Tuesday, May 9, 2017

The De-Massing of Retail

Trendcast 2017 lists out Trend #4 as “The De-massing Of Retail” and after a set of interesting weekend experiences (no pun intended), I thought what a great blog post topic!

I am sure that many of our readers go grocery shopping at least once or twice a week. The next time you do, take a look at the brands that populate the grocery shelves.

What you will quickly observe is that there are a good number of brand names on the shelves of which you likely have limited, if any, awareness.

You will also see that brands you know well and probably even purchased in the past, are less visual because they no longer command as many “facings” as they did even a year ago.

This past weekend, I shopped a combination of Kroger, Publix, Whole Foods and Target for the ingredients that went into two dinner get-togethers. When I arrived back to the house, I unpacked some interesting options purchased that did not bear the brand names of P&G, Kraft, Frito-Lay, Kellogg, Pillsbury and Nabisco.

Yet, the brands I purchased were smack next to those BIG brands along with a few other brands I had not seen a lot of until recently.

Last week, the Wall Street Journal featured an article titled, “Big Name Food Brands Lose Battle of the Grocery Aisle.” The article notes that Nielsen is reporting a decline of 2.4% for the top 10 national packaged food brands in first quarter 2017.

That same article goes on to cite increases in the top 10 regional packaged food brands along with fresh, locally produced meats, produce and bakery items during the same time in 2017.

Occupying shelf space and taking the lime-light away from the “mass brands” are unique, locally-rooted, specialty brands that quickly personalizes the shelf facings at the “chain” grocery stores. There might not be a “mom” nor a “pop,” but the stores feel more personal!

I also went and shopped at a “Super” Kroger and a Walmart “super-store.” In both cases, after long hikes, I could not find what I went in to purchase. I next visited a new Publix mini-store and found the fresh vegetables I needed and then visited a local lawn & garden store and found the specific type of garden supplies that Walmart did not carry.

This time last year EXPERIENCE worked with an ad agency that was attempting to pitch a restaurant-pub account. The restaurant-pub was a chain developed by a set of founders that included the CEO of one of the largest restaurant corporations in the U.S.

When I first started EXPERIENCE back in the early 2000s, that CEO came to us and asked us to create a new restaurant-pub concept.

The ad agency was one of three other firms that were challenged with finding ways to increase sales. I always quietly laugh how clients believe that the ad agencies can work magic and how the ad agencies sell themselves in with reinforcements of the belief.

The concept that EXPERIENCE developed was to create a true neighborhood non-chain, chain. We gave the concept an overall brand name, but laid out a brand platform in which the environment and aspects of the menu varied from pub-to-pub. We also recommended setting geographic boundaries in just how close one pub could be from another pub.

The restaurant-pub initiated the review because sales were down in markets now like Atlanta that now has about 10 locations or smaller markets like Orlando that have 4 locations. Oh well, I guess that the brand platform gave way to the craving to sell as many franchise units as possible.

In my counsel to the ad agency who hired us, I quickly channeled them over to observe what a lot of the new wave of restaurant groups are doing.

Here in Atlanta, there is a cool guy who we worked with very early on in his venture development. His name is Ford Fry and he started with a restaurant called JCT Kitchen.

Early in the development of the holding company, we sat down with Ford and chatted about brand expansion scenarios. He was very passionate about the uniqueness of the restaurant experiences and yet, at the same time, passionate about his brand name — Ford Fry.

Today, in Atlanta, the hippest restaurants are owned by umbrella firms that have as many as two dozen individual restaurants, each reatuarant with their own personality and brand name.

About 80% of the time that I sit in a café with my Mac and/or clients, we are sitting in an indie coffee house. God love Starbucks with over 13,000 locations in the U.S. alone, they chucked the “third place” brand culture and now lay claim to their coffee blends and price deals.

Business leaders and entrepreneurs that operate in a vacuum of thinking that a single concept can be defined and mass produced are living in past-times.

My suggestion among the doubters of this blog… go spend an evening watching Food Network and check out which restaurants and dives are featured in the programming!

The de-massing of retail is still very much in its beginning stages.

Will we see large, universal brands begin to de-mass? My bet is before year’s end, one of the large department store brands — perhaps Macy’s — will see opportunity to resurrect the regional brands that they acquired and re-branded under the Macy’s name.

Maybe Atlanta will see Rich’s Department Store return!

We will see more and more and more of will be in-town and village-anchored shopping centers chuck leasing out to the national chains and instead, lease out to the regional and local retailers… as long as they are able to pay the leasing costs!

Local chamber of commerce and business development groups will begin to re-think what makes their communities attractive for residents and businesses. They will begin to think less of becoming another Atlanta or Dallas or LA and perhaps more of an Austin, Asheville or Portland.

As I was writing this, I took a time-out and met with a very cool guy that I used to work in tandem with during my Time-Warner days. Luca Magnanini is his name. Luca headed up TBS and TNT Latin American when I was doing global brand work with Cartoon Network.

Luca and I both met this morning about opportunity to employ some very cool virtual reality (VR) integration into real-time brand experiences. We specifically talked about how those VR experiences could be customized against local communities and culture.

We both commented that many of the ad agencies and technology firms are still clinging to the past models of mass-marketing — even when they lay claim to personal relationship building executed within interactive and social media “networks.”

Luca and I are engineering some very cool VR applications that can be married with the neighborhood lifestyle audience modeling EXPERIENCE has expertise in crafting.

If you are reading this and it begins to get your mind pondering and generating some interesting thoughts and ideas, text me or call me at 404.245.9378.

The “De-massing of Retail” is only one — number 4 to be precise — of the Top 10 Trends rattling the marketplace. I get a kick out of presenting the trends and hearing others chime in about what they too experience and how they are working to capitalize on the change!

CEO & Discovery Chief at EXPERIENCE Insight Group, Inc. In the business to discover and craft brand experiences that humans seek out and engage in.