There’s a revolution going on in food retailing that is disrupting the marketing of food, including poultry and meats.
In a Food Institute webinar, “The Revolution of the Digital Marketplace,” food retailing experts from the consulting firm Willard Bishop explained how the disruptions are impacting the four Ps in food marketing: Product, Place, Promotion and Price.
P is for Product, P is for Place
First of all, the following food retailing growth segments
outpaced the market in year-over-year growth percentages:
- Disruptive new products with 87.9 percent growth
- eCommerce with 13.7 percent growth
- Natural and organic food, beverages and non-foods with 11.5 percent growth
- Fresh format with 10.4 percent growth
- Dollar format with 8.9 percent growth
- Prepared foods with 6.5 percent growth
- Limited assortment with 4.1 percent growth
These categories are all important to all marketers, but some have special relevance to poultry. Notice the growth in ‘natural and organic’ products and the ‘fresh’ format. The fresh format, for example, is leading all others is sales and store counts. That has huge implication for the marketing of chicken and turkey.
eCommerce and mCommerce impact ‘Place’ and more
Poultry marketers must also find ways to remain relevant in a food retailing market in which eCommerce (digital or electronic commerce) and mCommerce (mobile commerce) are of growing significance.
According to Craig Rosenblum and Jim Hertel of Willard
Bishop,there’s no such thing as the traditional shopping experience:
- The term “store” will mean physical and online
- The retail experience will begin electronically, often with ad circulars on websites or mobile devices
- Food sales will continue to expand across all formats (at the expense of supermarkets)
- Grocery retailers are getting on board with eCommerce, they said.
- Ahold’s eCommerce business will double to $1.5 billion by the end of 2015
- Shop-Rite is processing more than 1,000 eCommerce orders weekly
- Harris Teeter is processing more than 500 eCommerce orders weekly
- Kroger’s eCommerce sales will account for 8 percent of its
total sales by the end of 2014 (excludes Harris Teeter)
Mobile devices are playing big role
Four out of five consumers use smartphones to shop,
according to data presented by Rosenblum and Hertel. In 2015, more internet
access will be through mobile devices than desktops. What’s more, 70 percent of
all mobile searches result in action within one hour.
P is for Promotion, and the landscape is changing
The traditional printed ad circular is giving way to the ad circulars on websites and mobile devices. Target’s Cartwheel coupon app, for example, frees shoppers from clipping coupons and allows them to access and use coupons when and where they want.
What’s more, Rosenblum and Hertel say, the use of mobile
coupons is exploding:
- Usage of mobile coupons on smartphone is up 41 percent versus a year ago
- The number of mobile coupon users is expected to exceed 50 million this year
- Redemption for mobile coupons is 10 times higher than print
- Mobile coupons are a gateway into consumer insights
Promotional success for retailers is all about
analytics, digital/mobile and personalization, they said.
P is for Price: Industry wide pressure
Food retailers are locked a fierce price battle, and the
increased usage of mobile devices means that price comparisons are easier than
ever:
- 58 percent of shoppers use their smartphones to compare prices
- 38 percent of shoppers who are using their mobile phones
have stopped an in-store purchase as a result
Extracting behavioral analytics hidden in big data is
not only easier but essential for driving shopper loyalty. For example,
personal pricing will reward the most loyal shoppers.
The 3Ms for food sales growth
Finally, Rosenblum and Hertel urged listeners to remember
the 3Ms for growth: Millennials, mobile and more.
- More communication channels
- More personalized offers
- More shopping and delivery options
The traditional shopping experience continues to evolve with a continuing shift in retail formats, they said. One important trend is that the shopping experience is more and more occurring outside the store.
Connecting with Millennials (on their terms) is essential for growth, they emphasized. These shoppers are less brand loyal; very price-conscious (but willing to pay up sometimes); convenience-driven and very socially connected.
Of special significance to poultry marketers is that Millennials are attracted to fresh, natural and organic and specialty appeals.
