Whole Foods and GNC: How Product Makers Can Gain Distribution

For emerging brands, gaining distribution of their food, beverage, or supplement products in the specialty, natural, or vitamin channel can make or break their business. Some brands even seek to build long-term relationships with their trade customers, partnering on long-term innovation or product exclusives. But how to crack this code?

At the recent Newtopia Now conference in Denver, executives from Whole Foods and GNC spoke about the key trends they’re seeing in their stores and categories, and the best strategies that product makers can take to get onto their store shelves.

Retail buyers are looking for brands that demonstrate readiness, innovation, and sustainable business growth. Here’s what it takes to secure distribution, and revenue growth, in today’s competitive marketplace.

In this piece, I break down the approaches discussed by the seasoned merchants at Whole Foods and GNC, and how R&D and commercial leaders can apply them.

Highlight the 'Why': What’s new, innovative, or category-expanding about your product? It needs to fill a customer need, either stated or not. Share your sourcing story, the health or quality claims you can substantiate, and how you’ll educate or engage customers on what makes you different. Certain product categories can be easier to "get" right out of the gate, while others require greater effort to connect product usage and benefits to tangible human needs.

Know Your Market: Use data (either your own first party data, or syndicated data from resources like NIQ or SPINS) to demonstrate category contribution, customer enthusiasm, and growth potential. Michael Costello, CEO of GNC, encourages emerging brands to be laser-focused in their new item presentations on the four key things that they can do for a retailer, specifically:

• Increase category margin
• Drive category growth
• Bring new traffic into the retailer
• Stop traffic from leaving the retailer

Nail your Differentiated Positioning: Leaders from both Whole Foods and GNC emphasized the need for true differentiation from the new brands and products that they see.

"It can't just be a "me-too" product, or be new for new sake," said Casey Gaston, Executive Leader for Supplements at Whole Foods. "Think about it like you are having a conversation, and someone leans in and gets curious."

"It's about discovery, about something that hasn’t existed before, and why never before?” said Executive Leader for Dairy at Whole Foods, Ben Bristol. "Look at consumer trends and get in-store feedback from team members – remember that they are consumers." 

Bristol went on to elaborate about the introduction of A2 dairy and milk into Whole Foods, which allowed certain shoppers to enjoy their favorite dairy foods and beverages again when those products didn't contain A1 proteins. This type of differentiation, which makes a whole category relevant to a new consumer group, can be a game changer for brand and retailer alike.

Solid Infrastructure & Distribution: Be clear about your supply chain, production capacity, and ability to meet demand—whether starting locally or aiming for a national rollout.

“Operational excellence is important when you're coming into GNC, "said GNC’s Costello. "I see these brands that were fantastic brands...but they fell down on execution, and they ended up in the brand graveyard. Not because they didn't have any consumers, not that they didn't have the right packaging, but they just couldn't deal with the executional details.

Now, here are our ideas on how you can start to put these practices into action:

Four Action Steps for Marketing FoodTech and Ingredient Brands

1. 1. Start thinking about your brand / product positioning and messaging right out of the gate, including packaging, marketing messages, and meaningful certifications.
   2. Craft a plan to get to product-market fit as soon as possible.
   3. Emphasize your “why” and back up your most important claims with real, science-backed data.
   4. Prepare for the long game—invest in making initial partnerships and/or your first retail distribution a success, showing early momentum and a repeatable formula for growth.

Reach out to Ladder 17 to discuss how you can apply the above to a successful marketing launch of your new product.