I had the privilege of attending the Speciality & Fine Food Fair this year. The trade show was great, it presented many different types of business from all over the world that focused on the food and beverage industry. Not only was it great to connect with businesses on new products and markets, the seminars were very informative.
While there were many seminars throughout the show, one that piqued my interest was the one hosted by Kantar on the cost-of-living crises. While the seminar focused specifically on consumer businesses, I know the crisis will affect businesses across all industries.
The cost-of-living pressure is currently heating up. Grocery inflation is at its highest point in the last 30 years, current at 11.6%. With this in mind, what should we expect from shoppers? They will buy less, shop at cheaper stores for cheaper products, and be on the look out for more promotions.
Kantar recommended 5 tips for companies to grow their business, which can be applied across many industries. Please note, all pictures included in tips 1-5 are from Kantar’s presentation during the food show:
1. Be prepared to work harder to justify your price premiums
It is obvious that companies will be forced to increase their prices for products and services. Businesses should continue to invest where they can, such as innovations (new brands or sub-brands) and renovations (new size, flavour, type) to justify price increases to shoppers.
2. Communicate value not just price
This builds off point number 1. Make sure that shoppers know the value that your products or services bring. The winning categories in the last recessions were not necessarily basic needs.
3. Don’t overlook the older shopper
A lot of companies are now targeting Millennials and Gen Z shoppers, however, older shoppers (those over 65) are the biggest and most financial secure category. Specifically for grocery, 32% of all grocery sales come from older shoppers.
4. Think small value as well as big
When selling products, it’s easier to want to target financially comfortable households rather than struggling households. However, don’t be fooled that all value comes from comfortable households. Those under greater financial strain are forced to focus on immediate needs.
5. Take an active role in the loyalty battle
Discounters are picking up market share from every other channel. Big supermarkets, such as Tesco, have the largest spend by loyal shoppers. This is due to an increase in loyalty programs, e.g., Club Cards. These loyalty programs help keep shoppers coming back for more.
Kantar did a great job with their seminar: it was short, engaging, and helped break down the points for businesses to focus on.
If you did not get a chance to check out the Speciality & Fine Food Fair this year, I highly recommend going next year. All seminar recording will also be available online, so be sure to check out the material.