By Blackdog - one year ago
If Australian consumers aren’t angry they should be – mortgage rates ever increasing, gas and power bills knocking on the front door and logistics and supply chains in disarray all add up to pressure on Australian households and the family budget. Let’s add in an element of continuing post Covid frustration and we have what appears to be a tough year for grocery retail in 2022.
Black Friday/Cyber Monday – 10% down on 2019 and 20% down on 2020 suggests the special value events are diminishing in importance and that value has to be every day and driven instore to meet shopper expectations
But spend is still under post Covid shenanigans – eating out still booming, grocery/beauty sales tracking positively but high-ticket items put off till a better time.
With every $ under scrutiny how do we navigate, and drive increased instore impact in the grocery business?
Let’s stay agile and close to our shoppers.
Research from Insight Led – reveals a new consumer mindset is emerging from 2022 – that is focused on Purposeful Spending. Driven by financial pressures it also combines elements of health protection, sustainability, and provenance – Aussie made to the fore.
The new consumer mindset offers both opportunity and threat particularly in the Grocery sector
Value is liquid
Value is not a constant it’s liquid – without sounding like a Californian guru – the truth is that Value needs to flow through all aspects of the offer and through many different forms. Value flows into Brand positioning, innovation/new product development/key SKU’s/loyalty rewards. The question to ask does our offer maximise our value message at every moment of the customer experience?
Value is female
Often forgotten but our female shopper is a much more multi-faceted shopper than the mere male. And she will bear the brunt in 2023. Holding down many functions within the household – she comes with diverse thinking around her role as Mother, Household manager, Worker, Chief educator and driver of Health and Beauty regimes. This complexity needs to be funnelled into specific instore shopper campaigns and point of sale – utilising a female point of view to build value and incremental purchase aisle by aisle.
Be a place of Safety
Maintain the instore environment as a place of safety. Morph our Covid intensity into longer term programmes. Invest in and show your commitment to contactless interaction instore not as delivery system but as a way of maintaining a dialogue with customers. Add in health and safety advice as core – instore and online – deliver health bundles and specific product initiatives to your loyal customers
Eco – Consciousness to the fore
It’s quite remarkable that major FMCG manufacturers are still producing products that are not carbon neutral, that drive HFSS issues and whose activities are still being censured for environmental impacts and in some cases contain disputed claims over work practices.. Time to move on from greenwashing. Time for Australian retail to take this issue seriously as a new generation of consumers demand action.
Simple action – build category selections and aisle facings that deliver retailers endorsed sustainable and climate sustaining products
Provenance, provenance, provenance
Aussie, Aussie, Aussie – drive more effectively the Australian retailer’s relationship with Australian farmers and providers. Look to Naked Wines as an online and instore example of how your purchase decision impacts the farmer on the ground. How your purchase is a reinvestment in Australian resources. Build dynamic instore sampling programmes driving the individual farmer/provider story.
Own label as proof point
And lastly but certainly not least - all the elements of Provenance, Eco-Consciousness, Safety, Female as key target and value meet in Own label. With its price advantage – this is the battleground in 2023. Provide proof for consumers that Australian retailers are listening to the new consumer and driving purposeful spending into their own brands. Don’t be afraid to premiumise instore utilising celebrities and influencers in the Own label category. Shoppers are looking for certainty – provide it.