INSIGHTS AND PERSPECTIVES

Special Report: New General Market Purpose-Driven Summit

BY DSN STAFF

The retail game has changed — shifting consumer demographics, and the accompanying changes in demands — have forced retailers and suppliers to re-assess their approach. As Dan Mack explained at the outset of the New General Market Purpose-Driven Summit, put on by Drug Store News and Mack Elevation in June, “It’s about purpose. It’s about soul.”

It is no longer simply enough to put something on the shelf and expect it to sell — consumers need to feel connected to the brand they’re buying. The event brought together more than 100 retailer and supplier executives, who heard from seven speakers and three panels about the different ways purpose can play a role in growing their business. Click the links below to read the individual reports.

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New General Market: Brandless takes minimalist approach to purpose

BY Mark Hamstra

Brandless has not only eliminated unwanted additives from its products — it also has streamlined the decision-making process for consumers with its highly curated online assortment.

The San Francisco-based company, which launched in July of last year, offers a minimal assortment of grocery and CPG products all featuring clean ingredient formulations that seek to address consumers’ most common concerns about their health and the environment, said Rachael Vegas, chief merchant at Brandless, in a presentation at the New General Market Purpose-Driven Summit presented by Drug Store News and Mack Elevation.

Brandless also features a simplified pricing model that is akin to a dollar-store strategy — every item is priced at $3 each, or in some cases two for $3 or three for $3. One of the driving forces in the creation of Brandless was the concept that consumers should not have to pay a premium for
better-for-you products, Vegas said. That concept is especially important as younger consumers increasingly seek out these types of products, and at the same time are comfortable looking online for the best deals.

“It’s our tenet at Brandless that everybody should have access to better product, and that it doesn’t have to cost as much as our system right now forces it to cost,” said Vegas, who spent 13 years at Target before joining Brandless.

Consumers also are increasingly skeptical of established, mainstream brands, Vegas said, and they expect companies “to have some deeper social purpose than just making a profit.”

Along those lines, Brandless has embraced hunger relief as a cause and donates a meal to Feeding America for every order placed on its website.

Just What Matters
The company’s merchandising strategy is built around the concept it describes as “Just What Matters,” a three-pronged approach that includes simplified assortment,  clean ingredient formulations and efficient packaging design.

“At the end of the day, people are overwhelmed by how much choice they have — and we’re talking about choice around reasonably simple things,” Vegas said.

A search for lotion on Amazon might yield tens of thousands of results, compared with six or seven on Brandless, for example.

The Brandless website lists a single variety of many common items, including ketchup and mustard, as well as a larger selection of items in such categories as snacks, where consumers like to experiment with different flavors.

Most of the food assortment is organic, and many items tout other attributes consumers are seeking, such as no sugar added, gluten-free and vegan.

In the beauty category, Brandless offers products that are free from nearly 500 ingredients “that are questionable and that some consumers have said they don’t want in their products,” including parabens and sulfates, Vegas said.

Brandless also has paid close attention to its packaging, which is designed to be practical and sized appropriately to minimize waste and preserve freshness. True to its name, the company eschews traditional package branding in favor of simple, straightforward labeling that identifies the product inside, along with a checklist of the attributes the company believes consumers are most interested in, including “organic” and “made with whole grains.”

“In every category, we’ve really defined those attributes that we think matter most to consumers, and that we don’t want them to have to go searching for on our package,” Vegas said.


This story is part of a Special Report on the New General Market Purpose-Driven Summit — to read more insights, click here

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New General Market: Coty’s social listening yields results

BY Mark Hamstra

Beauty products giant Coty has opened its ears to the voices of social media. At the New General Market Purpose-Driven Summit, Shannon Curtin, a then-Coty executive shared how the company is listening and responding to its consumers.

Curtin said to better listen to its consumers, the company about two years ago established an internal “trend foundry” to monitor social media conversations and try to learn about what interested consumers in real time. Those insights, combined with the insights obtained from its retail customers, are helping Coty’s family of brands get the right products to market sooner to capitalize on the buzz before it fades.

“You learn very quickly about what works, and then you fail fast if it doesn’t,” Curtin said. “If it does, you invest and you keep moving forward at an accelerated pace.”

She cited data from a McKinsey & Co. research report, showing that companies that leverage customer behavioral insights outperform peers by 85% in sales growth and more than 25% in gross margin.

Curtin described the process of monitoring and leveraging consumer insights at Coty into four steps: Getting a sense of what’s going on with consumer conversations, storytelling around those conversations, building a surround-sound of the story and optimizing the assets and, finally, selling.

“In all of these, it’s as easy as asking, ‘What are people saying about our brands? What are people saying about the retail partners that we engage with? What are they talking about in a beauty space, and what’s coming up and what’s resonating?’” Curtin said.

Coty groups the consumers who are having these conversations into segments based on the types of beauty products they are discussing, then looks for actionable insights and follows with rapid surveys asking consumers what they think of a certain look, for example. All of this takes place within a span of roughly 72 hours.

“This flywheel is going really, really fast because we try to get into storytelling mode as quickly as possible,” Curtin said.

The storytelling phase of the consumer insights process involves creating content that leverages the learnings from social listening and surveying. Initial concepts are tested over the course of another 72 hours before they are turned into fully-developed content that can be distributed on such social media channels as Instagram, Twitter and Facebook, or on retailers’ websites.

That leads to the “surround” aspect of the process, which involves media activation and optimization, journey tagging and integrated reporting around various performance metrics.

Ultimately, the insights should lead to a more personalized selling experience, with the right message reaching the right customers via the right platforms, Curtin said. Combined with the insights from its retail customers, Coty also can tailor its messaging for a specific retailer’s shopper.

As an example of the power of Coty’s new framework for social listening and rapid response, Curtin cited the company’s reaction to consumer interest in blue eyeshadow earlier this year. In March, Coty noticed through social listening that a lot of people were talking about blue eyeshadow, so it began creating CoverGirl content that emphasized blue shades.

Then in April, Kim Kardashian launched a blue eyeshadow that was an immediate hit with consumers. The next day, CoverGirl — already prepared because of its social listening — launched a blue eyeshadow look on social media, seeing a measurable uptick in blue eyeshadow sales the next week.

“It’s all about listening to what consumers want and creating it for them in real time,” she said.


This story is part of a Special Report on the New General Market Purpose-Driven Summit — to read more insights, click here

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