Prior to the coronavirus outbreak and subsequent shutdown, more than half of Soom Foods’ sales were to restaurants, which company co-founder Amy Zitelman explained was a strategic decision to help introduce consumers to tahini and new ways to use the sesame seed paste beyond as a key ingredient in hummus.
But when dining it at restaurants was abruptly halted in early March to help slow the spread of the coronavirus, Soom Foods – like many consumer packaged good companies – quickly changed course to build out its consumer business.
In this episode of FoodNavigator-USA’s Soup-To-Nuts podcast, Zitelman shares strategies for pivoting from wholesale to retail, educating consumers to drive initial trial without face-to-face interaction, and leveraging ecommerce and direct-to-consumer online sales. She also shares how Soom Foods overcame common challenges experienced by small businesses, including efficiently fulfilling and delivering online order.
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Striking the right balance
When Soom Foods first launched its tahini-based products in the US 10 years ago, Zitelman said most Americans had never heard of the sesame paste – let alone know how to use it. And yet, Zitelman said, she saw great potential – if she could just convince consumers to give it a try.
She explained that in Israel, tahini is used in “a ton of different applications and different appreciation,” while in the US “tahini could only be found on the bottom shelf of the international aisle and most consumers were not familiar with the ingredient, [and] the product that was available didn’t taste that good.”
With this backdrop, Zitelman said, “there was a lot of opportunity to bring high quality tahini to the American market and ultimately educate consumers about its versatility and health benefits to make it a more popular ingredient here.”
But before Soom could do this though, it needed consumers to try its products and see the different ways that tahini could be used beyond hummus. To educate as many consumers as possible, as quickly as possible, the company teamed with chefs across the country – and made food service the primary focus of its business.
“For the first five or so years, we were primarily selling into the restaurant industry and were selling in a large format 40 pound bucket … and the benefit in that was that they were making more volume than consumers who were unfamiliar with tahini” and in doing so showing consumers how to use it, she said.
Chefs were “really our allies and helping to educate the market about tahini, how it can be used, how dishes can be better when you use high quality tahini and also its versatility,” she said.
By working with chefs, demand for tahini started to climb as did the frequency with which the ingredient appeared in food media and publications – further magnifying the team’s effort to educate consumers.
Direct-to-consumer outreach mimics work with chefs
While working with chefs and restaurants to drive initial trial is not currently an option for Soom Foods or other emerging brands, Zitelman said companies of all sizes can still educate consumers – albeit on a different scale – by providing recipes and other content to inspire and educate shoppers.
With this in mind, the company recently compiled many of the ideas into a new cookbook, which it also promoted through a series of videos that doubled as education and outreach for new consumers.
The company also regularly provides new ideas on its blog and social media feeds, which, Zitelman said, even hardcore tahini consumers appreciate.
Leverage ecommerce to build retail sales
Before the coronavirus outbreak, Soom Foods was already in the process of shifting its portfolio from primarily wholesale to more of an even split between restaurants and retail, and it was doing this by leveraging ecommerce through a two-prong approach with sales on Amazon and its direct-to-consumer website.
Zitelman said selling on Amazon is a “double-edged sword,” but it was the most efficient way for Soom Foods the distribute nationally without having to provide huge orders and drive high turnovers at retailers. The platform also gives consumers a sense of trust that they will receive their order and the company shipping it isn’t a fly-by-night operation.
The downside to selling on Amazon is that Soom Foods wasn’t capturing consumer information or forging a direct relationship with its fans – two main reasons the company began selling directly on its own website.
Streamlining ecommerce orders
While selling online allowed Soom Foods to reach a larger consumer base, it required a different portfolio of products than in stores or in foodservice. Obviously, Zitelman said, Soom couldn’t sell online the 40 pound buckets of tahini that most restaurants bought, but the team quickly learned it also couldn’t sell single jars as it might at a farmers market or in a brick and mortar store.
“For a long time, we sold mostly single jars but we realized that selling one jar at a time was really hard on our margins. Shipping is extremely expensive. The time it takes to create the box and fill the box – because we do all our own pick and pack within our warehouse” also was too difficult for single sales, Zitelman said.
So, the company began selling twin packs of its original and chocolate tahini and its date syrup silan – a decision that not only improved the business’ margins but also empowered consumers to use more product with confidence, Zitelman said.
When the pandemic hit, Zitelman said, Soom Foods had to once again reevaluate how it packaged and sold its products online to account for warehouse limitations related to safety and to more efficiently fill the surge in demand during the early pantry-stocking days of the pandemic.
“We decided to only sell full cases on our website. So, on soomfoods.com, we were really finding the most loyal of tahini users for about a month,” Zitelman said. She explained shipping full cases was the most efficient way to fill orders with limited staff time in the warehouse due to social distancing and other pressures from the pandemic.
As those pressures have eased, the company has reintroduced its twin packs and variety bundles.
During the height of the pandemic the company also temporarily restricted consumers to checkout only one type of product at a time so, again, it could more efficiently fill orders. While this strategy was created in a time of crisis, it also could help emerging brands with limited staff make the most of online ordering and delivery.
Expanding in CPG
Even as Soom Foods and the rest of the industry continue to grapple with the changes forced by the ongoing pandemic, Zitelman said the crisis reinforced her passion for tahini and pushed the company to explore how to become a more established CPG brand with a broader range of products.
“I’d love to release some new products. We’ve taken a lot of this quote unquote extra time [during the pandemic] to evaluate that question exactly and [determine] where do we want to go from here? And we’ve been inching our way to becoming more of a CPG product slowly, slowly, and I think COVID has kind of nudged us past that line,” she said.
Specifically, she said she hopes to push tahini more into the nut butter space as well as offer salad dressings and granola bars featuring the ingredient.