Top 10 Thoughts, Trends and Ideas for Food Retail Brands in 2011

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Food for Thought
Over the past year we’ve been working on some great projects with the super-creative folk at Jane the Agency, adding a whole other dimension of brand communications to the mix for our clients existing and new. An area of passion we share is food – food retail, food brands, food eating, food packaging, food festivals, food manufacturing, food growing, pretty much everything to do with food. Over the journey we’ve had some great food conversations which led Rachel Taylor from Jane to pen-down some brilliant thoughts, trends and ideas on the subject of food retail.

01. What are the food retail giants worried about?
In 2010 the CEO’s of the top 10 food retail giants ranked (in order) the top 4 key issues facing their brands:
1. Economy & Consumer Demand
2. Corporate Social Responsibility
3. Competitive Landscape
4. Food Safety

02. Consumers key drivers for purchasing food and brands in are…
1. Cost and quality
2. Buying local
3. Sustainability
4. Social Conscience

03. The Move to Natural
As we are all aware there is a growing push from the consumer to go natural. This is driven by a range of concerns but primarily health & social issues.
Brands that can promote their full list of ingredients clearly on their packaging will take a market lead.
The desire to understand the journey of food from the soil to the final product is becoming imperative – touching on brand story, food miles, sustainability & food safety.
Farmers are in fashion (as we have all noticed every major brand that can afford to – wants you to know that there is a hard working farmer in the process).

04. Avoiding the Copy Cat
A major issue for many privately owned brands is the growing push of supermarkets ‘own brands’. The shelf power and copy cat ability of ‘own brands’ makes it difficult for private brands to compete. ‘Own brands’ run on a bargain, better, best strategy which allows them to run cheap through to premium knock-offs of known private brands and cover most markets including organic. Privately owned brands will need to take this into account in their brand strategy for 2011 and beyond.

05. The main ways in which private brands need to fight back and protect their market share is via two core areas that supermarket ‘own labels’ struggle to meet;
1. A pure and honest brand/product story
2. Food preparation

06. Baby Boomers
It cannot be denied that this will be one of the most influential and powerful categories for the next 20 years. They have an abundance of money, will be caring about maintaining healthy lives and will want products that consider them as key. They will also require packaging that is easier to read.

07. Children as Environmental Warriors
We talk a lot about how children are persuasive (thanks to advertising) when it comes to McDonalds etc. But through the school system children are becoming highly aware of the current environmental/sustainable stakes. Schools are encouraging ‘eat fresh’ global warrior type programs, that educate why what we eat is so important. Brands that can tap into being recognizable environmental/sustainable brands will create bonds & awareness that have the potential to last a lifetime.

08. Sustainability
Sustainability is not a ‘project’ it’s a way of business. Consumers expect it, they don’t just think “oh that’s nice to do”.
The big retailers will continue to encourage and favor sustainable suppliers – especially in the next decade.
If you are delivering a premium ‘top of the range product’ then you are now expected to be a business that encourages, promotes and delivers on a sustainable diet message.
Well known food commentator and author Michael Pollan suggests that one of the keys to eating with a sustainable conscience is to “Only eat food your grandmother recognizes”

09. Online Shopping & Buying Direct
It is well known that food shoppers are always looking for convenience. No one enjoys the trip to the supermarket. Many companies are selling direct to the consumer allowing for easy purchase deliver, a stronger brand connection but most importantly online offers consumers a greater understanding of cost per unit; e.g. being able to understand quality, weight and cost in a brief glance. Coles Online and Farmers Direct are two fast growth businesses within Australia.

10. Loyalty Pays
The traditional loyalty card is slowly being pushed to the next level with the major brands such as Wallmart and Tescos running insurance, mortgage, health insurance and educational arms that when combined by the consumer can have dramatic savings and reward potential. An average family in the US who has a Tesco mortgage, Tesco insurance (car/home) and shops at Tesco’s can easily earn up to $4,000 in rewards points each year.

Kudos to Australian Packaging Conference speaker David Hughes for feeding the conversation.

Big thanks to Rachel Taylor Account Service Director at Jane the Agency

Dave Ansett, Brandamentalist
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Food Brand Designer Obsessive

15 Comments

  1. I love the depth and insights in this blog post. You are a talented bunch of brand designers for sure.

    I think retailers will need think about how they can remain relevant in the coming years with online shopping only getting bigger.

    Thanks,
    Tom

  2. Interesting that the first thought above is about what food retailers are concerned about…….an interesting counter point would be what are food producers in Australia concerned about, and that is surely …….food retailers. Coles is hellbent on a price led strategy that is squeezing the margins of producers/manufactures. As the financial review reports today , up to 8,000 grocery products are now cheaper than they were 12 months ago.

  3. Really interesting, considering these points in relation to the looming situation with fresh food production and prices in Australia. There’s a real opportunity for a major retail brand to step up to the plate and be a champion for the plight Australian Farmers and producers will go through in the next year.

    Not only would it make long term economic sense it could be a branding coup.

  4. Thanks Tom, Interesting times ahead for retailers that’s for sure. But every change in the market provides the opportunities for those brands committed to becoming leaders to adapt and develop brand strategies for success.

  5. Hi Zimra, here at Truly Deeply we rate brand authenticity extremely highly. Across all categories, and especially food retail leveraging your authentic roots and then building brand storytelling and brand gestures that ring true is a powerful way to connect with your customers.

  6. Interesting Perspective Reg, the other missing perspective is what food consumers are concerned about. Price and Value will always be drivers for the retailers – which has led to the supermarket duopoly in Australia having the whip-hand over food producers. In the tough battle the producers have to maintain margins, building brand equity remains one of their greatest tools.

  7. Thanks Derek, I love your idea. You’re right, now is the time for a retailer to take a brand position that’s for the good of Australian farmers and other food producers. The undercurrent of support for our fellow Australians has seen an overwhelmingly positive response to the question of buying blemished fruit from Australian farmers (due to the adverse weather conditions affecting the crops) over buying imported blemish-free product. Unfortunately there’s a truism playing out in our supermarket sector where two players does not create enough competitive tension for change. I fear until such time as there’s a third significant player in the market it will be more of the same from the dominant Supermarket brands.

  8. Great read! Social pressure on healthy eating I feel will play a major role on consumers food brand choices. An ever increasing interest in quality home cooking, accompanied with popular cooking shows on TV, only elevates the consumers thoughts and buying behaviour on environmental, sustainable and organic branded food products that are on offer… am off to the farmers market to buy some free range eggs, homemade strawberry jam and organic beetroot!

  9. Great point Rachel – social pressure and the trend towards making and sharing simple, natural great tasting food has also made a come back. There are more farmers at their markets in the city on any given weekend these days than in the country. How this trend play-s out in the major food retailers will be interesting to observe.

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