COLUMN | Craig Armstrong, Director (Customers) NZTE
A close and valued colleague used to say, “The world does not need any more wine from New Zealand”. I disagreed then, and recent data showing the export growth of horticulture (driven by wine) and processed foods (driven by pet food) proves how wrong his thinking was.
Craig Armstrong, Director (Customers), NZTE
A majority of the world has yet to taste New Zealand. A honey business told me last week that two-thirds of their US consumers are new to Mānuka. No matter how big and dominating we think, dairy in New Zealand is, our share of the global dairy market is just two percent. Back in the USA – where the Chardonnay grape varietal is two and a half times bigger than Sauvignon Blanc (and Sauvignon Blanc is only the 5th largest varietal), a Wine Intelligence report commissioned by New Zealand Winegrowers identified 13.5 million potential new consumers (an incremental $365 million opportunity) if New Zealand wine companies can acquire new US consumers who don't currently purchase New Zealand wine. New Zealand is only 1.5 percent of total world wine production. Coriolis noted that we stopped growing market share in Britain once it joined the EU, and since then, New Zealand’s share of UK imports has fallen to approximately one percent.
The world does want more wine, pet food, supplements, dairy, and anything else we can grow, harvest, or manufacture. We are far from saturating market share positions.
And so, it’s good to see the F&B Market Ready International Buyer’s Guide back in the market after COVID, sharing the best of New Zealand food and beverage with global markets.
The demand for - and value of - healthy, tasty, trusted (branded), safe and sustainable/ethical food and beverage from New Zealand has never been higher (even within shifting channel preferences and affordability challenges). If egg prices are high here, consider New Zealand eggs are fetching $3.50 each in Hong Kong.
With our domestic market harder to get exposure in and just five million people to serve, why wouldn't you consider Australia (about five chains and dozens of independents), the UK (about 16 chains) or the USA (IBIS reports more than 60,000 supermarket and grocery store businesses, five nationwide and 14 regional supermarket chains)? An Asian and European count is too difficult, but just Google to get some idea of the size and context of the market.
Passion, a great recipe, a family story, or a deep love of food will only get you to the border. OMARS, tariffs, safety and compliance, distribution layers, margins/pricing, storage, working capital, understanding consumer needs – being in FMCG takes grit, a lot of love, and requires a certain amount of enterprise, resources, and support.
You ARE, however, only a keyboard away from most of that support. Whether specialists; online portals of free curated information; analysis and insights; food and beverage development and production facilities; shipping and logistics; or editorial and solutions. The industry is awash with mentorship, support, and networks of entrepreneurs and those willing to help you on or in your journey.
The greatest challenge of getting great food, beverage, pet, beauty, and body care into the hands of global shoppers is awareness. The Made with Care campaign has been running amongst premium shoppers in five global regions. And whilst Kantar measures its awareness to be one and half times the norm for a digital campaign, it still means that some 60 percent of premium grocery shoppers are less aware of New Zealand food and beverage and, therefore, less likely to consider, prefer or purchase a New Zealand product.
That awareness goes two ways - awareness of your brand/product, and why shoppers purchase what they do. Often the most effective ways to understand this are the simplest – stand at the section/aisle and ask the shopper - ditto outside the checkouts. Photo the section, labels, prices, and pack formats; watch what people pick up and put back. Combine these in-market ‘safaris’ with trade fairs and exhibitions, and you'll succeed in achieving two things in a single action – for the price of a plane ticket.
A recent analysis of close to 200 food and beverage exporter projects found that what exporters “would do differently” and the “advice (they had) for others” is to understand and validate before acting (see chart).
In summary:
1. Understand the consumer experience with your product. Invest in observation, research, data and analysis to understand shopper decisions and consumer drivers.
2. There are always opportunities for more product innovation. Dial-up unique product differentiators and support with social and storytelling narratives (Include collaborative platforms like Made with Care and trust marks like the FernMark).
3. Adapt your brand to local market nuances.
4. Build your network(s) and your support. Being market-ready is not just about understanding the market, but getting your business ‘fit’.
