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Food Businesses Need To Pay For Space And Attention, Even on Amazon

“This product sells itself!” Have you ever heard that expression? It’s one of those clichés that is unfortunately not true. While there are things you can do to gain awareness, interest and trust in the marketplace, no product, food or otherwise, sells itself.

If you are a food business going into distribution at a physical grocery store, you have to spend money on things to position yourself to get trial by new customers searching through tens of thousands of SKUs. This includes discounting your product through a price promotion and/or paying slotting fees to get the “prime real estate” on the grocery store shelf. In addition, food businesses spend money on marketing to leverage relationships with customers to get them to go to stores and purchase the product or else, through in-store demos of their product. This is in addition to the money spent developing their branding to develop a relationship with their customer as well as packaging that both tells that brand story and sticks out on the shelf.

Selling your food products online is no different. On our podcast this week, Jeff Walcoff of Marketplace Strategy talks about how Amazon product pages essentially function as the “packaging” of online products and how even the big brands pay to advertise their product pages in Amazon’s search results. And, given the amount of complexity that goes into keyword research for determining what is in that brand’s product pages, most people who choose Amazon as a channel have to spend lots of their time (and thus, money) optimizing pages so they are discoverable on Amazon.

People’s time and attention are limited, and often the biggest challenge with acquiring new customers for food businesses is getting those customers to try the product. Because the food space is competitive, online and off, emerging food companies have to spend lots of marketing and sales dollars to get people’s attention by paying to have their product in the right place with the right positioning.


And now, our roundup of the best food and beverage finance news, events and resources from around the web…

Food and Beverage Business Models

Business Model Insights

Raising Capital

Raising Capital

Grocery Store Shopping

CPG/National Brands

Grocery Store Produce Section

Market Trends

 Regenerative Agriculture

Farming and AgTech

Mergers and Acquisitions

Deals/M&A

Events

Industry Events

Categories: Insights Newsletter