IHA gets acquainted with Mark Mechelse, Director of Research, Industry Insights and Communications for the Global Market Development Center (GMDC), for a preview of the panel discussion he will moderate about the importance of food storage products for consumers and grocery retailers at the upcoming 2017 International Home + Housewares Show in the Innovation Theater.
Joining the conversation with Mark will be Todd Hale, formerly of Nielsen Insights and panelists Steve Davis, WEIS Markets; Melissa Branin, H-E-B; Sheila Kostiak, AHOLD and Dennis Bruce, Newell.
Mark is responsible for leading the Educational Leadership Council that delivers the latest insights and next-practices with a total “go-to-market” process for members of GMDC. Mark has led vital design, future-facing and trend functions in the social expression industry and developed tailored programs for Costco, QVC, Barnes & Noble and many food retailers.
Mark, tell us about GMDC and its activities.
The Global Market Development Center Connects retailers, wholesalers, suppliers and service/ solution companies in the General Merchandise and Health Beauty Wellness marketplaces, Creating innovative growth in Commerce through inspired Collaboration.
GMDC is dedicated to serving its ecosystem of more than 600 general merchandise and health, beauty and wellness retailers, wholesalers, suppliers and service/solution member companies by enabling and reimagining consumer-facing innovation and retail. GMDC’s combined member volume represents more than 125,000 retail outlets and more than $500 billion in sales.
Mark, in the past few years, what has changed most in your business? How has your company met these challenges in the way you do your work?
Our industry is changing rapidly with constant disruption in the marketplace fueled by technology, first-mover products and innovation at every turn. Emerging demographics from Millennials to GenXers to Boomers are driving the way we shop, live, work and play. From the health care to self-care era to the advent of wearable technologies and artificial intelligence, the retail and housewares industries are transforming themselves in the new marketplace with products and services for tomorrow’s consumer.
To harness the evolving trends in the industry, GMDC launched the Retail Tomorrow program to introduce innovation in the marketplace through development and advancement of unique and first-mover products, services and technologies for members. Retail Tomorrow accelerates retailer “next practice” processes and provides insights into the future.
Nielsen is a founding partner of Retail Tomorrow, and is instrumental as the initiative gains momentum to fuel startups, accelerate retail category growth, and spark entrepreneurial engagement.
Consumers – and the industry itself – demand ideas, products, services and technologies that are truly revolutionary. While many companies, and even other associations, are talking about innovation, Retail Tomorrow is delivering opportunities and opening pathways of discovery for provocative, product- and process-changing solutions in the marketplace.
Additionally, Amazon.com is driving profound change in the retail industry and is reshaping the minds and expectations of consumers around the world. The recent announcement of Amazon Go is a perfect example of that phenomenon.
Why did you choose to speak at the International Home + Housewares Show?
GMDC has been a long-standing participant and supporter of the Show, and through the years has sought ways to collaborate in this leading-edge annual showcase/forum.
Sunday, March 19, 9:30 – 10:20 am
Food Storage Matters: For Consumer Health and Retail Profits
Mark Mechelse, GMDC
Todd Hale, formerly of Nielsen Insights
Steve Davis, WEIS Markets
John Gehre, H-E-B
Sheila Kostiak, AHOLD
Dennis Bruce, Newell
Innovation Theater, Lakeside Center, room E350
Tell us what you will be speaking about and how and this topic is important for Show audiences.
A host of diverse factors are converging to put the spotlight on the food storage category as an important source of sales and profit growth for supermarkets.
At a time when food price deflation is squeezing grocery retailers’ top lines, general merchandise overall is looming larger as a source of growth to offset the erosion of food sales. The time is right to take a fresh look at the sales and profit potential of non-foods and GM.
Within GM, food storage has clearly demonstrated its value. According to Nielsen data, sales of household plastics/food contact items rose 3.4% to $1.06 billion during a recent period and the category has demonstrated solid growth: the compound annual growth rate (CAGR) of dollar sales over the last four years is 5.8%, while unit volume in that period has grown 2.5%.
For example, Steve Davis, Director of Center Store, GM/HBC & Grocery Non-Foods for Weis Markets, notes that his company saw strong sales increase in food storage in 2016. “A lot of that has to do with the promotions we’ve been doing,” he says. “It’s certainly a category that’s growing.”
At the same time, food storage products are assuming greater importance with a broad spectrum of consumers that cuts across generational and ethnic lines. People are eating more at home, both to save money and to achieve a healthier diet. Health and wellness is an increasingly high priority and it is influencing the foods that people are putting in their shopping carts — in particular driving the booming growth of natural and organic foods.
The same concerns are heightening consumers’ awareness of freshness and preservation of nutritional value. And that awareness is dovetailing with a wave of innovation from food storage manufacturers, who are introducing a new generation of products that deliver greater efficacy, convenience and ease of use.
Like food prep, food storage products lend themselves to creative cross merchandising. Selective display of storage items with related food products can inspire unplanned purchases of the food item as well as the storage product.
In addition, food storage should be a key part of seasonal merchandising plans. Nielsen data shows double-digit and higher sales growth of Easter, Christmas and other holiday storage items. “In the fourth quarter we bring in pallet quantities of our store-brand food storage products with red and green tops,” says Davis. “We promote them at a special price and they perform tremendously.”
This is your first time presenting at our Theater. What are you looking forward to most from speaking at the Innovation Theater?
Last year we presented in S100 and introduced new consumer perspectives in the housewares space, namely a category recognized with retailers as “Food Prep.” Our panel was well-received and attracted trade awareness and media attention from the Chicago Tribune and many other publications with a strong voice in the market. That experience was a catalyst to becoming more involved in this year’s Show. Innovation is in GMDC’s DNA, so we are excited to share in the vision, trends and research that are shaping tomorrow’s consumers today.
What do you see as consumers’ biggest concerns regarding housewares products?
Certainly, the tiny home movement is shaping consumers’ buying habits. While many are striving for simplicity, minimalism and downsizing, they won’t sacrifice on quality. Innovative uses, design and aesthetics are important. And as technology-enhanced smart housewares products continue to emerge, consumers will expect more from their purchases.
Also, consumers of today are seeking more than a purchase, they want an experience. That means bringing trends into the home that they experience at restaurants, and creating experiences around the purchase such as trying out the latest kitchen gadget while preparing a meal as a family. Staying on trend is important as consumerism moves from just a purchase to offering an experience.
And, it’s wise for manufacturers to implement sustainable and environmentally friendly practices as more consumers want to know not just how the housewares product will benefit their lives, but also how it was made and further, how the company operated overall. Savvy consumers are concerned about the environment and social causes, and they want their buying habits to reflect these values.
“People are concerned about how many plastic bottles are going into landfills,” Davis remarks. “So they’re buying their individual beverage storage products so they can re-use them. And they don’t just use them during activities, many of them bring them to work every day.”
What are some of today’s trends or issues that new product development professionals and/or retailers face in the housewares market?
Next practice trends that are building the store of the future and driving dynamic sales are turning food shoppers into smart housewares buyers:
- Cultivate food prep– A new mega-category called “food prep” has been introduced, consisting of kitchenware, housewares, cookware and kitchen gadgets. It’s about how shoppers see the category, not how buyers buy. As the revolution of fresh food continues to grow in the grocery channel, there’s emphasis on how ingredients are prepared and what tools can get the job done precisely in order to ensure food tastes and looks good.
- Leverage merchandise adjacency– Retailers across categories can strategize to turn what was thought to be a shopping trip into a shopping occasion and maximize the basket fill with top-of-mind items. Stats show that while 70 percent of shoppers visit a store with a purchase in mind, half are influenced by what they see in stores. Proof of this was revealed during the session by retailer/wholesaler panelists who explained how selling a pineapple corer not only increases the profit margin of the overall spend, but also creates significant lift in the fresh food category. It’s a win-win for retailers.
- Attract the Millennial – This means having a sales strategy that integrates technology, convenience and experience. While Millennials are connected to all things digital, they still desire the brick and mortar experience and love to touch and feel the fresh food that they buy.
- Don’t forget the Boomers – They continue to heavily influence the Millennials as many have left the nest, but not the wallet. Boomers continue to spend on upgraded food prep tools.
These are a few of the leading trends we watching around the globe. Come to the presentation to learn more!
Thank you, Mark, for your insights into the food storage category and how to position these products in the grocery aisle as well as in the minds of grocery shoppers. We look forward to hearing from the panelists about their practices at your presentation on
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Innovation propels the housewares industry. Learn from experts about how to invigorate your new products and services by enhancing your innovation efforts. Critical issues such as global design trends, licensing, the emerging Smart Home category, branding, the needs of distinct consumer age and gender groups, the future of food and parenting – all impact the home goods market. Be sure to attend the free executive-level educational sessions at the Innovation Theater. These programs will give you a fresh perspective as you walk the Show and will inspire, inform and improve your business.
The four days of the 2017 International Home + Housewares Show will be packed with events and education. To help you plan your valuable time at the Show, we introduce you to the speakers and the 21 exciting presentations that will take place in the Innovation Theater in the Lakeside Center. Gain cutting-edge insights that you can apply to your work. All programs are audio-recorded and will be available at www.housewares.org after the Show.