What were once fringe formats are now mainstream in grocery

Trend Observation:   Once upon a time, bigger was better… and all the market had to do to succeed was become a super-market.  But it would appear that a tipping point has been reached, in which smaller, “growth format” stores are taking more of the grocery budget share that used to belong to the gigantic grocers that offered “one stop shopping.”  That is one suggestion in a story from this recent edition of Supermarket News (click to link).

Marketing Implications:  One might argue that one-stop-shopping is still the clear winner, and that some share erosion has come in response to companies like Walmart and Target getting into the grocery business.  But growth formats are coming on strong, by this account.  Maybe, rather than use the term “growth format,” which is a popular industry moniker, we should call these stores what they are:  Stores with a theme or focus (i.e., Trader Joe’s, Whole Foods, etc.)

What about your category?  Is bigger better?  Do you serve a niche that could grow to become a core for your business?  Innovation often (almost always) comes from the fringe...

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Increasing focus on the obesity epidemic

Observation:  A story from Marketing Daily this week explains how the Disney companies plan to limit junk food marketing in media assets that serve youth audiences; the announcement was made in Washington with First Lady Michelle Obama on hand (click here to see that story).  And last week, a firestorm debate started with New York City’s mayor Michael Bloomberg suggested restricting the sale of super-sized softdrinks (click here to see one of the stories published by the New York Times on that issue).

Implications:  There seems to be growing momentum behind the idea of healthy living.  Does your company offer a product or service that fits into this strengthening trend?  Should you consider adding one, or altering your current menu in a way that the consumers you serve are given more healthful options?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Free sample: The power of product trial in an age of wary consumers

Observation:   In the wake of economic turmoil, many consumers remain more careful about the way they spend money.  So what’s a new product to do, at a time when consumers are not in the mood to “roll the dice” on a product or service they aren’t familiar with?  Some ideas are offered in this story from NRF Store (click to link).

Implications:   While focused on the grocery and packaged goods industry, the tactic of free samples might be a wise thing to consider for almost any product or service.  When a consumer can experience your brand first-hand, a first purchase is less of an experiment and more of a sure thing, which is important at a time when folks are still seeking known value for each dollar spent.

The freebie need not be lavish or extreme... just enough that the consumer can feel confident about committing dollars to your product or service offering.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Gulf seafood regains “comfort food” status

Observation:   Gulf of Mexico seafood producers were among the hardest hit by the effects of the BP oil spill of 2010.  But a story from Supermarket News suggests that many consumers are once again comfortable with eating goods from the waters of the Gulf coast.  Click here to see the story.

Implications:   If you run a restaurant or a grocery store, this story might lead you to add more Gulf products to your menu… or if you’ve already done that, it might lead you to bring more attention to those offerings.

If you run any other kind of business, it should serve as a reminder that trust lost is not easily regained; the BP oil spill happened almost two years ago, and there has been little bad news on that front since the well was successfully capped.  It has taken all of that time—with little or no bad news coming from the Gulf—before some categories could finally show a comeback.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

More workers lunching at home

Observation:   More workers are getting away from the office over lunch hour, and dining at home.  That’s according to this recent post from Food Manufacturing (click to link).

Implications:   I appreciate the way this story outlined a problem (for foodservice manufacturers and restaurant operators), but then also suggested some ways to entice consumers back into the restaurant and retain those you’re already serving.  It’s important that we focus on the things we can control (service, quality, menu options), rather than those things we can’t.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Fast food meets the family dining room

Observation:   This week, I had the pleasure of talking about Consumer DNA with a really sharp marketing team in Orlando.  One of the things we discussed was the impending churn that we can expect in the in- and out-of-home dining category.  During the recession, lots of folks down-graded from upscale to family casual restaurants, or from family casual to fast food, or from fast food to eating at home.  As the recovery picks up steam, the folks who lost market share will try regain it, and the folks who gained share will try to retain it.

When I got back into the office this morning, an FMI newsletter led me to this story from the Orlando Business Journal, explaining how Winn-Dixie is expanding their take-home meal solutions menu.  Click here to see the story.

Implications:   This is another way consumers will be comparing Apples to Oranges… meaning that restaurants don’t just compete with other companies in their category; they must worry about another category they compete with (grocers).

Who are the direct competitors you’re focused on?  (The people who sell pretty much the same thing you sell?)  And while you’re focused on that obvious competition, are there other categories taking a bite out of your sector?  How might you defend?  Or, how can you play offense… and grow beyond your core business to find new veins of revenue?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Generational Economics: New Age Seniors

Marketing Observation:  Once upon a time, you might have referred to people age 60-69  as “upper demos.”  But that is an outdated notion, one that has not kept up with the changing face of demography, at least in the industrialized parts of the world. Here’s why I say that:

Fifty or sixty years ago, life expectancies were different than they are now.  People often retired from their careers at 62 to 65 years old… and then enjoyed life for a few years before their health began to deteriorate (or they just plain tipped over).  Now, life expectancies are much, much longer—approaching eighty years old—and of course many people are living into and through their 90s and beyond.  These longer lifespans are having a dramatic effect on how we’re living life, especially after age sixty.

Retirement savings have to last a lot longer.  So we’re finding that “retirement” rarely means, “the end of employment.”  For folks in their 60s, it often means quitting the job they’ve always had to have—for economic reasons—so they can take the job they’ve always wanted to have.  Someone who has worked in a confined space for a lot of years might decide to find a job where they can get out and meet people.  Others take a position that lets them fulfill a passionate interest or hobby.  In fact, the concept of “retirement” is making way for the idea of “re-hirement.”  And to the New Age Senior, that return to the workforce serves two purposes.  First, it can be an important supplement to a retirement savings plan that simply has to last longer than it might have, say, fifty or sixty years ago (retirement will last longer than it did back in the fifties for most people). 

But also, the right job can be a source of stimulation and self-actualization for the New Age Senior.  Just realize that their motives for wanting to work might be different now than they were during an earlier career.  Changing jobs can actually be seen as a way of, “giving back.”

Marketing Implications:  Whether you want to sell financial products and services to people who are re-thinking what retirement means, or goods to help people get established in “Career 2.0,” there is a tremendous amount of opportunity in targeting consumers in their 60s.  They still want to travel, spoil grandkids, and play golf.  But they’re looking for ways of fitting all those activities (and more) into a lifestyle that is busier than generations before them at this age.  They’re very health-conscious, eager to stay active, and more technologically savvy, too.

Is this a group of consumers you’d be smart to reconsider, or consider in new ways?

Mike Anderson, for The Marketing Mind consumer trends blog, service of The Center for Sales Strategy.  

Walgreen’s morphs the niche they are in

Observation:  It is an interesting time to watch the nation’s largest drug store.  First, in a gutsy revolt against the healthcare system, the chain recently announced they would no longer accept prescription orders reimbursed by insurance-giant Express Scripts.  According to a recent video from supermarket expert Phil Lempert (click here to see that footage), that move could represent as many as 80 million prescriptions.  But that was a hit Walgreen’s was apparently willing to take, in defiance of the prescription management company’s effort to shrink the store’s profit margin on medications.

Another story—this one from Forbes—suggests that Walgreen’s is moving toward a business model that is much more consumer-centric, with product offerings that include a widely expanded beauty products, select groceries (including “wellness” organic foods), wine and cheese shops, and even coffee shops.  Click here to see that story.

Implications:   This is just my opinion, but I see this move as Walgreen’s decision to not let Express Scripts define the business they are in… and take control over that decision for themselves. 

What business are you in?  Is the answer to that question decided by a landlord, vendor or supplier?  Or is it defined by you and your customers?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Wal-Mart heading deeper into healthcare

Observation:  A story from USA Today indicates that the world’s largest retailer will make an effort to become the country’s largest primary healthcare provider.  Click here to see that story.

Implications:    Wal-Mart has been a disruptive force for many retailers and service providers… and it doesn’t look like the local doctor will be immune from a similar advance.  It will be interesting to see whether—or to what degree—consumers will trust a discounter to be their healthcare provider.  And whether consumers will want to go shopping where there are likely to be more sick people hanging around!

If you’re a health care provider, do you (or does your clinic) provide a demonstrated value that makes you worth more than the coming Wal-Mart alternative?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Supermarkets: Expect smaller trips and more planning

Supermarket Guru Phil Lempert suggests that consumers will continue to carefully manager their grocery budgets… as prices on the shelves are expected to rise.  Click here to see the video.

Implications:    If customers are going to plan more carefully, are you offering tools online (and elsewhere) that help them plan?  And if prices are expected to continue their rise, we can expect consumers to continue their scrutiny.  Does it make sense to start bundling more products into a “meal cost,” much as one might see on the menu at a restaurant?  Just a thought:  Consumers continue to change the way they think about buying; that fact should influence the way we think about selling.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Patient, heal thyself

In greater numbers, healthcare consumers are adding additional therapies to whatever the doctor ordered… according to a study from Consumer Reports that I found through today’s STLToday.com in St. Louis.  Click here to see that story.

Implications:    From fitness programs to organic foods to meditation and yoga—and yes, even homeopathic remedies—consumers have been assuming greater control over their healthcare future.  Part of this might have to do with a lack of direction for healthcare in the political arena, and some of it may have to do with the fact that Baby Boomers are moving toward their golden years very quickly.  It could be that insurance (or lack thereof) plays a role... and there may be many other influences.

What kinds of products or services do you offer… that are “good, and good for you?”  You don’t have to sell healthcare, specifically, to profit from this trend.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

One shift that seems to be sticking: Store brands

Even though the recovery is underway, consumers continue to choose private-label (store branded) products at grocery, according to this story from Marketing Daily (click here to see it).

Implications:  Little comment is needed here, except to acknowledge that people don’t buy brands for the brands’ sake.  They choose a product or service they believe will deliver the benefit they seek better than other alternatives.  Absent that distinct selling proposition, the consumer has little choice but to use price as the main criteria in their decision-making process. 

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Nutrition disclosure from a local supermarket

Following-up on the story about food ingredient transparency from earlier today (see below), I’ll share this recent Minneapolis Star Tribune story explaining how one grocer is attempting to provide greater disclosure to consumers about the nutritional value of the products on the shelf.  Click here to see the story.

Implications:  There has been so much coverage about health issues and obesity over the past few years that I’m no longer sure whether it is a bona fide consumer concern, or journalistic hyperbole.  This supermarket chain might represent a chance to see whether consumers are really interested in knowing about the ingredients of some foods, and whether they’ll change their behaviors as a result of having that knowledge.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

What do you have to hide?

A recent story from the Lempert Report explains that Safeway has decided to place it’s nutritional label on the front of the package for its store brand goods.  The company thinks that doing so will generate greater health confidence from consumers, by offering greater transparency with regard to the contents of a products’ ingredients.  Click here to see the Supermarket Guru story. 

Implications:  This move should tell us—or at least, tell Safeway—just how much consumers care, are aware, or compare different food products.  But the move alone should generate goodwill from folks who are focused on their Self-Health and Well-Being.

What are you trying to hide, as a company, product or service?  If the answer is, “nothing,” you might ask whether putting your back-story on display for everyone to see… as having nothing to hide is akin to having something to brag about!

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

In the move from field or factory floor to the modern workstation, workers have gotten bigger

A workplace that is less physically demanding is now cited as another major contributor to obesity, according to this recent story from the New York Times.

Click to see the full story. 

Implications:  This NY Times article presents another angle of attack for anyone who is promoting health-consciousness, fitness, or weight-related products and services.  Remember that working out may not be about physique… but simply: staying healthy.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Independent healthcare is not feeling well

Last week, I came across an important article about the diminishing number of private-practice physicians in the U.S.  The story cited the costs involved—in both dollars and effort—when a doctor is trying to decide between opening a private practice or going to work for a large health-management organization.  Click here to see the story, which appeared in the New York Times.

Implications:   In case you hadn’t noticed, personal healthcare is becoming less personal.  If your doctor knows who you are and a little bit about you without looking at your chart, you are likely to be the exception to the rule. 

This story offers a preview of the impact that is likely to follow cuts to Medicare and private-sector health benefits (which seem to be the trend):  Hospitals and clinics will place increasing importance on operational efficiencies.  More health centers will use a team approach to treatments and scheduling… and those “between the lines” issues that cannot be found on a medical chart will increasingly be managed by the patient, herself/himself.

Does your company, product or service empower the consumer to take charge of their own wellness?  I’m thinking about things like a heart healthy menu at the restaurant or wholesome offerings at the grocery store… or any aspect of what you sell that contributes to physical fitness and overall wellness.  In the coming years, these product/service attributes are likely to be more and more valued by the consumer… as they rediscover an ounce of prevention is worth a pound of cure.

NOTE:  Another NY Times story, recently, exposed the nature of the sales process used by some pharmaceutical and health device companies.  Click here to read that story, as this issue, too, may influence consumers to ask questions and take action.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Scrutiny of marketing to children goes beyond traditional advertising

There has been much coverage about the influence of traditional advertising on childhood obesity, a topic that has had a higher profile, recently, thanks to first lady Michelle Obama.  A story in today’s New York Times suggests that scrutiny continues to go beyond the ad campaigns of food producers and fast food restaurants… to include the websites, social networks and even video games produced by those companies.  Click here to see the story.

Implications:   If you market to children, it’s smart to scrutinize both your motive and your message before sharing it with your public… because you know that others will.

If you offer a product or service that is particularly healthy or beneficial to children, you might even want to consider whether less beneficial items are also on the rack or menu nearby… as those elements might provide your critics with “the appearance of impropriety” they are looking for to cause a fuss.

That having been said, the more attention “violators” receive in this age of scrutiny, the more likely a child-friendly offering can be a valuable keystone in marketing to families, as long as the benefits are authentic and meaningful.

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Will less salt bring more health-conscious customers to Subway?

As baby boomers move through their 50’s and into their 60’s like a pig through a python, issues like heart health and hypertension become even more important.  That’s why I’m interested by Subway’s recent move to reduce sodium in much of their product line, according to this story from Marketing Daily (click to link).

Implications:   Trans fats and kid’s meals were only the beginning; consumers are becoming more educated about what it means to eat healthy, and we can expect those lessons to result in new expectations for the restaurants, packaged goods, and grocery stores they buy from.  Do you agree?  Does your company, product or service offer a health-based benefit that you're not talking about yet?  Should you consider adding that ingredient to your mix of marketing messages?

Mike Anderson, for the Elm Street Economics consumer trends blog. A service of The Center for Sales Strategy, Inc.

Food trends for 2011

Looks like I’m hardly the only person who quotes packaged goods and supermarket guru, Phil Lempert. A friend sent me this clip from the Vancouver Sun, summing-up Phil’s top picks for food trends in 2011. (Click here to read the full story.)

If you prefer, here’s another take on 2011 Food Trends, provided by The Food Channel (click to play, or visit The Food Channel site on Vimeo).

2011 Trends Forecast from The Food Channel on Vimeo.

Implications: Some of what is presented as a trend is actually more of a prediction. But I share the information here with the idea that you’ll watch for what’s important to you, consider implications for your business, and discard the rest. But the overwhelming message: Watch for changes in your target consumer... and be prepared to meet shifting needs and wants.

[Editor's note: Thanks to friend and fellow trend-watcher JoAnne Naganawa for the leads on these stories!]

Mike Anderson

FDA likely to get new influence over food supply

About an hour ago, the senate passed a bill that could result in new scrutiny of the U.S. food supply by the F.D.A. Read details of the bill as published by the Washington Post by clicking here.

A similar bill was passed by the house weeks ago, and must now be reconciled with the senate version. It remains to be seen if that can happen in this congressional session, according to this version of the story from the New York Times (click to link).

Implications: These days, bi-partisan support for anything is very rare. But after recalls on everything from eggs to peanut butter over the past few years, the topic of safe food is an easy political target.

Politicians often bet their survival on topics they deem popular and important to voters. Your company is a candidate, too, with elections held every day and where consumers vote with their dollars. Are you focused on what’s important to them?

Is food safety a competitive advantage for your grocery store, restaurant or other food business? Or… is it an issue that could haunt you sometime in the future if you don’t take time to inspect operational procedures and staff training?

Mike Anderson