And they're off! Supermarkets have the lead out of the gate. But drug chains are nipping at their heels. Still behind but with lots of momentum are club stores and discounters.
The race to satisfy consumer health needs is generating lots of energy from retailers of all types. This week, SN presents a theme issue on health by focusing on how different channels of retail and food service are responding to the challenge. Each section of SN highlights a different channel, beginning with supermarkets on Page 18 and continuing with drug, mass market and other segments.
There's no denying that supermarkets are naturally well positioned on the health front because of extensive food offerings that can be cross-merchandised with pharmacy and other departments. Grocers are taking credible early steps to stake out this turf, including flagging health-oriented products and services for consumers, building natural and organic departments and private-label programs, and holding classes geared to healthy food preparation.
Supermarkets are getting plenty of competition from drug chains and mass market retailers. Drug stores, for example, are competing with grocers in the drive to embrace in-store health clinics, educational programs and related services.
Meanwhile, membership warehouse clubs are improving their health marketing game with a growing focus on private label. Food-service outlets are also accelerating their efforts, boosted by new partnerships.
Each channel may take different approaches, but there's a common denominator. Players across all segments have discovered that health marketing itself is no longer a choice but a given.
Retailers are constantly redefining their perceptions of what consumers are seeking. For example, many had assumed that natural and organic should take center stage. Yet some retailers are finding that local products carry at least as much clout.
Retailers are increasingly defining themselves not just by what they offer but also by what they exclude. Wegmans sent a clear signal to consumers earlier this year when it decided to eliminate tobacco products from its merchandise mix.
A lingering question is whether retailer health efforts should follow or lead consumer behavior patterns. Information Resources Inc., in a report last November called “The Healthy Eating Evolution,” said, “The next phase will be more about getting ahead of consumer demand — stimulating new demand by making healthy eating easy, affordable and accessible to all.” IRI's report, in fact, urges targeted marketing for “high-potential segments,” including Baby Boomers, ailment sufferers and kids.
If the health-marketing competition is a race, is it best viewed by tracking different retail channels? A channel analysis is crucial because it shows how each broad sector is responding. But the analysis shouldn't stop there. Each retailer, regardless of channel, must consider factors unique to the local market in formulating innovative strategies. At the end of the day, retailers will win or lose based on how well they know their own customers.
