Social media is now considered more important than traditional print advertising in the food and beverage industry according to the Grant Thornton International Food and Beverage report, ‘Hunger for growth: Food and Beverage looks to the future’.
The report revealed that nearly half (49%) of all food and beverage industry executives say social media is a top method of attracting and retaining customers compared with 46% for print advertising. The company website is viewed as the most important at 78%.
Other digital tools such as email, online advertising, search engines and digital coupons are also being used to engage with customers, reflecting growing customer demand for accessible product information.
Grant Thornton New Zealand Partner and National Leader, Food and Beverage, Simon Hunter, said business owners in this industry need to embrace the growing use of digital tools in the value chain, whether it is used as a tool in the traditional value chain or as the firm’s dominant channel to market.
“Food and beverage companies operating in traditional channels have been squeezed between supply constraints, costs and the dominant role of the main retailers. Having a digital presence helps an organisation take back control. It’s becoming a critical part of product development, branding and direct sales efforts, enabling companies to secure specific categories and niche markets,” he said.
The report cites the impact of a food scare on a company’s reputation as an example of an issue that can be magnified if social media channels are not actively monitored and engaged with, saying that investment in the digital world will pay long-term dividends for companies.
“Businesses need to re-think how they communicate with stakeholders as reputations can be built and destroyed overnight,” said Hunter.
“Leading organisations are increasingly aware that being digital requires monitoring and measuring the value of online and social media efforts. They are also enforcing policies to keep social media messaging consistent and of a high quality, while minimising risks with processes to control, counter and mitigate negative exposure.”
A recent Sprint Mobile Moment of Truth survey showed an increasing number of consumers are using smartphones and tablets to access product information while eating in restaurants and shopping in supermarkets.
The survey revealed that 58% of people aged between 36 and 65, and 61% of younger adults, research products online, using smartphones or tablets, when shopping at supermarkets.
“Successful food and beverage enterprises are increasingly using online channels to sell products to these engaged customers, and the rest of the industry needs to ensure they’re aligned with these changes,” said Hunter.
“Social media has increased the speed of delivery of the message to market, enabling adaptability and a quick reaction time, but only if the organisation is geared up for it.
“An online presence can be a game changer for companies operating in a country like New Zealand, where retailer power is concentrated.”
Overall, the report paints a positive picture of the food and beverage industry. After years of uncertainty, retrenchment and delayed investments, many are now looking to invest in new products, new capacity, new distribution channels and new markets.
Demand for products is expected to increase by 50% over the next 20 years.
Simon Hunter
Grant Thornton Partner and National Leader, Food and Beverage
T +64 (0)9 926 5747
M +64 (0)27 4899 737
E simon.hunter@nz.gt.com