I’ve been in the food marketing business for a quarter century, and I’ve never witnessed so much disruption in nearly every channel. If it is a harbinger of next year, 2017 was the launch pad for rethinking your marketing efforts. If you are Rip Van Winkle, here are a few things you missed and some tips on how to win in 2018.
The watershed moment was Amazon’s buyout of Whole Foods. Rumors on new tactics to destroy traditional supermarkets abound, but 2018 will see Amazon strategies emerge. If you are a food manufacturer without a selling strategy that includes Amazon, establish one as quickly as possible. Let me guess. Shipping costs are the hurdle.
Changes in shopper habits emerged during the year. The lack of Millennial and even Boomer meal planning hit its crest. Instead of a trip or two to their supermarket or natural foods retailer, these key demographics make four or five trips a week and purchase only four or five items a trip. If your product lives in the center aisle, you should react by reducing your trade spending and rolling those dollars into in-store sampling, mobile marketing focused on your best retailers, and some traditional media to provide broad awareness that is focused on your product benefits.
The only bricks and mortar growth now is the value channel where new store openings continued at about 1,000 per year. Develop a value channel strategy, but understand that the average ring is only $15. Also know that food isn’t the primary mission of a value channel trip. Find somewhere other than the food aisle to showcase your product through promotions. Tie your promotion to a charity or the military.
In 2017, the fact that 44 percent of all restaurant meals were not being consumed in a restaurant challenged operators to rethink their strategies. Panera Bread hired 10,000 people to make home and office deliveries. Others cranked up catering. The year saw tremendous growth in third-party delivery options, with Door Dash serving more than 650 cities. For restaurant operators, find a way to reduce order mistakes in transferring third-party order systems to your POS. Bulk up your catering business, or offer your own delivery. If you are a manufacturer, offer new packaging options, like portion control packs, built for the road.
Growth among convenience stores slowed during the year, with teens and Millennials now accounting for more than 60 percent of in-store traffic. Craveable foodservice offerings with some healthy options will continue to be the difference between winners and losers in the channel in 2018. Beef up your mobile marketing and your loyalty program to grab the most from the c-store channel.
Meal kit growth from online purveyors, such as Blue Apron, will be challenged by local grocers in 2018. If you are a food manufacturer, reach out to the online companies and bring up how your products are perfect for your retailer’s own kits. While you are at it, pitch the supermarket deli, where growth remains among traditional stores.
By: Tony Treadway