Kantar’s Gildenberg offers tips on adapting to disruption
PHILADELPHIA — E-commerce’s endless aisle, click-and-collect shopping and the increasing prevalence of value-based retailing all have one thing in common — they’re disruptive to the traditional shopping trip where mass retailers deploy their best in-store merchandising tactics in an effort to generate a larger basket. And traditional tactics don’t work if the shopper isn’t walking through the door — whether it’s because their purchases are being delivered to them or because they’re shopping in a discount box.
“You’re going to get increasing pressure from retailers on the analytic capability to reach specific segments,” Bryan Gildenberg, Kantar Retail’s chief knowledge officer, said during the 8th Annual Emerson Group Retail Industry Day held here last week. “If only Emerson sold niche, targeted brands that could help the retailer define the environment that they’re in with incredible clarity and transformational elegance, this would be awesome, right?” Gildenberg asked facetiously. It’s actually a good thing that Emerson does exactly that, Gildenberg said. “This entity, which is Emerson and the collection of brands it supports, is unbelievably well-positioned to take advantage of this stuff.”
Retailers who are adapting to disruption in the marketplace are going after at least one of four buckets, Gildenberg said. They’re either re-inventing the store format to make the shopping trip more experiential, re-engaging shoppers on social media and mobile platforms to entice them into their stores, re-evaluating their approach to value-based shoppers or they’re retooling their digital commerce capacity in an effort to grow top-line sales in a more bottom-line-friendly venue.
All of that gets the shopper in front of the retail brand, but what happens if those shoppers don’t want to spend any more than they have in the past? That’s a big challenge for retailers today, Gildenberg explained, noting that much of the economic growth today is coming from shoppers who in the past had planned to spend less in the coming year, and who are now transitioning into shoppers who don’t want to spend more in the coming year.
That's a subtle, but significant difference.
“Here’s the trick. Retailers are good at selling stuff to people who want to spend more. I can trade you up. … They’re good at selling stuff to people who want to spend less, that’s all discounting and pricing,” he said. “What most of you have found over the last year or two, is that the shoppers are going to become much more sporadically reactive to promotions than they were historically — this is why. Basically, your shopper has turned from a deal-seeking coupon hound into every middle manager in America — ‘I’ve got my expense budget, I’ve just got to deliver it.’”
All of that creates a critical arena for suppliers attempting to use a more traditional model to sell into retail.
“Your battle as a [CPG] company, is against the endless aisle,” Gildenberg said. “A lot of the brands [that approach retailers] without a compelling economic argument, the retailer is going to try to sell them in the endless aisle. “If you’re a drug store, having 9,000 stores with 10,000 pieces of inventory that turn less than twice per year is at some basic level an idiotic economic model. No one would build a store that way today from scratch.”
Daily Diversion: Pee wee football dance party
Football is hard. Professional athletes train constantly to stay on top of their game. So we can forgive the pee wee football players in the video above for getting distracted and busting a move every time Silentó's “Watch Me (Whip/Nae Nae)” plays. It makes for a really bad game, but a really great video.
Stressing collaboration, ACP issues position paper on retail clinics
PHILADELPHIA — The American College of Physicians has issued a position paper on retail clinics whose executive summary was published today in the Annals of Internal Medicine, emphasizing the importance of collaboration between doctors and retail clinics.
The Associated Press recently reported that the rise of retail clinics has sparked a change in the relationship between physicians and patients, and the ACP’s position paper seems to be aware of this shift. The paper shows some concern that patients will begin looking to retail clinics instead of primary care.
“Retail health clinics should serve as an episodic alternative to care from an established primary care practice for relatively healthy patients without complex medical histories,” the ACP wrote as its first recommendation, adding, “Ideally, all patients should establish a longitudinal care relationship with a physician. Physicians should discuss circumstances in which the use of a retail health clinic might be appropriate.”
In an effort to avoid what could become a tug-of-war over patients between retail clinics and primary care, the ACP stressed the need for collaboration between the two to create system in which patients can benefit from both, with communication at its center.
“ACP believes it is primarily the responsibility of the retail health clinic to promptly communicate information about a retail health clinic visit to a patient's primary care physician, including but not limited to the administration of any vaccination, prescriptions, tests, or postcare instructions,” the paper says in another recommendation. “A balance must be struck between the convenience and access retail clinics provide and the importance of longitudinal relationships between patients and physicians, particularly for patients who have complex medical histories.”