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NZ Food Wholesalers Are Pivoting To Direct-to-consumer In The COVID Crisis - But Will It Work?

Kiwis across NZ have heeded Government advice to stay indoors and only venture outside if necessary. Cafes, restaurants and bars who would normally cater to large crowds have closed their doors.

This has left the wholesalers who supply food and drinks to them in a challenging spot. Many of these producers need to find ways to keep their business going, but the primary source of revenue has ground to a halt. However, with New Zealanders across the country looking for food deliveries and something a bit different from the normal supermarket shop a promising niche that wholesalers could fill has been created.

A number of NZ producers and wholesalers have pivoted to selling direct-to-consumer, opening up consumer-facing online shops and social media channels which offer delivery to customers’ homes directly.

The benefits of selling direct-to-consumer (DTC) are numerous, from establishing a trusted and valued brand to opening up incremental revenue streams and collecting customer data that will be valuable even after COVID-19 has passed.

The challenge however is large. Building a successful direct-to-consumer business model is a challenge for retailers that are normally customer-facing so wholesalers and producers have a whole new set of tests to overcome. One of the biggest of these is how you get the consumers to your website once you have built and launched it.

The biggest sources of internet traffic online in New Zealand are Google and Facebook, however if you are inexperienced, as many wholesalers will be, in advertising to consumers you can easily burn through a lot of advertising money with little return. This is where Affiliate Marketing can provide an excellent alternative.

Affiliate marketing allows producers and retailers to partner directly with a huge range of different websites and online traffic drivers whilst only paying if a sale occurs. There is no charge for traffic, content or impressions, only a commission based on the value of the sale. Affiliate marketing is, effectively, your virtual sales team, operating on a commission only basis or as a cost of sale.

In New Zealand affiliate marketing remains in its infancy but there are local operators with huge experience in operating the affiliate channel. SLICE Digital is an award-winning NZ Affiliate Network. They work with a wide range of retailers from the likes of Kathmandu and OnceIt to Linden Leaves and Banjos Beard. The SLICE Digital CEO is Gavin Male, an affiliate marketing veteran with over a decade of experience in the channel in the UK, US and Europe.

When asked about the affiliate marketing opportunity for wholesalers in NZ, Male said. "During the COVID crisis we have seen a number of new retailers approach us about launching an affiliate program to help them generate direct consumer sales. With internet traffic up across the world there is a huge opportunity with affiliate marketing to get your offering in front of a whole new type of customer and only pay if you make sales."

Male continues, "SLICE Digital are the New Zealand affiliate marketing experts. We have thousands of different websites and publishers looking for new offers and services to promote during this time including newly launched sites like www.LockdownDelivery.co.nz as well as more established online publishers with large and loyal audiences. All working on a performance basis.

With internet traffic surging, launching an affiliate program is a great idea for wholesalers who have pivoted to DTC as it provides a convenient and low risk channel for building brand, generating customer enquiries and aids with word-of-mouth.

While it may seem like a hassle to launch a new marketing channel during a crisis, it will pay dividends in terms of additional business. Wholesalers who sell direct-to-consumer don’t have to become The Warehouse, but if you’re reinventing your business model, you may as well do it effectively - and there will likely be benefits, takeaways and incremental sales that last well beyond the current situation."

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