One brand’s story of transformational growth.

Awhile back we represented Sargento Foods, today the leading brand in dairy case cheese. When we started, Sargento was looking for a new chapter in its legacy as a packaged cheese-specialist, family-owned company. However, the Sargento business was challenged with rampant category commoditization – cheese is cheese is cheese. The segment share leader was store brand, providing ample evidence that consumers primarily bought on price.

• Our goal was to transform the business by reinventing the dairy case cheese category. In doing so, devise a competitive advantage for Sargento that would change the landscape against historic branded segment leader, Kraft Foods.

Working in collaboration with Brad Flatoff, Sargento Chief Marketing Officer, insight research was commissioned to dig into consumer segmentation and behaviors in cheese use. The effort unearthed an evolving consumer relationship with food. A new and important audience was emerging, roughly 26% of the category overall, who were heavy cheese users and had a budding love affair with food.

• This food-savvy audience formed the foundation of the Food TV Network’s expanding fan base.
• They love being in the kitchen, or on the culinary receiving end, appreciated higher quality cooking and ingredients.
• They could tell you about the functional differences of knives and pans they used in the kitchen.
• They bought cookbooks for inspiration and subscribed to culinary magazines.
• They were, as characterized in the study, Food Adventurers.

As is often the case in high volume, high velocity businesses, Sargento had cast themselves for years as the choice for everyone and anyone. This thinking ironically contributed to a form of water-treading stasis that held the brand locked in a third-place share position.

Then, a remarkable thing happened. Executive leadership agreed to let the marketing team redefine the target user, narrowing in on Food Adventurers and working backwards from that profile. We built a plan that redefined the category, the product composition, the packaging, pricing strategy and communications.

In short, Sargento elected to become the premium brand in the dairy aisle and play to food quality cues the Food Adventurer would recognize and embrace. Instead of trying to be all things to all people, Sargento wisely decided to pursue an audience that was invested in food experience and paid attention to the ingredients they used.

A new product line was created called Artisan Blends that combined artisan style cheeses with Sargento classic flavors. The step-up line was priced at a premium to other products and the packaging got a make-over to accentuate the tone and visuals of a European more premium esthetic. But most importantly, the messaging was changed, and the communications tactics moved to align with Food Adventurer ambitions in the kitchen.

• Our strategy put the brand in league with a specific set of consumers as they participated in culinary discovery and pursued elevated taste experiences. Sargento became a sponsor and participant at the South Beach Wine and Food Festival, among other events. Celebrity Chef Michael Chiarello was retained as a spokesperson and cooking videos were created with him.

Bottom line: the gears were put in motion to carve a new future based on relevance and resonance specific to a food fan consumer.  Becoming important to a segment of the marketplace rather than defaulting to the all-things-to-all-people approach. Since then the retail channel business has transformed and the future, with help from the company’s enormously successful Balanced Breaks snack product line, is on a different trajectory.

Bold moves make for big results

To a large degree the success of this shift was in the hands of Lou Gentine and his son Louie, now CEO. Their willingness to swing for the fence and re-position the business led to the outcomes that have paid lasting dividends.

The lessons here come directly from the consumer and insight into their food needs and interests. Asking, how can we be of greater value to them and make a difference in their lives? When we brought the insight research to life, all aspects of the marketing mix were refocused on how we could build relevance and value with this audience and help them on their culinary journey.

Brand strategy guru Bernadette Jiwa summarized the approach in a recent post:

“Like most of us with something to say, serve or sell, they [marketers] have to do a better job of speaking to only their right customers. They don’t depend on the footfall of mass awareness—they thrive on the loyalty of minority affinity, built one customer at a time, over time. They understand what their customers want, they make promises, then show up consistently, week in week out, without fail to keep them.

There is no one-size-fits-all marketing strategy. The tactics we use must align with our goals and the goals of the people we want to serve. How are you creating affinity with the minority of people who enable you to do your best work?”

The Sargento case study is a great example of the benefits of narrowcasting and marketing bravery.

• When you decide to go all in with an audience that cares, and then cater to their wants, needs and aspirations, the results can be very satisfying – even transformative to the business.

This would not have happened without the insight research investment up front that, with trained eyes, unearthed the Food Adventurer target and their culinary aspirations. Armed with this understanding, the marketing plan became a lesson in ‘mattering’ to an audience of food fans. The impact on message and media was a powerful testament to why smaller engaged audience segments can have a significant impact on the balance sheet.

Can we bring this kind of fresh perspective to your business? Let’s talk.

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Enjoy Life proves the case for unicorn in the herd

Enjoy Life Foods enjoys the enviable position of being intentionally unique and differentiated by virtue of the market it serves. Have you noticed the skyrocketing increases in the number of people with various forms of food allergy? My oldest daughter is one and many families these days have someone in their circle with a digestive rejection problem.

Of note, some experts believe the rapid ascent of allergen free foods is due to compromised immune systems, in part to blame from the cultural and technological shifts that help assure children will be exposed less and less to bacterial and viral hazards. It is contact with these microscopic threats that puts the immune system activity into higher gear. Use it or lose it?

Enjoy Life offers 86 SKUs of products created and designed to give allergy sufferers a shot at snack and sweets bliss with unconventional (entirely) clean recipe solutions. They are crafted with a staggeringly high intolerance for anything in the product creation process that could introduce an allergen somewhere along the path. Such is their franchise and commitment to becoming a trusted solution for people with food allergies.

Enjoy Life is an acquired brand of Mondelez, the spinoff of the Kraft Foods break-up that resulted in today’s Kraft Heinz packaged foods behemoth alongside the snack and sweets oriented and equally hefty Mondelez International operation. In either case we’re talking about big food.

Joel Warady, who leads the Enjoy Life team and has been on board there since its early days, is a bit of an iconoclast in the belly of the Mondolez whale, but it works and works well. Perhaps Enjoy Life offers a model for success to the innovation-challenged legacy packaged foods industry looking to stem the tide of fractional annual growth or share losses. Of late, many legacy CPGs are seeking the cachet of high quality, mission-oriented food brands by investing in or acquiring the fledgling company’s rapidly scaling share and market presence. The food world has turned upside down ever since the barriers to entry evaporated for independent food start-ups.

“Acquiring companies like Mondolez have learned, and sometimes the hard way, that it’s best to let these emerging businesses continue under their current management teams and without a lot of interference,” said Warady. “The challenge is figuring out how and where to help, usually with R&D and distribution support or providing ingredient sourcing efficiencies and pipeline scale.”

Warady believes Enjoy Life has been a success story because key strategic decisions are largely left in their own hands. “We’ve had some embedded executives from Mondolez along the way, but for the most part we operate as we did before the acquisition only with more resources at our disposal,” he said.

Legacy food companies like Kraft and Mondolez have greater challenges on the product innovation front due to their size, and cultural habits that work to wring out risk. It’s a point of view that has caused them to routinely favor line extensions over disruptive, unproven and yet demonstrably higher quality food ideas that are popping up everywhere.

Now, the magic and heat index in food innovation is coming mainly from entrepreneurs with a vision for solving a neglected corner of the market like Enjoy Life. Other successful ideas offer a preparation or ingredient twist that inspires a new category such as Beyond Meat that imitate the texture, flavor and mouthfeel of genuine animal-based meat. These plant-based proteins are more widely targeted to those whose values supports the overall mission (whether clean eating, regional sourcing, minimized carbon footprint, etc.) – not just aimed narrowly at serving Vegan interests.

Enjoy Life was designed from day one to be a difference maker in the lives of people suffering from allergies. It helps when you solve a real problem that has existed for some time but neglected as a niche business and ignored by companies that at one time believed if the volume isn’t a billion dollars within 15 months of launch, it isn’t worth pursuing.

Ingredients for Success

Warady offers some guidance for founders and acquirers alike:

1. For founders, it’s important to know that food safety and sourcing standards – a pillar of strength for large CPG companies – is often lacking with start-ups and can be deal killers once a strategic investor starts to poke around. Thus for founders, it’s important to have consultants scour every corner of the supply chain ahead of a strategic conversation to help clarify areas of opportunity and deal points.

2. For acquirers, it’s vital to recognize the secret sauce for emerging brands is often held in their story that combines mission and values often with a more artisanal product solution that completely redefines what quality means. Best to let them operate independently to help support and retain the trust they’ve earned.

3. Because the path to market is completely different, emerging businesses can be extraordinary places to test new ideas and limited-edition products, while learning best practices. The old recipe of big TV advertising budgets mixed with quarterly price promotions isn’t resonating like it used to, and is antithetical to the more conversational, user experience-oriented world of emerging food and beverage.

Importantly, emerging food brands like Enjoy Life come to market embedded with deeper meaning and a higher purpose that transcends the more transactional genre of volume, velocity and profit.

Not that growth and profit aren’t equally important to the success of new food businesses, but these soul-driven companies recognize the path to riches is paved in reciprocity and relevance to the consumer’s interest in shared values.

Bottom line: the recipe for success inside big food is to allow the acquired businesses to retain the very lifeblood that makes them successful. Their sheer disruptiveness and uniqueness must be honored and fueled while maintaining the often higher quality sourcing commitments on which their recipes are based.

It is the user experience that sits at the foundation of early success for emerging brands – before there’s much of anything to talk about in brand equity. That said, smaller resource- constrained businesses will benefit greatly from a benevolent investor or owner that fills strategic gaps and helps nurture the business, providing expertise or capital where it can make a difference between a base hit and a grand slam home run.

Joel Warady and the Enjoy Life team sit as a worthy example of how remarkable innovation can prosper inside a much larger organization, continuing to dance to the beat of its own drum while offering a roadmap to the future of the food business.

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Once you’ve tasted an heirloom tomato you can’t go back…

For most of my adult life I have experienced a love/not love relationship with fresh tomato. The routine, ubiquitous beefsteak variety a frequent guest star that decorates the roof of a hamburger with some color. The pink flesh offers a hard, mealy somewhat bland flavor. In a salad the standard tomato as hero can be even more pronounced in its meh-ness. We hear it travels well through distribution channels and offers some shelf life. Yay.

Along comes the heirloom tomato with its erratic colors, crags, lumps and fissures to completely upend everything you think you understand about a tomato, punching your taste buds with luxurious flavor, acidity and tenderness that elevates anything it swims with. More expensive to be sure and worth every penny. Once you know this you can’t retreat to the beefsteak.

• So it is with the continued culinary-ization of America: as higher quality food experiences forever elevate the palate and expectation of nearly everyone who eats, the baseline standard of what people want is changing with it.

Thus why strategic planning needs to address this development because as the old but very real saying goes, “times are changing and if you don’t change with them, you’re in trouble.”

What happens when the consumer is at the center of strategic planning?

If it is vital for the collective futures of food retail and food CPG companies to put the consumer at the epicenter of planning and work backwards from there, then we’re going to pay attention to cultural and behavioral shifts. The goal to sync strategies and capitalize on those insights. It is definitely not business as usual these days because the pace of change has accelerated so significantly in the last five years.

Seven observations on the changes now upon us.

The quality bar keeps rising. The impact of chefs-as-media-heroes, cooking shows, elevated corner bar food, transformation of legacy food categories with reimagined higher quality versions, and the advancement of culinary experiences at restaurants – all blend together in a perfect recipe for moving taste and quality expectations upward.

1. Once you’ve experienced the added value of a pan reduction sauce to transform a flavor- challenged piece of chicken, you want the sauce every time.
2. Home delivered meal kits operate as boxed culinary academies, teaching consumers about roasting techniques for vegetables, layering flavors and saucing.
3. Higher quality ingredients and preparations now reflect the new intersection of indulgent taste and healthier. Healthy now redefined not as calorie math but the use of better quality fresh, real food ingredients, less processed and with a clean label as evidence of same.
4. Weekends are now calendared opportunities for scratch home-cooking exploration, experiments and food adventure. Which grocery stores observe this phenomenon and move to inspire ideas, ingredient solutions, menus and culinary guidance? …More meatloaf?
5. Maybe we’re still selling boxes, cans and bags off shelves at velocity and so there’s no time to match merchandising to the elevation of food experiences in America? Can you afford not to when disintermediating options are emerging all over the food business landscape?
6. Restaurants are trial generators for new global flavors, cuisine exploration and realization of unique cooking techniques. Outsourced meals aren’t just about convenience on a busy night, it’s also part of the food culture milieu that’s stoking the fire of culinary excitement.
7. Where’s the Chef de Cuisine now? He or she is a home chef operating in the kitchen looking to create, innovate and experiment with standard menus and dishes now getting an elevated makeover with layered flavors, sauces and artisanal quality ingredients.

The headline: could it be that the American home kitchen is not that far behind the restaurant kitchen, save a few thousand BTUs from the stove burner, as a place to produce distinctive flavor experiences? The answer to this query is yes. How are retailers and CPG innovators working to recognize and service this consumer? Small niche you say!? Not so fast…

In a recent report from the Hartman Group we find evidence in Compass data:

• 39% of restaurant sourced eating occasions are efforts to lean in on the culinary skill and experience going on in the professional kitchen. Remember the quality of restaurant food keeps going up, and while doing so challenges some chain foodservice operators who are trapped in cost structures and business models that make it difficult to profitably move up.
• 29% of at home eating occasions use cooking sauces, flavor aids, Deli prepared items, alongside higher quality produce, meat and seafood intended to replicate the restaurant experience at home.

Food culture changes are an undeniable juggernaut impacting where the ball is moving and challenging everyone to determine if they’re keeping pace with it or languishing behind.

Emergent’s guidance:

1. Consumers want the unique, higher quality flavor experiences they find at restaurants, repurposed for them in food retail available products. Hence the emerging brand phenomena now roiling legacy CPG market shares. Consumers yearn for the surprise and delight of more innovative packaged and prepared foods.
2. On the other side, food retail is ideally situated to sponsor artisanal exploration in cheese, baked goods, alternate proteins and cooking ingredients. Yet many find it difficult to get beyond the traditional infrastructure to position themselves in the culinary chair alongside shoppers who want more relevance and food experience in their shopping trip…and their shopping cart.

While so much preoccupation now exists with installing e-commerce platforms and digitizing the management and flow of inventory, we should not lose sight of what the consumer longs for and how we can enhance food relevance and adventure for them.

Your products and store could be a culinary Field of Dreams!

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Are you speaking clearly or in Morse Code?

During World War II and prior to the U.S. entering the war, the British government working feverishly to counteract the devastating German Blitzkrieg, authorized the launch of a spy network intended to sabotage the Nazi war infrastructure. It was called the Special Operations Executive (SOE) and began training ordinary people with a passion for country and duty to become spies and saboteurs. Their principle form of communication would be Morse Code. The objective to avoid detection while operating behind enemy lines.

The cinematic stories of heroism and sacrifice are legion as SOE undertook its desperate calling to disrupt – by blowing up trains and power stations, often while hiding in plain sight. These days some brand communication starts to feel a bit like spy-savvy Morse Code. Businesses can find it hard to step away from internally-focused, self-reverential monologues and ‘us-speak’ to, instead, talk plainly and directly with people about what THEY care about. Conversation not code.

It was strong beliefs and shared values that underscored the passions and bravery of SOE operatives that drove their communication. Those same characteristics, passion of shared interests, values and connection, now mark the attitudinal changes governing how people interact with brands and make purchase decisions.

Consumer behavior research over the last five years has monitored the change to what we call ‘symbolic purchase’. As beliefs and values increasingly shape popular culture and thinking, we observe that people use their purchases to flag to others who they are and what they care about. Purchases have become posters of personal expression and are largely emblematic demonstrations people believe will telegraph to everyone what they think is important. Not in Morse Code but in real, observable terms.

What Are Your Values and Are They Aligned with your desired consumers?

You may have detected the increased importance of shared values in how consumers decide what brands and businesses matter enough to them to be granted a small portion of brain time, consideration and wallet. For many years, marketers were preoccupied with efforts to convey their, hopefully, superior product features and benefits in the firm belief that logic and rational arguments would hold sway. After all, it’s 25 percent faster than the other leading brand, right?

People have evolved, and our insight optics have improved. We know that humans are driven by heart-over-head – and that all purchases are influenced through emotional connectivity. Indeed, it is the absence of genuine connection that sits at the foundation of why some brands struggle to truly engage their customers.

This isn’t, by the way, a discussion of new media channels or digital platforms, mostly social, as a means to secure the engagement sweet spot. Failure to nail relevance can be traced back to overlooking a prerequisite to correctly mine the consumers’ continual search for deeper meaning.

What your brand says, does, how it behaves and the many signals it broadcasts (some intentional and some simply reflected by actions – which always speak louder than words) either reveals shared values or it doesn’t. And as such, it will resonate and motivate people to want to interact with and purchase your brand or it won’t. This is in some ways a character issue more so than about deploying clever words and phrases.

Here’s the LitmusTest:

What do your best customers care about? And that question is not a request for evaluation of your features and benefits!

• How do they live?
• What do they struggle with?
• What are their aspirations and dreams?
• What are their concerns, wants and wishes?
• How is your brand and business an enabler and partner in making their lives better and answering their desire for deeper meaning?

In our increasingly cynical society people have become less trusting and more skeptical. The Internet amplifies this by illuminating every misstep, mistake, scandal and recall to a replay-able loop-tape of evidence that businesses tend to look after their own self-interest. In response to this, consumers yearn to connect with brands that are built around a higher purpose, a shared value system and, frankly, a “soul” that transcends commerce.

Mining the Treasure Trove of Engagement

What an amazing opportunity for the more enlightened brand-minders who can blaze a trail to long-term connection with their users. How can we create marketing that people actually want and seek out rather than work to avoid? Having the courage to disconnect the hard-sell and instead, start talking with consumers about their interests and needs is the starting line for deeper connection.

• For example: When the pet food company recognizes it’s not in the kibble business but in the pet care relationship and guidance business, you begin to see how the brand voice should evolve and how a bond can be nurtured. How exciting to be forging connections and conversations around the lifestyle people seek out with their four-legged family members. The specific quality of nutrition and ingredients doesn’t become unimportant. Rather, it’s what chin do you lead with – protein percentages or health and wellbeing? It’s the latter.

The great news here is the treasure trove of content engagement opportunities that can be created with an audience on the hunt for a steady diet of this material.

What is the Main Goal of Marketing?

If you simmer everything down to its core essence, the mission of marketing is trust creation. We have ample evidence that trust is an elusive commodity. It’s hard to secure it and even harder to keep it.

Trust development cannot just be a “strategy” in the marketing plan. It is an outcome of the very belief system and values we’ve been talking about here. There’s no ‘fake it till you make it’ in the trust curation department.

• The heroic performances of SOE recruits was delivered through an out-sized commitment to their mission and higher purpose. Their calling serves as a stunning example of what’s possible when more is going on than just seeking transactions.

The irony here, is the less selfish aspects of caring about the health and wellbeing of customers and contributing to achieving their life goals, in fact, feeds the relationship that leads to transactions. Fearlessly leaning into the understanding that shared values precedes the creation of any type of affinity or loyalty.  The honest development of a real bond and relationship is where all of this begins.

One of the most exciting aspects of our work at Emergent is when a client looks for guidance in this very arena and we have the extraordinary privilege of helping define what that higher purpose looks like and how it can become an anchor for business and marketing strategy.

What’s the definition of a really big idea? It’s an idea that you can immediately, obviously see how it will impact the behavior of the organization from top to bottom. The beauty of landing on this understanding is the refreshing clarity it delivers to every decision around product, innovation, organization, people and very importantly, marketing that works.

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Perhaps the most important convention in the food industry

From September 15 to 18 the food industry convenes in Las Vegas at the Venetian Hotel for the second edition of GroceryShop, Anil Aggarwal’s novel answer to a lingering gap in the meetings realm for food business and related technology companies.

Unlike most industry meetings focused on presenting a vast ocean of booths where company sales and marketing staff feature their latest products and services, GroceryShop is more focused on the sea changes, business model disruption and consumer shifts impacting one of the nation’s most important and robust industries.

E-commerce and digitization of the food business has buffeted the value propositions of traditional supermarkets, supported the emergence of new, higher quality food brands with mission-oriented story to tell, and witnessed the rapid rise of e-commerce channel shopping as consumers increasingly acquire food from the comfort of their dining room table.

Packaged food marketers and retailers alike have sought to better understand how to manage the transformational changes occurring around them. Mr. Aggarwal stepped in with a conference concept long on content and insight presentations more so than a straight buyer-meets-seller proposition.

GrocceryShop’s rapid rise can be attributed to creatively answering the thirst for guidance and direction in a rapidly changing business environment. Unlike the food business conventions of yesteryear where global food corporations such as Nestle and Mondelez held court with retail buyers, GroceryShop connects the likes of Google and Facebook to the conversation on how consumers will operate in a digitally-enabled world and what trends in fresh and prepared food will get traction at retail outlets.

GroceryShop presentations examine new technologies in supply chain management, while brand marketing discussions look towards the shift from traditional ad media and promotions to engagement based on relevance to healthy living and lifestyle aspirations, fed by digital forms of outreach and social media.

 The Future of the Food Business

The content forward approach Mr. Aggarwal has landed on serves as inspiration and best practice showcase to retail and CPG executives alike on how to remain relevant and inject deeper meaning into their brand and banner propositions.

The food business is in a state of rapid transition as consumers increasingly shop for menus rather than stock ups and the rise of super-convenient restaurant delivery makes out-sourcing dinner a viable last-minute option on a busy weeknight. Food has never been more competitive as quality choices are within arms-length from virtually anywhere.

• According to Accenture, the 80 million or so Millennials, now in their prime spending years, wield roughly $600 billion in annual spending power. For the grocery industry that ladders up to about $2,300 per year on average spending at food retail. According to a recent national survey by Sweet Earth Foods, this cohort will try at least 46 new foods each year, helping drive the emergence of new food and beverage brands now gaining additional in-store real estate at supermarkets.

Meantime the grocery industry is reacting to the significant moves by Amazon into their territory through Whole Foods and its own Prime delivery, by bolting on outside e-commerce ordering and delivery solutions from Shipt and Instacart.

So much change and so quickly for a retail business that for many years was fueled by selling boxes, cans and bags off shelves at high velocity and razor-thin margins. Now the perimeter fresh departments hold the magic and in-store groceraunts are popping up to satisfy the inevitable last-minute rush to answer the pounding question, what’s for dinner?

All of this helps explain why GrcoeryShop has traveled so far so fast as business model disruption impacts Big Food and small grocery chains alike. If you haven’t thought about where you need to be this September, might be good to check it out: http://www.groceryshop.com

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Profile of refined strategy for brick and mortar

In today’s consumer-driven marketplace, staying ahead of food and lifestyle cultural swings, shopping behaviors and the significant sea changes they create, are the most important considerations to marketing strategy effectiveness. Failure to recognize and address these ongoing shifts can negatively impact brand relevance with core consumers.

Case in point:  increased traction of e-commerce occurring in most product categories consumers’ value is causing a domino effect that will drive the future of successful retail strategy. Consumers are pushing harder on their preference for retail uniqueness, differentiation and memorable experiences. In the first of our two-part series we will look at implications of digital commerce to retail, and in part 2 we’ll peel the onion on what’s coming for CPG brands.

Home is where the heart, wallet and shopping reside

As consumer friction declines in e-commerce purchases and fulfillment, the inevitable move to online-ordering convenience will continue to grab share momentum. This trend is starting to amass a variety of ancillary impacts, such as consumer preference for the exceptional retail experience over the mundane. When the very definition of convenience to satiate needs transfersfromregional zones toarmchairs and screens in the family room, retail businesses are now being challenged  to adjust their optics and embrace new cultural (read consumer) priorities sooner rather than later.

• This is an inevitable transition. In a recent report from Federal Express, the granddaddy of quick delivery is projecting e-commerce growth will double the number of packages shipped to 100 million per dayby 2026.

The point-and-click ease of fulfilling product ‘wants’ creates a companion outcome: less and less venturing out from the four walls of the residence. More in-home purchase and consumption of everything. More online comparison shopping. More emphasis on consulting consumer reviews. Along with this at-home shopping revolution is a declining tolerance for the routine hassles of destination shopping and the time requirements to drive, park and walk. How far will people be willing to go for a shopping experience that has nothing special to offer — what’s really going to pull them from that point-and-click simplicity?

Experience with the endless shelf of digital commerce will adjust expectations of ‘want it now’ and cause people to be less forgiving of retail out-of-stocks and more limited assortments. With it, the added value premium on exceptional in-store experiences goes up as anything that feels commodity-like will yield to the ease of electronic ordering.

Trends ahead and the emergence of micro-trading areas –

Consider the long-term impacts of the decline in car ownership (once a defining metaphor for personal financial success and independence), alongside the emergence of driverless delivery vehicles and drones. Distance-confining legs, scooters and bikes are increasingly common modes of urban transportation. Witness the explosion of online restaurant and ghost- kitchen prepared food delivery that jumps squarely on the never-have-to-leave-home bandwagon.

As retail shopping becomes increasingly commoditized, there is a growing consumer thirst for scarce and transcendent experiences, more personalization and meaningful relationships with retail banners that matter. This may play against the vanilla, conventional character of some chain store concepts that can feel derivative, common and maybe even a bit boring.

By definition, the chain model depends on consistency and mechanization to achieve operating efficiencies and the ability to replicate at scale. Is it possible to rethink the business paradigm to allow for different designs, footprints and merchandise collections more attuned to the community they serve?

As convenience gets a makeover, with it comes a premium on re-casting what a trading area looks like to smaller circles of proximity. Alongside this condition we observe the continued idealization of the “small town” as a colloquial, romantic reference point for aspirational lifestyles. In urban areas this puts an increasing premium on reflecting neighborhood character and shopping within walking distance.

In Chicago, a fair example of this is Andersonville, a northside city neighborhood known for its Clark Street shopping district packed with unique collectible stores, fashion boutiques, local restaurants – all walk-able within a three-block core. Stands to reason this ‘go smaller’ development favors shopping experiences that mirror the lifestyle characteristics and populace of the neighborhood.

For retail we see five implications for planning strategy:

1. Increased pressure on the viability of destination shopping centers, as convenience is recast within shorter distances from home.
2. The rise of smaller footprint store designs that align with neighborhood shopping areas.
3. Emergence of retail concepts based on lifestyle experience more so than the traditional array of shelves and merchandise. Instead the attractions are ideas, emotion and guidance rather than pushing merch off fixtures (a twist on omni-channel commerce strategies).
4. Recognition that the future is with those who work to build bonds and relationships beyond just stocking inventory at a price.

• Expect to see a host of novel ideas develop in service of more relevant lifestyle associations such as on-line dating brand Bumble and their wine bar café concept and Taco Bell’s new hotel.

5. The bifurcation of omni-channel strategies to embrace exceptional experience that reside inside the retail store front while volume objectives are delivered online. How will this symbiotic hand-off work between high touch retail and digital convenience? Only the seamless survive.

Speaking of smaller footprint concepts, if people are increasingly food shopping for meals and menus more so than stock-ups, does it make sense to force them to search for 7 to 12 items in an 80,000 square foot maze? Can food shopping be made more fun and less of a navigational chore by specializing in what’s for dinner?

ALDI, a darling of grocery hard discount, recently announced an expanded test of their new “Local” store concept in the United Kingdom. The 6,000 square foot stores operate with 300 fewer SKUs than the normal ALDI. Proof that hard discount does not mean absence of insight, relevance and creativity.

Larger trend: ‘Extremeification’ of retail in America

Robinhood, the investment platform for non-one-percenters, recently reported examples of the growing bookends of success between the higher and lower ends of the retail spectrum — while the middle falls away. Restoration Hardware (RH) continues its relentless march towards further upscaling its retail roots. After recently posting a 7% gain in sales, RH stock shot up 25% on the related news of its new chic catalog concepts RH Beach House and RH Ski House. As well LVMH (Louis Vuitton Moet Hennessy) and Dollar General are celebrating record highs at the same time in their share prices.

Yoga pant purveyor Lululemon reports Spring quarter revenue of $782 million vs. its period forecast of $755 million, despite increased competition in its category. Last quarter profits hit a record $97 million. Hard discount and heavenly experience collectively show how disparate propositions that lean in heavily on their mission and ethos are advancing.

You have to stand for something — and go all in (go low or go high). In fact that’s really the message here. The future of retail belongs to the innovators who go deep on uniqueness and memorable experiences — which by definition requires focusing the concept and target audience appeal to a specific need and cohort. All things to all people is often a recipe for ambivalence.

Find your core, narrow your appeal, optimize your mission and go for it.

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