Thursday, 16 February 2017

Heck Food Birmingham Food Exchange by Enterprise Nation

In October 2014 Heck Sausages had 9% of the premium sausage market. Within 2 years this would be up to 42%. With a no-nonsense approach to business, incredible experience and a determination to make up for a previous mistake of selling a precious family business that ended up being controlled by a large corporation low on morals and values, Andrew Keeble gave a turbo-charged performance at Enterprise Nation's Food Exchange last summer hosted by Debbie Assinder.
Now as Heck Food prepare to join Enterprise Nations Go Global Mission to Paris Andrew Keeble is a business man who mean’s business!
Full coverage of other brands at the Food Exchange here Food Exchange Summary

Below is Andrew’s Amazing Secrets to Success

1) Brand Development
“A brand has to have attitude and a voice.”
Image result for heck food

“Develop a brand with a clear goal in mind”.
“Who do you want to appeal to? You cannot be all things to all men”.
“Saying you are ‘niche’ doesn’t cut the mustard anymore and don’t be too niche as that’s a small market.”
"Decide if your brand is a lifestyle brand, regional, national, deli or food show specialist".

Heck’s market research showed that most sausage buyers were in the 45-70 years’ age group. The 18 to 45 age range was not engaged so they would need a new specific marketing campaign to target them. So, the brand was developed with this clear goal in mind. The Elmwood agency subsequently used consumer insights to design a campaign. They did not use focus groups as Andrew said “groups can be easily led by someone with a strong opinion”.
AIM: “To be mainstream enough and premium enough.”
Heck have a no compromise approach to quality. They don't cut corners and use fresh ingredients and do small-batch production to keep flavour quality high.
“We are a fun brand, we don’t take ourselves too seriously. Our attitude is ‘Be humble, we’re not worthy’ ”.
The youthful vibe of the brand is reflected in a workforce with 40% of employees under 26 and a fun, energetic working environment. To promote the brand, they go all over the country attending more than 500 events.

For example, to crack the Northern Ireland and Republic of Ireland markets they sent two teams on a road trip around the counties giving out freebies, chatting and engaging with people. They got a proof of demand for the product in that area that they could then go into meetings with buyers to demonstrate Heck’s potential to make money.
“We don’t do a discount brand as dual-branding is very expensive.”
“The consumer is king and they want everything now.”
Andrew advised doing extensive market research using consumer insights and buying lots of data on customer trends such as Kantar Insights and Tesco Clubcard data from Dunnhumby. Tesco has around 13% of the market so the data is extremely useful and relevant. Andrew also recommended using Mintel reports.

2) Marketing
To drive the business forward Andrew spends 10% of Heck’s turnover on marketing both above and below the line. They do lots of PR and social media advertising. He warned that “price promotion will get you volume of sales but not loyalty. Customers will just switch brands depending on what’s on special offer that week i.e. Tropicana juice one week, Innocent the next”.
Of Heck’s 70 employees, 4 work full-time on social media. They prefer to post mostly on Facebook and Instagram as ‘Twitter is boring!”. The tone is not sales dominated “we are only £2:50 in Tesco this week!!”. They don’t talk too directly about the product or scream “look at me, look what I’m doing”.

“A complaining customer is your best friend.”
Why are they unhappy? Turn them into a brand advocate and give them their money back plus more.
"The best brands do evolve and change, unlike Kodak”.
Keep current, Andrew pointed out that the Amazon logo has changed 28 times since inception. Heck launched in 2013 and only 3 years later decided to do a brand refresh. People asked him why update when you’re doing well? Andrew’s answer was that the pace of change and future trends are so rapid that it’s worth spending £25k on a few tweaks.

3) Impressing Buyers

The sausage market in the UK is worth £840m which dwarves even the baked bean market at £600m. “We are swimming against the tide by growing sales in the premium category in a declining overall market”.
“Food is too cheap, so premiumising is a good thing.” Andrew did contrarily mention that shoppers can be promiscuous and that discount supermarkets had grown market share from 3% of the market to 11% in just three years. He wondered whether shoppers will get fed up of going from shop to shop just to save a few pennies.
With Richmond having a commanding 65% of the market he asked a key marketing question: “can we get their customers to spend just a few pennies more to trade up to us?”
You need to approach buyers ideally early in the year as after April you will struggle to get listed and you will have no chance at all after September as they will already be planning the next year.
Andrew advised that it’s important to understand that all buyers are under immense pressure from their bosses. They focus on sales; waste reduction and profit margin is key. They are super busy so aim to keep meetings to a brisk 20 minutes and make sure you know how the category is performing and how you can grow sales. Be chatty and remember personal details about them. Heck uses a small paper flip chart rather than PowerPoint for presentations. “Take notes on what they want the focus over the next year to be e.g. price. Confirm later that your understanding is correct”.
Download sales figures daily and provide retailers with suggestions weekly to improve selling.
“Always deliver your sales targets: hit your targets every quarter or you will your future meetings difficult. The better you perform, the more shelf space you will be given”.
“Retail changes so quickly, if you take a year out you can lose contacts quickly”.
To deliver the kind of profit margin buyers need, Heck works on a lean production model and make everything themselves including labels with direct labour accounting for less than 5% of costs.
Northern Echo

Andrew encouraged everyone to grow their list of suppliers and not be too dependent on one company. Tesco used to account for 80% of Heck’s business but now is down to 40%. Having said that you also don’t want to take on all of the big suppliers at once and they even turned down a huge order as they knew that they could not fulfil it.

4) Shelving: The Last 5 Yards
Getting listed is easy but standing out on the shelf is difficult. Sausages used to have ‘bodybag’ packaging so Heck went for an innovative and colourful cardboard packaging.
So although you’ve done all the hard work to get listed and stocked you must double check that your product made it on to the shelf and was displayed correctly. Use supermarket data to track stock replenishment and follow up in-store to check display values and correct price labelling etc.

5) Diversifying/Scaling Up
“Do you have a 2,3,4-year business plan? Set goals and work back from there.”

Heck’s marketing challenge is to move from being famous for sausage products and gaining a reputation for variety and vegetarian products. They began this by moving into chicken and healthy burger markets as Andrew bluntly put it “Quorn and Calder don’t deliver on taste or quality.”
Heck are opening a Heck World customer experience building in 2017 covering over 25,000 square feet housing a factory, picnic facilities and cookery school. They are also going to target the slimming community and health community as they are very vocal and their support can be a major boost.
In an interesting aside comment Andrew confidently predicted a £10 minimum wage in the UK by 2021.

Finally Naked Ambition
“Our turnover was £1m in the first year. Can we reach £80m by 2020?”

Words by Paul Clarke
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