Regardless of the business model, food business operators have been pushed to diversify with more digital options in the wake of the coronavirus pandemic. This trend was discussed in the last webinar of the Colorado Department of Agriculture’s Colorado Proud Marketing Program.
According to Chef Jason Morse, owner of 5280 Culinary, a food marketing and advocacy consultancy, the year of the pandemic was a good time to look for gaps in the market and think about ways to fill them.
He started his company in 2010 after years of working in institutional restaurants such as hotels and country clubs, as well as restaurants. Among other things, he now acts as the national spokesperson for Ace Hardware. He also works with Colorado-based agricultural commodity groups.
He spent the past year cutting costs, optimizing and diversifying his business, he said during the webinar.
“Consumers wanted a digital experience, so we added the digital experience to the other activities we had already done,” he said of his three-person staff.
Early on, Morse saw the need to break down barriers between producers and consumers, and to familiarize producers with tools with which to tell their stories.
“The producers do a great job, but they are constantly being scanned and beaten up for doing what they do. I don’t blame them if they want to hide in the pasture with their animals, ”he said.
While engagement is likely to generate some negative comments, learning how to deal with critics is necessary in order to meet increasing consumer demand for information, he said.
“In the absence of a story, there is scrutiny,” he said.
He gave an example of how this can be achieved in a positive way by using a specific commodity, potatoes from the San Luis Valley. Consumers want to know how they are grown and stored and who the people behind the products are.
“There’s a hunger for it,” he said. “Make it cool, make it fun, and that makes it easier to promote the product, build a brand, and be true to who that brand is.”
He also stressed being creative and adaptable to what the pandemic dictated for businesses large and small.
“When we couldn’t do a potato festival, we have a baked potato bar,” he said. “It was such a good feeling at the end of the day.”
The pandemic provided an unexpected opportunity to identify gaps in the market and think about how to fill them, he said.
For example, consumer surveys show that Instacart shoppers generally trust the online food platform to select chicken and pork on their behalf, but not a piece of steak.
“That led us to think about how we could work with the beef industry to train grocers to pick a great cut.” he said.
As the convenience factor becomes more and more important, better trained salespeople combined with better purchasing tools offer “a huge win for everyone,” he said.
Elizabeth Moser has also tried to find and fill in the loopholes. Moser is the founder of LoCo Food Distributing, which represents 140 Colorado grocery brands that sell to wholesale buyers at grocery stores and smaller independent stores from Fort Collins to Colorado Springs.
One thing she focused on over the past year was making sure that local products are accessible through online shopping portals as well as national brands.
“It’s been a steep learning curve and as we learn that seems to be changing,” she admitted. “Even our contacts in the grocery stores don’t seem to be experts.”
One interesting thing they discovered is that online ordering options often change by zip code.
“We’re working to make sure that there are local options, not only when someone is shopping in-store, but that our products are also available through third-party options like Instacart,” she said. “I think that will be a constant concern.”
So far, LoCo has mainly worked with processed products such as salsas and sauces, oils and spices. But Moser said she was interested in processing more perishable goods, especially products, dairy products and meat.
Because these items have a limited shelf life, sufficient quantities are key for this segment to work, she said.
“When you’re only getting an order for one case here and maybe another there, it’s difficult to keep this product in your catalog so that it will be available if someone suddenly wants it,” she said.
Support from large grocers is critical in building the volume required, she added.
For example, the Whole Foods Market now stocks ORIGIN Heritage a2 Guernsey Milk. The milk is made in Kersey through a partnership with Colorado Cow.
With Whole Foods in stores, LoCo can offer the product to smaller independent outlets that are on the same delivery routes.
Working with perishable goods also requires an accurate and reliable fulfillment system, she added.
“We have to have the logistics worked out with the producers,” she said.
For a Friday order, it might be necessary to pick the item up the following Monday so it can be delivered the same week to ensure freshness, she said.
LoCo provides startups with resources including a decision tree to help plan and scale wholesale. Moser said it works best when entrepreneurs start building demand for their product through product demos, farmers markets, and individual wholesale relationships before contacting LoCo.
After a person has grown beyond what they can do by themselves, this is the ideal time for LoCo to introduce their product to a wider audience, including national chain stores, she said.
Morse has experience with this side of things too. He recently launched his own line of low-sodium barbecue rubs, brines, and sauces, originally sold in three stores and now available in 3,000 Ace locations across the country.
What he took away from the surge in online buying activity over the past year was the need to put more emphasis on high quality photos and ensure that the online shopping experience was “fully dialed”.
He hired an additional employee to ensure that all online orders are shipped on the same day.
“We add a handwritten card to every package that goes out,” he said. “And we add little things from time to time, an extra item, to reward the customer. There are no discounts – we don’t want to devalue what we do – but if you order a certain amount from us, we’ll throw in an extra item. “
“It’s about adding value rather than reducing the value of our products,” he said.
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