Where Will Consumers Turn When the Mondelez’s of the World — or “Big Natural” — Abandon Them?

Joe Wade
July 30th 2020

Yesterday, Mondelez International announced that they would be reducing their SKU count by 25%. Mondelez owns nearly 40 brands, mainly in the cookie/cracker/candy areas.

Brands that may show up in natural retailers are Toblerone, Belvita, Philadelphia, Perfect Bar, and Enjoy Life Foods. During a previous Provender Community Conversation call, we talked about how the pandemic is accelerating the trend of reduced selection in chain stores.

Imagine if you can – a cookie section in a Fred Meyer or Winco or Safeway that is missing 25% of the selection. Mondelez calls it “cleaner shelf”, and “making sure that key SKU’s are on the shelf”. The result will be that each remaining item will have higher sales (consumers will generally not simply buy 25% less).

The loophole in their thinking is that CONSUMERS will settle for this smaller selection. That may very well be true in the world of retail food giants (to borrow Grocery Story author Jon Steinman’s phrase), but where will those consumers turn when the Mondelez’s of the world — or “Big Natural” — abandon them? To our member retailers who carry our member manufacturer’s products on their beautifully messy shelves.

 

Long live the Alliance!

Joe Wade
Board of Directors, Provender Alliance