Alice.com sets to directly connect CPG manufacturers with consumers
MIDDLETON, Wis. Alice.com on Tuesday launched its public beta of an online service that affords consumers a better way to buy household essentials online, the company stated.
The service combines always-free shipping and competitive pricing with a reorder queue that monitors customer usage of an item and sends a reminder to the consumer when the product needs replenishing. Like the Pro Merchant feature on Amazon.com, Alice.com never takes possession of manufacturer inventory. By contrast, Drugstore.com, another pureplay dotcom retailer, acts more like a traditional brick-and-mortar, buying, warehousing and shipping direct to consumers. On Alice.com, manufacturers sell directly to consumers in a format where there are no retail margin hurdles, slotting fees or in-store merchandising programs. Instead, manufacturers pay for “advertising,” which includes targeted couponing, sampling and loyalty programs.
“The [consumer packaged goods] industry spends billions of dollars each year trying to influence consumer behavior through traditional advertising, and much of that spending is wasted,” offered Mark McGuire, president and co-founder of Alice.com. “In contrast to this ‘spray and pray’ approach, Alice allows manufacturers to connect directly with consumers … the result is more accountability for the advertiser and more value for the end consumer.”
There’s certainly plenty of buzz building around e-commerce these days. According to the Census Bureau of the Department of Commerce, there were approximately $31.7 billion in online sales for first quarter 2009, up 0.7% from fourth quarter 2008; compared with traditional retail sales of $877.9 billion for the quarter, which were down 1.8%.
All of that suggests a robust online marketplace, where such retailers as Amazon.com and Walmart.com already have captured a significant market share of the e-commerce dollar. Some analysts have suggested Alice.com may find it challenging to attempt to navigate a cluttered online landscape.
The company’s “no shipping fees” offer avoids one of the primary reasons consumers don’t buy CPGs online — it doesn’t make sense to spend more on shipping than the product is worth. Also, today’s online retail pricing exceeds brick-and-mortar pricing by between 20% and 40%, suggesting that Alice.com will be positioned as the online discounter.
And time could be an impediment to an online CPG purchase, McGuire said. The impetus for the sale of CPG items oftentimes is pantry replenishment, meaning the customer has run out of the product and will not wait a day for an online order to ship. To address this, Alice.com has implemented an auto-replenishment program. “The vast majority of consumers don’t buy their household essentials online, and we set out to change that at Alice by taking a completely fresh approach to the CPG industry,” acknowledged Brian Wiegand, CEO and co-founder of Alice.com. “By eliminating the traditional retail layer, we allowed the companies that produce these goods to connect directly with the people who use them. The result is a neutral platform for CPG manufacturers to work together as an industry and channel their resources in exciting new ways for the consumer.”
That platform may provide an additional online opportunity for new-to-mass-market suppliers to generate a buzz around their products beyond such traditional pureplay mass retailers as drugstore.com and Amazon.com, or such brick-and-click retailers as CVS.com or Walgreens.com. “We are excited to participate on the Alice.com platform, and be a part of an entirely new and innovative approach to buying household goods,” stated Saskia Foley, EVP marketing and sales at Radius Toothbrush. “With Alice.com, we’re able to have a more direct relationship with our customers, and give them a great new option to purchase our products at affordable prices shipped free to their door.”
The Alice.com beta Web site is launching with more than 6,000 unique products (as compared with some 40,000 fielded today by Drugstore.com, for example). The company plans a full consumer launch in the fall.
Supplement industry experts gather to educate Congress on related issues
NEW YORK It is critical that the dietary supplement industry extol the benefit and value associated with supplementing for health and wellness, especially as today’s legislators determine what health care will look like tomorrow, and how patients will be incentivized into being more proactive around the pursuit of preventative health behaviors.
But just as important in today’s regulatory climate is defending the supplement industry as a predominantly responsible industry providing products based on sound science; and an industry that does not include companies that do not resort to the scare tactic du jour, like marketing a supplement “remedy” for the novel H1N1 virus, for example. Indeed, as the Food and Drug Administration steps up its efforts in publicly outing renegade companies purporting to field supplemental cancer “cures,” or that market products containing undeclared prescription drugs as supplements, only fuels the cry of supplement critics for greater legislation, including the need for pre-market approval.
The Council for Responsible Nutrition and the Natural Products Association have helped organize this quarterly mechanism to do just that — educate Congress leaders — through the Congressional Dietary Supplement Caucus. In addition to Polis, Congressional co-chairs of the caucus include Reps. Dan Burton, R-Ind., Jason Chaffetz, R-Utah, and Robert Wexler, D-Fla.
That’s not all the industry’s done in the past few years to help clean up its image. For example, the industry’s long-awaited supplement-specific good manufacturing practices have been adopted and will be implemented in totality by this time next year, a measure that ought to ensure ingredient integrity. The industry’s support for the inclusion of dietary supplements in serious adverse event reporting positioned the industry not only as a responsible player in a health-focused arena, but should also serve to underscore the underlying safety of supplements. And the industry’s sponsoring of a third-party review of supplement advertising highlights the use of sound science to support many supplement structure/function claims.
Bacteria can anticipate future illnesses, study finds
REHOVAT, Israel Israeli scientists from the Weizmann Institute of Science last week released a report suggesting that bacteria can anticipate a future event and prepare for it.
In a paper that appeared June 17 in Nature, researchers determined that the microorganisms’ genetic networks are hard-wired to “foresee” what comes next in the sequence of events and begin responding to a new state of affairs before its onset.
E. coli bacteria, for instance, which normally cruise harmlessly down the digestive tract, encounter a number of different environments on their way. In particular, they find that one type of sugar – lactose – invariably is followed by a second sugar – maltose – soon afterward. Yitzhak Pilpel, professor at Weizmann Institute of Science, and his team of the Molecular Genetics Department, checked the bacterium’s genetic response to lactose and found that, in addition to the genes that enable it to digest lactose, the gene network for utilizing maltose was partially activated. When they switched the order of the sugars, giving the bacteria maltose first, there was no corresponding activation of lactose genes, implying that bacteria have naturally “learned” to get ready for a serving of maltose after a lactose appetizer.
Another microorganism that experiences consistent changes is wine yeast. As fermentation progresses, sugar and acidity levels change, alcohol levels rise and the yeast’s environment heats up. Although the system was somewhat more complicated than that of E. coli, the scientists found that when the wine yeast feel the heat, they begin activating genes for dealing with the stresses of the next stage. Further analysis showed that this anticipation and early response is an evolutionary adaptation that increases the organism’s chances of survival.