Celebrating another Year

I have always loved being a 4th of July baby — guaranteed fireworks! But with each passing year, I’m more aware of our cultural obsession with aging. Anti-aging, literally speaking, is synonymous with dying. My dad used to say when asked about getting older, “It beats the alternative.” I reflect on this topic today, both as a marketer and as one being marketed to, on the cusp of turning another year older.

 

Fearing death is natural. So is not being thrilled with a gray hair or a new line around your eyes. What’s different now than in the past is the sheer volume of products and industries that are literally banking on our collective fear of getting old.

 

The billion-dollar Beauty industry leads the pack with its lotions and potions, tonics, serums, oils, ‘injectables,’ and scads of surgeries that all carry with them promises of looking younger and regaining what you have most certainly lost. Women’s magazines peddle exaggerated before-and-after makeovers, and several times a year, the infamous “Beauty at Any Age” issue — which I remember not so long ago stopped at the 40’s…. Vanity is one thing (and it’s healthy to have some), but the way we market and are marketed to with beauty products plays less on our vanity and much more on a fear of getting old and irrelevant.

 

The Health & Wellness world is cashing in, as well. Vitamins and elixirs, IVs, diets, smoothies, fasts, workout plans and machines and gadgets — all of it practically guarantees you will stay exactly as you are, right now, if you just sign on! Truly healthy lifestyles that include eating well and exercising regularly are the only real “fountains of youth,” and should be embraced for making us look and feel good and for protecting the quality of our lives. But even good health won’t make you a year younger on your next birthday.

 

The Fashion industry also capitalizes on the body shame and loathing that can accompany getting older, especially for women. There are garments that hold you in here, or make you look more round there. Designs and styles meant to make you look and feel more like your younger self … or your younger daughter.

 

So what? All of those things make people feel better, so what’s the problem? To me, the problem is that there needs to be some grace and sensibility to the whole aging game and it needs to be reflected in the products, promises, and marketing of the things geared to the aging public. And right now, not only is a lot of the messaging off-key, there isn’t a lot of it geared toward the 50+ market, in the first place. There is a real opportunity to reframe the offerings and messages to ones that empower this incredible 50+ demographic, which accounts for 50% of all consumer expenditures and spends $3.2 trillion annually! https://www.huffingtonpost.com/mark-bradbury/the-7-incredible-facts-about-boomers-spending_b_6815876.html

 

And along with better products and messages, we need to keep our own healthy perspective. I am lucky to have around me healthy, personal role models who bring grace to aging, starting with my beautiful mother, an octogenarian who takes incredible care of herself and is very young at heart. Same goes for my older friends, in their 60s and 70s, who are living exciting, healthy lives that honor growing older vs. disparaging it (you know who you are and thank you!).

 

Don’t get me wrong — I’m not giving up my gym membership, fancy eye creams, or vitamins. But I want to shift my focus away from what you lose as you age to what you gain — more wisdom, self-acceptance, and gratitude for what you have. I want products and services to appeal to the active, involved, healthy person I am and continue to be, and not to a 50-something relic who needs constant improvements!

 

Living past our youthful prime is a privilege. There must be a way to do it that isn’t full of fear and the rather ungrateful desire to anti-age.

Amazon Go Is A Game Changer

We have seen time and time again that convenience is king. A frictionless shopping experience will allow many customers to get their grocery shopping done quickly, and efficiently. There is no need to wait in line to check out. No need to pay at the register. This is a long overdue break-through innovation that will give Amazon a competitive edge in the grocery space.

 

Not only does the promise of convenience drive a competitive advantage for Amazon in the grocery space, but through technology, Amazon is able to drive efficiencies and, in return, reduce cost of operations in running a grocery store.

 

Business Model Advantage

Amazon is going to have the ability to apply their customer-centric methodology to the grocery space by driving convenience and lowering costs to the consumer.

 

Amazon will save money with their Computer Vision, Algorithm, and sensor fusion technology. Through Amazon’s Computer Vision, a customer will be able to take what they want off of the shelf, and it will be added into their virtual shopping cart. If a customer decides they do not want a certain product, they only have to place the item back on the shelf in order to have it removed from their virtual basket so they do not get charged for the item. This will save Amazon employee costs because they will not need their stores loaded with people restocking all the items that people leave in random spots of the store before checkout.

 

Second, shrinkage due to theft will become a thing of the past. Billions of dollars a year are lost due to theft in the retail space. With Amazon’s technology, theft will be a thing of the past.  Allowing computer to manage the virtual cart eliminates human interaction, which, in this case, eliminates theft.

 

Third, checkout will be an unnecessary expense for Amazon since the checkout process will take place in the shopper’s pocket automatically on their mobile phone. This will also reduce the number of employees, which will result in lower overhead for Amazon Go.

 

Finally, and most importantly, is the Amazon shopping algorithm. Amazon knows more about its customers through shopping behavior than most people can imagine. Amazon has the ability to learn from its customers within a geographic location to ensure that the right type of inventory will actually be available for purchase. What does this mean?  This means that Amazon can expect to see revenues of a football-field sized Walmart with a physical brick and mortar footprint the size of your local convenience store!

 

All in all, this is huge and I am optimistic that this will put pressure on existing grocery chains to “step up their game” in technology and convenience in order to compete with Amazon in this space.

 

The good news for grocery consumers will be that we can all expect huge improvements across the board in multiple chain grocery stores and improved pricing as others shift to compete with Amazon Go.

Amazon Acquires Whole Foods…. Now What?

Amazon announced that it is acquiring Whole Foods. The impact of this purchase is far reaching for retailers, grocers and brands. As marketers, we need to understand what this shift means to the retail landscape and to shopper expectations. Given this news, TPN’s Digital Commerce team has developed thoughts on what happens now and what to do.

WHAT TO EXPECT

Amazon is going to get smart on grocery.
Whole Foods gives Amazon the ability to leverage its knowledge within the grocery channel and a better understanding of how to source local and organic foods.

Amazon will integrate its features at Whole Foods.
Expect Whole Foods to integrate the ability to make transactions through a Prime account similar to the Amazon Go grocery model – making for faster, more seamless experiences.

AmazonFresh will grow.
Whole Foods locations will enable AmazonFresh to take food delivery to the next level, with faster, fresher deliveries taking place in a truly on-demand model.

Prices at Whole Foods will drop.
Many expect this merger will make Whole Foods more affordable. That said, it’s fair to expect prices at grocery stores to drop altogether.

HOW TO PREPARE

Get to Know Amazon.
If food brands haven’t already, it’s crucially important to build relationships with Amazon, get familiar with their ecosystem, and start understanding its numerous paths to purchase.

Get to Know the Amazon shopper.
As stated in TPN’s Shopping in the Flow report from 2016, the retail purchase funnel is gone, and the buy is happening outside of physical stores through mobile devices and other in-home technology like Amazon Alexa. Brands must move to where these purchase take place… before it’s too late.

Don’t wait. It’s happening.
Amazon isn’t waiting for anyone in its efforts to extend its reach across the retail landscape. Getting familiar with the retailer today can only fuel a brand’s success for inevitable retail changes in the future.

SO WHAT’S NEXT?

More change is coming. While Amazon will continue to grow and extend its giant reach across the retail landscape, expect other heavy hitters – like Walmart, Target, and Kroger – to step up to the plate, find ways to evolve, and introduce their own retail innovations.

These are exciting times, and it’s just the beginning. While much of what this merger means is still very much unknown, one thing is certain: More change is coming.

At TPN, we’re ready for it.

Author: Rami Odeh | Digital Commerce Director | rami_odeh@tpnretail.com

It’s All In The Delivery

The ways we eat meals continuously evolve as our lifestyles, social dynamics and workloads change. The frozen TV dinner changed the landscape of meals in the 1950s, streamlining meal prep with readily portioned trays that could be popped in the oven for easy weeknight meals. Tupperware enabled make-ahead meal prep possible, as well as proper storage of leftovers for reheating later. The mainstream introduction of the microwave in the 1980s, lead to more adaptations of ready-to-eat meals (and of course, the HotPocket).

Take out and delivery used to only be synonymous with pizza and Chinese food; fast food was burgers and fries (itself an evolution from street food vendors and bar food). Now we have apps that will coordinate pick up and delivery from just about any restaurant you could possibly want, at the touch of your finger tips; we gleefully hunt down specialty food trucks or trek down to the food truck lot, serving as our modern day, anywhere food court. Our busy schedules may not even lend themselves for meals, which has lead to a rise in snacking, a whole different conversation but one that I wanted to at least acknowledge.

So, while all this should beg the question Does anyone really cook anymore? Quite a contrary movement has taken place. Instead, there is appreciation for the home-cooked meal. The traditional route still involves grocery shopping for items needed for recipes, cooking the recipes at home; the routine is broken up by inspiration found on recipe sites, blogs, Pinterest and those droolworthy videos popping up in your feed that make all cooking look easy. According to Joe Scartz, TPN’s Managing Director of Digital Commerce and Integration, “Grocers have seen the trend move toward simple prepared meals now for years and they have tried to fight back with white label brands and grab and go meals.”

Retailers are also offering up opportunities to streamline the traditional process through omni-channel retailing of buy online, pick up in store: Walmart grocery is available in limited areas; CVS is testing CVS Express for a rollout later in 2016; Harris Teeter Express Lane has been around for awhile, also offering home delivery; Ahold’s Peapod is a online grocery service delivering orders and providing them for pickup; Amazon Prime Pantry is gaining speed as well, just to name a few. Inspiration becoming a final product precipitates social sharing of successes or pride in fails.

Meal delivery services, for those who can afford it, offer an alternate route with the modern convenience of having everything you need boxed up for you, ready to assemble/cook, so you can post it to your social media, aka humble brag “I made this.” What was once relegated to weight loss programs like Jenny Craig, these meal services now embolden people to be their own top chefs in the kitchen, with recipes that range from updated American traditions to ethnic fusions with unusual ingredients, previously found only in restaurants. The types of services available seem to only be limited by an entrepreneur’s imagination: local farm-to-table services, gluten-free services, food allergy services, high-end, unique services, etc.

A natural fit for its brand, Weight Watchers has partnered with meal service Chef’d to provide points-approved options that work well with their diet plan. Blue Apron has taken the lead of the services, with a somewhat customize-able recipe offering and subscriptions with meals for 2 and larger families as well; their price range is roughly $60 to $140 per week, depending on the number of meals delivered. Blue Apron also offers wine solutions as well, to partner with the meals. The convenience takes away all guess work and is winning with folks who alternatively, ate out or brought home meals on a regular basis.

We’re seeing how retailers are adapting to our ever changing foodie landscape, what can brands do to adapt? “Brands should be doing more to partner with the home delivery meal services if they want to attract this type of consumer. That being said, while consumers “barely” have to go to the store, 97ish% of all of grocery shopping is still done in-stores of various formats. It’s one of the slower ecommerce categories to catch on but that is changing, slowly,” says Scartz. To that point, “Brands need to worry less about the fresh food meal delivery service and need to worry more about being shut out of impulse purchase as grocery ecommerce does grow. For example, once a consumer creates a list for Amazon.com, they are apt to reorder the same products. Same goes for Instacart or Peapod or whatever. Brands need to market and merchandise on those platforms with an eye toward subscription, especially as omni-channel retailing becomes more the norm.”

Amazon and the Changing Grocery Game

So called “traditional” grocery players have long operated in a competitive landscape with a fairly straightforward structure. Like a chess game, there were a set number of players in a market that made similar types of moves and counter moves, all designed to capture the shopper’s attention and ultimately, their dollars and loyalty. But the rules of the grocery game are changing faster every day. In fact, the rules aren’t just changing, the whole game is.

The key player making the most game-changing moves is undisputedly Amazon. And while Jet will also be one to watch, Amazon has positioned itself as a committed innovator, creating profound disruption in every sector it enters. Its moves toward disrupting the current grocery model continue to pick up speed. Some of the most recent examples include the Dash button tests, Amazon Fresh, Pantry Prime service expansion, and now the rumors it is planning an actual brick and mortar drive-thru grocery location in none other than Silicon Valley. It should be noted that while Amazon commands only a small fraction of grocery sales today, it took under 20 years to virtually decimate the entire retail books category, and that was before it’s fully formed prime membership, now reportedly between 30-40 million strong in the U.S. alone.

So what should more “traditional” grocery players do in the face of the growing competitive threat of Amazon (and perhaps also, Jet)? The answers won’t be simple or easy. They will require creativity, flexibility, and a stomach for risk and failure. And while moves will be somewhat different for every player, there are a few strategies worth considering:

  • Think more like Amazon — Don’t just sell groceries, make it easier for shoppers to buy your groceries
  • Identify friction points – and work to minimize or remove them (hint: it’s not always price)
    • The shopping journey is connected and evolving with new technologies – test, learn and leverage them. Your shoppers are already going there, especially the coveted millennial demo
    • Do Loyalty differently. Grocery partnerships (a la Starbucks loyalty card and Lyft) that create added value beyond the store could be key opportunity worth exploring.
  • Prioritize offering relevant, inspiring shopper solutions — individual items are almost always part of a larger mission
    • Holistic solutions can make an assortment seem more curated, enhance Shoppability and convenience, and oh yeah, build baskets
  • The live shopping experience is a strong POD for traditional grocery players (for now) – capitalize on it by offering sensory experiences and inspiration. Make the shopping trip FUN.
    • A recent Nielsen survey found a majority of global respondents actually do find grocery shopping “enjoyable and engaging”. From food halls to farmers markets, shoppers have proved very receptive to more experiential food shopping.
    • The fresh perimeter is an ace in the hole – deliver high quality, localized, artisanal and on-trend items – make it an engaging experience then link perimeter to center-of-store through compelling shopper solutions. There is no doubt the grocery game is changing. Regardless of whether it’s ultimately successful, Amazon is on track to be a major disruptive force in the industry, just as it has in every other industry it has entered. The traditional grocery players who are willing to change how they play it while maintaining an unyielding commitment to the shopper will be building a new set of competitive moves for the long haul.

 

Valentine’s Day Gets a Facelift

Millennials, described as “confident, connected and open to change” by PewResearch, are living up to their characteristics according to TPN’s Seasonal Pulse New Year 2014 study.

Among all generations, millennials are the most likely group to “change it up” this Valentine’s Day. Thirty percent of millennials are planning to celebrate the romantic holiday differently than last year (see graph below), providing a huge opportunity for marketers to influence their plans – especially if millennials are trying to impress a new special someone.

Further, 21 percent of millennials plan to stay home and cook a special meal this Valentine’s Day. As notorious foodies who are always online, millennials will be hunting down new meal inspirations across social media and the web. Grocery retailers and online brands should be targeting this generation as they plan for their night in.

While 29 percent of millennials do plan on going out for a meal, those staying in, including myself, won’t have to make a last-minute reservation or spend an arm and a leg on food. Maybe it’s me, but I think millennials may be on to something.

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Source: TPN Seasonal Pulse, New Year 2014

For more information regarding TPN and our Seasonal Pulse findings, please visit www.tpnretail.com.

What’s In A Name?

Or more to the point, what’s in a brand name? As a marketing experiment with real world consequences, we’re about to find out when Hostess Brands returns out of bankruptcy with a new owner in August 2013. When Hostess first closed their bakeries last November, connoisseurs of baked dessert goods unleashed much sound and fury at the thought of their beloved Hostess Twinkies going away forever. And as the bankruptcy hearings dragged on, the stores shelves filled the gap left in Hostess’ absence with breads and other treats. Consumers frantically went on eBay to find the last boxes of Twinkies and Ding Dongs, because Hostess so thoroughly owned the category that there were no direct equivalents available.

But nature abhors a vacuum, and now other companies have rushed to fill the gap, rapidly producing their own knock-offs of iconic Hostess items to occupy the spaces that were once filled by those well-known brand names. With shelves now filled with alternatives, Hostess has emerged from bankruptcy auction and plan on resuming production shortly:

Twinkies will hit store shelves nationally by late July, Michael Cramer, executive vice president of Hostess Brands LLC told NBC News on Thursday. “We expect to be making and selling in July,” he said. “Probably the later half of the month before the product hits the stores.”

All of the classic Hostess snack brands will return, some making their return in August and September. Hostess Donettes and some of the snack cakes will be among the first to return. And “Twinkies for sure,” Cramer said.

In November, all 36 Hostess Brands, Inc., plants shut down after an extended stand-off with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union. That Hostess company has almost completely wound down its operations, selling its assets in pieces. The bulk of the Hostess Snacks brands the public knows best — Twinkies, Cup Cakes, Ho Hos, Zingers, Ding Dongs and Suzy Q’s — were purchased in April for $410 million by hedge funds Apollo Global Management and Metropoulos & Co.

And so we’ll now get to see in real time what exactly a brand name is worth. The usurper products will not willingly relinquish shelf space to Hostess, and the consumer will now have a choice for each item… in many cases a cheaper choice that tastes similar if not identical to the Twinkie/Ding Dong/Ho-Ho that abandoned them in their hour of need. Will consumers really pay more solely for a name? Or maybe Hostess will find that their comeback doesn’t taste quite so sweet after all.

Another App to Help Shoppers

Kroger has introduced a loyalty card mobile application that lets users download coupons, renew prescriptions and get discounts at checkout. The new version of the app also has features for creating shopping lists, viewing advertisements and keeping track of fuel discount points. Kroger joins other major retailers, such as Target, Marsh, Wal-Mart and Meijer, in creating its own app.

The company also has several more projects in the development or testing stage. Kroger is testing a “scan, bag, go” program in its Cincinnati-area stores. Customers are given hand-held scanners and bags as they enter the store. They can scan and bag items as they fill their shopping lists and keep an eye on the running total of the bill. When customers are done shopping, they take the scanner to the register, pay and head out the door.

Giving Back on the Go

Last week, TPN participated in its Annual Day of Service by volunteering at food banks across the nation.  The Chicago team worked together to unpack, rebag and repack 2,000 pounds of Corn Flakes at the Greater Chicago Food Depository.  It provided a break from the office and gave us a chance to do something different for the day.

It also reminded me how tough it is to make time to volunteer consistently throughout the year, outside of our TPN-dedicated days of service.

So I took it upon myself to look into some online and mobile solutions for those of us who want to give back, but may not have the time:

Snoball

Snoball “turns any action into a donation,” by using the power of social media to raise money for nonprofits.  By connecting Snoball to your Facebook, Foursquare or fantasy sports apps, it “empowers individuals to seamlessly integrate giving with living.”

I personally use this program, and each time I check into a restaurant on Foursquare, it donates a dollar to my selected nonprofit.  I also have a monthly limit on how much money I’ll give (I’m a bit of a Foursquare addict and can’t afford a dollar for every check-in).

FreeRice

Owned by the United Nations World Food Programme, Freerice.com has two goals: 1. Providing education to everyone for free, and 2. Helping to end hunger by providing free rice to hungry people for free.

Simply visit the website and answer educational trivia questions.  For each question you get right, 10 grains of rice are donated to the hungry.  It’s literally that simple.  Monetary support comes from sponsors who advertise on the website.

Charity Miles

Charity Miles, like FreeRice, uses corporate partners to support its cause of allowing users to “earn money and raise awareness for charities by walking, running or biking.”

The app not only tracks activity as any other running app, but users have the power to choose which charity they will run for.  Walkers and runners earn $0.25 per mile and bikers earn $0.10 per mile.

Mobile Phone “Blindness” While Shopping

No, you don’t actually go blind. But Bloomberg reports that recent studies show that as we check our phones in-store, all of those colorful attention-getters that we design are being glossed over:

These days, consumers are more likely to send a quick text and check their Facebook feed than to read a magazine or develop a momentary craving for the gum or candy on display. That has spurred companies such as Hearst Corp. and the Coca-Cola Co. (KO) to reconsider how they showcase their wares in supermarkets.

For years, publishers could count on bored shoppers waiting in the checkout line to pick up a magazine.

Hearst, which sells 15 percent of its U.S. magazines at retailers, is adding cardboard displays in places other than the checkout line.

“We avoid the dreaded cell phone at checkout,” said John Loughlin, general manager of Hearst’s magazine unit, which includes titles such as Cosmopolitan, Seventeen and Esquire. “Magazines are an impulse purchase, so we have more than one opportunity to capture the consumer’s attention.”

The problem has worsened in the past 18 months, as more than half of all Americans now carry smartphones, Loughlin said.

Check out the rest of the bad news here.