“It’s not natural versus mass, or natural versus Amazon,” Robert Craven, CEO of MegaFood, told NutraIngredients-USA. “There is an ecosystem and natural retailers are part of that ecosystem.
“The natural products industry faces many challenges; most importantly, however, is the tremendous opportunity to rethink the direction of the industry and innovate a new path forward,” he added.
At the recent two day ZingMojo summit MegaFood brought together experts from Conscious Brands, NetRush, The New Hope Network, the Mustard Seed Natural Living Center, Cambridge Naturals, Pharmavite and the Independent Natural Food Retail Association and 20 additional natural retailers of all sizes and specialties to discuss industry challenges, such as mass slippage, price and margin, trust and transparency and next level thinking.
Questions tackled included:
• Can we elevate the discussion so that our industry story is about our central role in combating nutritional poverty in the U.S. and beyond?
• Can we imagine a natural products industry in which the vastly different business models employed by natural and mass retail complement each other rather than compete at cross-purposes?
• Can natural retailers learn how to monetize their services in ways that stabilize their profits over time and meet growing consumer demand for high-quality experiences as well as products?
• Can brick and mortar stores transform themselves to compete in an age when everybody wants to be able to buy anything, anywhere, at anytime?
Best practices
“More broadly, I think natural retailers are being left behind,” Craven told us. “We’re trying to organize a mission/vision/strategy for the industry. We’re just a small brand and we’re trying to add as much value to the industry as we can.”
The summit broke down into three segments, he explained: What’s the story we’re telling (including what are the myths)? What’s the real story? And what is the story we make? The last point was about the narrative around how natural is different and fits in the community.
On the story we’re telling, there are several myths, said Craven, including that mass retail is stealing customers from natural retailers (mass slippage), that if a natural retailer cannot compete on price then it cannot compete at all, and that the future is online.
The real story, which was backed up by data presented by Carlotta Mast from The New Hope Network, is that, amongst other things, mass slippage also works in reverse; that Millennials prefer the natural channel; and that, with only 50% penetration of the US market, natural products have huge growth potential across many channels.
“The goal was then to narrow these down and produce best practices around that platform for the story we make,” he said, and these include: Mission orientation; community involvement; Value-added, fun shopping experience; Exceptional local workplace; and open-minded business practices.
Moving forward Craven would like to maintain momentum, which means having a similar summit at least every six months, but the frequency will be dictated by the participating retailers, he said.