Today’s interview partner is Katharina Wagner, Founder and Branding & Communications Specialist at food & beverage marketing consultancy Spoonful Solution.
Katharina is a branding specialist with 10 years of professional marketing background, of which she mostly worked in the food & beverage industry such as Unilever, Nestlé and Ferrero. With her experience in both multinational corporations and the startup world, she knows what sells well in the competitive German market.
Here she shares her insights on challenges and pitfalls in the German F&B market, the German consumer and building a brand in a highly competitive industry
What makes the German F&B market a challenge in your opinion?
Germany is the world´s 4th largest economy and a highly competitive market. One of our clients called it “the USA of Europe” the other day, and with regard to the market size and how challenging it can be to become a significant player, this might be true. Every category has a lot of competition and each brand tries to be recognized by consumers by telling a unique story. Only finding that story can be very challenging and a lot of companies struggle because they want to communicate too many things at once. Doing that, nothing is going to be remembered well by the consumers.
At the same time – and probably because there is so much competition – both consumers and buyers in the retail landscape are very skeptical. It takes time to convince them of their first purchase, and then it takes a great product in order to become ordered again and again. But once a brand gets a foothold in the German market and people start to like it, both consumers as well as buyers are loyal partners, which makes the market – apart from its size – so appealing.
Can you describe the German consumer according to your experiences and what are the best strategies to meet his/her expectations?
As in any market, there is of course no way to meet the expectations of everybody, target groups can be extremely diverse and people are interested in lots of different things depending on what type of product you have. The ideal target group of a frozen pizza will for sure have some very different characteristics than customers who regularly buy superfood cereals. This is why it is extremely important, to get to know the customers that you will be serving, before you actually start doing it. We offer for example tasting sessions with influencers in Hamburg and Berlin to get some initial feedback on new products, and if the taste range is very diverse, e.g. with a portfolio of 10 different müsli bar flavors, we let them pick the products that will probably sell best in the German market. From our experience, getting to know the consumer and your very own target group as quickly as possible is a good way to avoid pitfalls.
Nevertheless, the German consumer can of course be categorized by a few characteristics that are quite true for most people. One thing is the huge interest in quality, especially with regard to “where does the product come from and what is in it”. May it be based on the natural skepticism or the fact that consumers just want to know everything, Germans like to read the label and are easier to be convinced if they find good ingredients and a manufacturer´s name they feel they can trust.
Furthermore, many people are quite price-sensitive and it is not uncommon to look for bargains and check price differences between supermarkets. Especially when entering the market, a well-calculated initial pricing is therefore key to a long-term survival.
What is most important to building a brand in Germany? Do have a best practice?
As we stated initially, finding your unique story and building your brand around some key elements that people easily remember you for can be very hard. But it is also the best way to stand out from the competition, therefore we would always suggest to try to narrow it down as much as possible, even though most brands have a couple of unique traits they could easily share in their communications.
Try to explain as easily as possible who you are, what you stand for and also behave accordingly. This means that all channels you use and all messages you send should speak the same kind of language. With time, people will start to remember you this way.
Picking one specific brand as a best practice example is hard, because there are many that are doing a really great job. But one that we often come across in terms of message-alignment on all channels is the brand “Landliebe” for dairy products. Their story and brand is all about good ingredients from carefully chosen farms, natural products and a cozy feeling of home and love. From their product range to their corporate identity, packaging, website and social media communication, every touchpoint the consumer faces tell the same story. This is definitely a great example for branding and storytelling that always sticks to its roots.
Is there one common pitfall when entering the German F&B market you can tell us about?
We experience a lot of impatience when it comes to launching products in the German market, especially when a company is fairly young and unexperienced with internationalization. We recommend to speak with markets experts first who can validate the idea and expansion plans, and who also know how long it will roughly take until the first listings in supermarkets or restaurants will drop in. This pitfall can be especially dangerous because if you do not have the manpower or budget to have a little patience, the initial investments you made in the new market might never pay out.
Another pitfall, that is more crucial before the German market has actually been entered, is when brands follow the lean approach too much and try to enter the market without the right preparation in terms of product quality, packaging, salesfolders, websites or marketing strategy. Germans are not as proficient in English as many of their neighboring countries like the Netherlands or Scandinavia, and German is key if you would like to convince both consumers as well as buyers. Especially when talking to buyers, you often only get one shot, and losing this chance because of not being prepared enough would be terrible. If you have a meeting with a potential client or salespartner, be prepared, have all documents ready in German and show them your willingness to cooperation. This is a much bigger door opener than you might think!
Thank you, Katharina, for the interview and for sharing your thoughts.
General Manager and Branding & Communications Specialist at Spoonful Solution