Foodservice Manufacturing Is Having a Retail Media Moment

Consumer and foodservice marketing teams at food manufacturers live on different planets.?

B2C teams are racing full-speed into performance marketing channels, most notably retail media channels like Amazon, Target, and Instacart, with a 12% increase in marketing spend annually. It’s hard to beat the clarity and straightforwardness of placing product ads directly into the intent-based search experiences of end buyers, whether that’s for tomato soup at Target or a new USB charger from Amazon.

And for food companies, this capability isn’t new. CPGs have already experienced a whole hype cycle for retail media, starting with rapid experimentation on every channel imaginable, and ending with a consolidation of budgets towards the higher-performance networks. There are whole agencies and tech platforms built to help companies manage their retail media spend.

For B2B foodservice teams, the retail media party is just starting.

What’s Wrong With Foodservice Go-To-Market Anyway?

In the current foodservice marketing model, the strategy heavily relies on wooing distributor sales reps (DSRs) to advocate for products. Hosting a party and crossing your fingers that Johnny remembers to pitch your lettuce at their next meeting is ripe for failure, so most manufacturers work up incentive-based schemes to track DSR sales impact. But even these programs are ridden with inefficiencies and uncertainty, leaving much up to chance.

It’s not a great experience for the end buyer either. Operators often find themselves passively hoping that marketing materials and offers will miraculously land on their desks. Even if these materials do reach them, the conversion from paper to purchase is unpredictable and largely uncontrollable.

The problems for manufacturers with these classic approaches are clear:

• Minimal direct influence over how products are pitched to decision-makers
• They remain disconnected from the actual operators who use their products
• New revenue attribution is difficult to measure, with a high margin for inaccuracy

Next to retail media networks that can put advertisers in front of hundreds or thousands of relevant potential buyers per day, these traditional methods are not just inefficient—they're unscalable.

Now, we aren’t about to say that these practices should go away. The genuine relationships that DSRs have with their customers is, without a doubt, a powerful conduit for marketing new products to end buyers. When it works, it works. When it doesn’t, it’s hard to tell why.?

Retail Media Brings Manufacturers To Modern Digital Marketing

The most obvious limitation keeping manufacturers from accessing retail media opportunities in B2B foodservice is the lack of a specialized network. Chasing foodservice sales through consumer platforms, naturally, doesn’t work well.

Enter Pepper’s distributor retail media network.

We’re harnessing the collective reach of the 180+ distributors using Pepper for their ordering systems to create a first-of-its-kind network for foodservice teams at food manufacturers, because we believe manufacturers, distributors, and end customers all benefit from more effective foodservice marketing.?

• Manufacturers get all the clarity and scale of a retail media network
• Distributors unlock new revenue streams by enabling ads on their apps to their customers
• End customers discover new brands and products at the point of purchase, without disrupting their regular shopping experience

Pepper’s network is built around (1) brand-forward banner ads and landing pages that show up natively in distributor ordering apps, (2) intent-based search ads, and (3) sample request inquiries. Each type of ad gives manufacturers new opportunities to reach end buyers at scale, and complement existing efforts to woo DSRs.

Giving Distributors Fair Say And Pay In The Process

Unlike traditional consumer retail media networks where the ad buying dynamics primarily involve the seller and the platform, our model includes a third critical player: the distributor. Distributors may use Pepper’s technology, but it’s their ordering app. So it only makes sense that we have to reimagine how value is shared across all parties involved.?

Here’s how we’re going about this:

• Distributors get the yes/no decision. We wouldn’t dream of tyrannically placing an ad across all distributor apps. Instead, we give distributors a brief on the campaign opportunity and the ability to opt-in. We make it simple with the click of a single button and earnings projections to make running the campaign as attractive and easy as possible, but it’s never mandated. Distributors retain choice.

• Distributors get 60% of the campaign proceeds. For distributors who opt into the campaign, proceeds are shared according to each distributor’s reach and ad performance. This makes sure distributors are compensated for their app’s real estate and customer relationships. Just like it has always been, it’s in everyone’s best interest if the distributors feel connected to the campaign and are rewarded for their participation.

Foodservice marketers will continue to use the DSR-wooing tools and strategies they’ve used for the past couple of decades, but the next phase in modern digital marketing for manufacturers is here.?

At Pepper, we’re excited to be at the forefront of this evolution, offering retail media opportunities that benefit all parties involved—from distributors to manufacturers. By introducing these new capabilities, we are not just following digital marketing trends but are actively defining them within the foodservice sector. The future of foodservice marketing is bright, and together, we are paving the way towards more effective, efficient, and equitable marketing practices.