8 Ways to Drive Retail Velocity

8 Ways to Drive Retail Velocity

Post-pandemic retail is back in a major way for consumer brands. Early this year consumer spending posted it’s biggest gain in nearly two years, an all-time high. It’s no surprise that fledgling brands are all scrambling to get into retail.  

Why retail is more important than ever

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It’s not because of the rebound in consumer shopping. It’s because of the iOS 14.5 privacy update and impending cookie sunset. 

Prior to iOS 14.5, it was easy for brands to grow efficiently solely by running ads on Facebook and Instagram. In the wake of iOS 14.5, Apple devices are no longer passing cookie data to Facebook, and custom acquisition costs shot through the roof.  

Obvi founder, Ronak Shah, says, “Brands need retail more than ever, because it brings blended customer acquisition costs down.” As a result, brands are in a mad rush to get into retail. 

In general, it’s a risk mitigation strategy. As Jamie Roller, Director of Growth Channels at Dr. Squatch points out, “Amazon can be a tenuous platform. At any point, they can shut you down for unproven allegations of breaking the seller code of conduct.”

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Staying in retail > Getting into retail

Getting into retail is no easy feat. Brand founders often invest years and tidy sums in product development, branding, packaging, and direct-to-consumer marketing to prove their concept. 

But what most brands don’t realize is that getting into retail is the easy part. The hard work is just beginning when you get your purchase order. There are thousands of brands behind yours banging down the door of the retailer. The scary truth is if your brand is not selling, another will take your spot. 

So it’s staying in retail that really matters. And it all comes down to a single metric: retail velocity

Here’s how retailers calculate the sell-through metric

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Retailers will calculate it for every SKU in a shelf set, so your product can be evaluated against its competitive product set. 

According to Yannis Varrellas, CEO of Olyra, “If you want to be successful and maintain your position, you want to be in the top 25% of your set.”

So it’s on YOU to ensure your brand is standing out and selling through. And earning its spot on the shelf.

We’ve spoken to hundreds of operators and investors on the best ways to drive velocity in retail. 

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12 tactics to drive sell-through:

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1) Collaborate with your broker

Brokers and distributors are key players in the retail channel. A broker acts as an intermediary between the brand and the retailer. They are independent sales agents that represent multiple brands and work on a commission basis. They help with negotiations, market insights, and merchandising. 

‍Phil Jamison from Beatbox beverage shared a tactic for how he works with beverage brokers. He advised that you should focus on your differentiation, “tell them how you are different” and how you satisfy a “highly defined customer profile.”

Furthermore, you should plan on proving metric evidence (taste tests, margins, sales volumes). And show that you have a support system (marketing budget, staff in market). 

He boils it all down a tight pitch that can increase your sales 50% overnight. 

• We have a great product for this ICP
• We need to focus on the X,Y, and Z aspects of the product. 
• Go out there and sell

‍Ronak from Obvi highly recommends that you find a broker who works on performance, not a retainer basis. And Jake Karls from Mid-Day Squares stresses how important it is to have a close relationship with our broker. His broker was especially helpful with strategy and timing. 

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2) Get the category right. 

This is not so easy for the category creators out there. Jake Karls from Mid-Day Squares  shares, “Our snack bars were often put into the dairy set, but it was a vegan and plant-based product that was side-by-side with eggs and milk. Despite being a popular item, it would get lost.” 

People would see it, but it wouldn’t compute in their heads because they were looking for something else. Luckily, they were able to do some testing with smaller retailers. Managers would show them the planogram and let them experiment with a new position. 

And sales shot up. From there, they could take this data and narrative to other stores to show them it's a win-win move.  

Belgian Boys is another brand that has traversed the category switch moving from frozen breakfast to the refrigerated breakfast set. 

Pay attention to how and where your product is merchandised in the store. Work with your category manager, broker, and distributors to understand where you will sell best.

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3) Optimize packaging. 

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The packaging that worked in DTC doesn’t necessarily work in stores, because the product is ultimately sold by imagery and copywriting on a webpage. And on the shelf in the supermarket, the product is sitting next to a number of similar products from different brands. 

That means being different and noticeable compared to others in your section. Some brands like Tooletries have bold colors and designs, and have a built-in advantage. Other brands, maybe looking for opportunities to tweak their design to make it “pop. 

Packaging optimization means different things for different brands. For example, Ronak Shah shared that, “In preparing for Obvi’s Walmart launch means dialing back the focus on flavor and dialing up information about the brand and product.” 

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Finally, put a QR code on your packaging. A QR code will create a bridge between the offline and online. It will extend the real estate of your packaging and loop buyers into your digital presence. From there the options are limitless. You can:

• Communicate key information (ingredients, food pairs)
• Capture customer emails/phone #s
• Incentivize repeat purchase 

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4) Out-of-home (OOH) advertising

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A prime example of this is Strong Roots, a plant-based dinner side brand. Earlier this year they launched a major OOH ad campaign in NYC.

There were ~450 billboards across 5 boroughs, digital and traditional, above ground and in the subway. The ads feature some of their most popular products: Cauliflower Hash Browns, Sweet Potato Hash Browns, and Spinach Bites with a Buy One Get One Free Promotion. 🎁

To redeem the freebies, subway riders scanned a QR code and provided their email address. The coupons are delivered in real-time and can be redeemed at Whole Foods, ShopRite, and Fairway, as well as online at Fresh Direct and InstaCart.

Another recent innovative OOH example is a truck wrap from Jolie. Jolie, the hot new shower head for skin care wrapped trucks featuring a QR and drove around New York City. Check out Adgile Media, for high-tech truck wraps that can track buyers who stop in major retailers who see the truck and deliver a targetable audience for Facebook and Instagram.

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Jolie also went grass roots with their QR codes with branded stickers that they left in New York City restaurants, clubs, and bars. This is a more affordable option for brands that can’t afford a billboard or truck wrap.

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