Fresh is the final frontier…

We believe that consumer insight should inform strategy. So we place a great premium around here on monitoring behaviors and cultural trends in the food business.  Even more so now that food retail is at a crossroads with e-commerce accelerating rapidly to compete for more shopping occasions.

Emergent recently examined a series of reports from the Food Marketing Institute and research company The Hartman Group, profiling shopping trends in the grocery retail business.

We’ve identified 10 developments worth watching as the food retail business continues to transform amid the growth of consumer preference for higher quality, more authentic and real-food products.

1. Of millennials, 43 percent are now shopping online for groceries at least occasionally, up from 28 percent in 2016 – a 15-point climb in one year!

2. Most of this growth is coming from households that shop online routinely, and thus are already comfortable with e-commerce transactions.

3. Important to note millennials are more likely, however, to buy packaged products online rather than fresh and perishable items.

4. Gen-Xers with kids are more likely than other cohorts to actively use grocery store apps.

5. Millennials with kids are more likely to participate in grocery store social networks.

6. Millennials are more concerned about CPG and retailer:

Honesty

Openness about animal welfare

Ingredient sourcing

Social responsibility

They are apt to make judgments on the basis of ethics and sustainability practices.

7. Twenty-three percent of grocery shoppers claim to avoid GMOs, mostly for health related reasons, ‘naturalness’ and a desire to know exactly what’s in a product.

8. Top three reasons consumers prefer locally sourced products:

Fresher –                               72 percent

Support local economy –   65 percent

Better taste –                        54 percent

9. Seventy-six percent of grocery shoppers think a home-cooked meal is healthier than out of home meal options.

10. Households with kids have the highest adoption rates for retailer prepared meal solutions; two out of three households purchase them at least occasionally.

Most impressive is the speed of change we’re observing in the food marketplace, and the need for retailers especially to work smarter. This is done by embedding uniqueness and differentiation in their banner brands, and creating immersive experiences for shoppers in both online and bricks and mortar environments.

For retailers and CPGs still vying for transactions, it’s critical to realize that consumers have changed the rules. Those brands and banners that embrace connecting to shoppers in ways they find more helpful and meaningful will earn the business and their loyalty.

More specifically, the path to consumer engagement is shifting and healthy lifestyle is driving this transformation. Emergent is a specialist in leveraging this insight to grow food businesses. We bring the latest insights and innovative strategies to help food businesses navigate the new consumer landscape.

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Five steps to engagement and mattering

Food brand communication is going through a period of disruption and change, as consumers step away from conventional media to devote more and more time to mobile screens and social channels. Digital-based outreach in both narrative and video forms is where the action is, assuming you’re intent on fishing where the fish are.

However, the vast majority of communication in food and beverage categories is essentially re-purposed advertising trying to win a nano-second of attention — in an environment where consumers run from content that appears to be a sales pitch.

Just because you’re spending and ‘getting out there’ doesn’t mean your effort is gaining traction or that your communications is delivering the desired effect and business outcomes. It is harder than ever to simply buy fame and attraction. Why?

Dawn of Digital Resistance

A new challenge is rising up to once again confirm and restate the consumer’s master control over brand engagement: digital resistance. Simply stated, the consumer manages what they’re willing to consume — and anything that starts to look like conventional selling, marketing, feature/benefit communication is getting tuned out.

The alchemy of this change is fueled by the sheer volume of marketing activity trying to secure an audience — operating in an environment where consumers direct when, how and where engagement happens. Additionally, consumers have made it abundantly clear they’re interested in content offering help more than hype. Self- reverential brand messaging and product feature/benefit selling are just not cutting it.

Yet the temptation to focus on overt selling runs deep in our business culture. We believe that if we’re not showcasing and pushing product features, we’re being derelict in our responsibilities as marketers.

Ironically this is the very behavior that shuts down the opportunity for a relationship with those consumers we wish to attract.

When communication looks less like marketing and more like coaching and guiding, traction increases.

So how do you connect without overt selling? To provide some context, here’s how marketing conditions have evolved…

We’re Now Doing Business in the Relationship Economy

In the 1970’s we reached the apex of the Industrial Economy where the focus was squarely on specialization in the marketplace, and functionality of products aimed at modernizing your life. Marketing was about tonnage of media spend and persuasion.

In the 1980’s there was a natural evolution of this condition to the Experience Economy where services rose in prominence along with brand experience in pursuit of lifestyle associations. Marketing increasingly took on the guise of cinematic entertainment.

In the mid ’90’s when the Internet truly arrived, with it came the Knowledge Economy and the empowerment of consumers to start managing the relationship with the brands they cared about. This was fueled by the arrival of access to information previously controlled solely by brands and business. Marketing morphed to be more holistic and integrate ad campaigns with promotion and PR tactics.

Today, we’re doing business in the Relationship Economy where consumers are on a mission to secure greater meaning and purpose in their lives. Consumers now fully manage the interaction with any brand they deem worthy of mattering — by “liking,” “following,” “subscribing” and “sharing” — and ultimately buying. It is a transformative business environment dominated by the influence of cultural shifts. Brands that demonstrate an empathy towards the authentic experiences and content consumers now find most compelling (like ethical behavior, honesty and transparency) will fair better in creating true engagement with the audiences they seek to court.

Five steps to meaningful brand engagement:

1. Deep investment in consumer insight research aimed at fully understanding your core customer’s lifestyle passions, interests, concerns and desires
2. Marketing strategy which taps into empathy around how the brand and business can truly improve the customer’s life
3. Messaging and outreach tools founded on building relevant connections to consumers’ lifestyle interests
4. Embedding your brand with a ‘higher purpose’ that informs your actions and behaviors helping to secure consumer trust – essential for any real relationship
5. Communication built around content that operates in service of the customers’ interests; designed to mine emotional cues essential to gaining their attention and associating memorable storytelling moments that help endear them to your brand

It’s important to note here the advice of eminent psychologist Antonio Damasio: “We are not thinking machines that feel. We are feeling machines that think.”

Brand relationships operate in similar ways to the rules of personal friendships. As long as mutual respect is honored and the character of communication is focused on help over hype, the door to engagement will be open.

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The ultimate test for success in the merger of premium food retail and the world’s most savvy distribution juggernaut

“And they’re off!” could well be the call to action for last week’s industry-shaking announcement that Amazon has gone deep into the bricks and mortar food retail business with its historic acquisition of the upscale Whole Foods Market chain. This sets in motion the race for grocery supremacy and, in some cases, survival in food retail’s transformative future.

Omnichannel shopping is a well reported behavioral change among consumers who may look to multiple retail outlets, as well as online formats to meet their various food shopping needs. So, the acceleration of e-commerce in concert with shifts in food retail business models is no surprise.

What makes this marriage so interesting is the merger of Amazon and its algorithm mastery, distribution, and delivery prowess, with what may arguably be the largest chain of culinary-focused, fresh, and organic food stores.

High food tech meets high food touch

Said Joe Robinson of Catapult in his MediaPost column (June 19, 2017):

“Amazon personifies convenience and it will be able to bring that benefit to the items most consumers really don’t want to shop for—those that are chores. Through a subscription plan, click and collect or home delivery, Amazon can increase the number of items available through that model. As for experience, consumers are looking for an engaging experience within the grocery format—be it a cheese tasting, wine pairing or cooking class. Amazon has now bought into more than 400 locations where it can start to bring this experience to life.”

According to the U.S. Grocery Shopper Trends 2017 report, released by the Food Marketing Institute and Hartman Group, 43 percent of Millennials shop online for groceries at least occasionally, leaping ahead of 28 percent just a year ago. Apparently, consumers are getting (a lot) more comfortable using online platforms to get their food.

That said, food is inherently an emotionally-driven category. And increasingly, people see food not only as a symbolic purchase of what we want the world to believe about us, but also is directly correlated to our overwhelming desire for a higher quality life. So what happens when food passion collides with food retailing technology?

Therein lies the secret to this marriage’s success and, in many respects, the future of the entire food retail industry. How should you marry food cred and expertise to ordering and delivery tech? 

Trust looms large as a barrier to growth in e-commerce beyond the inherent attractions of convenience and price. People trust their own judgment when it comes to selecting perishables, especially produce and proteins.

Case in point: I have exacting standards on the meat I will buy – and come to the butcher counter with an eye towards my own quality perceptions. Said more simply, I care and make careful choices. Why? I take great pride in the foods I prepare and the outcomes of cooking, where ingredients will often make the difference between so-so and terrific.

Belief leads to trust. And how to cultivate belief? I want to know that the people involved with my food purchase care as much about the products and cooking as I do. What evidence is there in the form of relevant content that expresses passion for fresh ingredients, higher quality and creativity in the kitchen – which is then meaningful to me, and my lifestyle?

When it comes to CPG brands and retailers, we already know Millennials are especially concerned about honesty and openness around the issues of animal welfare, sustainability, ingredient sourcing commitments and social responsibility.

Combine this with the renaissance taking place right now in the kitchen, where fresh foods go to be reworked into something creative and exciting to eat. And right there you have the ingredients for building deeper meaning and relevance in how food brands and retailers go to market.

Building food credibility is job one 

As belief is created, trust is achieved. With trust, the barriers to having others squeeze your tomatoes will come down.

In short, people need to believe that the faceless e-commerce platform indeed has a face and can be humanized around the love of food and how it’s prepared and consumed.

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Marketing investments can make a difference…

At the very beginning, the Genesis moment if you will, entrepreneurs nearly always are translating a personal belief and passion into something new and potentially exciting in the food and beverage marketplace.

• EPIC – meat-based, hand held protein bars.

• Bare Bones Broth Company – culinary quality bone broth.

• Suja – cold-pressed nutrient dense juices.

• GIVN – premium bottled water your conscience will feel good about.

• EVOL – higher quality sustainably sourced frozen meals.

And (justifiably) so, these companies invest an incredible amount of energy and effort in bringing the product to life: sourcing suppliers, makers, packaging, distribution and scouring for retail customers who will take a chance on you.

Their goals are often to improve the health and wellbeing of people, raise the bar on quality and change (improve) the food system in the process. There’s a worthwhile and worthy pursuit. Heartfelt. Making the world a better place. Giving back. Elevating the game. Disrupting categories. Creating new ones. Thus, a vision in motion.

In the beginning with some exceptions, company resources are limited, and every dollar counts. Prioritization sets in and the first consideration is getting the quality and the mission embedded into the product. Like anything initially lacking scale, the ingredient, production and distribution costs will invariably be higher.

We also know there’s ample evidence of high failure rate on new product introductions and businesses that either gain some initial traction and flame out or never quite scale and live on in under-achieving anonymity in limited distribution.

Despite this truth, we find marketing at times takes a back seat, or no seat on this go-to-market bus. The general view might be, “if you build it (exceptionally well), they will come.” Or the more specific, “great products always find a market.” It’s naturally alluring, right, because it’s just so much better than the status quo…plus the deeper belief or mission system adds value. All true, but…

X-Factor: Marketing and the human being

Human beings are remarkable creatures. People are not analytical decision-making machines, and for the most part operate on emotional cues. We call this “heart over head.” Consumers are bombarded and buried in marketplace noise. Our multi-tasking, multi-channeled digital and distracted lives require some respected credible guidance and filtering in order to get our brains around what to pay attention to – and what matters.

Strong marketing firms are keepers of consumer insight.

Great marketing vs. just serviceable will always involve more than just a toolbox of outreach tools.

Communications tactics without strategy and embedded consumer insight is like shouting your story from a mountaintop where the only real recipients are big horned sheep.

A strong marketing partner will offer brands the following:

1. Insight into consumer behaviors, motivations, passions, concerns and needs that inform everything from packaging to web site to outbound and inbound marketing content.

2. Knowledge and expertise in branding, brand positioning – and mapping the strategic story you’re about to tell in an environment where gaining attention is more difficult than ever, despite the ready availability of social, digital channels.

3. Seasoned experience in navigating the dynamics of the buyer environment, retailer needs and how best to package an intangible – which can be a significant hill to climb for a newcomer selling assertions of future success.

4. Informed design and messaging for web, sales and trade communications assets that removes the guesswork in how the concept is presented to both business and consumer audiences.

5. Contacts and relationships in the industry and with influencers who can help break down barriers and resistance to distribution hurdles, equity investment interest and consumer engagement.

6. An informed sounding board for product development ideas, formulation moves, packaging adjustments and early innovation bets.

The beneficial outcomes:

• Better results, minimizing misfires and speed to gaining account placement.
• Removing risk in how to best package and present the brand story.
• Generating media visibility at a time when steady, ongoing awareness is hard to come by after the first salvo of newcomer attention.

A great partner understands the grist of what you are trying to do right down to the atoms and electrons level. When every dollar is precious, is there added value in making marketing investments early?

Even if engagement is limited to strategic planning at the onset, there’s more to be gained in getting it right the first time; it will help accelerate the trajectory of business development.

In short, better to put marketing in the plan and on the priority list upfront rather than see it as a downstream consequence of ‘required support’ once the business is percolating.

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As the food landscape changes, the equally disruptive media-machine upheaval reaches into and upends conventional CPG brand communications strategies – Where’s Don Draper when you really need him?

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