As we have seen in previous reports, there is a sector that can boast an important growth rate in terms of e-commerce and social commerce, and that is certainly food. The sale of food products online, already in constant growth for about three years at 15%, had a real boom in 2020 also “thanks” to the pandemic and the consequent lockdown that further accelerated this trend. From grocery food to gastronomy, many and different types of products are ordered online with consequent increase in revenues for respective brands. Today we will focus on a specific type of products: dairy products.
According to the publication by Monitoraitalia (Competitive Data Srl) of the balance sheet analysis of the first 270 capital companies belonging to the dairy sector for the three-year period 2018-2020, the cumulative revenues of the first 270 dairy companies registered an overall slight decline of -0.6% in 2020, with different results between various regional areas.
- South and Islands: +1.3% growth
- Northwest regions: substantial stability
- Northeast regions: -2.0% decline
- Central regions: -3.5% decline
The retail growth should be interpreted predominantly as online stores.
Many major brands have amplified and strengthened their online presence by expanding their e-commerce channels, but it is especially companies linked to the territory that have been able to seize this opportunity and have concentrated their efforts on creating online showcases that allow consumers to buy the product directly from the hands of those who produce it.
Amazon is the most well-known and important marketplace in the world also regarding food products and foodstuffs, for which there are strict policies regarding product quality, branding, and consumer safety. The heavy restrictions imposed by Amazon are understandable as they are aimed at providing the best experience to customers, and this includes selling safe products, especially when it comes to consumables like food or beverages.
The seller must be able to guarantee the freshness and safety of the product packaging, clearly identify expiration dates, clearly indicate net weight, expiration dates, and any dietary indications such as potential food allergens. A very important aspect concerns shelf life requirements: Amazon requires that all perishable products sold through FBA have a shelf life of more than 90 days. It also requires that perishable goods that are within 50 days of expiration be removed from fulfillment centers.
For this reason, dairy products present on Amazon are almost entirely shipped directly from the producer. Direct logistics, which in other categories represents a brake on purchasing, in the dairy sector instead contributes to creating a closer relationship with the producer, affirming the positioning of quality and territorial specificity.
The Amazon showcase becomes for consumers an opportunity to access territorial excellence products often difficult to find through traditional channels, while for producers it represents the possibility of approaching an extremely broad audience, combining the excellence of “territorial dairy” products with a “national brand” audience.
The product offering is rich, as immediately emerges from a generic search on the platform within the reference category “Dairy, eggs and cheeses,” where under the item “DOP cheese” we find over 1,000 results.
Most Searched Keywords in the Cheese Segment
Platform Search Rankings:
- Mozzarella: 7,838th most searched word on the platform
- Mozzarella di Bufala: 39,831st position
- Gorgonzola: 44,543rd position
- Pecorino: 58,339th position
To further amplify this market segment is Made in Italy, the Amazon store dedicated to Italian excellence, with sections dedicated to products and the possibility to explore regional paths to discover the typicalities of our territory.
Let’s not forget that, also on Amazon, there is a purchasing channel – Amazon Fresh – the grocery delivery service/household care products that allows all Prime service subscribers to receive their shopping on the same day at no additional cost with functionality very similar to that of Prime Now.
Access to Amazon Fresh as suppliers is currently by invitation only, and this explains why in the selection of available products all the major brands present in large-scale retail are present.
Roberto Botto
CEO of Inthezon, company of Libera Brand Building Group
Note: The contents of this column are the result of independent evaluations by Inthezon and not by Amazon or brands related to it.