Oscar Mayer Ecommerce
Four competitors of Oscar Mayer are Hormel Foods, Bar-S, Smithfield Foods, and Ball Park. Two of these brands, Smithfield and Ball Park, have partnered with companies that can help them expand their presence in the ecommerce grocery space. Details on these partnerships, along with information on the brands target market, differentiation strategies, and marketing channels are provided below.
Additionally, two insights about the U.S. grocery ecommerce market as related to perishables are the fact that market share is still small, but expected to continue growing and that there are several barriers to consumers purchasing perishables online.
- We examined Oscar Mayer's website, as well as their presence on Facebook, Twitter, and Instagram to see if there was any information indicating how they are promoting their ecommerce business.
- Oscar Mayer's website does not provide any information on where to buy their products, either in physical locations or online. Individual product pages provide nutritional information for each product, but no shopping links or additional information on where to find the products.
- An audit of the company's Facebook page, looking at posts from 2020, did not find anything related to ecommerce or directing customers to purchase products from online partners. The posts mainly focused on product promotion, the Wienermobile, NASCAR, and, more recently, on how they are supporting communities during COVID-19. Posts on both Instagram and Twitter covered similar topics, with no focus on where to buy products.
- Examples of sites found that are selling Oscar Mayer products online include Buying.com, Amazon, Target, and Walmart.
- The company differentiates themselves with the Wienermobile, which has been around for over 80 years, with a gap in the 60s and 70s as people lost interest. However, interest grew in the 80s, and there are now many types of wienermobiles crossing the country. In 2019, the company even offered the vehicle up for rent on Airbnb.
- The new Kraft Heinz CEO also has plans to differentiate some brands, including Oscar Mayer, by positioning them as premium brands in the space. However, experts are not sure this will be an effective strategy.
- When Oscar Mayer offered the Wienermobile up for overnight stays in August 2019, they were likely targeting millennials, who have shown they value experiences from brands.
- The brand also targets families with children as can be seen with products such as Lunchables.
- Currently, Oscar Mayer only has one active ad on Facebook.
- The company has several TV ads that are currently active including one on having a front yard cookout, one from Deli Fresh, and this second ad from the Deli Fresh brand.
- Oscar Mayer uses experiential advertising by utilizing their wienermobiles and brand ambassadors called "hotdoggers."
- Hormel Foods is a competitor of Oscar Mayer because they have brands that sell deli meat (Natural Choice and Hormel Deli Meats) and bacon (Hormel Bacon 1 and Old Smokehouse); they sell products in the U.S., with 81% of U.S. households having a Hormel Foods product in their house; and their primary selling avenue is grocery stores.
- To examine if/how Hormel is promoting online purchases of their food products, we first utilized the product locator on their customer facing website. This tool only brought up physical locations.
- On the FAQ section of their website, one of the questions they ask/answer is whether the company's products can be purchased online. They list about 10 websites where some of their products can be purchased including Amazon, Dollar General, Jet, Target, and Walmart.
- An examination of ads for Natural Choice, Hormel Foods, and Hormel Pepperoni did not find any ads promoting ecommerce. However, using the Shop Now buttons on some ads brought users to a page where they could see both online and physical store options for purchasing products.
- A scan of Hormel Foods tweets since the beginning of 2020 did not find any that were promoting purchasing their products online. A similar audit of the company Instagram page found the company focused on promoting brands and recipes, often related to a nationwide event such as a holiday or the Superbowl.
- At the end of 2019, Hormel added Prama Bhatt to their BOD, partially due to her experience with ecommerce and digital transformation.
- One way that Hormel is differentiating themselves is by promoting their focus on environmental and sustainability through a podcast. The company invites chefs, food experts, and food scientists to come on the show and discuss food issues that are important to consumers.
- Hormel has also expanded its product line organically and through acquisitions so it now has a differentiated product line that can appeal to a wider swath of customers.
- Based on what is being highlighted on the corporate website and on social media pages, it is clear that a target customer for Hormel are consumers who are interested in sustainability and corporate responsibility. Currently on the homepage of the website there is info on the company providing bonuses for plant staff during the pandemic, the company donating to food relief efforts, their commitment to food production efficiency, the hiring of a sustainable meat pioneer, and more.
- Hormel is advertising on social media, as can be seen through these ads running on Facebook for Hormel Foods, Hormel Pepperoni, and Natural Choice.
- The company also advertises on TV as can be seen by this pepperoni ad and this one for Natural Choice deli meat.
- Bar-S is a competitor of Oscar Mayer because they sell processed meats including bacon, franks, lunchmeat, sausages, and corn dogs. Although the brand was acquired by Sigma Alimentos in 2010, they sell their products in the U.S. and their primary distribution channel is grocery stores.
- Amazon was the only ecommerce site found that had any Bar-S products, and this appeared to be only a single product. Their products are also available on Instacart.
- To examine if/how Bar-S is promoting online purchases of their food products, we utilized the product locator on their customer facing website. This tool only brought up physical locations.
- The company website does not discuss ecommerce, and a media scan did not uncover any articles on moves the company is making in the ecommerce space. Instead, we found an article on a partnership with McCormick Grill Mates and a market report on the hot dog industry.
- Finally, an examination of the company's social media presence on Twitter, Facebook, and Instagram did not uncover any posts indicating that the company is trying to promote their ecommerce business. The main topics found on the platforms were recipes and product promotions. The Twitter page for the brand has not been active since 2015.
- According to Nielsen, Bar-S has been the best-selling hot dog brand in the U.S., by volume, since 2005. This distinction allows them to set themselves apart from their competitors.
- Another way the company differentiates themselves from competitors is through pricing. On Amazon, an 8-pack of Bar-S franks costs $1.25, while no other brand was selling for less than $2.24.
- Although information on the target market for Bar-S was limited, we did find that the parent company, Sigma, has an employee that is a Hispanic Marketing Specialist. This seems to indicate that one target market of the brand is the Hispanic community.
- We began our search for Bar-S advertising on sites that consolidate ads such as iSpot.tv, Moat and We Love Ad. There were no ads found on Moat or We Love Adly one inactive TV commercial found on iSpot.tv.
- The brand is also not currently running any ads on Facebook or Instagram, as seen by searching the Facebook Ads Library.
- The YouTube page for the brand was also examined and they appear to post videos about once or twice a month. However, with only 104 subscribers, these videos do not appear to have an extensive reach.
- Bar-S does have a sign up form where customers can sign up to receive coupons and newsletters. This would be a form of opt-in advertising.
- Although there are several Bar-S employees on LinkedIn that focus on marketing for the brand, and examination of their profiles did not provide any details on how the company approaches marketing. One example is Jeff Gaunt, a marketing director. An examination of his LinkedIn profile did not provide any details on how the company approaches their advertising.
- Smithfield is a competitor of Oscar Mayer because they sell processed meats including hot dogs (Nathans and John Morrell), bacon (John Morrell), and deli meats (Armour and John Morrell). Although the company also sells their products in Europe, the U.S. appears to be their primary market. Finally, as can be seen on their direct store delivery map, they sell their brands in grocers around the country.
- In 2017, Smithfield made a strategic investment in Chef'd, a meal marketplace. With this investment, Smithfield became the largest strategic investor in the brand.
- As part of the investment, Chef'd will utilize the Smithfield brands in their meal kits, which provided Smithfield with a non-traditional path into the ecommerce market.
- Additional reporting indicated that Smithfield would be selling U.S. produced pork in China, through the online retailer JD.com. Although this is not directly related to the U.S. market, it was included since the product was coming from the U.S.
- According to the company website, Smithfield differentiates themselves through "great taste, outstanding quality, and value." They also promote the company's reputation as a point of differentiation.
- Additionally, Smithfield is the top producer of packaged meat products in the U.S., which they can use to differentiate themselves from smaller producers, or producers who focus on other product types.
- One of Smithfield's target markets is families. This can be seen by this statement on their website: "Our success is based on a few simple ingredients: great taste, reasonable prices, and a reputation for products that families can trust."
- The company makes another reference to their target market on the homepage of their website: "And with today’s population nearing 8 billion, we are working harder than ever to provide families around the world with nutritious, delicious, and affordable food."
- In late 2019, Smithfield also began targeting "flexitarians" by promoting their new plant-based brand, Pure Farmland.
- One advertising platform utilized by the brand is Facebook, as they currently have three active ads, and several more that are not currently active from 2019. Although there are not currently any active ads for the brand on Instagram, there are inactive ads that were running in late 2019.
- Smithfield also utilizes TV for advertising, as can be seen with these example TV ads found on iSpot.tv. This ad is currently active.
- The brand also uses influencer marketing, as they appear to have a relationship with NASCAR driver Aric Almirola.
- It would not be surprising to see the brand launch some advertising to counteract the negative reporting it has received as a result of the COVID-19 pandemic causing closures at its plants. However, as yet, that does not appear to be the case, as none was found.
- Ball Park is a competitor to Oscar Mayer because it is a large player in the hot dog market. Although the brand does not sell deli meats or bacon, it is a U.S. brand that is sold primarily through grocery stores.
- To examine if/how Ball Park is promoting online purchases of their food products, we first utilized the product locator on their website. This tool provided both online retailers and physical locations where products could be purchased. This was notable because of the competitors examined, not all of them showed online options for purchases.
- Tyson Foods, the parent company of Ball Park, has partnered with eMeals to improve its penetration in ecommerce. eMeals is a digital meal-planning service, and when customers choose a recipe that utilizes a product from a Tyson category, the brand item is automatically added to the customer's shopping list, which they can then fulfill with a single tap through a variety of grocers, including Walmart, Instacart, and Kroger.
- One way that Ball Park differentiates itself from its competitors is by focusing almost exclusively on hot dogs. While the company does have two non hot dog products, refrigerated and frozen beef patties, their almost singular focus on hot dogs may give them an advantage over brands that have a wider brand portfolio.
- The company also differentiates themselves by promoting that their hot dogs are made with 100% USDA prime beef. As a comparison, Bar-S also has beef hotdogs, but does not promote them as USDA prime. Nathan's promotes their hot dogs as being made from premium beef, but this is not as clear or descriptive as Ball Park's description.
- Finally, Ball Park hot dogs were actually first sold at Tiger Stadium in Detroit, a baseball stadium. This is where they got their name and is a unique story among hot dog brands.
- Based on the company's website design, it appears that one customer segment the brand is targeting is people who like to grill. They not only have a page for grill tips on the site, but also have a specific dog, the Grillmaster, that is aimed at people who like to grill.
- Additionally, with the brand's story so tightly tied to baseball, and the fact that they promote that on the website, it also appears that baseball fans may be another customer segment of focus.
- Ball Park is not currently running ads on Facebook or Instagram.
- The brand does, however, regularly run digital desktop ads.
- Ball Park has also run TV ads in the past, although it appears this has become less common.
- As we found a casting call for hot dog vendors for a Ball Park ad, the brand apparently utilizes print advertising as well.
Ecommerce Grocery Industry
Share of Sales
- In 2019, online grocery sales in the U.S. accounted for 6.3% of total grocery sales. This is expected to increase to 7% in 2020.
- Only 45% of online shoppers purchased perishables online, which would include deli meat, bacon, and hot dogs. Therefore, these segments appear to hold significantly less share than the 6.3% held by the grocery market overall.
- Business Insider reports that 10% of U.S. consumers shop for groceries online on a regular basis. They additionally report that the online grocery market in the U.S. doubled from 2016 to 2018.
- The pandemic is leading to a surge in online grocery shopping, but it is unclear how long it will last, or how many consumers will continue purchasing online once the pandemic has passed.
- The sharp increase in online shopping has caused problems for some shoppers, with 51% of those surveyed stating they had to wait at least two days for delivery. Twenty eight percent had orders delayed or canceled This issues with deliveries could make consumers think twice about continuing to use online services.
- As can be seen in this reporting by Statista, perishable foods are not one of the top 10 grocery categories that is purchased online. The top categories are salty snacks, paper products, packaged/canned food, health & beauty care, household cleaning items, coffee & tea, sweets, condiments, pet food & treats, and ready-to-drink beverages.
- A recent survey that although consumer spending was down in many categories, those surveyed said grocery spending was up by 15-20%. However, 76% of shoppers said they weren't shopping online more frequently as a result of the pandemic.
Barriers to Purchasing Perishables Online
- A survey found that more than 75% of shoppers don't like to shop online because they want to choose products, particularly perishables, themselves. When they are not able to see, smell, and touch the products themselves, consumers are concerned they will receive items that are not fresh or of high quality. Freshdirect has tried to counter this thinking by offering a Guaranteed Fresh feature to tell consumers upfront how fresh various products are.
- The return process is a barrier for some consumers, especially when purchasing perishables. For example, Walmart does not allow the return of perishables to its stores. Instead, consumers have to contact Customer Care with detailed information in order to receive a refund or replacement.
- Even with these concerns, recent survey data found that about 1/3 of shoppers expected to buy deli products online in the next 12 months.