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Panelists included representatives from Walmart, Onlinesales, AndMakers, and Home Depot
Co-hosted by Krysti Keener, an Excelerate champion, and Bambi Francisco, founder and CEO of Vator, the focus of the webinar is on how smaller brands can create awareness of retailers.
Millions of businesses start every year in the US., and many of those are mom-and-pop shops inventing new BBQ sauces, slippers or gadgets. Half go out of business by the second year, and some take a generation to win the title of fastest-growing brand in the world, like BelVita just did. So, as a young consumer brand, what’s the best way to get noticed in the crowded world of consumer products? She talks to marketing and retail experts, decision-makers at retailers and retail marketplaces, as well as innovators helping these younger brands land premium shelf space.
The panelists included Nasreen Murad, Manager of Strategic Accounts (US Marketplace) at Walmart; Kunal Parekh, Vice President of Products at OnlineSales; Lily Chan, co-founder and Chief Revenue Officer at AndMakers; and Sada Kshirsagar head of Product Management for B2B eCommerce at Home Depot.
Highlights from the event:
In response to macro economic conditions and bank failures
NM: Some brands will struggle to scale because they're not getting the connection that they used to from SVB that they had, including a robust network which would give them access to businesses, investors, VCs, mentorship. So, we will see a little bit of a decline in scaling these small businesses, just because that piece is missing. Also, a lot of businesses are getting acquired by other big companies that can accelerate their business, so we are seeing a shift in total retail right now. The bigger companies can help them accelerate and give them the resources and the expertise but if you want to be a niche brand, that is going to be a challenge just because they can't really tap into that funding that they were getting from SVB bank.
Why retailers, like Bed, Bath & Beyond went out of business
NM: DTC brands know how to reach the customer in a different a more innovative way, just from the features of their products, the capability of putting the product together, getting it very quickly to the consumer without having to leave their homes. That's impacted the brick and mortar business and customers are just lacking engagement in stores. Customers really are looking for that experience and that could be a reason people are shopping online more: they're getting better experience online versus in stores. Bed, Bath & Beyond really capitalized in terms of that coupon feature and getting the foot traffic and knowing how to get that customer but the innovation wasn't there and these smaller businesses just knew how to really do a good job on that side of the business in making it more creative for the customer.
SK: In retail, there are many companies that have come and gone, like Circuit City and Sears. When Circuit City went away, Best Buy survived and thrived; when Sears went away, other companies took a lot of that market share away, including Home Depot, Best Buy, and Lowe's. From a consumer standpoint, the choices that a consumer has to spend their dollar today are only increasing. So, the demise of any company is just a temporary blip in hundreds of years of retail history. If big players like Sears can come in and go, maybe there'll be a day when we talk about Amazon in the same light. Consumers have choice, they have other platforms to go to.
How are smaller brands competing?
KP: What we are seeing, specifically from smaller branches, is they're focusing on one thing, which is profitability. Everybody is in shock that a big box retailer like Bed Bath & Beyond just shut down like that, but they are really now focusing on profitability, and everyone is figuring out ways to increase their bottom lines. They are now starting to value the amount of data in terms of audiences, the audience data set, the loyalty data sets, and they now are thinking in terms of how they can leverage that to build a better, personalized online experience for a particular shopper. They're investing in the consumer experience. They are personalizing it even further, to the extent that when the physical delivery happens, that has to be personalized, it should be their identity. That is a huge shift we are seeing in the mindset of these small brands.
LC: Even if it's a large company, and they have good run rate revenue, it's doing well, she always go back to product market fit based on that target audience in that retailer's portfolio. Consumers tend to see the same products on all of these different retailers, however they're going to have a different way of how they're going to market to their clientele. They're doing SEO, PPC, mailers, email, and targeted marketing. In the beginning, when Chan talks to a new brand, she says for their top five that you want to target first and then tells them to study their products, and find their passion. If they want to make marble tables, they need to know how much they need to charge to be able to make their money back. Then they have to research the retailers that they want to work with and identify what their business model and their strategy as far as cost price, pricing, merchandising, even reviews: who do theuy want to target to write about their marble table? And then of course, their competitors: who else is selling this similar item?
SK: First, take care of your product: is your product the right product? Do who know who your target audience is? Brands need to spend their money making sure that they have the right product, they have a differentiating product, and then it's all about distribution. If they have the right product, are they in the right place for the consumer to actually find them? One of the things that they could do as a brand is to make sure that they have the content, the images, the SEO copies, and review content that they really need. Every retailer has what they call a seed program, or an onboarding program, for reviews, so brands should take advantage of it.
To what extent is retail media used and what's the ROI?
KP: What used to happen is brands were very greedy in terms of ROI; they wanted the ROI faster, but now there’s an understanding that it takes time to figure out who the right audience to target is, but they patience now, that is what is what we are seeing, even from smaller brands. This only used to be from head brands, where they wait and they experiment a lot, they do a lot of A/B tests. The amount of experimentation hypothesis they put in to make sure that their distribution is successful on a big box retailer online, like the sponsored products or brands that you're seeing, from a data standpoint, they are making those kinds of decisions.
NM: There's no simple formula, especially when it comes to getting an item discovered. One of the challenges for businesses is that after their 90 day maturity level, there's a ton of business that they're expecting to get back but it doesn't work that way. It's really a science. The first thing she focuses on is really getting the content right, that is the first step, and it's an investment, but it's really worth the investment because the store is the first thing the customer sees, and so they're going to either keep going or leave. Rich media is very important when you want to drive conversion; it's not just about content, there's a lot of tools that are out there that people don't take advantage of, especially below the fold. There are different features that can enhance the shopping experience on a product page and many businesses don't take advantage of that.
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