BrainTrust Query: Can other retailers find inspiration in Whole Foods’ new spa concept?
By Laura Davis-Taylor, Founder and Principal, Retail Media Consulting
This week, Whole Foods announced that their new 52,000-sq. ft. store in Dallas will include a spa concept called ReFresh. Designed to be an everyday spa, customers will be able
to take an elevator to the second floor of the store for a 10-minute chair massage or a full day of spa services. It also boasts a private patio serving spa cuisine, wellness
classrooms, organic clothing and home spa services. Even more impressive, a concierge will be available to take grocery orders, which will be ready and waiting when spa service
is complete.
The chain has no immediate plans to open more spas, but it’s likely this location is serving as a test site for rollout elsewhere.
Whole Foods is one in a long tradition of innovative retailers going “beyond the basics” with their retail brands. Cooking classes, DIY clinics, wellness centers, vet and grooming
services, in-home customer service, social events… are all part of a slowly building movement that pushes the boundaries of retail storefronts to attract and retain today’s
shopper.
To be successful in these ventures, retailers must focus efforts on understanding the wants and needs of those shoppers and find methods to delight them — challenging, considering
the myriad of issues many retailers face with customer service, margin erosion and, in some cases, a stubborn attitude towards change. However, as goods become more of a commodity,
these efforts could very well prove to be defining differentiators to the success of key retail brands.
Discussion Questions: In today’s highly competitive retail landscape, how critical is innovation in the retail brand experience? How do we motivate retailers
stuck in old school retail thinking to embrace consumer-focused store innovation?
From the trenches, I find that some retailers are very much on board with innovation and others are woefully stuck in the past. I’m less interested in whether
Whole Foods’ spa concept, specifically, is good or bad… but how we can find inspiration from their gutsy approach.
This is a fascinating – and compelling – retail test for Whole Foods. Having secured a place in the hearts of their shoppers, they are plucking at those
brand heartstrings to secure a deeper place in their lives. They know that their core shoppers have some commonalities that make them brand loyal: social responsibility, business
ethics, health and wellness, superior service expectations and an appetite for education. Having “proven” that the brand lives what it stands for, they are now searching for the
evolutionary path for their store experience.
Whole Foods is also testing innovations with the right approach in mind. Using the hospitality industry as the model, they’re focusing on concierge quality
experiences. What if every store experience we had felt like being in a top-notch restaurant or hotel? (Danny Meyer, author of Setting the Table, has many insights to share
on this topic.)
Final point – this is a test concept. They are not spending millions of dollars to roll something out nationwide. They are doing what Best Buy and a handful
of others have done well for years: testing new concepts on a small scale, determining what works well (and what does not) and then rolling out the best ideas to the nationwide
footprint. This is responsible innovation – likely coming from the top down – and I applaud them for their appetite to evolve. If only more retailers followed suit.
Innovation is something very few retailers cherish. Let’s face it: most stores are me-too copies of each other. It takes an outsider to disrupt the me-too lockstep march to mediocrity. eBay is innovative. Amazon is innovative. Whole Foods is willing to try something new. To most retailers, “what’s new” is really “here’s what we copied from someone else who’s very similar to us already”. How many retailers reward their people for suggestions? How many retailers know how to test new concepts and measure the results? How many retailers announce the percentage of profit and sales that come from new ventures?
Here’s an example from a manufacturer famous for its emphasis on new products and encouragement of employee innovation: 3M Dental Products. They won a Malcolm Baldrige Quality Award because 45% of their sales came from products invented in the past 5 years. 75% of their employees say the company gives them the opportunity to improve their skills. They encourage people to spend 15% of their time on self-directed research. What retailer could claim one-tenth of those statistics?
Innovation is critical, imitation often fatal.
I personally believe that exciting times lay ahead for customers in the ever changing innovative retail landscapes. It’s clear that all retailers are striving to find that point of difference to influence customers to come and spend their dollar with them.
The question is, how far can this innovation go? The thought of going to conduct your weekly shop and having a massage at the same time a few years ago would have been considered crazy. What next? Areas of space set in store for exercise? Perhaps a 3 mile run on the treadmill whilst using the electronic display to create your shopping list?
There is a fine balance between providing cutting edge innovation to create a highly satisfying shopping experience and forgetting retail basics, like high availability, tailored product offerings and affordable prices. Customers know that innovation costs money, and that money has to be regained somewhere for the retailer to remain profitable.
I’m off to pick up my groceries and maybe get a hair cut while I’m there!
Retailers are always on the lookout for new ways to differentiate themselves. Other retailers will a) probably keep a watchful eye on whether or not this works well and b) may be invigorated to try other new, different and innovative approaches. Whole Foods should be applauded for trying something new and different.
They are making an offering that is consistent with the lifestyle they reflect and the customer they appeal to. The Whole Foods I visited in Chicago had organic clothing for sale, sandals and retail spa products. It is not as much of a “stretch” as it first sounds. If you can get oil changes, a Big Mac, haircuts and your nails done at a Wal-Mart, why not a massage at Whole Foods? You can call your order in to Sam’s and pick it up curbside. Why not concierge service at Whole foods?
They would also be providing services consistent with their customer’s price and quality expectation, an area where retailers sometimes fall down as they try to layer on new services and new price points, a point discussed in the recent Wal-Mart upgrade conversations.
Whole Foods knows their customer and is always testing new concepts. This spa/wellness program seems to fit with their affluent, well educated shopper who likes new experiences and can save on time by getting groceries picked while they take on a self-indulgent afternoon.
As a smaller scale modification of this idea, I’ve always thought that a special checkout service for self-indulgent shoppers would work at the right store. Imagine this… while your order is being picked, go to a VIP room, get a massage, sample and learn new recipes, listen to great music.. etc. Bypass the entire checkout wait. This service is for frequent shoppers or people with large full basket loads.
The first store to do a great spa service is the former Nature’s Northwest in Portland; complete with workout rooms, hair salon, spa, massage, wellness library… the works.
George Andrews is spot on. Match the experience to the customer, find new ways to excite and surprise them and they will keep comin’ back.
Research demonstrates that consumers don’t like to do grocery shopping. Now, if I can get a massage maybe it won’t be so bad!! Innovating with the store format and offerings is necessary to provide the products and services your consumers want in an atmosphere they want to visit. Testing the innovation at one store is smart. Like Whole Foods, I’ll be interested in the results of this test. Consumers are in for some interesting in-store experiences if the rate of innovation picks up.
As others have mentioned above, this is somewhat old news. At many Wal-Marts you can have your hair and nails done. I think Kowalski’s in the Twin Cities has spas in some stores. Whole Foods is just copying good ideas they have seen elsewhere. And there is nothing wrong with doing that.
Thanks to all comments!
To expand on Vahe’s post, the question here was not if the Whole Foods concept was a good one or not…or if it was new news. The question was how can we find inspiration by their ability to push their own boundaries and become more than just a store? What’s holding others back from following suit?
From my perspective, our store experiences are just too darned close to what they were 20 years ago. We’re getting much better, but where is my store-level personalization? How about store-to-web data and services integration? Why are we not seeing more of the amazing technologies available to retailers actually in-aisles and gathering learnings? Why are the socialization and new service strategies so slow to pop up?
We have such a rich environment for creating experiences in our stores and the creative ideas (and technology) are available to us. IF we could just get around our individual agendas and apply them more bravely for our customer’s benefit.
It’s going to be a very rewarding decade ahead, as I truly believe that we will be part of a radical evolution in what retail experiences are. I’m just personally impatient for us to pick up the pace!!!
An expansion on Ryan’s post – a brand roadmap.
Step 1:
-who are we?
-who are we perceived to be?
-who does the market want?
step 2:
-who do we want to be?
-who can we be?
Step 3:
-we declare who we will become
As far as motivating retailers to be more customer centric, how about some tough love: if a grocer can innovate around a customer and we all know that grocers are just operators who make money by selling shelf space, then what are you (the nonfood retailer) doing to get a greater share of wallet?
What a strategic and on target marketing program, leading to the creation of a greater base of shopper loyalty and excitement!
And, very interesting, its ties into the Holiday Season gift giving period and, concurrently, this retailer’s brand positioning – “eating right, better, and healthier, as you take care of yourself. Whole Foods gives you the product knowledge, personnel service and healthy products you want!”
Bravo for this grocery supermarket’s ‘outside-the-box’ thinking”.
As someone who makes a living in a similar industry, I am thrilled with what this Whole Foods is doing. At first, I was impressed by how they have obviously embraced the wellness trend sweeping this country; then I realized they were also taking the best of the old retailing models like Wal-Mart and adding that personalized touch that is in high demand today.