The Candid Voice in Retail Technology: Objective Insights, Pragmatic Advice

Whole Foods And Localized Merchandise: One Conversation At A Time

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I have a friend who’s a bit of a know it all. I’m sure you know the type: you may even have a similar one in your own circle of family and friends. But despite his over-the-top nature, he’s consistently one of the most well-informed people I know. Mention a topic – any topic – and he’s got a wealth of background stories, stats, and opinions on the matter. And more often than not, his viewpoint is well worth a listen. I’d never let him know this, of course, but it’s a very large part of why we’re such good friends: I genuinely look forward to our conversations.

That said, the topic of retail came up over dinner while we were both in Detroit this past weekend. There were a few of us at the table, and I didn’t bring it up, but as soon as it was in play my know-it-all friend (Mike) started in. It began innocently enough when another friend, Adam, asked if Whole Foods was a stock worth holding onto. Mike came right over the top saying that not only did he think the brand’s stock was overvalued, but that he thought the chain was doomed to fail. Why? Because they allow their store managers to have a serious impact on what merchandise gets put in each individual store.

Now, normally I let his bloviated diatribes go on for a while before I interrupt. It’s part of the fun. But on this one, I needed clarification, so I stopped him immediately. “How could you possibly see store managers affecting their product mix in a personalized, localized way as a bad thing? ” And that’s where it got interesting.

Mike told us that he knows a store manager at a Whole Foods where he lives very well, and that she’s constantly overwhelmed trying to figure out what to order and when to order it. He went on to insist that part of what makes a national chain powerful is its ability to standardize its product mix. “How unprofessional does it look to be selling one thing in this store over here and not in that store over there? ” And that’s when I felt compelled to slap him down a little bit.

Mike – and everyone like him – is certainly entitled to his opinion, but he bases his opinions off both tradition and his own industry (online automotive parts and sales). For someone like him, in his own words, were he to ever open stores, it would be foolish to have a part available in one store, and not in another. It would actually serve as a sign of disorganization and failure. Or would it?

That’s when we started talking about differences in consumer demographics. How a mall-based apparel retailer in New York would most certainly not want to have the same clothing selection as one in Miami, even if both were in largely Hispanic-American communities. Truth is, even during the summer months those communities have wildly different tastes. And that enabling a store manager more input – even if that means a level of stress-inducing responsibility – would indeed help make the store “feel ” more like it should: stocked with the items that people there want to buy. I think he actually saw how that might apply to auto parts as well, as people in Montana certainly drive different vehicles than people in LA, and therefore have vastly different needs.

Just to drive the point home, the next day we visited the local Whole Foods in midtown. The store had a bunch of products neither one of us had ever heard of (a local bakery provided baked goods, a local salsa company provided chips and unbelievably delicious salsa), and it made the place seem just a little more like it belonged. So did the Detroit-style graffiti (there is no shortage of graffiti in downtown Detroit) over the dairy department. In fact, we had just visited the Motown Museum the day before, and when he noticed the classic Motown vinyl 45s serving as checkout lane markers, I think he finally gave up.

But here’s the thing: it’s not just people like Mike who still cling to the notion of “standardized equals professional. ” In our most recent Merchandising Report, only Retail Winners had any real grasp on the value of localized assortments (55%) – and that’s certainly not a windfall. Apparently when it comes to the value of making stores feel more like the communities they represent, change may come one conversation at a time

 



Newsletter Articles April 7, 2015
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