Since 2012, the way in which the UK shops for groceries has changed. Kantar shows discounter share has doubled (9% to 20%). Online share has trebled (4% to 13%). Big store checkouts are far less busy (70% share to 53%). Step back and think about it – it’s an extraordinary amount of change.
So what next? Could we see more seismic changes? There’s a lot happening out there, from all the noise about quick commerce (Getir, Gorillas, Snappy Shopper and more) to significant volumes in some categories shifting to DTC (shaving, coffee capsules) and Gousto, HelloFresh and Mindful Chef growing fast. Gousto, for one, is telling a compelling story about a future of personalised nutrition, sustainability, and a better way of doing meals.
The fundamental challenge right now for suppliers is understanding how significant these emerging trends are. Finding and servicing these needs will likely add cost and complexity. Is it worth it? How do you know?
What gets measured gets done, and if you can’t see the growth of these disruptors, you might find yourself thinking they aren’t there. This is what happened to many companies when Aldi and Lidl surged in the last decade. Nielsen and IRI scanning did not pick up their sales, so it was common to hear companies comparing their performance in the big four retailers to a “total market” benchmark from scanning – ignoring the most important dynamic.
Kantar did and does measure the discounters and was therefore the best measure of the big picture changes in the industry. But still, many people looked away – perhaps because it was more palatable to keep the benchmark less challenging.
So how can you avoid this trap? How do you get visibility of the new entrants and emerging channels? You can be sure the data providers are working on it right now, but in the meantime, companies are having to rely on piecing together information from various sources. That means listening to what these new entrants are saying publicly and privately, gleaning information from industry networks, and conducting ad-hoc surveys to find out what consumers are doing.
For an industry that is used to being so well served with high-quality purchase behaviour data, all this can feel uncomfortably home-made. But this is the best you can do for now. It’s better to have a hazy view of the developing landscape than to pretend it isn’t there at all.
The companies who can get a clearer picture of what is actually happening will be best placed to pick the right places to play. Insight and category teams should be thinking now about how to get that clearer picture. Just because you can’t see it, doesn’t mean it isn’t there.