Getting your product range 'right’ for Retail, and the rookie mistakes to avoid.
Developing new products is the fun part for many startups. You’re creating something ‘brand new’ and its natural instinct to work on every different type of format & flavour to have the widest appeal - and your friends & family are likely a wellspring of ideas for packaging, flavours and more. While this is great if you’re selling direct via your brand website or through local markets, it can be a headache if you don’t take the time to get the fundamentals right for launching with large Retailers.
One of the biggest challenges and headaches for Retailers are the constraints of physical shelf space. There are literally hundreds of products all vying for space, endless new product pitches from existing suppliers and new, and the reality is ‘the shelves aren’t elastic’. This means Category Managers are faced with making decisions about what goes where and why, in order to meet the needs of their shoppers and asking themselves (and you) the blunt question ‘why you’ when evaluating your product range.
Although this can feel like a real head scratcher for a startup, having clarity of focus in your range and understand what the fundamentals that are needed for successful product launches in Retail will give you the best chance of a successful pitch and gaining the invaluable space on shelf.
Remember - less is more (literally).
A great example of a new grocery startup doing it exceptionally well is Boring Oat Milk.
They launched in August ‘21 with a super tight range of only 2 SKUs (regular and barista in 1L PET bottles) after three years of testing and development and became the #3 brand in the rapidly growing plant milk category within the first six months in store. They’re now looking at exporting internationally after only a year in the market and on a trajectory for huge success.
Boring’s focus on having a super clear proposition for retailers, a very clear and strong brand story and exceptional shelf impact in a sea of tetra-cartons on shelf, has meant that they have a strong platform for expanding into new markets without the cost & complexity of managing a large complex product range.
The process of developing and perfecting Boring took three years, a timeframe that even the most dedicated and tenacious would surely find trying. “There were many times where I was like ‘am I crazy? No one’s done this…’” Maw reminisces. “I knew it could be done, but it was just about really how long I was going to stick at it for.”
Working with the factories to implement all-new methods of creating excellent milk from oats was a challenging process. “There were a lot of failures. Every step was a failure, and we’d learn from that and do something different — then that wouldn’t work, and we’d learn something new again”. https://www.thedenizen.co.nz/gastronomy/meet-boring-oat-milk-founder-morgan-maw/
So how can you make sure your product range is right for larger retail expansion?
Know your ‘hero’ products and be able to back it up with data including sales history, customer feedback or any pre-market research that you’ve done. Your category manager wants to know that YOU are clear on what your lead product is and why. By having a clear hero you have an anchor point for your brand and a clear #1 to focus on. For Boring Milk, they solved this problem by having one product type - Oat Milk - and two SKUs (Regular and Barista) that had been extensively researched with coffee experts and consumers, which gave them a super focused range.
Have a clear SKU priority ranking. A shrug or ‘oh, they’re all great’ is a recipe for disaster when it comes to explaining to your Category manager what the priority SKUs are. If you’ve been selling your products for a while, through website or markets, then there is a clear expectation that you’ll be able to use sales history as a first step guide to ranking. There can be other reasons why slower sellers can have higher ranking - they offer something distinct in the market, they’re brand new formats so taking the time to grow etc. You MUST be able to clearly list and rank each SKU if you’re pitching a range, and taking the time to think this through will save headaches down the line.
Be able to explain the market need for your product. This means you need to speak to your target consumers, understand the competitor offers and have a clear point of difference. Supermarket shelves are full of a hugely diverse range of products that can vary by price, packaging type, flavour, format and more. This isn’t about explaining your brand story and talking all about you… its ALL about explaining the value that your product will bring to the retailer and the need for your products to go on their shelf. With Boring, it’s likely they could point to the massive success of Oatly in global markets (supported by statistics, data and learnings), demonstrate the value that it offered and why having a NZ made brand was something that NZ’ers would want to see on shelf.
Demonstrate how your products will fit in with THEIR shopper needs - and why your product offers something that is missing from the category that competitors can’t offer. It could be solving a problem like smaller pack size, lower allergen or more sustainable pack format. You need to be clear on the shopper needs in THEIR stores - and not speak to shoppers in general. An example of this is drinks in a service station, where shoppers are in a ‘grab and go’ mode and looking for trusted brands like Coke, Powerade, V and Pump rather than browsing for the latest hip cool kombucha, cold brew or soda. For Boring, they could speak to the explosive growth in alternate milks in recent years, the need for a more sustainable low allergen offer that also tasted great and was in a format, price and pack that ticked all the boxes for shoppers keen for something new.
Do your homework on competitors already on shelf. You MUST be able to talk about what makes your product something that they ‘must have’ alongside everything else that’s on their shelf. If your product is a near identical to something they already have, or worst case you haven’t actually looked at competitors… then you’re likelihood of ranging success is near zero. Boring was able to take the lead in a category (alternate milks) that was growing rapidly but dominated by almond, soy and international brands. I’d assume a focus on being a NZ brand featured strongly in their pitch, and they could point to extensive local market testing with leading brand Coffee Supreme to highlight a difference vs competitors.
Have a clear strong brand and shelf impact with your packaging. The time and investment spent creating a strong shelf impact can’t be understated and done well will payback quickly. Spend the time instore while you are in early product development and market feasibility and take lots and lots of photos, trial samples and work with designers to create standout. With 20,000 products in an average supermarket and less than one second looking at a shelf mean you MUST grab attention quickly for shoppers. Boring Oat Milk broke conventions of the category with their simple impactful branding and PET shrink wrapped bottle so it immediately grabbed attention from day 1 on shelf. This has given them huge traction to drive sales and be highly focused on what makes their brand distinct.
Expanding into larger Retailers especially supermarkets is an exciting step for any emerging business and by taking the time to get your range right, from packaging to shipper count and distribution, then you’ll give your brand the best chance of success in ranging.
If you want help in reviewing your product range, packaging and pitch, then get in touch. We’ve launched hundreds of products over the years and have the inside knowledge on what works and how to avoid common pitfalls.
