Whither Natural Retail?

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In February, Nestlé announced it would clean up its ingredient list on its signature chocolates, followed about a week later by Hershey, with a similar announcement to use “simpler” ingredients in its ubiquitous candies.

A couple of months ago, drugstore chain CVS dumped $2 billion of its sales at a whack by removing all cigarettes from its shelves, saying the company goal of health and wellness was in conflict with the sale of unhealthful products. Also recently, drug chain Rite Aid created a new position in its stores for Wellness Ambassador, to function as a bridge between the front of the store and the pharmacy, with primary responsibility to help customers locate products and provide access to information about OTC items, vitamins and supplements, and to help create a more personal relationship with the pharmacist.

As conventional supermarket chains develop new private label offerings, the products tend to be not only natural, but also organic. An increasing amount of space in grocery stores is devoted to fresh foods, including prepared, ready-to-eat, or heat and serve; also with an emphasis on simpler, healthier ingredients. And, it is becoming the norm that supermarkets offer wellness coaches with weight-loss, exercise and nutrition education programs.

Notice a theme here? It’s been a long time since the mainstream media has contacted me to ask if natural and organic foods are a fad. No, it is now obvious to all that today’s consumer is demanding the foods they eat be not only interesting and delicious, but also made from healthy, preferably fresh and local, ingredients.

As if all this direct competition on the products you sell wasn’t enough, there’s an even larger disruptor threatening to overturn the entire brick-and-mortar store concept: the Internet. A couple of Harvard Business School professors have just published a book called Retail Revolution where they make the case that brick-and-mortar retailers are in unavoidable long-term decline as collateral damage in the monumental battle between Amazon and Walmart for the hearts, minds and wallets of consumers.

It’s the Experience, Stupid
To paraphrase President Clinton’s famous campaign mantra, if you are not going to be able to win on unique product, and you certainly won’t win on lowest price, then you’ve got to do something else. That something else is the total experience of shopping with you. When shoppers can simply open an Internet browser and get most everything they want without leaving the comfort of their homes, there’s got to be a compelling reason to venture out onto the street and into your store.

So, what is it? Do you have a convenient location? Easy parking? Are your aisles comfortable to shop? Is it easy to find stuff, and are your shopping carts big enough? Are your products fresh? Floors clean? Lights bright? Checkouts quick? Staff friendly?

What if you started to track all of these things, keeping score on improvements over time? It couldn’t hurt. WF

Jay Jacobowitz is president and founder of Retail Insights®, a professional consulting service for natural products retailers established in 1998, and creator of Natural Insights for Well Being®, a comprehensive marketing service designed especially for independent natural products retailers. With 38 years of wholesale and retail industry experience, Jay has assisted in developing over 1,000 successful natural products retail stores in the U.S. and abroad. Jay is a popular author, educator, and speaker, and is the merchandising editor of WholeFoods Magazine, for which he writes Merchandising Insights and Tip of the Month. Jay also serves the Natural Products Association in several capacities. In 2014, Jay received the Natural Products Association’s Industry Champion Award for notable contributions to the industry above and beyond commercial success. He can be reached at (800)328-0855 or via e-mail at jay@retailinsights.com.

Published in WholeFoods Magazine, April 2015