Baking and snack food companies can make the best products ever invented, but without finding consumers to purchase them, they start off dead in the water. Having led sales and marketing teams at firms such as Tyson Foods and Hostess Brands, David Leavitt worked in consumer strategy and marketing for more than 20 years. Now a Kansas City, MO-based management and marketing consultant to the consumer goods industry, he offers his advice on building food brands and prioritizing marketing efforts to adapt to an ever-
changing consumer landscape. You can find him on LinkedIn at www.linkedin.com/in/dvdleavitt.
Baking & Snack: What basic steps should bakeries and snack producers take to build their brands?
David Leavitt: First, you need to understand your positioning in the marketplace and what you are going to stand for. This is critical because everything you do going forward needs to reinforce this positioning: your products, promotions, advertising, channels served, etc. Make sure you understand the consumer or customer problem or problems you are trying to solve as well as the motivations or issues that exist. For example, does your positioning center around a more authentic taste or a unique flavor because your customers need or want it — and you understand why? Are you focused on health and wellness and are ready to support any claims you want to make?
Once you understand your position in the marketplace, you can focus on brand building. You must master all of the basics, including brand design, packaging, pricing, product offering and channels of distribution.
The biggest pitfall is trying to be everything to everyone or not being clear in what you are, which always results in not being anything to anyone. Take the time to work and rework your core until it is solid.
What trends are you seeing in the marketplace, and how do you develop marketing strategies to leverage those trends?
Value has been, and will continue to be, the overriding trend for several years. Everyone recognizes that spending patterns and spending ability have dramatically changed during the past few years. The longer the economy stays like it is, the more permanent value will become as the overriding theme.
There is a fundamental shift in how consumers value brands, and you need to know where you stand. I have used this quote several times: “Good is now better than what the best used to be, so for many, good is good enough.” What does this mean? Consumers continue to shift their buying patterns because many “value” brands now offer very good quality. This can be seen in the continued shifting of consumer dollars from everyday brands to private label and from casual sit-down restaurants to fast-casual and quick-serve channels.
But let’s not get stuck only on value. There still are three key macro trends from the past decade that will remain critically important: health, convenience and indulgence. Everyone should already recognize
these by now. What is important is to understand within each what people are looking for (health equals whole grains, gluten free; convenience equals portability; indulgence equals decadent and global
What should baking and snack companies consider when creating an online presence?
First, what are you trying to do? Do you want to be an online retailer, or is your web presence geared more toward branding and supporting sales in your primary trade channels (i.e., grocery or restaurant).
Let’s assume yours is a traditional consumer brand. It goes back to your positioning and branding. If this is a local brand only wanting to reinforce your spot in the community, that has one set of requirements. If instead you want to be the health and wellness expert centered around whole grains, then that has a different set of requirements.
You also need to ask what level of personal engagement you want to offer. Do you want a static site where you push information out to the Web, or are you willing to be social and go deeper into a relationship
with consumers? There is a huge distinction between the two because social media require two-way communications. You don’t just build a Facebook site and leave it. You just opened up and invited your consumers to join you in your kitchen. Now you have to entertain your guests and engage in conversations.
All of this requires a human presence, so understanding your staffing requirements will be critical. Most firms that have an aggressive online presence and are executing with excellence have at least one person dedicated full time to social media internally, as well as a really good ad agency partner.
What are the benefits of using social media such as Twitter and Facebook?
You really have three main social platforms to focus on: Facebook, YouTube and Twitter. For many brands, you should be prioritized in that order. You can focus on just one, two or all three, but unless you are committed to execute with excellence on each platform, you should focus only on the platforms you can handle.
Each platform can serve its own purpose, have its own audience, its own content. Whichever platforms you decide to use, they all should tie back into and reinforce the company’s positioning, brands and products. For small consumer packaged goods companies, Facebook might be their only Web presence to engage their fans. Other firms, such as ingredient companies, may choose to use YouTube to showcase how their products make others better. But for most companies, social media should be but a part of an overall digital strategy, rather than stand alone. Why? Because where about 75% of US households have Internet at home, only about 50% have a Facebook account. And even fewer people use Facebook every day.
One key to all of these social platforms: They are public, so you must realize you won’t have complete control of messaging, timing and content. You must put together a social media policy guidebook for your company. Who can respond to comments on Facebook or Twitter? Are they responding as an employee, a fan of the product or the official company spokesperson? How often will you update and communicate with the online community? How will you monitor social networks? Who from your consumer affairs group and legal department are engaged in the process? Realize, some complaints will now come to you via Facebook or Twitter in a social setting, not in a direct-to-the-company communication.
How can a company know which strategies will have staying power?
Most “best in class” firms use an ongoing strategic planning process, driven by consumer insights; by watching consumer and customer trends, researching needs and possible solutions, constantly getting feedback from the marketplace. This allows them to identify and focus on trends and create sustainable strategies that address the trend, versus trying to react to each fad.
Business trends with staying power tap into the fundamentals of an ever-evolving consumer or business landscape. They don’t just appear overnight. But fads can show up overnight, sometimes linked into an underlying trend, sometimes not. For example, it is a trend people consume more healthy foods every year. It is an ongoing and evolving shift in behavior, driven by various consumer needs and wants. The diet fads tap into the trend, but typically follow a one- to three-year cycle of meteoric rise and fall. They are more of a tactic with a short shelf life than a strategic trend.
What products have redefined this market?
I feel only two products have truly redefined the marketplace in any manner in that they created $100 million segments. First, the “Thins” platforms showed you can take a common platform such as bagels and with a simple change, make it better. Bagel sandwiches had been around for years, but how many people ate just part of a sliced bagel before they were full? Now you have a product for bagel fans which allowed them to enjoy more for breakfast, or use bagel bread as a sandwich.
Second, the multiyear run of the Hostess 100 Calorie Packs defined portion control for several years. Here again you had a common platform, cupcakes, modified to fit consumer trends of portion control and bite-sized fun. In both of these examples, the brands were supported by print advertising, a broad spectrum of digital marketing, as well as some traditional consumer promotion. Both of these product platforms allowed brands to take a leadership role in a newly defined space.
But I would be remiss if I did not talk about another form of innovation not wholly recognized by consumers, but definitely recognized in the industry. From a manufacturing standpoint, I believe the ability the baking industry has shown to offset some of the commodity increases over the past five years through processing improvements, advances in ingredient science and formula optimization has been nothing short of fantastic. We could easily have bread at $5 a loaf, and the entire industry should be proud of the inflationary offsets realized. The world demand for grain-based ingredients and processed foods is going to continue to rise, and these types of improvements in manufacturing and distribution will be strongly needed in the future as well.