How Do you Know the Price of Your Products are too HIGH?

 

When asked what’s more important where you sell your product or the price of the product?  The answer may be more difficult than you think.  If you were to ask PepsiCo, they might just say the value of their product is at the intersection of what consumers are willing to pay for it and what is cast to get that product place on the shelf. 

 Recently Carrefour stopped selling PepsiCo products in four European countries because they raised the prices to high?  That was Carrefour saying that.  The question is, will consumers demand PepsiCo branded products and ask Carrefour to bring them back, or will they simple opt for a substitute product. 

That according to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® “creates an opportunity for ‘forced trial’ in most instances and if the product is less expensive and  has the same or more appealing flavor, texture, package size customer migration might just follow.”

Recent inflation has consumers on edge, even if they received a healthy pay increase themselves, they are still aware of what they have been paying for branded products and simply dislike how much they have recently gone up in price.

Grocery stores, restaurants, and convenience stores are facing increased competition from the Dollar Store sector.  All food retailers are used to selling volume and living on slim margins. PepsiCo sells many items that consumers like to bundle (Mix & Match) in to a convenient meal solution according to Johnson.

Should a retailer the ilk of Walmart, Carrefour, Kroger, or Tesco use price of your product alone to determine if they are willing to continue selling your product? Does a Branded potato chip add value to the retailer selling potato chips? 

When a retailer is dropping a brand, on price alone they are disrespecting the consumer.  When a retailer replaces a brand with a private label ilk niche product for less, they empower consumer choice.  However, brands the ilk of PepsiCo, Kraft Heinz, and Procter & Gamble have a long-standing relationship with consumers and powerful brand messaging that can drive a consumer from one retailer to another.

Even more important legacy brands the ilk of Kraft, Colgate, Tyson, and PepsiCo have a new product innovation pipeline that private label does not.  That innovation pipeline drives trail, visits, top-line sales and bottom-line profits for all retailers need to keep customers thinking that they have contemporary relevance.  

Marketing messaging matters.  Brands do have a relationship with consumers, if success does leave clues its time that brand messaging edifies brand values.  If it does the consumer will follow your brand where ever you sell it.

Do you know how to find your Price, Value, Service Equilibrium? The team at Foodservice Solutions® thinks that, consumers are resetting the Price, Value, Service Equilibrium. The formula for this equilibrium is as follows:

 

(Mobile Access + Digital Payment + Delivery) X (Price + Food Quality + Speed) = Value Incremental Value: Constantly Changing Menu (Seasonally / Sustainability with Creditability)

 

Are you ready for some fresh ideations? Do your food marketing ideas look more like yesterday than tomorrow? Interested in learning how our Grocerant Guru® can edify your retail food brand while creating a platform for consumer convenient meal participation, differentiation, and individualization?  Email us at: Steve@FoodserviceSolutions.us or visit: us on our social media sites by clicking one of the following links: Facebook,  LinkedIn, or Twitter

Morrisons Beef’s up it Grocerant Niche Offerings

Consumers touchpoints are important at Morrisons.  At the intersection of customer relevance and one of key drivers of the grocerant niche is the ‘halo of better for you’. That is intersection Morrisons is using to edify their brand with consumers according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.  

When, UK retailer Morrisons has announced that it has introduced a lean meat box for health-conscious consumers it was clear they were looking to add brand value with incremental customer relevance.  So, the six-kilogram box, priced at £45, will offer 50 portions of chicken, beef, pork, turkey and bacon - all containing less than 5% fat.  That focus on the ‘halo of better for you’ plays perfectly into Foodservice Solutions® FIVE P’s of Food Marketing and will drive sales now in this time of COVID-19 and after according to Johnson.

Head of food boxes at Morrisons, Tessa Callaghan, stated, ”Many of our customers are thinking about their health and fitness during lockdown. …“So, we wanted to create a great value bulk box which was made from British lean fresh meat and which could be delivered right to their front door.”

The boxes can be ordered online and are delivered the following day or at a chosen date. How are you expanding top line sales and bottom-line profits?  Are you ready to enter the grocerant niche?

Invite Foodservice Solutions® to complete a Grocerant Program Assessment, Grocerant ScoreCard, or for product positioning or placement assistance, or call our Grocerant Guru®.  Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869

Global Food Trends Catch -up with Tesco

Back in the day Tesco was the global grocerant niche leader, food industry icon and pace-setter of grocery trends and then the past began to creep in as industry food industry veterans replaced innovators according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.

During the 1990’s Tesco was the innovator driving industry excitement, customer relevance, top line growth and bottom-line profits and the world watched, copied, and followed their lead.  However, over time innovative leaderships was replaced and legacy category managers were sent into eke out profits, as an unintended consequence they drove out innovation opening the door for all sorts of retail competition.

Twenty-five years later Tesco is rebooting, rereading the grocerant playbook and stepping-up to stand out as a legacy grocery store search for customer relevance according to Johnson.  With a focus on Robot-driven supermarkets, upmarket convenience stores and a tenfold increase in plant-based ready meals it appears that the ‘halo’ of better-for-you food positioning Johnson was encouraging Tesco to follow back in the day is about to take hold.

The UK’s biggest supermarket chain, which accounts for nearly a third of all groceries sold in the UK, told investors and City analysts at a presentation on Tuesday there was still room for it to open additional small stores in Britain including more than 100 One Stop outlets.

The company has 169 One Stop franchises, in addition to 776 fully owned Tesco outlets and more than 1,000 Tesco Express stores.  Today small stores are also a key part of future growth overseas, including 750 new outlets in Thailand. While the future for Tesco just might be robot technology within its distribution centers.  It is also adding self-scanning handsets and mobile apps, which enable shoppers to pay without using a till, are also expected to help Tesco save £68m in costs as it aims for all self-scan transactions to be cashless in two years and all self-service checkout payments to be cashless within five years.

It is our hope Tesco will continue to drive growth via innovation in customer touchpoints rather than regressive category tactics of yesterday.   Have your sales and profits been stifled using legacy tactics of the 1990’s.  Do your stores look more like yesterday than tomorrow?

Are you ready for some fresh ideations? Do your food marketing tactics look more like yesterday that tomorrow?  Visit www.FoodserviceSolutions.us for more information or contact: Steve@FoodserviceSolutions.us Remember success does leave clues and we just may have the clue you need to propel your continued success.

H-E-B Growing Grocerant Meals & Meal Components

Grocery stores around the world have been capitulating market share to the Dollar Store sector, Convenience store sector, Restaurant sector for so long that they have 50% fewer grocery stores today than 12 years ago according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®. 

One simple fact has driven most remaining grocery stores to evolve from selling legacy pantry filling CPG products to selling grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food according to our Grocerant Guru®. That fact Millennials don’t have or want a pantry?  They want fresh prepared meals and meal components according to Johnson.

H-E-B is one retailer that is standing up for itself and meeting the consumer half way by offering more and more grocerant niche Ready-2-Eat and Heat-N-Eat fresh food inside it stores as regular readers of this blog know.  Now they are one of the grocers going after a larger Share of Stomach opening a free-standing restaurant directly in front of an existing H-E-B store in an attempt to garner back restaurant customers.

H-E-B’s new 625 ft free standing seafood restaurant albeit directly in front a H-E-B store is a branded invitation to think H-E-B for fresh food according to Johnson.  This is a clue on how the industry may evolve according to Johnson. Most it cost a lot to stock a seafood department with qualified fish mongers, fresh fish, and competitive pricing.  Regular reader of this blog know Tesco is closing 90 seafood and meat departments in its store in an effort to save money.  

The menu at H-E-B-s new seafood restaurant includes classic chain seafood staples the ilk of fried seafood baskets, broiled crawfish, peel and eat shrimp, snow crab and mix and match combo meal options. Yes, by the way you can get takeout.  H-E-B understand consumers want seafood, but they don’t have the skill-set to cook it.  Thus, meals and meal components used to expand the H-E-B brand.

Invite Foodservice Solutions® to complete a Grocerant Program Assessment, Grocerant ScoreCard, or for product positioning or placement assistance, or call our Grocerant Guru®.  Since 1991 www.FoodserviceSolutions.us  of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869

Sainsbury's tries cashier-less shopping 'till-free' to speed-up Checkout

Time starved consumers love Amazon Go cashier free stores according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®. Is it any wonder that food retailers are all trying to find ways to speed up the shopping experience?

UK based supermarket chain Sainsbury's currently is experimenting a ‘till-free’ check out so consumers do not have to wait for the next teller. Instead, customers can scan goods with a smartphone and put them straight into a bag. When they have finished shopping, their payment is processed by the phone similar to what Kroger is testing at many of their stores in the US.

The Sainsbury's SmartShop app lets customers scan the contents of their shopping cart as they browse the aisles to reduce waiting time at the checkout. The app is already available in 68 stores, but customers in one location will now be able to pay with the app too. The trial is currently only available in the Clapham North Sainsbury's Local, to iPhone users who have Apple Pay set up on their device.

It is this simple after scanning an item they want to buy customers can put it straight into their own personal shopping bag. After finishing their shopping, customers scan a QR code by the store's exit to confirm their purchases. They are then free to leave.

The simple fact is today’s consumers want to get in and out fast and retailers want to have less employees and benefits to pay this scan and go system is a step in the right direction.  It is not as good of a solution as Amazon Go according to Johnson.  However all retailers must move forward faster or they will be the next A&P.

Foodservice Solutions® specializes in outsourced food marketing and business development ideations. We can help you identify, quantify and qualify additional food retail segment opportunities or a new menu product segment and brand and menu integration strategy.  Foodservice Solutions® of Tacoma WA is the global leader in the Grocerant niche visit Facebook.com/Steven Johnson, Linkedin.com/in/grocerant/ or twitter.com/grocerant