The SFA’s newly released State of the Specialty Food Industry report, 2021-2022 edition, digs into a business environment still adjusting from COVID’s impact over the past year. A burgeoning ecommerce channel has been one of the shifts the industry has experienced and here, members of the supply chain share their opinions on its growth, challenges in discoverability for small or emerging brands, and the future.
“For specialty brands, a lot of the ecommerce platforms for retailers are very not friendly to browsing, not nearly as much as old-school shopping trips where you’re walking through a store, and you say ‘I’ll try that.’
Retailers need to level the playing field a little bit for specialty because you need that browsing ability for specialty for somebody to stumble onto your [brand]. That’s my biggest concern right now for long-term growth for specialty.”
-SVP, business development at a specialty food and beverage broker
“When we added the online ordering platform that came along with DoorDash, it was like having an additional outlet to give people food. We just had the discussion this week where a store manager asked when we’re getting rid of curbside and our response was ‘probably never.’ It’s probably going to be an element of our service model going forward. This will allow us to curate those relationships with frequent customers and do special rewards for them.”
-CEO of a specialty retail and foodservice group
“Brands are discovered in a variety of ways and you have to be relevant in every way that your consumer would discover and buy your brand. And maybe online is a very saturated platform, it’s hard to compete as a small brand. I know for us online was pretty small [pre-COVID], and now it’s a huge chunk of our business. And [by] online I mean our own DTC, but also online retailers like Imperfect Foods, Fresh Direct, Good Eggs, and Amazon Fresh.”
-head of sales at a specialty dessert brand
“We saw a lot of emerging brands do more paid advertising themselves to location-specific audiences, driving traffic back to particular retail stores rather than driving traffic to their own websites. Especially brands in cold distribution since they simply don’t ship direct to consumer. They do paid ad spending, which you have to dial in, but once you get it, it’s relatively affordable, and there should be a positive return on investment. It’s win-win. The brand wins and the stores love it.”
-owner, founder of a specialty brand consultancy
“One of our biggest challenges has always been that people love sweets and they believe that something with low sugar can’t taste good. Demos and getting people to try the product for their first time has gone away, so we’ve been focusing more on how to engage with people digitally. The challenge is how to get taste cues across, so we’ve been using recipes a lot to help them understand what it will taste like. And we’re also starting to use coupons more than before.”
-CEO of a specialty chocolate brand
“Jet, Walmart, Amazon—basically all of the major retail platforms out there … bias the large incumbent players, which makes sense. That’s where the mass demand is, that’s where the dollars are. So, what does that mean for small and emerging brands out there?
It’s really interesting to see great things that small brands are doing, truly innovating, and offering a lot more value to stand out versus the big incumbent players in the space.”
-CEO, co-founder of a specialty e-commerce retailer
“We launched in October 2020 and think the timing was ideal in many ways. Of course, with COVID forcing people to change their patterns, it unlocked some behaviors that were previously closed off. We’re pretty big believers that [ecommerce] is only going in one direction. This is not a trend. This is a permanent shift in consumer behavior that’s here to stay.”
-CEO, co-founder of a specialty ecommerce retailer
You can learn more about market growth, fluctuations, and drivers, as well 10-year category tracking and forecasts by purchasing the State of the Specialty Food Industry, 2021-2022 Edition.
And weigh in on what you think the new post-pandemic industry norms will be in our discussion in the Community Hub.