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Fukui's Monthly News Letter

The Importance of Packaging

We talk about the importance of packaging in order to set apart and add value to cultured shellfish in the marketplace and I wrote about it last year.

After attending the International Boston Seafood Show in March, I decided it was time to revisit this topic. The last time I was at the show, in 1994, displays of aquaculture products were limited mostly to salmon and some shellfish. Now, five years later, I was pleasantly surprised to see exhibited a large variety of both cultured shellfish and finfish from around the world.

From conversations with show attendees and exhibitors, it's clear that consumer buying habits are changing - and that the aquaculture industry is well-situated to take advantage of new trends.

I attended the show this year to introduce our new shellfish packaging system and to check out how much of a profile that cultured shellfish has at such a premier event.

Dan Vogler from Meat and Seafood Merchandising identified some of the ways in which consumer purchases are changing.

  • People, in general, are eating healthier and looking for food with less fat content. Even the fast food restaurants have gotten in on this trend with their low fat menus. Red meat consumption in some areas has leveled off or dropped, though it is still "the king." Beef marketing boards are busy bombarding consumers of late to eat more "lean" beef! They wouldn't do this if peoples' eating habits weren't changing and market share was not dropping.
  • People are busier it would seem, than ever before, with both parents working as well as many single-parent families. The trend to quick, easily prepared meals has become a main component of supermarket sales and a focus of their product lines. And this interest in convenience holds true across all economic levels.

The poultry industry, for example, has seen the per capita consumption of whole birds over the last 20 years drop from 61% to 11%, while the sale of ready-to-cook pieces have gone from 32% to 53%. Further processed items have gone from 7% to 36%.

Fast, ready-to-cook products from supermarkets saw a 10% increase in sales from 1996 to 1997, compared to declines in servings at both fast food and regular restaurants.

This all falls in line with what Faith Popcorn stated in her book about future trends concerning the cocooning of North Americans. What this equates to is that as family units more people are taking refuge in their homes, they sleep, entertain, learn, work, watch video or satellite, gather information by Internet and they eat simple to prepare meals, all this at home!

  • Product branding has become associated with quality and safety, and consumers recognize brand names on a regular basis when it comes to making their buying decision. Think about all the products that you purchase and how you associate the well-known brand name with the product: Kleenex, Perdue, Xerox, Styrofoam, and Pampers.

Apply to shellfish

So how do we as shellfish growers with a very high quality product that is healthy to eat, fit the market demand for easy to buy and prepare shellfish, while creating a brand image?

We start with information about the product. Things such as: how to prepare cultured shellfish and access to favorite recipes, its nutritional value, how it's grown, and why it is better; how to serve cultured shellfish and what other foods to serve with it, how to tell if it is fresh and safe etc.

I know you probably know all of this; however, once you move inland from the coast the consumer's knowledge of seafood drops significantly. If you are to increase consumption of shellfish then you are going to have to make the consumer as comfortable as possible with the product - as they are with beef or chicken.

While growers agree with this approach, information without a solution isn't very useful.

As a result, we decided to develop a delivery system that would allow the grower or processor of cultured products to take advantage of the trends that are taking place. We are working with a company, Tipper Tie of North Carolina, to provide a specialty packaging system.

Survey results

But there may be many ways to satisfy the marketing criteria needed to move cultured shellfish to the consumer's plate. To help growers or cooperatives, the following describes the information we gained from surveying the industry.

The supermarkets told us that they wanted to reduce their labour cost, have a package size based on the needs of the customer and not what their supplier could supply; and through point-of-sale packaging, increase sales.

Some might comment that shellfish should be sold through seafood stores only. But when you look at distribution outlets and consumer traffic patterns those types of stores are limited compared to the number of supermarkets out there.

What if shellfish were served either as an appetizer or main course at only 1% of all the backyard weekend barbecues in North America? To achieve this increase volume of sales you need effective, informed and broad distribution.

Processors and wholesalers told us they needed to reduce labour, increase production, and be able to better meet their customers' changing packaging needs without stocking huge amounts of many bag sizes. They understood that cultured shellfish have a higher but they didn't necessarily believe it was their responsibility to promote it. They thought the growers could better explain the quality difference. Branding and labeling are big factors in this information flow.

Restaurant buyers are at the demand of the chef, who wants the best quality possible so as to have a consistent supply, this is where branding comes in. The buyer once convinced of the quality will always buy in confidence the brand that the chef approves. As a restaurant patron yourself, think about the restaurant that you do not attend anymore because of a bad meal and you will understand why this is so important.

We also know through price comparisons that growers who take an active role in the branding and marketing of their product enjoyed a substantial increase in their return on capital invested.

One unfortunate fact did arise from the growers that understood the need of self-marketing. They were sending their product out in nicely labeled onion bags, (labels that said shellfish and not vegetables) which are a great start. But we found some buyers identified onion bags as a delivery system of a lower value product. And, in general the end user rarely saw the bag - or its branded label - because its size was much greater than the average portion size sold.

In one case I actually saw one of the larger bags thrown on ice, ripped open with a knife and left to be the point of sale product display. I also saw cardboard boxes used for oysters as well as the plastic bags with the gray juices running out of the bottom sometimes used for mussels.

Compare this with what you see for point of sale promotion for other proteins or food stuffs at today's modern retailers and you will understand why today's sophisticated consumers are buying products other than shellfish.

Don't think for a minute that your product is a commodity. You have a high quality market niche product and with a little bit of understanding and marketing savvy you can have increased sales with a higher market value.


Contact Don Bishop at:
Fukui North America
PO Box 669
110-B Bonnechere St.W.
Eganville, Ontario K0J 1T0
CANADA
**NEW**Tel: 613-559-0075 or 613-628-5266
**NEW**Fax: 613-432-9494
Email: kate@fukuina.com or don@bishopaquatic.com

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