Plugging the Insight Gap..........what brewers want to find out

We set out two months ago to create a completely new and accessible form of customer insight to the brewing sector

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We announced that we would be reaching out to 5,000 UK beer and cider drinkers with our online survey in June.

This survey would uncover the attitude and motivations behind consumer and shopping behaviour. Not transactional data, but the true insight into why consumers do what they do.

And we made it accessible to the entire sector by setting a price of £500…crowdfunding the exercise to address the cost gap that prices out the smaller brewers.

Since then we’ve had many fantastic discussions with our investors, retail buyers and other sector experts. They’ve shared their challenges and frustrations, both with winning and keeping shelf space, and with sourcing decent insight. 

These discussions have helped us to shape the survey – four sections and the questions within each. Still 4 weeks to go, so plenty of time to fine-tune these, so if you want to get involved, get in touch!

General Behaviour & Attitudes

Okay, so this section does captures a bit of the “what consumer do” rather than why they do it – however this will enable us to cut the data by category, brand, retailer etc.

It also looks at what individual brands stand for in the eyes of their customers, what drives loyalty and why consumers switch.

Invaluable information to share with a retail buyer, or to guide your own marketing or NPD.

Craft Migration

We weren’t initially sure about this section, as Craft beer and cider does tend to get a disproportionate amount of attention compared to it’s market share.  

However, craft has certainly refreshed and grown the sector and has inspired hundreds of new brewers over the last 10 years. It also has a huge presence in stores. And with retailers starting to reduce the number of SKUs, brewers are facing an ever-more challenging trade discussion.

So, we’re trying to uncover the reasons for migration because future growth will rely on traditional lager and ale drinkers switching to craft.

Off Trade experience

A hugely varied section which will create some unique and differentiating discussions with buyers. We’ll also be able to benchmark each retailer against the others…

On Trade experience

For small brewers especially, pubs and bars are a more important route to market than retailers. Understanding how consumers choose what to drink in the pub, or even which pub to go, will be useful. Even more valuable will be the relationship between on Trade and Off Trade decision making.

So, that’s how it stands at the moment, but there are plenty of discussions still to happen so it’s likely to be refined further.

For more info, or to get involved, go to www.UKInnovationsurvey.com or call Mark Thomson on 07496 602553

Hello weekend, goodbye health!

This month we surveyed 1,031 Scottish food & drink shoppers to uncover their buying habits, but more importantly to understand the attitudes and perceptions that drive those behaviours.

 

Not just what they do, but why they do it.

 

It’s something that not enough food & drink suppliers look at when they’re developing new products, which is why 75% of them fail within the first year*.

Too many decisions during the NPD process are based on gut feel, and not enough on actual evidence provided by real customers.

 

There’s a good reason for this…the kind of customer insight we’re offering has always been hard to find, and the extremely cost prohibitive for SMEs. Shopping data yes, though expensive, but bespoke insight? Not so much.

And yet it can have a huge bearing on the chance of success of any new product. For example, take the simple question of which days certain food & drink products are consumed…

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82% of people surveyed say that they consume Health food & drink products between Monday and Thursday. Great news for the Scottish Government’s “A Healthier Future” agenda. And helpful info for companies developing new Health products. We also discovered that households with children under 12 years old are 11% more likely to buy Healthy products than the average, and that 48% of people say they buy Health products to keep their family healthy.

The flip side is that health F&D isn’t really on the radar over the weekend, so how you position your products can become more focused with this information.

 

The Job to be done

Consumers buy a product because it does a specific job or meets a specific need e.g. “to keep my family healthy”.

Discovering the “Job to be done” (ref. Harvard Business School) for the consumer can unlock market share, in a way that no amount of data ever could, because it gets at the causal driver behind a purchase.

More targeted insight during NPD might go on to uncover that the products needs to be easy to unwrap, not messy and keep a 7-year-old full until their lunch break. And doing that “job” better than other options can be the key to success.

 

Premium Saturday!

And when the weekend comes what do we do? A whopping 39% of shoppers say they consume Premium products on Saturday, and 74% in total over the weekend.

Right, we’re off to buy our steak and Prosecco for Saturday night!

 

https://scotlandsinnovationsurvey.com

Goodbye gut feel!

Today we launch

Scotland’s Innovation Survey

Food & Drink 2018 report

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Aimed at food & drink suppliers as well as retailers, who want to understand Scottish consumers better – what drives their shopping and consuming behaviour. Not only what they do, but why they do it.

 

What drives us? We want to see SMEs basing their NPD and innovation on customer insight and evidence, rather than gut feel.

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  1. Based on a survey of 1,031 Scottish shoppers, the 31-page report contains over 40 tables and infographics

  2. Finds out what motivates consumers in Scotland when they buy F&D products

  3. Looks in more detail at the areas of Health, Premium and Convenience

  4. Analysed by category and retailer

  5. Analysed by customer demographic and shopping mission (Main shop vs Top-up)

Market research is pointless for Food & Drink innovators

…if it’s not backed up with real customer insight.

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Manufacturing consultancy Newton has released a report which claims food manufacturers and retailers in the UK grocery industry waste £2.7 billion annually on product innovations that consumers do not want or prove too expensive to produce.

However, the report claims that if companies focused on products consumers want rather than basing innovations on ‘gut feelings’, the industry could generate up to £233 million in profit from new products and offset the £2.7 billion wastage.

These findings are not a surprise to us, we see it all the time.

What’s the point of knowing how large the addressable market is, if none of these customers are going to actually buy your new product?

We’ve come across very few SMEs that put any real effort into identifying the true needs and attitudes of their target audience.

Of the few that do, most stake everything on their own internal assumptions, those “gut feelings”.

And of the fewer still that actually go and ask the customers what they think, they do it at the wrong time – post-launch, when sales start to fall and they need to protect their shelf space.

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Customer insight should come in the very early stages of the innovation process, not at the end. Before your business wastes any time and money on developing products that aren’t wanted – go ask the customers what they really need. And what they need enough to pay for.

To find out more, please get in touch

Are you sure that customers are going to buy your new product?

We’re helping Food & Drink SMEs take a different approach to insight and innovation – getting true customer insight, not just market data.

The classic approach to developing and launching a new product is based on gut-feel and “expertise”, perhaps with some customer feedback 3 months post-launch to help protect your shelf space.

The risks to this approach are obvious – you might launch something that customers don’t need and won’t buy. Which costs you money and time, and makes you look bad to retailers.

Our message is to bring customer insight in at the start of the process, before you invest any time or money on development. Get it right before you start!

Two recent clients provide examples of contrasting outcomes…

1. "Customer feedback stopped us in our tracks".

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Our client is a successful F&D brand, with an innovative range of products launched a few years ago. They asked us to help them stress-test their new idea, which they hope will take them to the next level commercially.

Initially, working though our methodology helped them fine-tune their ideas about their target market, their customers’ needs and how the product could be positioned.

However, when we tested their proposition concepts with real customers, the feedback stopped our client in their tracks. There was a single barrier to sales that they hadn’t considered. Without this feedback, the launch could have been a disaster, and even potentially damaging to the brand.

2. “We’re moving ahead with confidence…and we’re all on the same page”

Our client is an established F&D group, with several successful brands including a recent innovative product that is flying off the shelves and leading their sector.

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Riding the crest of this wave, they are looking to enter and hopefully lead a related sector. While they might have been expected to rely on their experience and charge on, instead they tried a different approach, working with Prop B.

We helped them develop their new product as an early stage proposition, identifying the target market and what would make them stand out to these customers. We then tested several concepts with 1,200 consumers, via an online survey.

The results gave the client real insight into the attitudes and behaviours of their target market that they wouldn’t have got from market data research.

Their new concepts got the thumbs up – allowing the client to drive forward with confidence that their assumptions have been validated. 

As an added bonus, the insight also brought the team onto the same page with the project, giving the more cautious Directors the confidence they needed to back the others.

www.propositionb.com/insights

Why NPD in the Food & Drink sector creates churn, not growth

What constitutes NPD for a lot of food & drink manufacturers?

Answer: different flavours & pack sizes

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From family-run SMEs to global monsters, we hear this time and again – “innovation” being measured by the number of new flavours and pack sizes.

It’s frustrating for retailers, who are fed up with manufacturers bringing their new varieties to them. As a Senior Buyer pointed out recently “we get 25 new proposals each day but it’s not innovation, all they’re doing is creating 20% churn in the category. In 3 months it’ll be replaced by another variety.”

There are some obvious exceptions…flavoured gin for example, as a new alternative to traditional gin. That created new sales in the sector. What doesn’t create new sales is introducing additional new flavours – that brings us back to churn.

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The problem seems to be that this is now the norm, most manufacturers just don’t have the tools to break this cycle.  They need to take a different approach to NPD, try think and do things differently.

They could do worse than take look at Agile, usually regarded as a corporate IT thing.

Agileists would tell them to bring the customer back into the heart of their NPD process. More than that, they would tell them to focus on the actual needs of the customers and the “job to be done” by the product (ref. The Innovator’s Dilemma by Clay Christensen, professor at Harvard Business School).

 

The job to be done by a milkshake is a story that every food & drink NPD manager should know and learn from.

Of course, the next mistake we see is the manufacturer relying on their own assumptions about the customers and their needs. “Gut feel” and experience can work, but for every success story there are 99 failures that don’t make the shelf or stay on it for long!

The only people you can rely on to tell you what customers truly need and value? Customers themselves.

www.propositionB.com/insights

Winning shelf-space outside of Scotland…taking on the local brands

Kantar’s 2018 Brand Footprint, published last week, included the reminder that in the UK food & drink sector, Global brands only account for 41% of sales.

Kantar Worldpanel 2018 Brand Footprint Report (Click to open)

Kantar Worldpanel 2018 Brand Footprint Report (Click to open)

The majority of purchases are for local brands, a trend that is increasing year on year as they win market share and shelf space.

The reason for this is obvious – local brands can adapt better and quicker to market trends and to the needs of customers.

Kantar Worldpanel 2018 Brand Footprint Report (click image to open)

We see that in Scotland’s stores, with homegrown brands doing well across many sectors, from craft beer and gin to crisps and ice cream, and from established brands to new entrants.

However, the same logic makes it difficult for Scotland’s SMEs to win share in England, especially London and the South, where they are competing against local brands.

So, how can a Scottish brand knock those local competitors off the shelf? How can they present a convincing trade argument, with evidence, to the large retailers? How can they compete with the track record of the incumbent brands?

From what we’ve seen, too often the answer seems to be a marketing and branding agency – the problem with this is that there’s a lot of gut-feel and guess work involved. If you don’t understand the motivation and attitudes of the customer, there’s a fair chance you’ll get it wrong.

The alternative – base your innovation on the true tastes and needs of your new target audience, in London or wherever.

Become Local

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The only way to uncover the true needs of customers in London and the South is to talk to them. Not market data, but actual customer insight. Traditionally however, this has been equally challenging because of the eye-watering costs involved in acquiring that insight.

It doesn’t have to be.

Do it quickly and affordably and do it at the start of the innovation process, when you can use it to develop your product and positioning.

We have over 50 SME Agile insight and innovation sprints under our belt, turning projects around in under 4 weeks or less if required, giving clients the confidence that they are launching new products that customers need enough to buy.

www.propositionB.com/insights