The Edible Man - Part 2
I've just finished reading the biography of Dave Nichol, Canadian marketing icon - the man who brought Loblaw shoppers President's Choice, No Name, G.R.E.E.N. and "Too Good To Be True" product brands among others.
In my previous post, I talked about how his innovation drove Loblaw's financial turnaround, turning the grocery store chain into the most profitable chain in Canada.
He took on major brands (like Coke, P&G, Oreos) and drove profitability by increasing margins using products created (and in many cases completely developed) by small private firms. By leveraging his shelf space and by promoting these brands cheaply, he was able to increase margins on major products to as much as 30%. Name brands for many grocery stores are often sold at cost to drive store traffic.
His innovation led a movement into Private branding and today every grocery chain in Canada, features their own private brands.
Last time I talked about six traits that drove his innovation.
Here are six more.
1. Attention to every Detail – the product name and the packaging matter as much as the product itself. If the packaging stands out, (product can easily be found on a shelf) and the product is worth talking about (has a hook), people will buy it.
2. Storytelling. Tell a story. People remember stories. Dave would tell stories around almost all of his products. In fact he had an entire line of sauces and marinades called Memories of (city name, country name)..... He led Canadian consumers on a world journey, where they could sample great cuisine in his footsteps. These stories were told in his 16 page Insider's Reports, in commercials, in Infomercials, in his cookbooks, and on in store television sets.
3. Get Noticed – to stand out you have to be different! Instead of duplicating a popular 7 bean soup, he insisted on creating a delicious 20 bean soup, making it stand out in the Marketplace - making it remarkable (as Seth Godin might say). Every product needed a hook - a reason for being, whether it was "the best I've ever tasted", or "as good as the one made at Spago's" or "contains more than twice the chololate chips of any other cookie". Dave Nichol knew the benefit of having remarkable products.
4. Product successes are built upon a littany of product failures. PC Cola took three attempts before success. In fact Galen Weston, Nichol's boss stated that "Dave Nichol created more failed products than anyone in history. Of course, he launched more products than anyone in history."
5. Never Settle. Nichol rejected literally thousands of product samples until he (and he alone) was satisfied that the product was a superior value. The product didn't necessarily have to be the best on the market, but it had to be the best for the money. Ironically, Nichol was the sole arbitor of taste. Loblaw didn't use traditional focus groups. At noon each day, he would be presented with a buffet of products under development and would travel down the buffet pronouncing his (usually harsh) critique of each presentation.
6. Stay acutely aware of cultural trends. In many ways, Nichol developed brands, like the fashion industry. He launched G.R.E.E.N. products as the environmental movement begain it's rise in Canada. His lower calorie and fat entrees reflected society's desire for healthier foods, his ready to eat entrees met the time constraints of two income families. His No Name products reflected a desire to save substantial money over name brands. He was constantly aware of the shifting marketplace and of public whim. He was so in tune with these trends, it became unclear whether society was driving the brand development or the brands were driving consumer's behaviour!
If you're interested in reading the story of one of Canada's best product innovators. I'd highly recommend the book. In 1994, it was the National Best Business Book award winner.
Enjoy.
