Food Companies Look to Capture Online Grocery Sales

We’re in the midst of a digital grocery boom. And grocery executives are scrambling to keep their brands relevant to young, smartphone-loving shoppers.

At last week’s Online & Digital Grocery Summit in Chicago, nearly 250 grocery executives met to discuss retailer strategies and learn from their forward-thinking peers at companies like Mondelez, Kellogg’s, Nestle Waters North America, and others.

Here are my top four takeaways for grocery brands developing online content and discoverability strategies for 2017:

1.  Category Growth Tied to Online Grocery Success

Millennials are already shopping for groceries online and the trend will accelerate over the next few years. This generational shift towards online grocery shopping is changing how consumers communicate with brands, noted Chris Butler, head of ecommerce for Nestle Waters North America.

The industry is headed towards a time when, “if you’re a brand that doesn’t have an ecommerce presence, that’s an automatic 10% loss of sales,” Butler notes.

Oskar Kaszubski the ecommerce general manager at Mondelez, was equally blunt, saying: “You cannot grow your business right now if you don’t invest in ecommerce.”

In addition to forfeiting online grocery sales, brands with no ecommerce strategy or online presence will also lose in-store sales. Wayne Duan, head of digital commerce merchandising at Walgreens, noted that every dollar spent online at Walgreens influences $11 spent in stores – a number will only continue to grow.

2.  Discoverability: Grocery Brands Looking for Strategies

“If you’re in-stock, but can’t be found, it doesn’t matter.”

That was one of the points made by Danny Silverman of Clavis Insights in “Winning via Digital Shelf Optimization.”

Silverman and other speakers recommended analytics tools to help brands optimize keywords, track pricing, and make decisions. My colleagues, Mark White and Preston Keaton, spoke about how online grocery brands can combine the pay-per-click options available with Amazon Marketing Services and search-optimized product page content to boost discoverability.

3.  Retailers and Brands Partner on Content

As a professional advocate for online content, I loved hearing brand and retailers rave about how focusing on improving  content provides a better shopping experience and increased revenue.

Nestle Waters North America and the grocery retailer FreshDirect teamed up last holiday season to promote Perrier with landing pages and photo shoots.

Jet.com launched a test case where they added +5 pictures as well as accurate product descriptions, product attributes, enhanced content, and proper keywords to several product pages. The improved content resulted in a 33% increase in revenue, said Jet.com VP of grocery Carmela Cugini.

Charis Marquez the director of site merchandising at Sam’s Club, creates content that generates excitement but is also useful and informative – such aspublishing a cheese-lovers guide to go alongside cheese products or offering online cake ordering.

Nathan Mansperger, the director of ecommerce for AB InBev talked about their timely Super Bowl promotion of Minibar, an alcohol delivery service.While the promotion pushed Minibar traffic up, Mansperger said they’re looking to “do things smaller.

4.  Brands Need to Think Small, Nimble

Indeed, several speakers echoed Mansperger’s mantra of going small.

Ben Zifkin, CEO of Hubba, talked about the rise of what he termed “craft brands.” Ecommerce had enabled small brands to challenge established players.

“Big brands need to think small where they used to think big,” Zifkin said.

Kaszubski of Mondelez concurred. Consumer packaged goods companies need to become more agile, he said.

“Those little startups aren’t going to wait,” Kaszubski noted. “In three months they can move two mountains that for us would take two years.”

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