With restaurants temporarily shut down because of the coronavirus pandemic, online ingredients retailer Spiceology knew it needed to shift its focus on a new target consumer—everyday consumer cooks—and away from chefs.
“We basically made the decision on March 16 that we’re a consumer spice company for the next three to six months,” says CEO Chip Overstreet,
Typically, about 40% of Spiceology’s sales are from chefs, 40% from consumers and 20% wholesale, such as to specialty grocers. The retailer promotes to its shoppers that it is “chef owned and operated,” which spurs sales for both chefs and for consumers, Overstreet says.
“Our consumer sales were doubling year over year because we were focused on chefs,” Overstreet says. “Consumers buy from us because they love our products and they love the chef communities. Chefs have become the new rock stars, the new professional athletes. Little kids grow up wanting to be chefs.”
Now, Spiceology is doubling down on its consumer focus and catering its ecommerce site content to everyday cooks. This means the retailer is developing more teaching content, including recipes to make with one of its unique spices—such as for its Greek Freak, Maui Wowee Raspberry Chipotle—opposed to its chef-focused content that showcased its products and interesting cooking techniques. Chefs aren’t usually interested in recipes as they like to create their own, Overstreet says.
Spiceology posts about three to four videos each week geared toward consumers, up from none before. In fact, it even hired an employee to help create the videos and join the Washington-based retailer’s team of 42 employees.
Spiceology also paused its chef challenges for the past few months. Previously, Spiceology launched contests in which chefs would take a spice and develop a recipe, cook and plate it for consumers to vote on their favorite.
Because Spiceology has pivoted its target shopper focus, now about 80% of its sales are from consumers, 10% wholesalers and 10% chefs.
Overall, sales are still growing year over year, but not as fast as it had been growing at the beginning of the year, says Overstreet without revealing more. Its consumer sales are growing because more consumers are cooking at home, are in need of inspiration on what to cook and may be willing to try something new, like a new spice blend, Overstreet says.
However, consumers don’t buy as large of orders as chefs in terms of average order value, frequency and spice quantity. Prior to the pandemic, chefs spent about $200-$300 on its site each month, Overstreet says, much higher than the cost of a $14 consumer-size jar.
Plus, fulfilling consumer orders requires more labor. The spices for a consumer order are in smaller quantities so there are more jars to fill for a consumer order of the same amount of spices compared with a chef who buys in bulk.
To keep up with fulfilling its more labor-intensive orders, Spiceology’s entire staff is pitching in to fill, label and ship spice jars. “People on the sales team are doing shifts on the product line,” Overstreet says. “It’s all hands on deck.”
Spiceology’s new consumer focus, however, does not come at the expense of chefs. “That doesn’t mean we’re abandoning chefs. Quite the opposite,” Overstreet says.
Spiceology launched a website called HelpChefs.com that posts weekly stories about chefs in their communities, aggregates a list of merchants that are donating in some capacity to restaurants impacted by the coronavirus and provides other resources for consumers to donate to the restaurant industry.
Spiceology spearheaded the launch of that site, but it is a collaboration with merchants that sell products to the food service industry.
“Cooking is something that everyone can connect on, everyone needs to eat,” Overstreet says. “We’re fortunate that we have both chefs and consumer as our consumers.”Favorite