December/January, 2008

From the Editor

The Specialty Cheese Challenge/Opportunity

As Wal-Mart rolled its Supercenter concept across America, the smart advice has been for stores to become the anti-Wal-Mart — high service, more upscale product, more organic, more artisanal.

Few areas seem more appropriate for such a mission than specialty cheese, which is enjoying a boom at mass-market retailers. Yet the boom is calling into question the product offer and merchandising abilities of supermarkets of all types. We say we are going to offer broad arrays of specialty product, but large assortments pose unique challenges for procurement teams and enormous challenges to merchandisers. Are retailers up to the challenge? Can suppliers help more?

Intrinsic in this question, of course, is the notion that an opportunity exists for increasing sales through more appropriate product assortment and better merchandising.

Specialty product serves so many purposes that the same product can be sold in virtually unrelated markets. Many who will buy a bouquet at a supermarket wouldn’t think of getting flowers for a wedding or funeral there.

Specialty food also offers many distinct markets:

  • The gift market: Specialty foods always make great gift items, and offering gift packs can open a whole new sales universe.
  • The entertaining market: Many consumers want to offer guests an assortment of wonderful foods — such as specialty cheese — but what to offer, how much, with what should it be served? Their nerves can fray while the opportunities for both producers and retailers abound.
  • The personal and family consumption market: Some consumers know they or family members like one particular item, say a specialty cheese they were served at a party, but are uncertain as to what else they might like or with what to serve it. Other consumers know specifically what they want. They are more likely to be swayed by serving size and price than other markets.

Then, within each market, we have three buyer types:

  • The knowledgeable expert: Some people walk into the store and know they want to do a flight of cheddars. Next week they may be looking for something unusual from Cypress or the latest award-winner from Oregon. Think of a wine connoisseur; then change wine to cheese.
  • The aspirational consumer: He knows specialty cheese is sophisticated, upscale, eco-friendly and hip. He sees it as in line with the kind of life he wants to live. But he may be young or just newly aware of specialty cheese. Think of a yuppie-destined college student with his first sip of a French Beaujolais and now imagine him trying some American specialty cheese for the first time.
  • The unmotivated consumer: He knows this is a hot area and doesn’t want to make a fool of himself, but it is not his thing. Think of the guy invited to his boss’ house; the boss, a wine lover, is serving rack of lamb. The guy runs into a liquor store and asks for a really nice bottle to match. He doesn’t want to be an expert but wants to seem knowledgeable and wants his store to help him.

This holiday season, we had the opportunity to buy a fair assortment of specialty cheeses and found supermarkets of all types lacking. On a trip to Los Angeles, we were at a Bristol Farms, about as upscale as you get, and noted the mediocre quality and non-fresh nature of the products included in its pre-made gift baskets.

We asked to purchase our choice of upscale foods to make a super quality, super expensive basket; a floral staffer was brought out — her control of the shrink-wrap machine put her in charge. The floral manager told us she was too busy to do a basket then or anytime that day, but if we gave her a list of what we wanted, she would do it tomorrow.

We wanted the gift basket for a special party for a special friend, and we needed it that night. Since they wouldn’t help us, we spent our money elsewhere.

A large order of high-end specialty foods walked out the door because a high-end store wasn’t sensitive to serving the gift market and knowledgeable, expert consumers.

Where did we wind up buying most of our fresh foods, including specialty cheese, this holiday season? Costco. The assortment was excellent, the price was reasonable and the product offering included things like pre-set cheese plates with assorted specialty cheeses.

There was a lot of good stuff, in areas where we didn’t know much — for example, specialty packages with assortments of Spanish cheeses — and many pre-selected assortments packaged into simple yet sophisticated gifts.

Many deli departments are filled with fantastic offerings — 10 types of olives, 200 cheeses, prosciutto di Parma. Shame on us if we don’t put all this together so our consumers can see the value, expand their palates, meet their needs for gifts and entertainment and enjoy shopping rather than leaving our stores not knowing how to put it all together.

It may sound like a burden — can’t we just sell product? — but it really is the opportunity. Being the anti-Wal-Mart is as much a matter of thinking of — and delighting — the non-Wal-Mart shopper as carrying particular product.

Much of the industry could do worse than a New Year’s resolution in that direction.  DB