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Product details
File Size: 1446 KB
Print Length: 264 pages
Publisher: Kogan Page; 1 edition (October 3, 2018)
Publication Date: October 3, 2018
Sold by: Amazon Digital Services LLC
Language: English
ASIN: B07HQLPR8K
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Steenkamp has produced a breakthrough book on the history and current, ascending threats of private label goods. Anyone who sells private label goods or is selling brands ( against private-label clones) needs to thoroughly digest this book.What's a hard discounter (HD)? Traditionally its been grocery stores like - Aldi, Lidl and Trader Joe's - that stock 2000 SKUs v 45K+ for mainstream grocery stores. Most of the HD's SKUs are private, store labels designed to be as good or better quality than #1 brands. These clones are sold for up to 50% less than brands at mainstream grocery stores. By getting huge volume and turns per SKU with less complex replenishment systems, these competitors are growing faster and more profitably than mainline brands and stores. Steenkamp offers the first (that I've seen and an excellent) overview of the hard discounters' business model. And, he then offers a thorough prescription for how mainstream competitors can best mute the damage that these invaders are doing.Why is this a must read now? In mid-2017, three big announcements/plans were announced:1. Lidl (an Aldi clone competitor from Germany) announced a huge US invasion.2. Aldi (which has been in the US for some time, but growing slowly due to alternative investing in their fast-growing subsidiary: Trader Joe's), then announced a $5B investment plan for more and upgraded Aldi stores.3. And, Amazon bought Whole Foods. How will they take private-label, food-clones into both the stores and the cloud?The grocery industry is now in a frenzy of innovation and price cutting.B2B distribution channel players need to read this book too! Why? First, do some google research on:1. "Amazon brand accelerator program".2. Then, check out Wyze Lab cameras and Arcadia Group "Choice" medical devices. These are two examples in which startups have created SKU clones of B2B goods that are as good or better for dramatically less with 5 star reviews. These startups are virtual companies that use AMZ's end-to-end supply chain to create the goods and AMZ marketplace and fulfillment to sell and deliver. No need to create distribution channels. Imagine having a killer line with only 2-4 SKUs sold in massive volume taking off in weeks not years!Cyber-marketing will ruthlessly attack over-extended, brand lines. Big Brands are typically guilty of two things:1. Offering overwhelmingly and confusing choice. (Research fact: 6 most-popular SKU flavors of jam sell more total sales than a full-line of 24 flavors)2. And, charging the same mark-ups on all 24 flavors when the #1 flavor is 40% of the volume. Whenever Brands over-price their #1 SKU to subsidize long-tail items, the HD clones will attack.Get the book! (And, the cost-analytics to know what your biggest, net-profit SKUs are that will get eaten by HD clones)
J.B. Steenkamp is a master at bringing rigorous academic research to bear on the questions that keep marketers up at night and distilling the insights in a concise and very useful way. This, his latest book, is no different. If you have anything to do with grocery retail, in fact any kind of retail, this is a must-read.I really enjoyed the historical perspective that he and Laurens Sloot provide on the evolution of some major hard discounters in different parts of the world. In typical Steenkamp style, the chapters that provide guidance to hard discounters, their retail competitors, and national brand manufacturers on how to thrive in this new competitive environment are based on solid research. The data, statistics, and analysis throughout the book, together with the authors' many in-depth examples, are presented in thought provoking and bite-sized chapters. This is the kind of book you can read at one go but to which you will likely return more than once to dig into specific chapters. It is a great resource for retailing professionals, MBA students, and marketing professors.
if you are related, in any way, to the grocery retail business, you'd better read this comprehensive book about HD. Since only one person in my company reads English, I am even preparing a thorough presentation for the top staff.Five years ago, three HD chains started doing business in Colombia (Koba, Jeronimo Martins and Justo y Bueno) in a very aggresive way and very few locals understand the concept, much less know how to deal with them.
During an interview of Clayton Christensen, I asked him, “What exactly is disruptive innovation? There seems to be at least some confusion about it.â€â€œQuite true. It has a very specific meaning. It is not a breakthrough innovation that makes good products better. It has a very specific definition, and that is that it transforms a product that historically was so expensive and complicated that only a few people with a lot of money and a lot of skill had access to it. A disruptive innovation makes the product so much more affordable and acceptable that a much larger population has access to it.†I was reminded of that clarification as I began to read Retail Disruptors. The focus is on the hard discounter business model and the strategies followed by the key players and countries. "This sets the stage for the development of counterstrategies." As one result, "incumbent retailers and brand manufacturers are anything but helpless. Indeed, some will actually profit from working with hard discounters."These are among the passages that caught my eye, also listed to suggest the scope of Steenkamp's coverage:o Ascendancy of hard discounters Pages 1-15)o When is a preference for a limited assortment most likely? (24-25)o The hard discounters model: managerial takeaways (34-35)o Aldi -- The inventor of the hard discount concept (39-44)o Pillars of Aldi (42-44)o The only firm that Aldi fears (44-48)o Trader Joe's -- the upscale hard discounter (49-51)o Four major discounters: managerial takeaways (54-55)o Key success factors of hard discount concept: managerial takeaways (72-73)o Dollar/Dollar Tree (80-82)o Hard discounter disruption in the grocery business (89-93)o Characteristics of U.S. grocery market: managerial takeaways (94-95)o How hard discounters create their own "blue ocean": managerial takeaways (116)o Four strategic reactions to hard discounter encroachment (120-127)o Four competitive responses that conventional retailers can use: managerial takeaways (142-143)o Four checklists for procurement savings: managerial takeaways (162-164)o Building stronger national brands (167-198)o Five imperatives for building stronger brands: managerial takeaways (193-196)o Requirements for success for three types of companies: managerial takeaways (215-216)o Key issues to consider during negotiations: managerial takeaways (230-231)The business world today is more volatile, more uncertain, more complex, and more ambiguous than at any prior time that I can recall. Be that as it may, Jan-Benedict Steenkamp with Laurens Sloot take "a look into the future of disruptive retailing" in the final chapter. What they see is best revealed within the narrative, in context. However, no spoiler alert here, they remain convinced that hard discounters such as Aldi, Asda, Lidl, Morrisons, Sainsbury, and Tesco "are -- and will remain -- a permanent fixture in the grocery landscape. The ultimate winner is the consumer. And that is the right outcome in a competitive society."I agree and perhaps you do as well.
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