Why Innovate?
In the past couple of years, we've all seen and heard much — perhaps too much — about the importance of innovation in store brand product development.
When it comes down to it, innovation is simply the introduction of something new, whether that be a new product, a new version of an existing product or a new way of doing things. When done purposely, it can help set a retailer apart from competitors and build shopper loyalty. But when done blindly, it can be as ineffective as employing a watering can to combat a five-alarm fire.
Those of us who were lucky enough to hear Douglas Merrill, former chief information officer for Google, speak during the PLMA's 2011 Private Label Trade Show last month got a much-needed refresher on innovation — and why companies should be engaging in it. Merrill challenged attendees not to innovate for innovation's sake — but to "innovate to win" instead.
To do so, innovators will need to examine how consumers behave instead of listening to what they say they want, he said. Why? Because consumers "can't envision what they haven't seen."
Store brand innovation is becoming an ever-more-critical weapon in the retailer vs. retailer battle for shoppers' dollars. And retailers that invest in consumer insights — to uncover actual consumer shopping behaviors — will be in a much better position to innovate to win than those that do not.
True innovation also will require companies to hire for diversity, Merrill noted, meaning retailers and suppliers must bring in people who do not think or behave like their current employees.
"Hire people who annoy you," Merrill told show attendees. "And then you have to let them talk."
The winners in the store brand innovation game, therefore, will be those companies that are in-tune with shoppers' behaviors and unafraid of fresh thinking that challenges the status quo. They will be the ones launching the brands and products that fly off the shelf, and giving shoppers a reason for returning to their stores again and again.
Post-show thoughts
This year's PLMA Show had much more to offer than Douglas Merrill, of course. Other featured speakers provided insights on topics ranging from how consumers make decisions to how to cater to the growing U.S. Hispanic population. And the show floor itself was packed with more than 2,000 exhibitors showing off the latest in products, packaging and services.
During the lull between the opening presentations and the PLMA Welcome Reception, we at Progressive Grocer's Store Brands even held our own special event: a well-attended retailer-supplier roundtable titled "The Innovation Disconnect." (Coverage of the roundtable begins on p. 6 of this issue.)
We also had a chance to honor our Supplier Pacesetter Award winners on the show floor and to pay homage to our retailer Store Brand Achievement Award winners during an evening cocktail reception. In fact, we created an online photo gallery of the award presentations. Check it out at http://tinyurl.com/7rvn8ks.