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08.04.2020
Customers love variety. The competitive retail sector is a challenge for dairies but also an opportunity to show off innovative products.

Nowadays, customers want more

The supermarket is where consumers make the big decisions

The food retail is our interface with consumers. Supermarkets are where they decide what to put on the table. There were times in the past when shopping at the grocery store was a little bit like the comedy film “Groundhog Day“ whose protagonist Phil Connors lives the same day over and over again until he almost goes crazy. Seeing the very same thing in supermarkets every day, shoppers may have occasionally felt a little like Phil Connors themselves, with too much routine and not enough novelty. Nowadays though, whether they are in Germany, the Netherlands or anywhere else in the world, customers want more. They want to see cool products that are fashionable around the world. They also want a sense of home and familiarity, and are keen to buy regional products. Shoppers want variety, and also they support animal welfare, and they want food that is GMO free and transparent supply chains. And they don’t want this to be too expensive, either. The world is changing and the food retail business is changing too. Nowadays, supermarkets offer shoppers experiences, whether it is products that are being baked, or a tasting stand. They are places where consumers can explore new trends and a range of products suited to lifestyles that could hardly be more diverse.

How can a dairy like DMK score points when shopping is no longer about meeting people’s basic needs, but the differentiators are experiences and services? This is a question for Category Management, the team that considers which assortment mix to run and where ideally these would be placed on supermarket shelves to help orient shoppers. Consumers need to be able to get a quick overview of what they are looking at and products on refrigerator shelves need to be organized in an orderly fashion. DMK’s experts work together with partners from trade, industry and bulk buyers to analyze how best to arrange categories and subcategories of products so these are placed logically in terms of brand, trademark and matching products. Category Management continuously gathers and evaluates data about market trends and developments to ensure that goods are placed in a way that is as logical and practical as possible.

Taking a holistic view

The Perfect Shelf is a key factor when it comes to sales. Experts take a holistic view, looking at the whole positive temperature area before recommending what product to place where. Alongside our white and yellow ranges, that also applies to the red line of sausage products, convenience and delicatessen goods. If goods in the refrigerator are arranged clearly and logically, that guarantees products there will sell better. The experts also consider the latest consumer trends and desires when they provide advice on how to organize store shelves.

DMK works closely with its retail partners to achieve these aims. This new form of cooperation encompasses the whole value chain. And it is working, too, meaning there are only winners, whether they are farmers, consumers, retailers or the dairy. Everyone benefits in their own way from this consistent approach.

Changing patterns of food trade...

...an opportunity to show off innovative products

The world is changing and so is the world of food retail

Telling stories

Nowadays, alongside selling products and services, the aim is also to tell the stories behind them – that’s what customers like. DMK is doing this too, by MILRAM-izing all of the brand’s new products and relaunches. That includes MILRAM Kalder Kaffee “unbelievably strong” and “with oats,” Friesendrink, Moin! cocoa or the marketing of MILRAM cheese – all are being sold with the claim “MILRAM – from the home of freshness.” The aim is to connect with the customer emotionally. The images of the northern German coastline and the local dialect awaken a sense of home, and enable customers to identify with the products.

Healthy living

Despite all these changes, one thing that is constant is that customers still want to eat healthy food. This is an important factor in their decision making when shopping. DMK is running innovative initiatives to work out how to lend food a sense of “healthy hedonism,” meaning food that can be enjoyed but is still healthy, rather than going without. An example of that way of thinking might be someone who doesn’t eat meat today, but might fry up a steak tomorrow. That’s fine, a conscious decision. Another question DMK is addressing is how to help consumers who are used to sugar to switch to – and enjoy – products which are less sweet. DMK is responding by cutting back the amount of sugar or gradually replacing it with alternatives, for example by splitting lactose to release the natural sweetness contained in the milk sugar. As the company creates products for the future, all of these considerations are taken into account.

Retail goes gastro

With the seemingly unlimited supply of goods, and the trends towards greater individualization, mobility, singleperson households and high purchasing power, retail is becoming gastronomical. More and more food in stores is ready to eat, available for consumers to take away. Consumers with less purchasing power, meanwhile, are looking for products that cost less, in larger packets, to feed the whole family. DMK’s Foodservice faces a similarly broad range of needs. In the fast-moving catering business, for example, ready-made products such as MILRAM Porridge are making chefs’ work easier. And MILRAM Gourmet Stations for canteens, cafeterias, service areas and convenience stores allow consumers to put together their own servings of quark, adding fruit, sauces and cereals as they like, without needing staff on hand to help.

Agile, not slow

DMK is on the right track with its strategy, and proof of that can be found in people’s shopping carts. Analysis show that more people are buying MILRAM products than comparable goods made by competitors. Shoppers are also spending more money on MILRAM goods than on competing wares, on both the yellow and white product lines. The dairy industry is changing rapidly and just like an agile, dynamic start up, DMK has to navigate its way through these new times, where what’s important is being able to act, develop and try out new things. Being more agile also means innovation cycles can be shorter.

It’s working:

The Lebensmittelzeitung, a German grocery trade publication, recently voted MILRAM one of its top brands. These days, consumers want to know what a brand stands for and where it comes from. Brands have to deliver something that their rivals cannot, whether through their packaging or the product itself, to justify their existence.

Dairy products are one of the best-selling ranges in the retail sector. Thanks to innovation and a wide range of products in the refrigerated section, nobody has to be like Phil Connors and make do without any variety. For consumers, every new day is different, thanks to our farmers’ milk, which is the foundation for everything else.

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