Anticipating and adapting to changes in an agile way, in an unprecedented and dynamic market, will be one of the fundamental aspects to consider. It will also be necessary to continuously review the value propositions in search of competitiveness, differentiation, and profitability.

Fuente original:

Faced with a changing, unpredictable, and at the same time exciting future, where we see movements that shake the market, it is necessary to identify the challenges, confront them and look for opportunities within the changes that arise, expected or not, but with consequences, if they are not tackled.

1. Living with uncertainty, anticipating, and adapting to change in an agile manner, facing unprecedented market dynamism.

Agility and flexibility are essential in a new era of constant change that requires open-ended plans, subject to continuous review with an eye for opportunities in the face of paradigm shifts. It will be essential for processes, teams, and purposes to respond to this new reality where the only sure thing is change. It’s increasingly rapid and with consequences that are more difficult to foresee. We must be prepared for the emergence of new players, new channels, and new alliances that change the rules and the playing field. We must stop seeing competitors where there may be allies that make both proposals more robust, which will be part of the evolution.

2. Continually review value propositions in search of competitiveness, differentiation, and profitability.

It is such a competitive and atomized market. But with a leader with more than a quarter of the market share and a discount block that has doubled its share in the last 5 years and has a positive projection. The search for differentiation among retailers is fundamental to guarantee their share. Fresh produce, prepared food, a dynamic, innovative, wide and deep assortment, a commitment to sections and experience categories, new services and a personalized, close and differential treatment and attention are the ingredients of the winning recipe.

3. Responding to a more polarized, more complex, more expert consumer, who is more unfaithful to brands.

It is necessary to assimilate the fact that consumers are empowered and that they share channels, operators, and brands as something natural. They can have changing and polarized behaviors without responding to the reasoning of another era. Purpose and values, transparency, honesty, value for money, and working the rational and emotional sides are fundamental to generating engagement. Seducing, surprising, entertaining, convincing, and exceeding consumer expectations is the goal that enables achieving identity and differentiation.

4. Work on health, sustainability, social awareness, locality, and proximity.

The pandemic has acted as a catalyst and accelerator of these values in the consumer. Concern for health and sustainability and commitment to our immediate environment has become part of consumers’ consciousness.

Therefore, retailers and food manufacturers are increasingly adjusting to respond to what would be not only a trend in food but also a change in consumer values. They are more conscious in their purchasing decisions, concerned, aware, and committed to healthy, sustainable, ethical, and local consumption. Eating becomes a responsible act with the environment and with the person.

5. Putting the customer at the center of all decisions and personalization are the basic premises to be relevant to our customers.

To win back the customers we have lost or to avoid losing the ones we have gained, we must prioritize the customer above all others at the first level. It will be vital to base loyalty on personalization, recognition, and the incorporation of customers in decision-making and performance.

6. Betting on omnichannel.

The complete integration of on and off in the purchasing process is already a must. We stop thinking about channels and start thinking about purchasing options adapted to the customer’s needs. The challenge will be to complete the transition from multichannel to omnichannel, aligning with the way consumers behave and truly integrating channels.

7. Integrating foodservice and retail

It is a union that satisfies the consumer’s stomach quota with more evolved models, agreements, and proposals. The convergence of channels is a reality. The bet by retailers for a more advanced and closer proposal to the hospitality industry, added to the bet by foodservice brands to launch products in food distribution, is evidence of it. The future perspective considers smaller households, less knowledge, time, and desire for daily cooking. The rise of delivery that provides consumers with unlimited options puts distributors at risk of losing stomach share. It makes it inevitable and urgent to bet on prepared food. It is both a challenge and an opportunity to offer value and win new consumption and sales moments. Learning from more developed markets helps draw proposals that will not always be the same, adapting to formats, locations, and types of customers. Alliances between distributors and operators will be options to explore.

8. Pay attention to immediacy and convenience taken to the extreme, new needs created by delivery and quick-commerce.

New proposals that revolutionize the thesis of commerce, eliminating barriers and enabling any delivery option in the shortest possible time. Probably the most significant retail disruption in decades will undoubtedly accelerate non-face-to-face shopping, taking convenience to the extreme and resolving the previous barriers.

A scenario with new so-called “phantom” operators that appear and disappear very quickly, whose irruption is challenging to foresee and quantify, and who have become the kings of non-physical convenience shopping overnight. Traditional retailers will have to find ways to avoid losing this most profitable online shopping mission. To foresee the potential, it must be considered the channel in previous decades was conditioned by the existing offer of operators, delivery times and slots. The biggest challenge for these phantom operators will be to change consumers’ habits by positioning themselves as their first choice when they need something. An arduous challenge due to the number of existing points of sale close to homes with extended opening hours, adaptable to their habits and lifestyles.

9. Embrace technology to transform and revolutionize business models and how retailers and brands engage with customers.

Consumers are now connected, and this provides unlimited access to information and offerings that they can search, compare, and seek recommendations.

Brands and retailers need to find a formula that enables them to engage consumers in their conversations by combining content and personalized offerings built on honesty and humility. It is necessary to technologically empower stores, workers, and brands to build a personalized, differentiated, and lasting relationship with connected consumers.

10. Do not lose sight of the dynamism of operators with unbeatable differential proposals and with price as a lure: hard, smart, and happy discount, cash.

We are witnessing a boom in new price-led formulas that show that the game is not over, and the T-shirts have not been handed out. Both Lidl and Aldi, with a more advanced value proposition baptized as “smart discount,” are far removed from the hard discount model. They are proving their appeal with growth and, above all, potential. It will undoubtedly mark the trajectory of the market and its competitors because, in addition to penetration in households, they are planning a significant expansion in the next five years. We must keep an eye on the orthodox hard discount gap that they are leaving behind in case it is filled by operators such as Mere, which has announced it. The unprecedented success of Family Cash demonstrates that these formats still make sense and have appeal, as long as the proposition is justified. It is worth noting the unparalleled opportunity for rapid development due to divestments by other operators. The challenge will be with a more intermediate size not to lose its differential based, in part, on being very agile, taking advantage of opportunities, and minimizing central structures as much as possible. Finally, the boom of ‘happy discounters’ such as Dealz, Primaprix, or Sqrups, offer a fun, discovery-based shopping experience with a mobile assortment that provokes impulse and whim purchases. The expansion of these models is making them a new option close to consumers’ homes.