retail news in context, analysis with attitude

by Kevin Coupe

MIAMI BEACH - The thing about a meeting like the Food Marketing Institute Midwinter Executive Conference is, there tend to be more questions than answers.

Maybe that's normal. After all, we live in a fast-changing world with evolutionary and sometimes even revolutionary competition, enormous financial and infrastructural challenges, and a consumer population that often is near impossible to judge and/or satisfy. So it's natural that during the course of several days of events, there will be more sentences ending in question marks than periods.

But that's certainly the way I felt on Monday. And it is one of the things I am going to try to address in the panel discussion that I'll be moderating at FMI Midwinter this morning.

Monday started with a presentation by Doug Stephens, an author and self-described "retail prophet," in which he talked about how traditional retailers can compete with e-commerce offerings. The prescription won't be a surprise to anyone who has been reading MNB for the past 13 years - stores, Stephens said, have to tell a story and need to create "an intensive experience that you can't have online." Retailers, he suggested, need to treat the store as a kind of 'living website," constantly offering new products and services, and be ready to adapt to shoppers who no longer are homogenous and predictable. There will, he said, be retailers that are immersive, value-added and that will create an emotional connection to the consumer, and there will be retailers that will be ubiquitous, low-service and low-cost, creating a cognitive connection to the consumer. But there won't be much in the middle, he said.

"This is an historic change," Stephens said, "and if you miss it, you are going to have a hard time staying in business." He did offer one terrific metaphor, showing a picture of a dreary bus stop and suggesting that retail has been just like it - doing what it is supposed to do, and no more. But then he showed a picture of a bus stop in Paris where the seats have been replaced by swings, and where the expectations about waiting for a bus have been turned on their head.

That, Stephens said, is what retailers need to do.

In a later presentation, pollster John Zogby - in addition to talking about the powerful habits of Millennials as described above by Michael Sansolo, also offered a somewhat dour view of the American dream circa 2015, a time when there is greater food insecurity than ever, and when more and more people are working at jobs making less than they did in earlier jobs. And, he talked about the segmenting of America, as people break up into "neo tribes," challenging marketers to figure out how best to influence them.

The thing is, all this got me thinking...

Okay, the industry has to adept to new competitive realities. New ways of segmenting and targeting customers. Has to find new products and services to offer, and figure out which products and services are less relevant. And they have to create new and immersive store experiences, except when they don't.

To me, the question becomes simple: How?

Or more specifically, how do the economics and the infrastructure of the industry have to change in order to make these adjustments?

The business world often doesn't take kindly to retailers who try to create fast, revolutionary change in their organizations. (Just ask Ron Johnson, late of JC Penney.) So what is required of leaders who lead their companies in these new directions, hoping that the destination will be a profitable one and not the edge of a cliff. And how will all these changes affect the competitive landscape of the industry?

That's what I want to talk about this morning when I get on stage with three very smart guys: Burt Flickinger of Strategic Resources Group, Scott Moses of Sagent Advisors, and Andrew Wolf of BB&T Capital Markets. I've talked to all three of these fellows ... I think they'll be provocative and lively ... and we'll bring you up to date tomorrow about what they say.
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