Foodservice has been firefighting the impact of the hospitality shutdown on cashflows, assessing how changes will affect margins, and working to protect their supply chains. Now the dust is beginning to settle, the landscape is looking very different in the sector.
For foodservice and wholesalers, a move to B2C means a change in your competition. There are companies who have been operating in this arena for years with good reputations and successful marketing strategies – the likes of Abel & Cole and Riverford, not to mention the big six. On the other hand there are local convenience stores, independent greengrocers and markets. Consumers don’t want to pay inflated prices due to high demand, nor will they keep paying for items they don’t want in readymade boxes of ‘essentials’.
Before deciding on and heavily promoting your new offering, it’s essential to have robust systems in place to take and process consumer orders. Initial demand for groceries was so high that most services stopped accepting new customers. While that rush has eased to some extent, it shows that even companies who’ve invested thousands in these systems over a number of years weren’t prepared. Smaller companies may have the initial goodwill of local consumers, but poor customer experiences at this stage won’t easily be forgotten. At every stage, you need to balance what your company can do against what consumers require and expect.
Operationally and logistically this is a huge challenge, and one many wholesalers have risen to admirably. It’s worth considering pubs or other businesses as hubs where possible, rather than having delivery drivers going to hundreds of homes in a day. This approach is safer in public health terms as well as cheaper and more convenient, especially in more rural areas.
Take time to think, plan and get things right.
Understand Consumer Behaviour
Everybody needs to eat, but you can’t take your customer base for granted. People who are key workers will be struggling for time and so will be looking for fast, convenient options rather than cooking from scratch. Those who are in high risk categories or self isolating won’t be able to get to the supermarket or corner shop, but may be relying on family or friends to drop off groceries rather than ordering. They may not be online. Then there are those who are healthy and low risk but staying at home. They might have a lot more time on their hands than usual, and they may well be shopping for vulnerable relatives too.
Most wholesalers switching to B2C have considered tiered boxes for couples and families, but what about people living alone, and those with dietary requirements or religious restrictions? While the focus was on staples like pasta, flour and tinned goods in the first week of our lockdown and then on fresh and frozen foods in the second week, people still want little luxuries and treats during this stressful time. And we’re all used to having access to a huge range of produce and products both in the supermarket and online.
Worry and stress might trigger people to buy things they wouldn’t usually consider or to buy in larger quantities. But in the medium term, when they’re calmer, they will look for familiarity. In the long term, something resembling normality will return, but there is the potential for shopping habits to change for good if consumers get used to shopping hyperlocally, by delivery or collection, and less frequently.
Income level and lifestyle influence where people normally shop, but it also dictates who they turn to in a crisis. Some will be willing to spend more to get what they need, while others will be watching their spend because of loss of employment or uncertainty. The majority of UK shoppers will go to the supermarket or order online for delivery already, paying by cash or card.
Less familiar methods for consumers that are the norm for your trade customers are ordering by phone or email – there may be issues of trust when handing over card details over the phone. Contactless has been the go-to for in-person shopping, but online you have the option of Paypal or card payments. You might also choose to offer a subscription service rather than pay as you go, and it’s definitely worth capturing email addresses if you’re operating a phone order system – otherwise how will you reach out to first-time customers again? Make sure you have an up-to-date, GDPR-compliant data policy to support this.
Most people will shop for fresh food every few days under normal circumstances, and once a week or fortnight for other staples. Store-cupboard items are needed less often, but will need topping up. Whether they will return to you will depend on the product and the service you provide and how it matches their expectations. If they value ethical, sustainable choices and their order comes in lots of plastic, they may not reorder. If choice is limited they may look elsewhere, and perceived value for money will be a factor whatever the customer’s income level. Incentives and referrals may not be a priority right now, but building customer loyalty should be important to you when you don’t know how long this situation will continue or how your business model might be forced to change over the longer term.
Different demographics have different wants and needs, even in a crisis. Be clear and clever about what you can offer.
Reach your new audience
One of the trickiest parts of adapting to a B2C model for wholesalers will be reaching their new consumer audience. This is another benefit to seeking hub distribution partners in hospitality or retail who will already have a social following. Word of mouth is fantastic, but you’ll probably need to become active on social channels you either haven’t used before, or where your current audience is made up of trade contacts.
If you are going down this route of setting up or shifting the focus of company Facebook and Instagram accounts, for example, then it’s crucial to get the language and tone right, and to seriously think about your messaging. Even more so if you’re investing precious funds in social media advertising – it’s all too easy to throw money at Mark Zuckerberg to no avail if your creative is wrong or your targeting parameters aren’t set up properly. The same goes for pay-per-click and search advertising. This might not seem necessary given a sudden influx of new customers in the first couple of weeks of lockdown, but remember they had limited options due to high demand. As time goes by, you’ll need to work harder for new orders.
With most delivery services operating out of necessity within a fairly small radius, consumers are getting to know what’s available, quite literally, on their doorstep. This hyperlocal mindset means you need to invest time to search out local community Facebook groups and websites hosting local business listings. Introduce your business and services and think about creating a special offer just for these groups.
This isn’t ‘business as usual’. Take advice from those with B2C marketing experience.
Room for opportunity
It’s important not to overwhelm people with choice when they’re already under a lot of strain. That said, if you’ve got other products available that won’t necessarily make it into a box of essentials but people will still want them, make sure they can see what is available before the point when they’re making their order. If they’ve seen a post about a veg box, how will they know they can also order fresh dairy or confectionery or dried foods, for example?
While many wholesalers are focusing on what they see as ‘essentials’, after the initial shock and potential panic, consumers will look for access to the same huge range of products they’ve come to expect in the supermarket. Speciality and artisan foods might appeal to the more affluent end of the market, and you could even tailor boxes towards different world cuisines.
Inspire your new customers with recipe cards and meal plans that show them how to make the most of their order. Helping them find ways to minimise ways, such as suggesting what can be frozen and how it could then be used at a later date, will increase the perceived value for money of your service.
Consider setting up a ‘recommend a friend’ referral scheme to help spread some joy. – think about the point at which someone packs away their shopping. You could ask your new customers to share a photo of their order when it arrives – or even pictures of the meals they make – on their social media profiles and tag your business. How will you thank them? How will you ask for and use their feedback? Small but thoughtful touches can mean a lot, and great customer experiences create brand advocates who will recommend your business and services.
Even in a fast-changing situation, you can be proactive rather than reactive.