Does the agrifood sector know the new consumer?
The figures are devastating. Depending on the study that is analyzed, approximately 85% of the new launches of companies fail. The resistance of consumers to the acceptance of new products is the highest in all of Europe. Does that mean that it is impossible to successfully launch a new agri-food product to the market?
The answer is negative: it is possible to do it successfully following certain steps and procedures. The paradox lies in the fact that, in spite of being the country with the greatest resistance to new products, instead of making an effort in market research and knowledge of consumer behavior, very little is being done in this regard.
How many times do the needs of the consumer precede the facilities of the factory? How many times is a specific package used because the machinery does not allow using another format that provides greater added value to the consumer? Unfortunately, on many occasions; In the usual way a product is not designed based on the needs of the consumer, but a product is created and then it is a question of selling when at no stage of development has the customer been thought of.
Before launching a product to the market, it is essential to ask a series of questions:
1.- Is it my extraordinary product?
2.- Is it different from the others?
3.- Is it a product worth speaking for consumers?
If the answer to any of these questions is negative, we have already begun badly and the chances of success are markedly reduced. If it is positive, we are already on the right track. (For example, the octopus Paul can be considered a very successful launch … that would respond in the affirmative to these questions …)
“Is that my product has a very high quality” argue some … Very good. Most consumers do not have the same “quality” concept as the manufacturers and, in addition, every consumer assumes that a product that is on the market already has quality according to their criteria, because otherwise, it would not be on the shelves. Quality is no longer an added value for the consumer; it is presupposed.
Passivity before the crisis
After the crisis of the early 1990s, a study was conducted in the United States with 1,000 companies in the PIMS database. The objective was to analyze how the market share varied in those companies that cut their marketing budget during the crisis period, those that maintained it and those that increased it.
The results are conclusive: Those companies that increased their marketing actions during the recession period, subsequently increased their market share considerably in the years following the crisis. On the other hand, those companies that did not do anything about it or even reduced their marketing budgets varied their market shares by a much lower percentage after the exit from the recession.
Recently Kantar Worldpanel published figures that indicated similar results. Many companies that in 2009 increased their budgets and marketing actions in 2009 managed to increase their market share.
Whatever it may be, it seems that the experience of the past is not of interest for many companies and it is again acting the same way later, cutting budgets in marketing in times of crisis, avoiding the launch of new products and cutting sales staff. The short-termism and the presentation of results in the following management committee takes precedence over the evolution of the market share within two years. Instead of increasing marketing actions and making use of new creative tools, in general, the sector contracts and remains immobile.
360º marketing strategy
Packaging products in a different support than usual and with a careful image is very useful to achieve a differentiation at the point of sale and in the mind of the consumer. Differentiation is fundamental.
Promotional actions carried out in isolation do not contribute to the consolidation of the brand in the market. Strategic marketing actions require continuity over time, consistency and a multitude of supports, relying on diverse actions in multiple tools with a 360º global management that contemplates packaging design and graphic image, communication of values and differentiation, participation in events, public relations, web 2.0 tools, point of sale management and management by categories and, above all, the experience, lifestyles and emotions that the brand transmits to the consumer.
360º vision of marketing actions
The marketing strategies until a few years ago were basically focused on the products. In these moments, more and more, they focus on emotions and lifestyles. The lifestyles of a person make reference to the pattern of the way of living as an expression of the activities, interests and opinions of that person, showing how the individual interacts with their environment. The lifestyle goes beyond social class and can even go against the stereotypes of behavior that are presupposed to a person for belonging to a certain social class. Lifestyles are influenced by the activities that the person practices (profession, hobbies, social events, club membership, etc.) interests (family, food, sports, fashion …) opinions (politics, business, education, economy …) and demographic factors. (Age, educational level, income, place of residence …).
The questions we have to ask ourselves before initiating an action are the following:
Does our product and its brand culture fit with the lifestyles, habits and customs of our buyers? What are your moments of consumption? Special occasions? daily? Breakfast or dinner?
In order to understand the behavior of consumers, it is necessary to study their processes of perception, attention, understanding and memory, their attitudes and intentions and the functioning of purchasing decisions. The study of these factors can be carried out using different techniques of market research, from observing the consumer at the point of sale (with real or controlled situations) to direct questions to the consumer through questionnaires, in-depth interviews or group dynamics in the market of origin and even the use of Neuropsychology, as it is reflected in the fantastic book Buyology.
Segmentation and selection of markets
It is very common in the agri-food sector, especially in small and medium-sized companies, to hear “I sell to the whole world” type responses when asked about the segmentation of the market to a company. Is it really like that? Do all the different types of consumers consume our product?
To meet the needs of customers, we must segment and analyze them. How many times do we ask them and consider their opinions before launching a new product to the market? How many times is it done based on the illusion of the CEO or founding partner?
A qualitative and quantitative market research prior to the launch of a product allows obtaining information on the format, type and design of the label and graphic image, modes of use, (not only salads) tastings (carried out with consumers, not with experts), purchase intention, usage experience, valuation of the quality / price ratio, etc. It does not assure the success in a resounding way, but it minimizes the percentage of risk of failure.
It is possible to improve in times of crisis. Innovation (which provides a relevant benefit to the consumer) creativity and its materialization in new products provide numerous benefits for olive companies:
- It solves unmet needs of the market.
- Dynamize sales. (+ 10% according to data from the National Institute of Statistics)
- Difference from the competition.
- Loyalty to customers.
The management of a brand is a global process that covers different areas. To take care of the packaging in an isolated way or to assume that the consumer will appreciate its quality is not enough, so it is necessary to work and innovate continuously to satisfy a dynamic and changing consumer.