Grocery retailers need to increase their efforts in supporting the plethora of new age food brands entering the scene. It is not enough to put them on shelf, set a rate of sale, and say see you at range review time. The world of the food producer is fraught with difficulty and challenge. Having worked with a dozen or more in the last 12 months, I can honestly say that if I were asked to start a new food brand, I would decline. The barriers are enormous. Yet, and refreshingly so, we see so many new brand emerging. Even today on crowdfunding sites, where I spend a lot of time, I see tonnes of brands pop up daily.
This is after all of the other challenges have been met, then they are told, you have got to go direct to consumer – this is a must from boards, investors and so on. They are wrong – as a standalone strategy, it will never work.
- Online real estate is damn expensive and noisy. General point.
- The search volume is not there in enough scale to support the unique and niche ingredient/benefit ratio that brands adopt.
- Consumers do not shop for one-off brands or products types – when off platform.
- A full-time advertising resource is not good use of payroll when it is not a full-time job
And then there are the retail grocery platforms – they are inadequate when it comes to the discovery process. Fundamentally, they are not equipped to support the growth of smaller, niche brands. If this behaviour does not happen on search engines, why would it take place on Tesco.com. It does not make sense.
When on platform, there is limited ability to drive change for this fact. Even if you spend (and you can spend handsomely) – the ability for new brands to be added to the basket is negligible.
- Challenges include:
- Poor navigation
- Poor search parameters
- Best match is predicated on sales – but wait, I just joined and have no sales, but I need sales? Reminds me of the Simpsons – Leg Up programme.
- And then there is the lack of info. The vacuum – which breeds fear. What happens if we don’t spend?
In researching and living this, I read through a lot of articles. This is an exceptional piece and a must read if you are in the food game. In fact, this is the best article I have read all year on grocery retailing.
**The IGD is predicting growth in online grocery sales of 52.4% by 2023. This has resulted in brands continuing to increase their online shopper marketing budgets. Grocer-owned online media on their e-commerce sites (for example department banners, favourite interrupts) represents the lion’s share of investment, but digital advertising channels outside the grocers’ control are in rapid growth.
Let’s just think about it for a moment – all businesses are now committed, like it or not
Online Grocery shops do not do enough to help the new wave of food producers who are innovating relentlessly to invigorate stale categories and drive innovation through new product delivery. In delivering online strategies, we have focused on driving footfall offline, a spurious link – yes. All our gateway metrics are painting this picture and we see brand awareness jumping too.
In order for food brands to thrive and not just survive, we need the grocers to start thinking of ways to deliver innovation for search and discovery. Instagram and InstagramPay may just be the first platform that satisfies all of the criteria a new food brand needs to grow profitably and in control of their own brand experience.
- Mobile first experience
- Brand is talking to the consumer already
- Use cases and social proofing are already taken care of, in platform.
- What better time to buy, as when you are presented with the products and your satiety needs serving.
New food brands spend so much time investing in brand material, marketing and getting their voice right. They now need to invest that time in people who are can effectively manage and trade product through IG. Engagement should no longer be passive and in fact, should be really proactive.
The social media index from Asbicon here makes for grim reading. Look at how disparate the top 50 brands on social engagement have become. None of the new age innovators appear. As they grow, so will their need for digital strategists in their business and conversely, the grocers need teams of people with the desire and ambition to drive new digital platform experiences that the brands have. This will continue to be difficult as own brand, low cost selling continues. Loyalty programmes need opening up and to be democratised away from central distribution by the retailers – then we would see how the innovative food producers work best.
I see this as the toughest category to be in – in every sense and I cannot help but feel that this first real wave of young foodie will pave the hard path for more, even more successful brands to follow. So my advice, is to take advice, and push the retailers and realise that this relationship you build is a two way street. Look to people like the Young Foodie group for their experience and network to help you understand the trials and tribulations of being who you are.
Check out the Young Foodies website – a truly wonderful team of people too.