Marketing Challenges For Emerging Grocery Brands

June 12, 2022
Customer Experience is the Anchor of Retail Marketing Strategy

It could be very frustrating when you put in a lot of work into making your business thrive and at the end of the day, nothing tangible to show for your effort. It happens frequently, especially in a competitive market such as the grocery industry. Emerging grocery brands find themselves in a bit of a dilemma when it comes to their retail marketing strategies. It could be the product, planning or the execution of the ideas that have some flaws. Customer experience in retail is one aspect of retail marketing strategy emerging brands often miss to address, yet it could be a crucial element that can prove very crucial in the success of your business.

Challenges of Startup Marketing Budget

Many supermarkets now are making shelf space available for emerging, local grocery brands. So getting your products on the shelf is less difficult than it used to be only a few years ago. However, there are on average over 30,000 items carried in a supermarket and you cannot leave it to chance that consumers will find and decide to try your products. Surely creative packaging and media advertising could improve probability of success, but these require very large marketing budgets to produce any results. Small company with an emerging brand will not likely outperform well established competitors with multi-million dollars in media budget and familiarity to the consumers. However, an excellent field marketing program can help reduce the strain caused by these established brands in your products.

In Store Product Sampling

Consider an example of a product (chocolate bar) from an emerging brand that sells only 5.8 units (SKU) per month in a single store. Since only a few dozens of stores carry the product now, advertising in print, radio or TV, even if you had the necessary budget, would be very ineffective and wasteful. The price discount typically generates a two times product sales increase during the time of promotional period. However the residual value of promotion is very negligible. In other words, very few consumers become loyal customers as a result of a TPR.  In store sampling of your product, on the other hand, often creates lasting sales volume increase for months to come.

In the above mentioned example, a single in store demo resulted in a 65% increase in monthly units sales per store. That does not take into account the number of units sold during the four hours of demo. The most important fact is that even the smallest producer can afford a focused demo campaign. KIND brand started it’s field marketing efforts with $800 to build 1.5 billion (assets) company. Now their product sampling budget is $10 million.

In Store Demos are Very Effective

In fact, many emerging brands had a very positive initial experience with in store demos as a very effective means of introducing their products to the consumers. Admittedly, the in store marketing campaigns are often initiated by the retailers, as a precondition of stocking the brand new, unproven products. In many cases these demonstrations are conducted by a brand owner. Even when you are "coerced", it's hard not to appreciate the value of this direct form of experiential marketing effort - as shoppers have an opportunity to experience your product, you have an opportunity to experience an immediate reaction of these shoppers.

While learning opportunities and emotional gratification of connection with your customers are abound, there comes a time when you need to focus on scaling your brand growth. While it is hard to imagine that anybody could possibly promote your product with more enthusiasm and expertise than you do, you cannot be everywhere it needs to be done. Besides, you have to open new territories, hire new distributors and ... basically do you brand manager's job. That is where really good field marketing management software can provide a great benefit of well thought through workflows that can help to scale your operations in a very short time.

Regardless of whether you plan to manage the demo program in-house or to outsource it, nothing can replace a clear understanding of the workflow and market intelligence (data). As your brand starts to take off, you would have to make choices:

  • which store's demographics will likely to provide a better return on your marketing investments,
  • what days of the week will likely be the most productive,
  • what to focus on - retail customer experience, brand exposure or unit sales per demo, etc.

Successful Demo

A truly successful in-store demo is not a discrete event, but a customer relationship exercise that has a lasting effect on the store's re-order pattern. It is wise to correlate these trends for the future planning and leverage local market knowledge of your brokers and distributors.
Well formalized workflow will make much easier to schedule demos, as continuous juggling of stores' and brand ambassadors' availability can challenge one's sanity after few cycles of changes. Even when you decide to outsource, the scheduling process is often remains a brand responsibility as most demo companies are focused on staffing, not the management of relationship with retailers.

Are you a retailer?Are you a brand builder?Are you a demo company owner?

Would you like to be notified when the next article is published? Leave your name and email address

Oops! Something went wrong while submitting the form.