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Sweets And Snacks In A Volatile, Fragmented Market

Leon Nicholas at NCA's Sweets & Snacks Expo

Confection and snack manufacturers have to be where the shopper is, according to Leon Nicholas, SVP of retail insights at Kantar Retail. During Nicholas’ keynote address at the 2013 Sweets & Snacks Expo at McCormick Place in Chicago this week, he gave attendees some insight into the snack and confection industry’s retailer opportunities and how companies can reach a broader customer base—which he characterized as volatile and polarized, yet connected—through more in-depth digital marketing and a deeper understanding of shopper behavior.

“The marketplace today is more volatile than ever. It is more polarized than ever; in fact, it’s fragmented. (But) it’s more connected,” he said.

Five ‘lenses’ for success

To grab polarized yet connected customers in a volatile market, Nicholas suggests five “lenses” manufacturers should use: value, convenience, logistics, online and reimagined stores.

Value and convenience are staples in the industry, with efforts to lower price points, offer promotions and make things easier in the marketplace.

In terms of logistics, Nicholas says manufacturers need to be aware of options for consumers to buy and receive their wares, from directly at the store to online.

“I think for us as an industry, we have to leverage the power that we’ve got in the assortments and the logistics expertise across this portfolio of trip types and box sizes,” he said. “We are uniquely capable across the industry, across all the categories…to help (retailers) understand how our portfolio can mix differently in different box sizes and also how they can contribute to different trip missions, whether it’s in the digital sphere or whether it’s in the brick-and-mortar sphere.”

In the digital age, e-commerce is a growing concern for brick-and-mortar retailers, but Nicholas explains that online shopping can help both manufacturers and retailers. He used slow-moving SKUs as an example.

“Those are those SKUs in your portfolio that may not be earning their share of shelf. A lot of retailers are now stepping back and saying, ‘That’s OK. We can put you on our website, and…(shoppers) can order it online.’”

In the snacks and sweets industry, manufacturers have the opportunity to help retailers, according to Nicholas. As an example, he discussed a campaign from Sunshine’s Cheez-It brand, which asked shoppers to scan a QR code and vote for the next flavor of Cheez-Its.

“That’s the kind of thing retailers are looking for,” he said. “We talk a lot about share of wallet. I don’t know if we’re talking enough about share of excitement.”

As an industry that does much of its business during four key seasons, Nicholas suggests creating seasonal opportunities even during non-seasonal times. He stressed that selling a solution is more important than selling items.

“Nobody buys items. They buy solutions,” he said.

“You give a tremendous amount of opportunity back to the retailers, and you deserve credit for that,” he said. “But you’ve got to look through those lenses.”

Find photos from the Sweets & Snacks Expo here.


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