This weekend I read an interesting piece in Boston.com – it was all about the shifting behaviors we have when it comes to buying our food. Click here for article. The basic theme of the piece was that we no longer simply go to one grocery store, but rather selectively shop at many different locations. While the days of the butcher, baker and candle stick maker have gone by the way of the dinosaur, we are becoming trained once again to seek specialization within what are suppose to be large distributors. Distributors that were suppose to be one stop shops.
As consumers this is has put the power and control back in our wallets. We can go to a Whole Food Market for some specialty meats, then hit Costco to buy our toilet paper in bulk and finish at Giant Eagle to get some staples like bread and ketchup. Could we just do this all at one store? Sure. But we like the choice. For retailers and CPG companies this has added a layer of complexity when it comes to pricing, packaging and distribution.
I can drop a bulk pallet at Costco, but need to break that bulk when I deliver to Kroger or Giant Eagle. If I run a promotion at Shaws, but my consumer gets that item at Costco will I be cannibalizing a sale? From the CPG stand point, they need to know across all these channels what is happening, what is creating lift and can they draw patterns? For the retailer, they must be aware of how their consumers are shopping at their store. Is the consumer coming on a regular basis just to get milk and bread? Or do I need a fuel perks type program to gain loyalty?
Add to this equation the massive influx of consumer and manufacturing data and you have a daunting task for both retail and CPG supply chains to manage this process. An exciting time for us as consumers, an opportunity for retail and CPG.