And we don’t mean retail. We’re talking about those suppliers who pulled their advertising budgets in a cost saving stance that really wasn’t warranted. Truth is that grocery business is good – incredible in fact - and to pull back on advertising is simply bottom-line building and certainly not marketing.
Citing a few brands who are awake to the future including the likes of Arnotts, Matakana Superfoods, Uncle Toby, Yummy and a couple of others, gives us heart that clever marketing does still exist. Going dark at this time will have its consequences down the line making fresh brand building a much more difficult task.
Not being top of mind for the consumer gives them an opportunity to be adventurous with new and different products - and perhaps like the shift from traditional brands. Building up that rapport again is not cheap nor easy so those who have stayed in the promotional market at consumer level will be the real winners.
In fact, there has been almost no fall-off in sales for most suppliers as supermarket sales skyrocket but not being top of mind still is a major mistake, as the experts are now saying. Promoting a product generally brings sales and supermarket operators and buyers know full well that it doesn’t need a sales rep in-store to push that point.
By the time we get into the lower lockdown levels, normality will have returned to the grocery industry and as one of the essential industries, we won’t have lost too much. Our two retail groups have done the right thing by continuing to promote heavily and not going dark despite the booming sales. It’s a lesson that our suppliers also need to heed about advertising to both the consumer and to the trade.
Opportunities Up For Grabs
While the pandemic may have its downside for some sectors of the economy, notably hospitality and tourism, there have been some bright spots for the grocery industry.
What it has done is completely knockout the independent butchery and greengrocery business and handed it to the supermarkets. And it is now the big banners opportunity to put together even better departments with top department managers and staff.
The industry has already missed a chance to dominate the pharmacy business with the couple of big discount players moving into the sector as small chemist shops fall by the wayside. The industry didn’t quite miss the boat with bakery and the in-store offering continues to succeed. And of course, liquor has been a real winner with either in-store or owned operations.
The lockdown has also opened-up the opportunity to move more deeply into the prepared food market with key restaurants perhaps not wanting to open but maintain their skill and appeal by preparing a selection of frozen top of the line meals. Perhaps this is a local opportunity rather than national supply – they just need to be shown how to do it commercially.
We need to let the likes of Costco and the Warehouse do their thing in the general merchandise market – something grocery should stay clear of except in very basic household items. While dry and canned lines will remain key, fresh and local is going to play an increasingly important role in the future supermarket to ensure bricks and mortar supermarkets are a destination. Locking up categories will complete the supply circle and that is gradually happening.