Wendy 00:09

Hello, everyone. I'm Wendy Liebmann CEO and chief shopper at WSL Strategic Retail and this is Future Shop. This is where I talk to innovators disruptors and iconoclasts about the future of retail.

Wendy 00:29

My guest today is my colleague, my business partner and all things, all things as well as everything shopper, good friend and president of WSL, Candace Corlett. Candace regularly joins me as many of you know when we have a hot off the presses new study new How America Shops® study, which we do today. So we are going to talk about that the title of that one is called The Paradox of the New Shopping World or probably correctly the paradoxes. Welcome, Candace.

Candace 01:02

Hi Wendy, and then we would have made it paradoxes. If I could have figured out how to spell plural paradoxes, right?

Wendy 01:09

It gets too weird, and Maryann would not be able to fit it on the page. So all of those things, but anyway, so hope you're well, I know, we've had a very strange summer, we've all been working very hard, but have been totally depressed by our baseball teams. So you know, Yankees Mets in the toilet, excuse the expression.

Candace 01:27

And then there's the Mets. I'm going to the game tomorrow. Wish me well.

Wendy 01:34

You're a sucker for punishment.

Candace 01:36

I am but you know, you gotta show up.

Wendy 01:39

Yes, you do. And it's part of the fun. It's been a busy on the road time from I seem to have done the West Coast spin. While you've been doing all this great work with a team from Los Angeles Retail Safari® to my panel at Cosmoprof and then just back from San Diego, where we had a very interesting and exciting NACDs total store Expo. So it has been a season of lots of events and many 1000s of people. So everybody's out and about and then feels like a sorority Halloween. What happened with that? What are the stores doing out there with Halloween?

Candace 02:13

Well, you know, you sound like the newbie reporters that I've been talking to, they are totally fluffed that Halloween is in the stores in August, I said, Well, it's the next big retail holiday. And it came as a shock to them, that you buy those big bags of candy now. And they're gone by mid October 8, grade for picnics back to school lunches, and then you replenish. So brands and retailers are on to this. I was in Costco and all their costumes are out. And that's tricky. If you have a four year old who wants to be Super Mario in August, and then by October, they want to be a ninja. There's no trade, that's a lose lose.

Wendy 03:02

Well, then you buy just in case or we could all wear pink can be Barbies. How about that? So serious stuff, we just completed our latest shopper survey. So remind everyone how we do it.

Candace 03:20

We go out and collect a nationally representative sample of shoppers over the age of 16. Because we like to include Gen Z who are aging rapidly. We do a national online survey and collect people. And this survey was based on 2500. And we always stop and think about what are the topics that are going to be impacting our clients brands and retailers that are going to stick trends come and go. And we again confirmed in this study that 90% of shoppers, what we're calling inflationary pricing, they're calling a permanent price correction. So 90% of people don't think these prices are going to go back down. And I don't know whether that's a lack of trust, or cynicism, but whatever it is, they're planning on living with them for a long time or permanently.

Wendy 04:21

And that's one of the paradoxes right, because one of them is, you know, on the one hand, we have, you know, all the economic indicators looking so strong, unemployment is down wages are our you know, supply chain is better, all of those things are looking good. And GDP is looking good, confidence. I think that's you at any minute. We'll see what that looks like. And yet there's this Oh, just in case maybe I won't spend and I found that absolutely fascinating. The sort of continuity of that from all the surveys we did last year, really ended up in the deep mess of deep reflection and inflation. high inflation not deep. And so this general caution and concern on the part of the American shopping populace that actually, this is what it is.

Candace 05:10

Well, and we've continued to confirm that. And you know, within that 90%, half the people think the prices are still going to go higher. And you do wonder how much higher a loaf of bread could go before people can go back to baking their own?

Wendy 05:26

Yeah. Well, it is also part of that conversation. I heard that a lot in this last few days in San Diego at the conference, where, you know, companies are still talking about taking price increases, and retailers are still saying, Oh, no, we've done enough. That's it because people are concerned. And so, again, that paradox of what will it look like? And how do we keep people coming into the stores when you want to increase prices, and I don't want to take the price increases? So there is a friction there, that is worrisome?

Candace 05:56

Well, you know, Wendy, we've been doing this long enough to know that shoppers always figure out how to do an end run, they get what they want, at prices they can afford, and one of their strongest support networks. And and when we talk about shoppers, we're not just talking about lower income shoppers, one of the paradoxes is that households will then come over 100k or 150k, a quarter of them are saying we're spending frugally because we just want to wait and see but they always figure it out. And you know, we saw a huge increase in the places people shop in three months, from eight to 14. That's a 51% increase since 2014.

Wendy 06:47

Yeah, explain that metric. Because you know, sometimes people think it's just we say that this is defined as places people tell us in our sentiment indexes, places people tell us they have purchased something, not just gone wandering around browsing actually bought something.

Candace 07:05

And we give them an exhaustive list of channels. We cover every channel from convenience stores, to DIY chains, but that 51% increase has come from compared to 2014. There are now channels in place that did not exist in 2014. The deep discount grocery Aldi, Lidl, Save-A-Lot was the only one back in 2014. And now Aldi and Lidl, Aldi seems to be taking over the country and Lidl certainly the Northeast, in the Atlantic states. And then there's the direct to consumer, which is not just limited to fashion and shoes, people are buying beauty home cleaners, they're finding ways to get what they want at affordable prices.

Wendy 08:00

And what's interesting is, and this is where I think everybody has to be conscious or careful of the broader economic indicators, because it's not that people aren't willing to spend on certain things, regardless of income, the little treats that in a world that's so unsettled, make us feel better happier for a moment, since so many are depressed and anxious. So you know, we see it in things like travel and restaurants and you know, services and things like that, that make life easier or happier. But within the sort of CPG categories health, wellness, beauty, pets, food, beverages, all of those things, as you say, there are just so many places to buy so many things. And that number is just stunning. That was one of the big surprises.

Candace 08:46

And that's one of the paradoxes that the places people shop have grown so dramatically, but they've grown because people are finding, I mean, there are now $37,000 stores around the country. And we have two thirds of our shoppers are in those in three months. So they're finding ways to get what they want, so that they do have money leftover to keep the lights on to buy the bread, and maybe even to take a road trip or vacation.

Wendy 09:18

Well, and I'll tell you that you raise the point of higher income. I mean, we've all shared stories just so everybody knows the way we get to these themes is of course we're doing our work all the time. But we begin with our what we call our sensing, you know, our observation, we listen, we hear stories, we talk to people, you know, all the time to hear what's bubbling up. And so that's how we continue to build out this quantified work that we do around the country. But the other thing that I heard a lot again, just because I've been on the road so much as this issue of wow, you know, trips are down or the people that are coming are spending more but not as many people are coming and so all of those issues of how many stores do I need and where They need to be, and the whole conversation of, and you've talked about this a lot, this sort of transformation of the shopping journey, and that we're leveling out now or transforming of the physical store, the digital store, this whole concept of kind of unified commerce that's emerged. Talk a bit about that because that's also something we've been seeing. In all our work, I'm still here, but I'm not here as often. And my trip, there is quite different kind of thing.

Candace 10:29

Or, you know, I mean, we have almost half the population doing curbside or store pickup. And interestingly, two thirds of the people who do those pickups then go into the store, but it's primarily men, what are they going into by Well, the going into my frozen and fresh, but snacks and beverages reward for doing the pickup. And when the women who go in are looking to get, you know, to spend 10 minutes in the beauty department, or everybody's going in to see the displays to discover something new and what's on sale, in case they missed it in the Online offers. So again, they're getting what they want, easily, and at prices they can afford.

Wendy 11:19

It's interesting you say that too, because as you know, as you remember, a couple of weeks ago, I had Parbs Dhariwal who is the head of the retail media CMX at CVS Health. And we were talking about the sort of the changing funnel that everybody talks about in terms of the shoppers journey and, and I was talking to him about how retail media is great money pot that all the retailers are thinking they're getting, or seem to be getting, but how that in real value terms to the shopper would be understanding what part of the trip she or he is on and then being able to inspire and form when they are now at a different point coming into the store after they've done the grocery shopping or looking for beauty or something new and, and the way we have to all step back and think about that, because it's not the way it was. And that to me was really interesting. In this you work as it sort of continues to evolve that story for us.

Candace 12:15

What we've known for a long time, is that everybody's goal is to make their shopping for the basics easier. And what you just mentioned about retail media, it's one thing to get, have your groceries placed in your car, and then to run in to check the displays the sales, see what you missed. But the whole concept of retail media, to help people navigate the store better, you know, to hear or have at the curbside pickup with the in store pickup. Retailers have been doing a lot with that space. But it mostly involves putting merchandise in that space. And messaging would be a lot more powerful.

Wendy 12:58

But also in that knowing at that moment who I am on that trip when I come into the store. And so the ability to target that and say we've got this new X or come in and look at the cheese or whatever it is,

Candace 13:12

or wander down to beauty to see the new colors for the season. You know, or check out the allergy display because allergy seasons coming up.

Wendy 13:12

That's right, and all of that ability to tailor that message to that part of the trip. Not even the whole trip. But that understanding where that moment in time is where people say, got that done parking the car. Now I'm gonna go in and see what it is that we meant.

Candace 13:39

And understanding what people buy when they go in, you know, fresh food for dinner tonight, dairy produce,

Wendy 13:48

Understanding that the nature of that now it's not just the usual up and down the aisle up and down the aisle up and down the aisles.

Candace 13:55

Oh, no, that is so passe. And one of our shopper interviews, someone said well, I don't want to walk miles of aisles in the store. I can find better ways to get my steps.

Wendy 14:07

Right yeah, absolutely. The other thing about this that I thought was interesting is you know, obviously, we're always looking at demographics. So, but we don't just look at age and income and gender. We also look at, you know, household configuration, ethnicity, obviously, location in the country, things like that. But in this instance, it was interesting to me even more to think about the nature of the journey from different generational segments. And I thought that continues to build out and some of its distinctive, even more distinctive than it was, you know, when we first started to look at this through the pandemic, how are you finding that in this study in particular,

Candace 14:48

It's a result of Gen Z and Millennials age. I mean Millennials are in their early 40s. Gen Z the oldest of them are now around 24-25 and a lot of them have children, we are seeing under the banner of what's an easy shop, which I know we're going to have our Virtual Retail Safari® in September, around easy shopping. And it's very different by generation. I mean, just the concept of self checkout. That is the number one thing that Gen Z wants for easy shopping, or as boomers prefer cashiers. And actually, a third of millennials prefer cashiers too, because if you've got toddlers in that shopping cart, the eggs can go on the floor very quickly,

Wendy 15:38

right? Trying to find a barcode, right?

Candace 15:40

Yes and you know, now is the time for retailers to learn how to use those apps, not just for coupon delivery, but for navigation, because people want to say, Where's the cranberry sauce? Where is the apple sauce and just go and get it, they don't want to walk up and down the aisles. So we thought we had a problem with center aisles. 10 years ago, no problem with all aisles. So easy shopping tends to be very different. Boomers and Gen X want to get a lot done on one trip. And I think that's because Millennials and Gen Z order so many categories online, it doesn't matter if they get everything done under one roof, in a big format. For them, it's more important to get in and out quickly. So it's knowing who your shopper is. And I think that changes by day part too.

Wendy 16:39

Yeah, I think that's so true. I mean, we could take a learning a leaf out of the proverbial old book of work we did in the convenience store industry. And think about those day parts. And actually, you know, some of the grocery retailers are really good at that. They understand whether it's in their marketing, messaging, advertising, all of those things that really do help you take something off your list, what's for dinner tonight, what do I need for the kids for school? Those things that, you know, really are in the moment and understand who I am at that moment, and what I'm trying to solve for.

Candace 17:16

So demographics matter a lot when you're trying to figure out what's easy shopping. And you know, I was reviewing some work that we're releasing on this Retail Safari® in September, the Virtual Retail Safari®, and the retailers are starting to recognize that you may not use a QR code. But they need to make you aware that there is more merchandise on their website, because I think both the mass merchants and the supermarkets have been slow to send people to their websites. And you're going to see that part of this easy shopping is you don't have to have it all on the floor to confuse people. But you have to make them aware that you'll have a website with lots more.

Wendy 18:07

Well, you've mentioned you've tantalized people twice about the Virtual Retail Safari®. So let me drop the that in right now. It's September 19. And it is all about easy shopping. So go to our website wslstrategicretail.com and sign up. It's a great hour, bring your lunch depending on what part of the country you're in, or your morning tea as we used to say. And listen because it's you know, where we reveal both data and what's what we're seeing in our research Iike Candace is talking about. But we also share lots of examples from around the world as we go safaring’ and are we in our scouts to to showcase how retailers and brands are actually executing around this. So there's lots of inspiration.

Candace 18:51

Well, it brings our numbers to life. You know, what is easy navigation, what is getting a lot done under one roof, what is decluttering the store but giving people the option to find lots more

Wendy 19:06

and there's a lot going on and it goes on in other places, then perhaps the stores or websites or whatever DTC that you usually live in or compete in. There's a lot of inspiration going on, especially now that's one of the big stories coming out of the pandemic when everybody spent all their time worrying about supply chain. Now, this whole push, particularly from the retailer's, to say, don't bring me same old, same old I want to see things that are really new and products and merchandising and marketing programs, all of that. So anyway, join us on September 19. So thank you for that little promo Candace.

Wendy 19:41

The other thing that struck me about this survey in particular was again, paradox is that this whole conversation around private brands, I mean, the logical comment would be I would have expected as yes, I'm buying more store brands, private brands because I'm trying to save money better actually the way people think about private brands or exclusive brands at a retailer, is really a lot about the quality, the innovation, the presentation really giving national brands a run for their money, right?

Candace 20:13

Oh, it is. And you know, I've insisted that our team, not call it private label, because the private label was what your mother bought in a pinch. And everybody pushed back and oh, she was being cheap. But now store brands are brands, they have positioning. And in our study, 75% of shoppers feel that store brands have improved on packaging, quality, and innovation. And when you look at the presentation of store brands, I was looking at, of course, we all know Kirkland. And have you even buy Costco gas now. But Kroger has six brands, they have three brands for pets, and one for baby goes to show you the priorities our shoppers are focused on, and their brands for pets include all meat, natural meat, and they named them well, and they package them beautifully. And then you know, you look at Shop Rite’ Bowl and Basket and Stop & Shop. They were among the first present affordable, organic, everything. So it is scary. And you know, I focused on the beauty category. Because I said how are people buying more beauty and 30 to 40% of people are buying more store brand beauty. And you know, you take a look around at Bath and Body Works, the private brands from Ulta and Sephora and Sephora now promoting clean skincare for under $20. It's a scary time. I mean, I was a brand manager and a Group Director for a long time. It's a scary time for brands.

Wendy 22:03

And I think that's a real learning because there was always that pushback you remember people would always say, Oh no, there are no private brands or exclusive brands in beauty. And of course, all you've got to do is walk into as you said a Sephora and Ulta a Bath and Body Works, a PINK, I mean, Victoria's Secret, or even, you know, you walk into a CVS, and you see the exclusive brands they're featuring or Target of course Target. But Walmart we had Noah Rosenblatt on from, as you know, from SpaceNK a few weeks ago. And aside from all these, you know, national niche brands that they feature, not only in department stores, but then another selection in the Walmart SpaceNK format. They also have a whole personal care line of body and fragrance and candles and things that they sell at Walmart that are under the beauty SpaceNK that are exclusively at Walmart. So the more that goes on, you know, the big national brands have to be truly conscious of it's not just you know, one big brand fighting another big brand. There are a lot of big brands that are exclusive or private to a retailer or a couple of retailers. So I think that was the other piece that again, the paradox, oh, it's all about low prices, people are concerned about inflation

Candace 23:22

It is not any more because I am have become obsessed with the Vitamin Shoppe, True You brand. That is not low price. It is premium, but it covers health, beauty skincare, it is a premium brand, but owned by Vitamin Shoppe. And I think, you know, the other thing is shoppers are now truly proud to discover how good these brands are. And they tell everybody in their circle, and they feel smart to buy them, you know, and it used to be really smart to buy private label because it was less expensive. But now these brands are really on par. And the innovation surprised me. I was happy. We asked about do they innovate? And the senses? Yes, they do.

Wendy 24:12

At the Cosmoprof Beauty Expo in Las Vegas. It was amazing to see not only big brands, but also smaller brands, startups doing really innovative and unusual things. And then recognizing that some of those brands were manufacturing for retailers and others and you followed the retailers as we usually follow the shopper. I followed the retailers on the floor to see where they were stopping and what they were doing there. So same at the NACDS Total Store Expo around health and wellness. On that subject of health and wellness, a major passion of ours. Lots of work we've been doing for at least a decade or so one of the things I thought was really interesting in this work again, is that we took a sneak peek into Just things that we will be doing more work in as the year progresses. But the growth movement in some categories that we've been talking about, for some time really starting to bubble up in that health and wellness space. So what do we see there? That's a little preview of what we've got to come

Candace 25:18

All the taboo topics that polite company didn't talk about, I mean, menopause. And this is the internet, driving retail to catch up. If you Google menopause, so many sites come up, and they are selling products, everything from fabrics to keep you cool to skincare, that doesn't make you sweat, and menstruation, god bless Victoria's Secret, talking about it right up front. And Urban Outfitters having tables with products for menstruation. And what we discovered is people are searching for information. So if you are Gen X, you're looking for menopause. If you're Gen Z or a Millennial, you're looking for products to help you relieve the symptoms of menstruation and retailers are we publish in our Retail Safari® work, the end caps that Walmart is putting up, and then let's not forget sexual health and pleasure that is much more overt online. And again, retailers and brands are trying to catch up. And you know, my favorite observation, having 15 nephews or in their late 30s and early 40s, is how aggressive they are about taking care of their health. And they will call me and say which vitamins do I need, like, I'm the vitamin expert. But they they are they're out there shopping for products for themselves. So we included men in this study to hear what topics they're looking for. And thinning hair crosses men and women. But erectile dysfunction, low testosterone, low sperm count. And it's primarily the guys under 40, who are out there looking for information, and then being led to websites that sell them products. And we had this conversation with a client the other day, concerned that there is no vitamin that is going to help erectile dysfunction or low sperm count. And I said, but people are finding that online. And you and I may know it, that doesn't work. But people are desperate because you're not providing them solutions.

Wendy 27:44

And I think that is the when we think about the opportunities. And we think about paradox as it's pain, it's analgesics,

Candace 27:54

cough, cold, allergy, digestive aids,

Wendy 27:57

all of those categories. And now we hear this conversation a lot about women's wellness. And for those of you who listen to this regularly, you've heard Dr. Somi Javaid, talk about menopause, you've heard Sally Muller, her brand Womaness, as you know, we've had Susan Lang talk about the vision of a retail health and wellness. And this is a you know, in some ways uncharted territory, because it's not just I've got a you know, I've got some kind of acute condition or chronic condition. What do I do now

Candace 28:29

No, this spans years and a woman's life or years and a man's life.

Wendy 28:34

And the other thing I thought was interesting in this preview that you gave us that everybody. So you know, even more detail coming as we move into the early fall, is that younger shoppers, I was intrigued by the younger shoppers, particularly younger women who are doing you know, their own sort of searching home work looking for issues and information around perimenopause, this sort of searching for information from trusted sources, and really trying to do their sort of preventative homework or at least understanding of these issues before because they're just everyday regular issues that as your point nobody talked about and now guess what?

Candace 29:16

Everything. The internet has opened the door. Yeah, exactly. Exactly. And then we come to the point of they can always be on display. And we did ask shoppers where they would expect to find menopause, perimenopause and some of the men's conditions where would they expect to find that in store? Shoppers only know what they know, feminine hygiene or vitamins and the opportunity for retailers is to surprise them with a special I mean, Target has carved out a really nice three sided space for men to buy personal care. Suppose you did that and women's health, men's health

Wendy 30:00

Do you see that with Ulta I mean Ulta they are not beauty specialty retailer and they have created a women's Wellness Department. And so because like when we had Jo Horgan on from Mecca last year or whenever she was on, and talking about here was beauty specialty, and in that, in addition to, you know, all the more obvious products, you know that we're talking about fertility in their stores, they were talking about natural paths and their stores. So this sort of notion from through the lens through the eyes of the shopper, not through, you know, Category Management, not through while we put we've got three feet here, we'll just stick it in there. That's where the goldmine is to listen, we always say good all repeat after me follow the shopper to see the future, that that's where all this opportunity is now. So it looks paradoxical. But again, if you follow the sharper as we do, you will see the logic and all of that

Candace 30:57

And you can figure out the paradox

Wendy 30:59

Exactly.

Candace 31:00

And it all makes sense.

Wendy 31:01

So as we step back, and you know, this is we're just immersing ourselves in all this new work and connecting it to the trend to the previous work and look again to the future. What are the two or three things that you think companies, manufacturers and retailers really need to be thinking about now, particularly now, because it's planning time, right. So now I'm talking about 2024-2025? What should they be focused on now?

Candace 31:29

A. they should be focused on this encroachment of store brands, and the power of the store brands, and how do national brands always had huge personalities, and, you know, you wanted to be associated with the personality. How do I get back to being associated with the personality?

Wendy 31:53

Today It's the influencer. The personality isn't me. It's the influencer who says I'm okay.

Candace 31:58

Right. The second thing is, why is the internet driving the expansion of health topics? That used to be the jurisdiction of brand management and innovation in companies. And then they went to retailers, and presented the opportunity and the space. And how do you build it out? That has been taken over by the internet, and you can see how retailers and brands are catching up. And all you have to do is follow the shopper to the search?

Wendy 32:35

Yeah, I think that's so true. And then the other thing that strikes me in this work, and again, because our work, everybody is a continuum, you know, we're continuously observing, sensing and then beginning to say, let's measure this, how big is it, it's a small, Candace always tells us internally, look at the small numbers and see where that goes.

Candace 32:54

That's where the future is. We all know the big numbers.

Wendy 32:57

That's right. That's what we do. So that you keep an eye on those things and how they're growing. But it also strikes me out of this work that, you know, as you said, Before, people still go to the store, they are the park and go in, you know, do their essentials off the list and go in, they might run out of something. So they go into the local, easy to get to store that 13-14 places people shop and buy something from in a three months period just boggles my mind, then you step back and say that eternal question, how many physical stores do we really need? And I think we are getting to that point of where how many stores do I need and how much stuff in those stores do I need. So this whole conversation around simplify to amplify, is a very interesting conversation that we hear from retailers now more and more, and what stays in the store and to your point, what goes online or what never comes at all.

Candace 33:57

And I was so glad to see that retailers are making shoppers aware that we have much more on our website. And that's a new card that they're playing, and it should pay off. Because I'd much rather be standing in Walmart will say their display of college stuff and Target did it too. And said, If you don't find what you're looking for here, just go to our website and find more,

Wendy 34:23

as opposed to say, no, no buy here while you're here, buy here,

Candace 34:26

or packing the store with all the choices to the point where you're tripping over the lamps, you know, and the desks and the chairs,

Wendy 34:36

right? And then you've still got to get them to the car anyway. So all of that requires a much finer hand on the part of both retailers and brands and brands manufacturers understanding that you know, the notion of showing up and saying here's my latest widget and the retailer, actually, even if you're a big company saying to them, maybe not it's not worth the space on the shelf Often we've heard that we do for those of you who don't know a lot of we do retail executive interviews when as we talk to retailers in, you know, in depth ways about what's important to them now, that conversation about what's really innovative and what isn't. And what they want in their stores or do not is a very powerful conversation we're having, and they are very willing to push back on that increase prices, all of these changes coming to the fore. So the paradox seems paradoxical. And actually, in fact, there is lots of clarity to all of that. So don't be fooled. And don't be thinking that what something meant three or four years ago, means the same thing today. So thank you, Candace, for making things clear, as always.

Wendy 35:48

For more on this, everybody, go to our website, as I said, wslstrategicretail.com There's a lot of free content. There's our blogs, there's our podcast, there's the Retail Safari® that Candace mentioned, on September 19. And so there's a lot to help you think about what this road to uncomplicate in this paradox looks like. So join us for all that. And with that, we will see you in the future.