Small specialty food producers have more opportunities than ever before to get the word out about their products and build their businesses, from blogs and social sites to crowdfunding sites to third-party online retail partners.
Online sales of packaged goods, including foods, are on track to hit $53 billion by 2016, according to Kantar Worldpanel. In the U.S., sales will hit $25 billion this year, up 13% from 2013, and they’re on track to reach $32 billion next year, according to Nielsen. Big-name brands will comprise a big chunk of those sales, but small specialty producers are commanding a larger share as well.
Online sales and marketing are becoming increasingly important tools for many small specialty food businesses, helping them grow more rapidly and reach a much wider audience than they would have in the days before the digital age. Several exhibited at the Summer Fancy Food Show in June, including Bantam Bagels, Barefoot & Chocolate, and Element Snacks, which have their wares for sale on sites ranging from Amazon to Vegan Essentials.
Specialty food producers start small and often have compelling stories. In the past, the stories were told to one consumer or group at a time, through traditional media, packaging and in-store demonstrations. Now, with websites, blogs, social media and third-party marketplaces, they can tell those tales to consumers around the globe. Even those that haven’t found major success selling on third-party sites are finding ways to use new digital and social tools to raise brand awareness, tell their stories and increase sales.
Emmy’s Organics also shared its line of raw cereals and macaroons at the show. Partners Samantha Abrams and Ian Gaffney started the Ithaca, N.Y.-based company about five years ago, and in 2011 launched a crowdsourced fundraising campaign on IndieGoGo. The pair raised $15,000 in 30 days and used it to create a new logo, redesign its packaging and ramp up branding efforts to boost sales. The company’s mission is to create healthy, sustainable organic snacks that are raw, vegan and gluten-free.
Emmy’s doesn’t sell to retail customers on Amazon, although there are some wholesale customers that resell the products there. Instead, the company works with two third-party sites, Vegan Cuts and Abe’s Market, two sites with missions that mesh with Emmy’s, Abrams said.
“We get requests from other third party stores all of the time, but if they want us to drop-ship, I hesitate. This is mostly because I have someone in house who puts together all of our online orders from our website and the others and at a point, checking too many websites for orders can be confusing and time consuming,” she said.
Small specialty companies need to pick and choose their online retail partners carefully, she said, because typical deals include participating in the retailers’ sales and marketing campaigns and discounting prices. “It can be less money for you up front, but you absolutely can find loyal customers on those sites,” she said.
More from Abrams on what’s working for her company:
Which digital tools bring the best results?
It depends on what success is. If success for you is getting new attention, I would say personal stories. I find that our posts that are about myself and my partner Ian are often the most popular. If success is sales, I would say online newsletters. Here you have a targeted group of people that want to be receiving your news and if you include a coupon code, you will often get traffic and sales on your website. If success is SEO and being found on the internet, I would say customer reviews and testimonials. Having your website linked on a lot of websites is great. Its wonderful to have quality content about your brand very available to people. Plus, people are more likely to purchase your product if someone they trust says they like it!
In the end all of these tactics are wonderful. I would love to publish more recipes and blog more, but for now, I don’t have the resources or time to make it happen. This is something that will improve as we grow.
What have proven to be the most productive digital channels in terms of sales?
I think the most product channel is newsletter marketing. When we send a coupon out to our customers with a little update about us, it usually brings sales with it. Everything else is pretty hard to track.
Do you think your sales and brand awareness have grown faster because of social and digital media?
Sales on our website, yes. Sales in stores, its really hard to tell. We try to promote the stores that sell our products but we don’t really know who is seeing that and going to buy our products.
Does the social marketing and/or presence on third-party sites help you get products into physical retail outlets any more quickly?
It hasn’t yet for us, but it’s certainly possible! If a buyer, for example, follows certain social media profiles of people they trust or they take a look at a company like Abe’s Market, who screens their vendors carefully before approving, they might take interest. You never know, which is why saying “yes” to new opportunities is always important!
Are in-store demonstrations still as important as they were before digital media? Is it a challenge to market food online when so much depends on taste?
YES! Store demos are still the best way to get new customers in-store. Hands down. Its a great way to interact with your customers too. Both Abe’s Market and Vegan Cuts have come up with some digital “trying” programs. Abe’s does a “try for $2” program and Vegan Cuts does a curated subscription box. Both allow customers online to try things for less money than just buying it and I think that can be very effective.
Which digital channels are the most productive for your small food business? Tell us about it in the comments.
If you enjoyed this article, join SmartBrief’s email list for more stories about the food and beverage industry. We offer 14 newsletters covering the industry from restaurants to food manufacturing.