer, educate and promote a variety of healthy alternatives from all the protein groups.

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Ben Ball, Senior Vice President, Dechert-Hampe

The seafood show was great; enormous attendance, and people generally upbeat. But I don't see the category booming. Dollar gains have come largely from higher costs (supply/demand of this worldwide commodity) and inflation. The growing middle class in China is among the factors having some effect. U.S. manufacturers are promoting less, and new product intros are down.

On the foodservice side, seafood is showing up on more and more menus in fast feeders, however. There's underlying fear about farm-raised fish and disease that kills off so many of them, or the antibiotics use and its potential harm to consumers. Consumers say they'll pay more for sustainable seafood, but I have my doubts, at least for the middle-class demographic.

Further, most shoppers don't really know what sustainable means when it comes to seafood, or which species are endangered. They mistrust package labeling (as to species) although such fraud is a bigger problem in foodservice than in supermarkets. There's definitely opportunity with new species, value-added meal solutions, and teaching consumers how to cook seafood. But all these issues need addressing.

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Warren Thayer, Editor & Managing Partner, Frozen & Refrigerated Buyer

Overall, the shopper demographics are evolving and favor the increased consumption of seafood. Boomers are retiring and their doctors are telling them if they want to continue to be in denial of the aging process, "eat fish instead of high caloric and less healthy alternatives."

Unlike Boomers, younger shoppers have been conditioned to more readily accept seafood as a part of their dietary needs as they have grown up with Red Lobster and their local supermarket having an attractive seafood department. Still, this group needs help with preparation and meal solution ideas. The industry has done, I believe, a credible job of promoting both and thus making it easier for the Millennials and the X'ers to consume.

Also, seafood is much more readily available and priced more reasonably than in the past. With the economy still looming as a behavioral catalyst in the backdrop, retailers are promoting seafood at an increased rate, thus providing the necessary incentives for budget-minded consumers to partake.

Clearly, the path is open for supermarket retailers to continue to expand their offerings and their expertise in seafood merchandising. The consumer is on board and waiting for the next catch.

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Mark Heckman, Principal, Mark Heckman Consulting

Last weekend my hubby purchased some fresh and pricey shrimp for a stir-fry. when he arrived home, we found the shrimp had not even been de-veined. The fact that he told the seafood counter person it was for stir-fry and was given NO advice about what to buy is illustrative of why consumers continue to be so skeptical of seafood at the grocery store. Even though my husband knows to buy de-veined shrimp, he put trust in the counter clerk, and then had to go through the icky process of de-veining shrimp in our kitchen. No more seafood will come from that store, I can assure you.

There's so much to learn and no one to teach it, unless you shop at Whole Foods or a high-end local grocer. This is only one barrier. The whole idea of sustainably raised fish is a whole different issue, and just as difficult to communicate.

I'll contrast purchasing seafood with chicken, which we get from our local farmer's market, where we know the guys who raise it and even know what the chickens are fed. Trust and information means everything!

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Anne Howe, Senior Vice President, Shopper Solutions, part of Acosta Mosaic Group

Do what I did in my stores more than 20 years ago: Hold seafood cooking classes right on the sales floor. Few people know the tricks behind preparing many seafoods.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

Lately, fast food chains have been promoting seafood a bit more, with items like fried fish "bites" and even a broiled fish sandwich appearing on TV commercials. I would attribute this to consumer insights, such as a growing number of Americans who avoid terrestrial meat in their diets. If they are eating fast food, it's not purely a "health" issue, but why quibble?

Fresh fish is a hard category for conventional supermarkets to do well. Quality depends on rapid turnover, but attractive variety works at odds with that goal. Stores with a large and relatively affluent shopper base have a better shot at doing well, because the math works out better.

I should share my concerns about global over-fishing, which is driven by protein demand from increasingly affluent populations. Aquaculture seems to address this to an extent, but we should also be cautious that our relentless pursuit of food from the sea does not result in long-lasting changes to the oceans.

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James Tenser, Principal, VSN Strategies

This article only points out the same trends that the food industry is already enjoying. Healthy, fast, quick foods that can be snacks sounds like so many other food choices as well (from fruits to vegetables). We are seeing this in drinks, including smoothies and fruit and vegetable juice blends, to low fat meat and meat substitute foods, to snack foods. Keep all of these foods in the above categories and the retailer cannot go wrong....

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Kai Clarke, President, Kowa Optimed, Inc.

I think the biggest trends will have to be tracability and species verification. Multiple stories of species substitution have made me suspicous of both foodservice and retail purchases. Whether willful or accidental, it is inexcusable. Regarding traceability, do you want wild-caught Gulf shrimp, or the equivalent of feed lot beef shrimp from Ecuador (not a value judgement since I eat both types), but of concern to many consumers.

Regarding extra promotion at fast feeders—wait until Lent is over and those commercials come to a grinding halt.

'Stanaggie'

Not all seafood is healthy; usually shelled sea food has higher cholesterol. Also the choice of seafood varies largely by the demographics of the store. Most seafood is generally healthy though, but the addition of high fat sauces and having them fried makes it unhealthy.

New seafood recipes have to be introduced making it easier to consume and at the same time keeping it healthy and enjoyable. Fresh seafood with easy-to-cook/eat options can make this category very profitable given the latest health trends.

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Shilpa Rao, Practice Head - Merchandising, Tata Consultancy Services

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