There is Such a Thing as the Wrong Consumer

There is Such a Thing as the Wrong Consumer

If you hang out with old school sales pros from the natural products industry, you will often encounter a belief that distribution (in the right locales and channels) is all you need to grow with an ‘incremental’ product. They are used to low EBITDA businesses that never did much marketing other than bizarre wellness rags that I can’t ethically even mention to you; they are so unscientific. There is no ‘wrong consumer’ in the narrow world of natural health food stores in their minds.

But what happens when you go into Kroger in your hometown? Or Costco? That’s when your risk of attracting the wrong consumer goes up, especially in chains with integrated merchandising, where premium brands bump right up against the major players.

OK, so, who are these naughty consumers who are messing with your business? They are all light users. Their initial trial may either a) never repeat at all or b) at such low frequency as to be unable to sustain your shelf presence at specific accounts they discovered you in.

Discount Trial
Cue busy shopper distracted by an endcap featuring your brand on deal (in a category he buys): ‘Hey. This is only $2…huh, looks OK…why not?’ Shopper grabs your product and tosses it into his cart. Do folks like this look closely at the package? Do they notice your differentiating attributes? Do they even confirm you’re a natural product? Do they even care? No. You were literally cheaper than their regular brand, and they were willing to take a risk to save money.

Do not cave to 6 promotional cycles a year at major accounts because it will not only train consumers to buy you only on deal, but it will also promote constant surges of one-time trial, especially if you are NOT clearly differentiated.

Clueless Trial
The problem with clueless trials is that the ‘clueless’ consumer will not intentionally buy you for your optimal point of differentiation. This is a fancy way of saying, ‘they just don’t get you.’ They’re not paying attention. And your package isn’t making it clear.

Educate shoppers, online and offline, to increase the % of triers in your target audience. Let word-of-mouth, not overly aggressive trade marketing, drive velocities. It takes longer, but the growth is more sustainable.

Reductionist Trial
Yes, you are gluten-free, but your point of difference is not ‘gluten-free’ AND, honestly, you’re not the cheapest gluten-free option out there anyways in your category or even in the broader macro-competitive space. That’s because, ‘hello friendly consumer!’, you’re
trying to sell something more sophisticated. Argh!! Clenched fist shake!

When consumers fail to grasp your true value and reduce you to commoditized, mass-distributed, and ultimately, non-differentiating attributes, you have failed as a marketer.

Take-Away: Don’t highlight baseline attributes on the front of your package that are NOT key to your point of differentiation. For offerings easily reduced to a larger macro-fad, better that, early on, your package actually dissuades reductionist buyers from picking you up at the expense of total revenue.

All three forms of ‘light’ trial drive cash flow, but they don’t lead to repeat purchases. And it is repeat purchases by 50% or more of consumers annually that is pre-condition for exponential growth. Yes, you can scale a mostly one-time trial business, but you have to do it lightning fast, and…the odds of it collapsing on the other side are quite high. It’s not how you build the next KIND Bar.

Ready to learn how to plan for growth and to know how to measure the growth in your biz? Join me with other Founders at my Riding the Ramp webinar Q2 2023 Cohort, Friday, May 5. All registrants are screened.

Dr. James Richardson

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