Ouch. cf. the Walgreens flagship stores, at least the one in Washington, has a floor dedicated to beauty. It's a great "store within a store." But I don't know how successful it is in selling cosmetics or in attracting additional customers. It can be done though. cf./2, Shoppers Drug Mart. Or Boots.
Theoretically it could be used to reboot CVS to be less boring, or really, less of an urban convenience store.
This reminds me of a song lyric by Billy Bragg: "a busy girl buys beauty, a pretty girl buys style. But a simple girl, buys what she's told to buy..."
Anyway, CVS will always have a hard time competing with Ulta and Sephora. Isn't about more than having planograms and minimally trained staff? It seems unlikely that they can staff such units with "aestheticians" the way that true beauty stores do (remember the quote from the CEO of Ulta, "we're not selling cosmetics, we're selling beauty").
But they can probably sell more cosmetics to more segments that aren't likely to shop at Ulta and Sephora (and Blue Mercury) but do shop at CVS. The "simple girl" indeed....
This ain't particularly a new thing. These ULI reports go back to the early 2000s:
- Ten Principles for Developing Successful Town Centers
- Ten Principles for Rethinking the Mall
- Ten Principles for Reinventing Suburban Business Districts
- Ten Principles for Reinventing America's Suburban Strips
Commercial district planning, be it malls or traditional commercial districts, need to look at having co-working spaces as part of a daypart focused mix plan for retail, entertainment, food, and other attractions. Some malls have the opportunity, because they have characteristics similar to those of traditional commercial districts. Others don't.
I think it's difficult politically for stores to segment the types of services they provide by income demographic. That being said, I was just at an Aldi in Laguna Hills in Southern California, and that store was "NICE." Much different than the stores catering to low income shoppers in Prince George's County MD and DC where I normally shop, and nicer than the "middle income" Aldi branch in Silver Spring, Maryland in high income Montgomery County.
At the Laguna Hills store and maybe the Silver Spring store, I can see BOPIS as an important add, excepting the points others have made about the loss of impulse buying.
I once met Herbert Haft, one of the leaders of the discount retail revolution, and he said that people with money are much more focused on saving than people without it.
Aldi as shown with the Laguna Hills store, has a lot of opportunity to reach higher income demographics, especially as they improve their own brand specialty products, which are now a lot better than they used to be. (E.g., after buying Aldi tortillas once, I said never again, but their current offering is quite good; tortilla chips comparable to Mission, etc.)
I thought that Lidl might have been the company to do this, that Aldi was painted too much by its hard discount reputation. But most higher income shoppers don't know Aldi's previous reputation, so it doesn't matter. And Lidl hasn't fully figured out its sweet spot in the US, especially in terms of store locations (me, I think the opportunity is in cities and conurbations, not so much traditional suburban locations). Aldi has lots of opportunity.
My first professional job was for a nutrition policy advocacy group. The information-driven are but a small segment of the food and health market. One of my responsibilities was managing a nutrition software analysis program. I had the idea to build it into a platform, but was ahead of my time (things like licensing cookbooks, etc.) and it was the wrong environment to expect my advocate bosses to understand and accept.
That being said, while I think this comment is insightful, like "Amazon Prime," this product could be developed into a broader health/food/nutrition platform as well, with broader connections into nutrition and health, links with RDs (Kroger isn't known for this, unlike Hy-Vee, ShopRite, Martin's, etc.), "nudge" type programs with regard to weight loss, etc.
For example, it could be linked to pharmacy and medication adherence, dealing with food-related chronic conditions like diabetes, etc.
It has the potential to be brilliant were it to move to that kind of environment. That being said, I think Kroger has lots of what I call "stranded best practice" that doesn't seem to be gathered up into structured best practice and incorporated across their banners. (With some exceptions, like the Marketplace format.)
FWIW, recently I tried Turkey Hill vanilla frozen yogurt and it's awesome.
I've only been to a Smith's Marketplace (and Fred Meyer), not any "marketplace" stores for other banners. Does a Ralph's Marketplace even exist? Anyway, a Kroger Marketplace is no different than a Fred Meyer, Meijer, Walmart Supercenter or Target. Since I believe mostly that the marketplace format is a way to discourage Walmart and Target from opening stores nearby, it would make sense that Kroger realizes that in the ever-competitive marketplace, they need to do more to make their marketplace format more distinctive and special and a destination.
Yes, I neglected to make this point. A few sites will be great places from which to do this, because they'll have the right demographics to support high volume use. Most sites won't. It's why I don't think the "Bodega" vending machine has a lot of legs ... cf. Juicero, the $700 machine that squeezed specially prepared juice packets.
Agreed. But this is more complicated than Dunkin' Donuts or 7-Eleven serving their stores from "depots" that produce baked items, or "fresh food" deliveries to a CVS by jobbers. Plus most of the machines aren't likely to generate huge volume, making the machines that much harder to service. I see it as an interesting idea and concept that gets a lot of play, but very hard to make work successfully in practice.
Probably a small segment of the TRU consumer base will shift to independent retailers, but not a significant number. TRU is about volume, discounting, the toy supermarket. People aren't going there for the quality of the experience, as they would to an independent toy retailer. Walmart and Target are best positioned to be able to step in, if they want to. Grocery stores, I can't see it at all, except for the companies like Kroger and HEB, which have formats that add GM goods to some of their stores (besides Fred Meyer, Kroger has the Marketplace format, and HEB has something similar). I suppose if Giant-Eagle can link up with ACE Hardware, someone could create a toy store equivalent.