Ubiquitous Retail

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Ubiquitous Retail

By David Diamond - 09/01/2010

If being everywhere works for Verizon and Starbucks, why not for supermarket operators?

Having just arrived in the north woods of Wisconsin for my 24th annual get-together with college friends, I noticed that the baggage wizards at Delta had somehow managed to mangle my cell phone charger beyond recognition. This wasn’t a problem while I was at the cabin, but in a few days, I would be leaving directly on a three-day business trip for which being connected was essential. So I decided that on on my way back to the airport, I would stop in Minneapolis and buy a charger there.

As I was driving back to civilization, I made my way through a succession of small towns — generally a few stores, restaurants and c-stores serving the tourist trade. As I entered the third town, the quaint hamlet of Spooner, Wis., I spotted a big, clean Verizon store, so I stopped and bought my charger — two, in fact — one for the wall and one for the car. Delighted and surprised to have found this store in the middle of nowhere, I drove to the next town, where, oddly enough, there was another Verizon store, and in the next town another, and so on. By the time I got to the highway — still 80 miles north of the city — I had passed four Verizon stores.

The idea of retail ubiquity isn’t new. McDonald’s popularized the approach in the 1960s, The Gap tried it out in the 1970s and 1980s, and more recently, Starbucks and CVS have put stores seemingly on every corner. Their strategy is simple: they want to be there whenever you might have the slightest need for their products. But somehow, the Verizon approach seemed new. It’s understandable not to want to go more than three blocks for a cup of coffee, and to go back for a second or even a third cup daily. But how many cell phones and accessories does one person need? And are cell phone plans so profitable that it’s worthwhile building so many stores?

Verizon’s approach can only be described as ubiquity for its own sake. The underlying message of all of the company’s advertising is that its network is everywhere and works everywhere, so it’s actually using the presence of retail locations to underscore that idea. Apparently, it’s now quite easy to license the Verizon name to make an independent wireless store a Verizon “authorized dealer,” which is what I was actually encountering all over rural Wisconsin.

This strategy of retail ubiquity seems worth visiting for grocery retailers. After all, who should be ubiquitous if not the providers of basic sustenance in the form of food supplies? That being the case, shouldn’t you consider making your brand name visible all of the time?

That thought leads to a couple of ideas that could significantly drive business for grocers.

The first is simply that the wireless category is too big and profitable to be ignored. Smart food retailers can play in the wireless space in a variety of ways. Perhaps Verizon, AT&T, T-Mobile or Sprint would be interested in building mini-stores inside larger food stores. If not, perhaps there’s a limited product line of accessories and disposable phones you could carry without having to worry about signing up subscribers. If a category can support this many stores, food retailers need to participate in it, just as many grocers have rightly followed Starbucks’ lead by putting branded coffee bars in their stores.

The second is a more radical concept. Maybe a solid regional food chain such as Giant Eagle could make an agreement to become the “brand” of a leading convenience store chain in Pittsburgh. And while the grocer’s at it, it could remerchandise the center of the store in a way that would sell more groceries.

And it isn’t just convenience stores. Chains could approach small chains of local restaurants or delis and offer to co-brand, using the deli’s name inside their stores to add distinctiveness to the deli department while putting the supermarket name over the deli’s name to build brand image for the deli. Chains could talk to local drug chains about using the food chain’s expertise and brand name to help the drug store compete with CVS and Walgreens in the food category, while the grocer uses the drug chain’s name to help underline the strength of its pharmacy and HBC offerings.

In those ways, ubiquity might have some real applications in the grocery business.

David Diamond is an independent consultant to leading retailers, manufacturers and service providers in the grocery industry. In his over 25-year career, he has helped numerous small companies identify and execute the strategies that have allowed them to become large companies. He can be contacted at [email protected]