Not only the retail price determines the success of products, but other factors play a part too. Add external circumstances, such as the current inflation and geopolitical unrest, and the puzzle is complete. Backed by recent research results, Wim van den Berg, Marketing Manager at Prominent Tomatoes, shines his light on the matter. ‘In certain areas, European countries are very different but on one thing they all agree; a green and healthy strategy is the future.’
Does the retail price influence buyer behaviour or do other factors play a part?
Where organisations see the retail price as an important factor to purchase a product, consumers have a different opinion. Recent European research by GfK shows that healthy and natural ingredients as well as quality and origin are just as important. ‘GfK’s research indicates that in every European country, healthy and natural ingredients are the most important factors to convince consumers,’ Wim says. ”˜Next to these number one and two, Central and Eastern European countries find quality and safety important, while in Western and Southern Europe waste reduction and regional and/or local production are crucial.’
But what is meant by ‘healthy ingredients’? ‘These are products without genetic modifications, artificial additives, and artificial sweeteners as well as products low in sugars and fat. Surprisingly, consumers in Central and Eastern Europe consider these five characteristics to be more important than consumers in North-western Europe.’
More focus on price-quality due to inflation and geopolitical unrest
Great news for the fruit and vegetable sector, as vegetables are considered ‘healthy and natural ingredients’ by default. ‘In Eastern and Southern Europe, more fresh vegetables are being consumed per household than in North-western Europe, while less is being spent proportionally,’ Wim explains. ”˜That is very encouraging, as something as a great price-quality ratio appears to be extra important in times of a global (economic) crisis. Due to the current inflation, consumers are more price conscious. But the political turmoil also asks for cautious spending. These developments explain why a focus on price-quality is more visible in Eastern European countries.’
Sustainable production to guarantee a constant quality
‘But price, quality and sustainability do not have to rule each other out. By focusing on sustainable production right now, we can keep delivering products of the same high quality in the future. Our growers produce their vegetables in a closed system, that allows them to control which raw materials are needed at which moment during the process. This means nothing is wasted,’ Wim explains. ‘The heat in their greenhouses mostly comes from sustainable resources such as thermal heat and any waste materials are recycled as much as possible. For crop protection, we use natural control like insects.’
‘In Southern Europe, Morocco or Turkey production often takes place in low-tech greenhouses, where local growers are faced with a different climate. The constantly changing weather conditions not only lead to mixed results but also to more raw materials being needed to optimally grow the crops and control harmful insects and diseases. In addition, these external factors make it more difficult to guarantee a continuous quality and yield. Our Dutch growers can provide such guarantees, as they produce their vegetables under controlled conditions.’
Consumers are willing to pay more for premium products
‘A regular single tomato is generally not that expensive. Premium variants such as cocktail or snacking tomatoes come with a bigger price tag, which consumers often seem willing to pay. Particularly in the Netherlands and Germany, the popularity of this small tomato has increased in recent years. The research by GfK confirms this. Their statistics show that European consumers gladly spend a bit more on natural ingredients, but also on sustainable production and packaging. They are also willing to pay for regional and/or local products, with a smaller carbon footprint.’
Growers United believes in green and healthy entrepreneurship. Curious to learn more about our sustainable solutions? Stay informed at growersunited.nl/en/sustainability or get in touch, via marketing@growersunited.nl or +31 (0)174 238 000.