BRAND SECRETS AND STRATEGIES

PODCAST #61

Hello and thank you for joining us today. This is the Brand Secrets and Strategies Podcast #61

Welcome to the Brand Secrets and Strategies podcast where the focus is on empowering brands and raising the bar.

I’m your host Dan Lohman. This weekly show is dedicated to getting your brand on the shelf and keeping it there.

Get ready to learn actionable insights and strategic solutions to grow your brand and save you valuable time and money.

LETS ROLL UP OUR SLEEVES AND GET STARTED!

Dan: Welcome. On this podcast, we spend a lot of time talking about brands, brand strategy as well as how brands can leverage their unique mission to drive sales on retailer sales and to get their product in the hands of more shoppers. Today, we're going to talk about the one thing that all brands have in common, whether it's online or in a traditional brick and mortar store. The retailers when customers usually find products for the first time and it's how a brand makes its first impression and where it begins to build their loyal community. There are a lot of different retailers that brands can choose to launch their products in. None are perhaps more important than the independent natural retailer. This is because natural retailers are where brands typically get their start. It's the independent retailer that is responsible for launching many other brands that you know and like today.

It's the independent retailer that gave that brand a start that first gave it life. It's for this reason that I say that the natural independent retailers are the heart and soul of natural. Let's face it. It's a lot harder to get distribution at a large retailer where you have no track record, you have no proven success story. I'm not saying that it's impossible. Let's be honest though. It's a lot harder to build distribution in a large retailer unless you have a lot of money to buy the shop space. Brands know that the best opportunity that they have to grow sales is to start with where their customers are shopping, natural retailers and especially independent natural retailers are where customers go to learn about nutrients to find healthy, better for you products that they can't find in larger stores. The success of an independent retailer is tied directly to their relationship with the brands on their shelves.

On today's podcast, we talk about different ways that brands can help independent retailers succeed and grow. Remember, this podcast is about you and for you. The strategies, tips and tricks that we share are designed specifically to help you help the retailer grow sales by leveraging your brand, which of course in turn, helps you grow sales and helps you develop a loyal community. Stay tuned in the end for today's freebie. If you like this podcast, please subscribe, share with a friend and leave a review on iTunes. Now, let's roll up our sleeves and get started. Here's Corinne. Corinne, hi. Thank you for joining me today. Can you start by telling us a little bit about yourself and how did you get to where you're at today? How did you get into a position where you're leading a coop?

Corinne: Hi, Dan. Thank you for having me. How did I get to where I am today? Our journeys are always a very interesting pathway. I started my career in the organic and natural food space, I like to call it space now, back in the 80s as a general manager of a food cooperative here in Minnesota. I did that for 15 years, and then from there, I went on to help organize the Coop Grocers Associations at a regional level, and helped organize and facilitate the birth of the National Coop Grocers Association. In 2005, I had a group of independent retailers who asked me if I would help independent family owned businesses put together an organization that would allow them to leverage some of their purchasing power and have a new voice in the organic and natural food space, and I chose to give that a go and here I am. 12 years later, we opted to organize as a purchasing cooperative and it's a really exciting space to be in and I love working with the retailers that I worked with.

My journey was really a lot of tenacity and perseverance and a willingness to just learn wherever I could and take opportunities when they were presented to learn more and more about the entire supply chain and the world of cooperatives in doing projects both nationally and internationally, and just continuing to say yes.

Dan: Thank you for sharing that. Let's back up a little bit and pack some of that. What is a food cooperative?

Corinne: Well, a food cooperative, in depends on what you're talking about when you're talking food cooperative. In the sense of retail, a cooperative is community owned by the members of the community and they participate through their purchases and they're called consumer coops, and they operate on a set of principles that allows for the ownership of that store to belong to the community. Purchasing coop is a little bit different.

Dan: Okay. How is it different?

Corinne: There's many types of cooperatives. The purchasing cooperative often times is formed in order to be able to facilitate purchases, hold contracts at a national level and the members of a purchasing coop are usually other types of businesses. One is a consumer coop, which would be the food coops and the purchasing coop is generally organized by other businesses. Really good example that's similar to INFRA that people are aware of. It's the 95-year-old Ace Hardware coop.

Dan: Oh, okay.

Corinne: That's a purchasing coop. All of those store fronts that are Ace Hardwares are individually owned by people, generally families.

Dan: How do you differentiate yourself from other retailers at that point?

Corinne: Well, INFRA itself is not necessarily looking to differentiate itself from other retailers. We work with our retail members who are independently owned family businesses to help them differentiate themselves inside of the cooperative and inside of their community. Often times, you'll have a coop grocer and an independent grocer in the same trade area and there is a slight difference between those two businesses, but primarily I would say the biggest difference is the ownership structure, I would say, the value system is similar, I would say the proposition with their customer is similar, but the biggest difference is their ownership structure.

Dan: How do you mean ownership structure? How do you define that and what does it mean for anyone who doesn't understand?

Corinne: How do I define that? Well, an independent grocer is generally owned by one or two people. It's a sole proprietor. A cooperative is owned by the community and the consumers that join that cooperative.

Dan: At INFRA, are you one organization that owns a lot of different retailers or for anyone whose confused, are you a bunch of independents that work together as a single unit?

Corinne: Yep. INFRA doesn't own any stores. We have members and our members are all independently owned and operate a single unit and we aggregate our work at the national level and facilitate opportunities. I tended to describe it as if you think from a perspective that there are many things that many retailer needs to do, so we spend our time looking at where can our members align, so that they can spend more time on their meaningful differences? A really probably detailed example of that, Dan, is if you think about it, just about every retailer has brown paper bags. Let's use that as an example. Handled brown paper bags. You've got ... Well currently and perhaps, 240 members with 358 store fronts, and everyone of those store fronts needs that brown paper bags coming through their door, but the customer that they're serving doesn't necessarily spend a lot of time looking at the bottom of the bag to determine that they get that from Dura-Bag, that they get it from warehouse or where did they get that bag?

Where the bag comes from is not a meaningful difference for that independent retailer. If we basically go to the marketplace and put our proposals and ask for national contracts to support the use of those bags in an aggregated level, and all of our members agree to purchase from that one company and to the same distribution stores, then we can drive the cost out of those bags pretty significantly and it really doesn't have an impact on the customer.

Dan: That helps a lot. That makes good sense. I've worked with different coops in the past, so I have a little bit of an understanding and I appreciate you clarifying that because I don't think a lot of people really understand the benefit of those and what it means. Let me back up a little bit and a couple of other things you said. You work for an organic coop and then you were part of the birth of the National Coop Association. What is a National Coop Association, and what do they cover? What territory? What channels, etc., do they cover?

Corinne: Well, the NCG, the National Coop Grocers Association and INFRA are very similar. Our only difference is that the members of MCG are consumer cooperatives. The members of INFRA are independent family owned retailers. They both have membership structures. One that says cooperative retailers and one that says independent retailers.

Dan: As a retailer, what are the pluses and minuses? The reason I'm asking this question is to help unpack and understand why INFRA versus NCG or someone else?

Corinne: Well, that's a pretty easy one to answer. It has to do with the structure that the national purchasing coops have put around their membership requirements. In order for you to be a member of NCG, you have to be a consumer cooperative. In order for you to be a member of INFRA as a retailer, you need to be independently owned. Sole proprietorship, not a consumer cooperative. We actually define our membership criteria, Dan, in more what a independent retailer is not versus what it is because there are so many different types of ownership and structures out there. In order for retailer to be a member of INFRA, they cannot be publicly traded. They cannot be a more than 50% owned by a venture capital or private equity. The reason for that being that we want the decision makers at the table. When we're doing large contracts, we want to be able to ensure that we've got the decision makers at the table for those companies.

Dan: Makes sense.

Corinne: We can't be a consumer coop because we didn't want to be in competition with our sister organization NCG, and there's different areas of service between the two organizations, not necessarily in the operational services that they provide their retailers, but more in the focus and concentration of their work because there is some slight differences there. We also define that for INFRA, that your primary business has to be in the space of organic and natural food because we can't be all things to all retailers and it takes a lot just to align the similarities of the retail footprints that we serve.

Dan: Got you. I understand the buying portion of it. Can you give us some other examples of why this matters? The reason I really wanted to focus on this question next is because as an independent retailer, I understand that there are cost associated with everything. How do you help me as an independent retailer compete against the large chains and how do you help me differentiate myself against those chains?

Corinne: That's a really big question, how much time do I have today?

Dan: As long as you want. It's early. Well, until your family obligations kick in, let's put it that way.

Corinne: Well, I gave the example of the paper bag and our first year of that experience, we had retailers, but the cost difference in just that one item returned an ROI immediately. If you think about how many paper bags the store goes through, some of our larger retailers were finding that they were in the first year of that program saving over $80,000 on their bottom line.

Dan: Wow.

Corinne: That's not a small dollar amount.

Dan: No.

Corinne: How do we support and why would a independent retailer want to be part of INFRA is we've got the purchasing elements and over the years we've grown, we do much more than just the paper bags these days. We also have short term and long term EDLP programs, promotional programs, relationships with the vendor community and the manufacturer community because if you think about it, you can get a much more effective trade span if you're working with INFRA and that trade span then reaches out to all of those 300 some plus doors that I spoke to earlier. We also currently have, I would say motored into a space of being able to have primary supply agreements with both major distributors, both Kehi and UNFI and that allows us to basically aggregate that voice when there's a need and they can ask, so we don't have 240 individual retailers asking for the same thing, but just in a different way.

We help narrow the focus into what is the real need here for the independent. Let's take that either to our distributor, supply chain partners and let's have the conversation at a level that maybe we're able to affect change or influence change in that way. That's a big part of the purchasing and we have operational supplies. We have fresh promotional program. We go as deep as doing just ancillary business services as well. What I mean by ancillary business services is a cost saving program for anything from merchant card services to payroll services.

Dan: Oh, okay.

Corinne: Then, some. We have three core tenants in our organization. It's purchasing, operations and marketing. I would say that most retailers join INFRA to gain the price advantage because that's the easier thing to grasp, and understand, but I would say that once a retailer is part of the community that is INFRA, they say the biggest benefit they get out of the organization is being part of that community, what they're learning, the best practice sharing, the improvements of their operations, their ability to have access to financial benchmarking that they haven't had access to before, and if you think about it, large chains can be very effective because they can see the trends much more rapidly than an individual store could see and so by doing our financial benchmarking program, it allows them to see trends much more rapidly and it also positions them to be able to have a different conversation when they're getting ready to look for either investment or looking to both at the bank to expand or add more locations.

Dan: That helps a lot.

Corinne: Yep. Then, I would say the last biggest tenant that we have that we found to be really beneficial ... Or not the last. We have a lot is we have a online training platform for the staff members at our retail locations, and in that online training program, we have everything from Natural Foods 101. When you hire employees, they can take the training and they'll know what is before they have to go on the floor and talk to the customer all the way up to operational support and understanding. I would say a good example is retail map. It's been an amazing thing when you start to train your employees on what it means when that dollar sale happens at the register, what are all the components of that dollar and what are the impacts to the retailer of that sale?

We spend a lot of time with our members too in best practices around how to be better sellers, because if you think about most of the independent retailers, they came into the business because of their passion to the food system.

Dan: Right.

Corinne: Not necessarily because they had a lot of business acumen. Now with all the competition in the marketplace, the requirement of business acumen has really increased and our members are just doing an amazing job with everything from open book management, so that their team members understand the finances around the store to the importance and the value of their customer service and interfacing. Our goal is to help our members do things at the back of the house, so that they can spend a lot more time at the front of the house and looking at more how do they sell versus how do they buy. So much of their time today has been on how do we buy iN order to actually achieve their multiple bottom lines.

Dan: That helps a lot. Thank you. I really appreciate you sharing that. I used to be a retailer, so I have some understanding of what that looks like. It's a tough job, and it's really hard when you've got to order everything years ago, when you have to order everything by hand, you've got to stay in top of your numbers. Fortunately, I worked for a retailer that have the capability of understanding their numbers, but I had to do all the heavy lifting, all the hard work. I had actually called people up and order things and so I get it completely and that helps. As a retailer, as one of your members focusing on front of the store, one of the things I think that makes natural, natural that I think a lot of people overlook and the words that a lot of people have around what is the fate of the independent retailer? I believe that they can be strong and succeed as long as they're more strategic. To your point, natural does natural better than any other channel.

As long as a natural retailer can focus on understanding the products and understanding how they work and how they benefit people, etc., that's going to really differentiate yourself. How do you help those retailers understand the products? Do you have a program that's part of your teaching where you can go in and say, "This is ashwagandha," versus, "This is turmeric," versus whatever else?

Corinne: Actually, yes, we do. We have a component of our academy and retail training that is centered on product education and knowledge based.

Dan: Good.

Corinne: We do that in partnership with our vendor partners. We actually will work with the vendor partner and ask them to build the training in the format that will fit into our current online platform. It's a beautiful relationship. It works really well, and then our members can choose to use that training with their staff overall. We spend a fair amount of time in ... Well, let me back up here a little bit. One of the other ways that I think that our retailers really do a good job in product knowledge is sharing with each other. We have forums and Listserv and all kinds of different ways that our members can communicate with each other, and just creating that space and creating that platform to allow retailers to come to a group of their peers and get further more in depth information, the brain trust is huge. It's amazing.

I have so much admiration for our retailers because you're right, retailing has gotten so complex. When you think about what a retailer has to nail in order to be successful from everything from understanding what they need in the world of technology today all the way down to the product, and their consumer and their marketplace, I watched these conversations and I go, "Wow. I don't know if I could go back to retailing as much as I love it." I'm a retailer at heart, so like, "Wow." There's such a breath of knowledge.

Dan: I loved it. When I was doing it, I thought it was great, but oh, the hours that I put in. I only work six days a week, so just kidding. It was tough.

Corinne: Yeah, it is tough. No. I was going to say that one part of your question I didn't answer was the other part about products that INFRA does, listening to our members. We take on certain advocacy roles as well and we help educate around GMOs and we help educate around the next gene editing activities and full disclosure, I'm also the board chair of the non-GMO project. We can get that information to the members quickly, and then they can get it to their customers more quickly. Keep some out there in the forefront as the knowledgeable retailers in their communities.

Dan: Well, that's really what makes things difficult for retailers especially for retailers. I was talking to Phil Lempert, the Supermarket Guru. We're talking exactly about this about how retailers and brands need to not allow themselves to become blinded, and what I mean by this is if you think of blinders are on a horse, not become blind to what's going on around you. The only way to really do that to your point is by being involved in masterminds, by reading, by looking to sources, trusted sources that can tell you, "Here what the trends are in different places." That was a great podcast, so listen to that because we specifically talk about the future of natural retailing and the future of independence and why they're important, and natural organic brands.

Going back to what you were saying about the coop, I love the idea that the way you're bringing people together to have what I would call a mastermind type group where you're taking the collective resources, the collective brand trust as you said for the entire organization and putting it to work. As a member of INFRA, how would that look? How would that work? Is it a weekly call? A monthly call? Do I just call when I need to? In other words, is there an organized structure where I would, say, once a month, get on a phone with a group of other retailers and learn a tip or a trick or have a discussion around something?

Corinne: I'm chuckling under my breath, Dan, because everybody communicates in a different kind of way.

Dan: Right.

Corinne: We have both formal opportunities and informal opportunities. We facilitate, believe it or not, an old fashion Listserv which the members love, and so that's 24/7. Anybody can get on and ask a question at anytime electronically, goes into all of the retailers' boxes. That's accessed all the time. INFRA facilitates education trainings in department specific areas. We do marketing podcast, or not podcast, excuse me. I got podcast on the brain today. Can you believe that?

Dan: No.

Corinne: Marketing share series. They have HR share series. We do what we call intensive where we, at a regional level, we'll have a two-and-a-half-day event. Our most recent intensive focused on promotions and merchandising and we'll have between 40 and 65 retail merchandisers in the room and we spend two days on training and sharing, and doing peer reviews at our stores. We have an annual conference. We have lots of ways for our members to engage and interact with each other.

Dan: Where are your members? I should have asked this earlier. Where are your members located? Are they all in Minnesota? I know they're not, but it's for the audience, where do your stores ... Where are they located at?

Corinne: We just actually approved our first Minnesota members, so there's not very many members in Minnesota. Our heaviest concentration of membership is in the northeast. Well, we have members all over the country, currently we're in 38 states including Alaska and Hawaii. Where we have the least amount of members are in areas where I would say there is still like not as many urban areas, North Dakota, South Dakota and Nebraska, areas where I think there's still opportunity for the growth of natural foods as those communities grow and change as well.

Dan: Right.

Corinne: Yep. We have California to Maine and everything in between with the exception of few of those states today that I mentioned.

Dan: Good. How would you define a chain store versus an independent versus a natural organic retailer?

Corinne: How would I define a chain store?

Dan: Yeah. What would you say would be the differences? If a consumer walks in the store, what would they say from a consumer/shopper perspective?

Corinne: I think sometimes that that's hard to differentiate, right? As more supernaturals come into the space, supernatural chains from Lucky's, Sprouts, Earth Fare, Fresh Thyme, I think the biggest differentiation has been when the independent retailer has really done a good job of telling their story and saying, "This is who we are. We're owned by the Brett family from Kimberton Whole Foods, or we're owned by the Kantar family. The Kantar family has been here for 40 years. We're part of the brick of the community.

As far as the differentiation, I think in store once a customer comes through, that story is being told pretty well in most of our retailers and it's there and it's visible. I would say that the level of expertise and knowledge in the product is so much higher in our independent retail stores. Then lastly, because I think many of your listeners are also interested in understanding the brand proposition in an independent retail store, we have a lot more, I would say fluidity and flexibility. We're able to actually merchandise to the community and to what that community population is looking for from their organic and natural food retailer.

Dan: Good point. You brought me up to another good question. In terms of merchandising, how do you determine or how do you know that the assortment for the store in Colorado or California is correct in terms of what the community wants to buy? How do you help the members understand that?

Corinne: Well, we do it just about like same way as most retailers. We help them understand that through having regular ... We do four-category reviews monthly, and we do that through a webinar opportunity as well as create what we call a workbook. We provide planograms and we do it a national level, but then we provide the individual retailers with how that would look differently in their particular region or their state. We do that obviously through using the various tools that are out there from insights data to spends data, to what we're seeing over the activity of the retailers of INFRA as a whole. Then, we spend a lot of time educating that this is your base. This is your foundation for these planograms. This is your foundation for this category review.

These as a top sellers in your region or in your area, and if you don't have them, you may want to bring them in. However, our recommendation is merchandise your story. If I'm an independent retailer and the most important thing to me is to ensure that I have non-GMO verified products on my shelf, then that's what should be at the eye level. If that's your story, tell it at shelf. If what's really important to tell your story is local product, if you happened to be a fortunate retailer who has lots of access to local product to be able to put that at the place on your shelf that really tells that story.

Dan: That makes so much sense. By the way, I appreciate the fact that you shared one of your workbooks with me, and gave me a chance to take a look at it. You said four category reviews a month. Do you go through every single category in the store? Then, I didn't get a chance to see what the local component of what that would look like. How would that look in addition to the national picture?

Corinne: No, we do not do every single category every single year. We have a calendar just like everybody else. When I say that we do two, four a month, we rotate through so that our retailers have more than one timeframe that they can participate because not everybody is available at the same time. How that looks as a local component is that we, in essence, have found with the number of retailers that we have and this is what makes a cooperative work, and that there's a responsibility of the retailer as well. We don't just deliver when we deliver at the national regional level. Then, we offer the support at the individual store level. We make an expectation of our retailers that they attend the more general category review, but then if they want the specific work for their individual store, they have to ask for it. We're not just going to deliver because we want to know they're going to also execute on our time.

Dan: Well, that's a good question. Execution, how does that work? They have to hold themselves accountable, I would imagine, not you holding them accountable. Correct?

Corinne: Exactly. Exactly. That's the beauty of INFRA and why it's working even though there's been many attempts for independence to organize in the past is we've created a structure of accountability and its self accountability. Really, the retailer's all going to get as much out of the organization and as much ROI as they put into it.

Dan: I love that.

Corinne: It's not about delivering. How does that work with execution is it's actually really a beautiful thing because I mentioned earlier that the retailers have easy access to each other. We have, I would say, some very advanced and strategic retailers who are willing to just take the risk and put their energy into some of the INFRA opportunities at a very high level and they'll execute on this category we've used. They might not do it in the same month that they heard it, that they plan for it, and they say, "Okay. We're going to do this one in six weeks. We're going to use the information." They do that category review and then they share with their peers. We did the category review. We did the one that ... We did X category. We reset. It took us this long to do it, and we've seen a 40% to 50% list in this category.

Dan: Right.

Corinne: We highly recommend that you do it.

Dan: Well, that's fantastic. I think that's actually one of the ... From what you're sharing with me, I think that's perhaps one of the biggest benefits that you offer is the forum, the ability to communicate with others, so that you're not working in a bubble because back when I was a retailer, I was working in a bubble. I didn't have other stores to bounce ideas off. I had to pay attention to the market, pay attention to the technology, pay attention to the products. Now full disclosure, I was a grocery manager for Price Club before it became Costco. We're talking about high volume, fast moving items, but I had to know every single skew within under that tent including C-Store, tobacco, the daily, the butcher, etc. Point being is there's still an off a lot to know.

If you think about running any stores, I have tremendous empathy. To be able to have a group of peers or somewhat help support you even if it's online, I think that's just critically important. Thank you for sharing that. What other things do you want to share around what's unique and different about a coop versus say, a Kroger or Safeway, some of these other chains that are out there?

Corinne: I would say that one of the things that's unique, I think is the ability for each of the retailers to be innovative, and bring that innovation to the table for the other retailers to noodle on, if that's something that they want to adapt. Some of the marketing strategies that our stores have used and where someone said, "Hey, I started doing this pajama party." This Debra Stark of Debra's natural foods up in Cambridge or in Massachusetts, right? Concord. Excuse me. I said Cambridge, Concord, Massachusetts and she have this brilliant idea where she invited all of her customers to shop at the store at 6:30 in the morning in their pajamas, and if you showed up in your pajamas, you got a certain discount.

Dan: Cool.

Corinne: She's been doing it for years and it's been really successful and the customers love it because it's building community amongst the customers, and she shared that out with the members and there was half a dozen to a dozen members that adapted that strategy and saw great successes. That's just on the mark one small example of the many marketing ideas that come through. If you look at it from a brand perspective as well is we started launching innovative brands and new brands and we can do it in a way that really allows a brand to look at the marketplaces that they're in without having to scale up right away. Where is this product going to be ready for sale?

If it's unique and different than what you've seen in the past? Our retailers can really spend the time and they can do more of this too. We like to see and do more of it, but really spend the time with the customer to be able to say, "This olive that I have on my shelf is naturally probiotic. It uses 1,000-year old Greek methodology for fermentation. It's different than all the other olives on the market because of X. You can only find it in this area." They can really spend that time and they can help a brand determine whether or not it's going to be successful in the marketplace.

Dan: Did the brands connect with the headquarters or did the brands go to the individual stores?

Corinne: Both. Things bubble up from the individual stores and things get introduced from the national from INFRA. We have brands that will come to us. We'll test it within our stores and say, "Hey, we have this opportunity. What's your interest level? Do you think this is a good fill of gap that you need on your shelf? Should we pursue this?" We have buyer's councils in each of our regions and so we actually have the store buyers participate and engage in that process.

Dan: Got you. You know that when we talked last time, my focus is on changing the way brands go to retail. I've got about 300 articles printed globally around the subject in Natural Foods Merchandiser, WholeFoods Magazine, etc. In addition to this podcast and my free Turnkey Sales Story Strategies course. The point being is I'm trying to teach the brands how to help the retailers drive sales in their category. What would you ask of the brands? What would you want to hear from the brands in terms of how do you help? How does the brand help the retailer?

Corinne: I think there's two major components there on how the brand can help the retailer. One is make sure that the brand has the story, so that the retailer can tell the story and they have it in a way that can be either expanded on or can catch the customers' attention in a few short words. More education around why that retailers should put that brand on the shelf in the first place? What are the benefits? What are the health benefits, or if the story is in regards to just the environment or equal footprint that that brand is permitted to, if it's about the quality of the product. There are so many different things that our brands are involved in today, which is great for our retailers. If they can connect those things, it's excellent. Then, the other piece is really, I would say giving demo support wherever possible because the customers are going to want to try it. Right? The more generous you are with your demo support and your promotional support to bring that into a marketplace, the better.

Dan: Very helpful. Thank you. I love the fact that you touched on the brand story. I think I told you that I just released a free course, Turnkey Sales Story Strategies. It is designed to teach brands how to learn, how to become an expert in their story, how to become an expert in their competition, and how to become an expert in the retailer. Then, when you take all of that and you distill that down so that when you're talking to the retailer, you can provide that information. Here's what's unique and different about us. Here's how our consumer buys the product. When they buy our product, here's what else they buy. Here's what's unique about our product within your neighborhood, your niche, your market because retailers need insights, fact-based insights, actionable insights and the whole idea about that, if the brand can partner with the retailer and help the retailer understand why they need that product, to me, that's a win-win.

To back up a little bit, we talked about the forum that you have for different resources, which I think is a phenomenal idea. Well, this is adding rocket field to that. This is bringing the brand into the conversation and allowing the brand to help the retailer grow sales. Face it, the brands are seeing things in other markets that the retailers don't have access to, insights they don't have access to. By developing a collaborative relationship, the insights that the brands that we're sharing are effectively pouring rocket field on our independent retailer sales. The course where I talk a lot about brands, it's also designed for retailers, especially independent retailers because I want retailers to start asking more of the brands and what I'm getting at is instead of having someone say, "Look, I've got a great box for its slogan, etc." Here's why that product's unique. Here's why that product is different. Here's how that products wouldn't help drive traffic in your store.

If their retailer can ask more of the brand, the brand can provide more to the retailer, then that's how this industry is going to continue to thrive and survive. I've had a lot of conversations with a lot of different people about that Jon Sebastiani with Sonoma brands about telling the story. Mathis Martinez who used to be with Kroger talking about the importance of understanding your story and taking that to shelf. Ben Friedland, Lucky's Market talking about how they partner with brands. My point is this, when a brand and a retailer work together, you've got retailers working together as a coop, that's beautiful, but if a brand can get involved in that and start interacting and supporting those retailers at a much higher level, that's how this industry is going to continue to thrive and grow against no matter what the competition is. Your thoughts?

Corinne: My thoughts are there's a lot of truth in that. I would say the additional piece that needs to be added to that dialogue, Dan, is what also provides the differentiation around the brand and why should that retailer be passionate about the brand? It's not just about driving the footprint, right? Driving customers into the store. It's also about how does this brand proposition fit my values as a retailer. How does it help me tell my story?

Dan: Well said.

Corinne: Because I'm setting my shelves in a way that I'm trying to bring to this community the highest quality food, and the highest quality food also includes organic. It includes non-GMO, verified. It includes the packaging. It includes the eco footprint. It includes the impact on the climate. All of those things are really important. How is that brand, like you say, different in the marketplace? What's their commitment to remain different? What is their commitment to remain with those values? Many of these retailers have been around for 40 plus years and they came into this with a commitment to the food system. What's the brand's commitment to the food system?

Dan: Well, that's at the core of what I'm talking about. The reason that's important, and I agree with you 100% is that consumers buy differently today than they used to. Consumers looked on the four corners of the package, they want to buy the brand's story. They want to buy, to your point, are they eco-friendly? Are they invested and sustainable packaging? Do they give back? What is their mission? If the brand understands everything about them and they know how to market. Market, I don't mean market in a sleazy bad way. I'm talking about marketing in terms of being able to connect their message or align their message with their core consumer, and then help their retailer understand what's unique about that brand because they do.

For example, Numi Tea giving back, part of the Climate Collaborative, Lotus Foods, etc. Taking that message and exactly I agree with you 100%. Instead of saying, for example, "Lotus Foods, I'm a nice company, buy my rice." It's, "I'm a rice company. We’re giving back. It's one crop per drop." I recently interviewed Caryl Levine about what they're doing and Sheryl O'Loughlin with REBBL Foods, and my point is that when a brand can capitalize on those strategies to help align with the retailer, and if the retailer's able to celebrate what's in the package because the bottom line is consumer's going to forget about their purchase, and while not every consumer can go work in a food bank, say Soulfull Project, if they support Soulfull Project Foods, then they can help support that mission.

If a retailer is focused in giving back to the community and focused on the brand bank, I mean the food bank for example, then that's a perfect alignment. It's taking that story and it's leveraging that story to help the retailer drive sales to grow, to be successful.

Corinne: Exactly. I love the fact that you've just mentioned a bunch of my favorite brands and frankly brand owners and the work that they're doing is ... The work that we're all doing together, it's a whole supply chain from the producer all the way to the consumer that's really going to make a difference. I love the fact that you mentioned from a climate collaborative. INFRA is a founding member of that as well. It all makes a lot of sense, and especially when we look at the fact that the customer ... I'm trying to figure out. I hope at one of your podcast, you can come up with some new verbiage instead of consumer because consuming ... It's not about consuming in the same way we think about consumption or did in our capital society. I think now, consuming is so much more conscientious. Right?

Dan: Right.

Corinne: Because everybody, I think is starting to feel the pressure, we've got to make good choices. I can't say everybody right now in our current environment, but I think that you're exactly right. The other piece that I think is really important to our retailers in understanding that whole supply chain, which INFRA has been able to help increase their understanding and education from producer to consumer is the fact that that's only going to continue to build. Technology only is going to continue to allow the customer to know and understand more about their choices. We go as deep as looking at brands and who has map policies and how is that brand looking at the omnichannel, and how is it going to continue to support the independent retailer? Where do we want to help build up? Not every single producer wants to scale up.

I had the great privilege of being able to speak with a group of New Zealand producers at Expo West. Thanks to some work by Gary Hirshberg and Walter Robb. These producers definitely are interested in coming to the US market, and yet they also want to continue to control and have sustainable production. Sometimes when you scale up too far too fast, it's difficult to maintain that sustainable production. I love the way people are thinking today.

Dan: Well, that's why this podcast exist. To your point, it's about celebrating the brands that are staying within their lens, that are staying true to their message and I had a really good conversation with ... Actually, several good conversations recently with people like Steve Hughes of talking about how the companies that take the VC money, and they've got to scale up and not that that's good or bad or the big brand money, and some companies eventually lose sight of what their mission is. These companies that are staying true to their core values, these are the companies I want to celebrate. These are the companies I have on, and I've actually had a long conversation about this with Gary Hirshberg as well. The point being is that what makes natural, natural, as long as the companies and the retailers and the brands stay focused on their core mission and don't lose sight of their values, that's again what differentiates us. That's what makes natural, natural.

To your question, to your point about consumer versus shopper, it's confusing. Generically speaking, the consumer is anyone who's in the market. In other words, a consumer would be anyone who walks in the store but a shopper is someone who buys in a specific category. For example, a new parent would be a shopper for baby wipes and diapers. Now, the reason that this matters is because it allows companies to segment around customer need-state. A customer needs date is what is their purpose or their intent of that shopping trip? For example, a customer with a flu would have a need-state for cold and flu and the reason that this matters is because if a retailer can group items in need-states in terms of things that are similar or complimentary, then they can make the shopping experience easier for the consumer.

Now, when you couple this with the right product assortment, this is how you build shopper loyalty and this is how you keep customers coming back in your store and this is how you differentiate yourself from your competition. I discuss this more in the course and on other episodes of the podcast. I talked about the ripple in the pond and the natural, the core natural shopper. The shopper we're talking about is that small ripple. We're paying attention to that small ripple before it becomes a tidal wave and ends up on a big-box store, and as long as we're focused on the authenticity, the transparency, the value proposition, the mission focus whether it be grass-fed or giving back to a third world country or supporting a food bank, that's how we differentiate ourselves.

What are the thoughts do you have or comments or questions do you have around some of the stuff that I do and how can I help support your retailers and their brand partners through the content I put out including this podcast?

Corinne: That's a really good question, Dan. We are very, very blessed here at INFRA because we have tremendous industry support. We work with all of the major brands and vendors. I think that what can help is more telling of our story, who INFRA is and why INFRA is a value both to the retailer and the supply chain is always really beneficial. We love getting introductions to new innovative ideas before they hit the marketplace. I love working my network for that opportunity as well, and continuing to embrace the education and helping us educate our retailers are some of the most important and valuable things that the supply chain can give us.

I wanted to comment really quickly on your statement and that said, all of these wonderful things can take place that really define rightful living, but at the end of the day, an independent retailer still has to be very savvy about how they do business and they need to be mindful of the fact that things are changing really rapidly and really significantly in the marketplace and we need to rethink our business models and we need to be thinking about less about margin and more about our growth profit dollars. We're not going to be able to compete with really big-box stores and Costco's of the world on price, but yet we can be very strategic with it. If we change how we think, we can be really strategic with it and that's my hope that we'll start thinking in that way. I think that the independent retailers right now have amazing opportunities, just amazing opportunities.

As much as the Amazon, Whole Foods, merger acquisitions out kind of scary, I think it's actually opened up the door for even more innovation and even more quick to market opportunity with the independents.

Dan: Absolutely. Well, I'm glad you said that. Thank you for sharing all of that. The reason the podcast exists, the reason I produce the content that I write, I've been doing this for several years, like I said, 300 plus articles is for this exact purpose to help educate retailers and brands on all these important topics. To your point, I agree with you 100%. I'm trying to change the way people think about growing a category from being based on penny profit and item margin to overall basket. What's in the shopper's market basket when they checkout of the store? Because at the end of the day, that's what is going to differentiate the different brands, the different retailers. That's how you drive sales and so instead of having a blanket statement that says, "I need to make 10% or 20% or whatever on every item across the board," sometimes you give a little one place and you make up a little more in another place.

I think I shared with you, I worked for SPINS for several years and the distribution tracker was my idea, and I'm the one who got them to start selling retailers store level data. The idea behind that was that I was trying to help them focus on or understand the importance of being able to give a brand and a retailer line of sight to their shelf. As a part of that, it's not just focusing on one brand. It's not focusing on what drive sales in the category, but it's focusing on what's moving those trends and then figuring out a way to creatively merchandise one product with another product to boost sales, to boost foot traffic but all the while, focusing on the overall market basket ring because loyalty ... I believe loyalty is something that is ... A lot of companies have loyalty cards. I've got one for every retailer in my neighborhood. I've got one for every airline.

Loyalty cards are misnomer. I think they are more of a coupon in the eyes of most consumers. Loyalty is what you have when you have a relationship with that shopper and the way you get that relationship with that shopper is by giving them what they want by partnering with that shopper to develop as you said, a community, to have that relationship with your core shopper. That's how you develop loyalty. The next step is how do you figure out what should a product mix look like? What should the assortment look like to help support the needs and the wants of that shopper? I agree with you 100%. Again, that's why we're talking today. I really appreciate your time, and I'd love to get more in depth with you and talking about some of these other strategies.

I know we're bumping up against the hour. One of the things that I would encourage your members, all the different retailers to do is go out there and consume some of this information. Listen to some of the thought leaders in the industry, the John Foraker's, the Seth Goldman's, etc., and listen to their stories and listen about their message and use that, leverage that to help them tell that creative story about that brand to their shoppers. In terms of the education piece, again that's why we're doing this. I really appreciate your time. What other thoughts do you have or recommendations or anything else that you want to share or comments that you want to make about things you'd like to see not only industry for me, from others, from brands, how would you like to close this?

Corinne: I think the thoughts that I would like to share in closing is that the brands should continue to show up at the table for these very important social issues that we're working on.

Dan: Yes.

Corinne: The more brands that are educated in the space of what's happening with genetic engineering, what that looked like, the better because I think that what's going to continue to differentiate our retailers and what's building that loyalty that's been there is the fact that the customer trust that store when they walk through the door, and they know that product has been thoroughly vetted for them. It's getting harder and harder out there as these new technologies come to the marketplace, so a brand commitment to ensure that what's in the product is truly that value proposition that they started with because it's really tempting to buy something from of a Petri dish. It's a lot cheaper than trying to get the real thing from Madagascar. I think that they need to stay educated and they need to continue to support that work that helps us understand it, whether it be friends of the earth or the ETC group or the non-GMO project or fair trade or all of those different spaces that it's possible to contribute.

I think the last that I would like to share with the group is that we're very fortunate. The retailers who are a part of INFRA are illustrating some great growth given today's marketplace, still a lot of challenges, but great growth and I'd like to turn the thinking around that I think that the consumers introduced to the product in the big-box stores and then they start looking for the more intimate experience that they can have as a customer in our independent retail stores.

Dan: Interesting thought. Yeah. I think a lot of people are introduced to the product in the natural store and then go looking for at the big-box store and I agree that that is a huge problem. We don't want to lose these customers in, and I think back to what we started this conversation with, if the retailer has a solid stone story and is able to merchandise as you said, which I love around that story, that's how you keep that customer coming back to your store, to the independent store instead of not inviting them to go to the big box store. I think that that should be a core mission of all these different retailers. How do you differentiate yourself and not be a carbon copy of the next guy. That goes back to that loyalty we're talking about.

I really appreciate you're sharing your time with us and your expertise and your thought leadership, and you'll love the fact that I'm really doing my best to help support the Climate Collaborative OSC². In fact, I've been swapping a lot of notes with Ahmed Rahim about how to get more involved and how to better communicate his message through the different brands that support a part of those organizations, those important organizations. Stay tuned and look for more podcast not only about those organizations, but about the missions that those brands take on, those missions that those brands champion because at the end of the day, that's all part of the story that the retailers can leverage to help build loyalty in their community and connect with their community. Thank you for your time.

Corinne: That's right.

Dan: Yeah. Thanks. I really appreciate your time and thanks for joining me today.

Corinne: Thank you, Dan. Have a good rest of the day.

Dan: Thanks. I want to thank Corinne for coming on today and for sharing her wisdom, and for sharing her insights about the importance of the natural retailer. I'll put a link to the climate collaborative and the INFRA in today's show notes and on this podcast webpage. You can get the transcript by going to brandsecretsandstrategies.com/session61. Today's freebie is a merchandising checklist. It's designed to help brands help retailers better merchandise their categories to grow sales, profits and more importantly, shopper foot traffic. Remember, an effective merchandising strategy is a key to developing the loyal consumer-based. Your merchandising strategy communicates your commitment to help the consumer get what they need, what they want as well as your commitment to the community that you serve.

You can get it instantly by texting “merchandisingchecklist” to 44222 or by getting it on this week's show notes and on this podcast webpage. Thank you for listening and I look forward to seeing you in the next show.

INFRA http://www.naturalfoodretailers.net

Climate Collaborative https://www.climatecollaborative.com

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