Policy Interventions for Healthier Diets: Insights from Scotland

Last week I was in Helsinki at the invitation of Hannu Saarijarvi to present two sessions to selected Finnish Ministries and to the S-Group. As noted before in this blog I have co-authored a book chapter with Hannu and Sonja Lahtinen on Transformative Food Retailing. Hannu is doing interesting work with loyalty card data and Sonja is completing her Phd on Transformative Sustainability.

The topic they wished me to discuss with policy interventions for healthier diets and to draw on the developments in Scotland and our review a year and a half ago for Food Standards Scotland. I have covered the Review in this blog before (and have presented on the review to retailers – Are retailers social engineers?) but these presentations were an opportuinity to reflect some months on and to bring things up to date with the recent consultation and other papers on this subject from the Scottish Government.

Below is a summary of what I said, prepared for translation into Finnish, and at the end of the blog you can find the overheads I used if you are so minded. Comments welcome via the usual channels.

“There is a crisis in obesity, diet and health amongst western and developed economies. Our food consumption has switched to a diet focused on unhealthy processed products. Our response to this has been to emphasise personal responsibility and choice and to focus attention on education and advice and then medical interventions when these fail.

What we eat however is much more complex than personal choice, being the outcome of varying personal, societal, cultural, government and business influences. It is a highly valid question as to whether personal choice can be exercised in what is an unfair environment. In retail stores this is seen clearly in the promotional, positioning, pricing and product mix that privileges unhealthy over healthy products. The outcome is both societal and locational health inequalities.

Government responses to date have tended to focus on better information, labelling, education, advice and promotion of the benefits of eating healthily and having a good diet. This has sought to rebalance the environment, by emphasising the benefits of a good diet, but has had limited success. It is now the time to consider if a more restrictive and interventionist approach to the environment, including retailing, is required. Rebalancing needs not just to involve enhanced spending by government on positive messages, but reduced spending by industry on the negative messages.

The diet in Scotland is poor and has not been improving. As a consequence the Scottish Government has begun to lead on intervening in the retail environment, as seen with restrictions on tobacco (displays and packaging) and alcohol (including promotional and sales time restrictions and most recently Minimum Unit Pricing) and positive support for healthy eating displays and information in smaller stores. In hospital settings, the Healthcare Retail Standard has restricted the amount and promotion of unhealthy products. At the same time UK government interventions, such as the Soft Drinks Industry Levy (the “sugar tax”) have also been introduced and seen product reformulation.

In 2017, we published our review for Food Standards Scotland on policies that could be developed to intervene in the in-store retail environment. The approach suggested was to focus on disrupting and altering the context and choice architecture faced by consumers in retail stores. By better understanding how retailers construct the in-store environment (“what consumers see”), the possible steps to intervene to improve the choice architecture and situational context can be understood. There are a range of possible interventions that can be developed, but real issues in the scope, scale and practicalities of possible policy, as well as its acceptance.

It is clear that the current situation is unsustainable and that emphasising personal responsibility in such an unfair context will not work. The environment need to be rebalanced and it is clear that this will not happen voluntarily.

Thus, between October 2018 and January 2019 the Scottish Government consulted on possible restrictions on promotion and marketing in retailing (and other out of home consumption sites) of foods that have next to nil nutritional value. This would constitute a ground-breaking set of interventionist policies on retail (and other sector) operations and if taken forward into policy would rebalance the retail environment. It would restrict the ability to promote (in the widest possible sense, and including price, place, position and visual merchandising) many unhealthy discretionary food and drink products.

There will be resistance to this approach, both from consumers (“the nanny state”) and the various industry sectors involved in the supply chains. Policy has to be drafted carefully to minimise unintended consequences e.g. on small stores, sectors and the internet. It is also clear that such policy alone is not the answer; food consumption is a multi-faceted construct and needs to be addressed accordingly. However it is clear that the current state is unsustainable and has to be challenged and that a reconstruction of the in-store environment would be a major step forward.

Scotland is not unique in having these issues, though it has distinctive problems. The steps that have been taken and are potentially in the pipeline are strong responses to these problems. But, they are necessary to address our health crisis. There are potential lessons for other countries, though they will undoubtedly have to be tailored for specific situations.”

The overheads can be found here:

Policy Interventions for Healthier Diets: insights from Scotland? – pdf here

Retailers as Social Engineers – pdf here

PS: Great place to present  – the House of the Estates

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Posted in Consumer Lifestyle, Cooperatives, Diet and Health, Food Retailing, Food Standards, Government, Health, Healthcare Retail Standard, Healthy Living, Labelling, Legislation, Loyalty Schemes, Policy, Retail Policy, Retailers, Retailing, Scotland, Scottish Government, Social Inequality, Uncategorized, University of Stirling | Tagged , , , , , , , , , , , , , | 1 Comment

An Aide-Memoire for Towns

Guest Blog by Matthew Hopkinson

Aide 1

In December 2018 I decided that to try to help Towns better understand the challenges they face; there should be something that could be an easy reference document. This came about from completing day one of a #CreatingBetterTowns Masterclass for the Local Government Association with 24 councils and from thinking back to my military days where as a young platoon commander I had a Tactical Aide-Memoire (TAM) that provided all the key information and considerations to do my job. Without it you would have been lost on many occasions especially when situations called for quick responses. From these two encounters the #CreatingBetterTowns aide-memoire was born! I see it as a document that will evolve and change, based on how it is used and how towns change over time.

The aide-memoire aims to address key areas that people involved in towns should understand, think about or consider. There are 13 core sections.

The definition of what a town is and what the National Planning Policy Framework says about Town Centre First and what the sequential and impact tests actually are.

Decision-making is critical and many towns and businesses do not understand where data lies or what data is versus information and evidence. From these one is able to derive knowledge as an individual and wisdom as an organisation. The former three will increasingly be machine driven and the latter two human – combining the two is called Augmented Intelligence.

Base knowledge of a town is key as it is the starting point and by this one needs to have a very good understanding of how residents, visitors and workers use it today and how they might use it in 5, 10, 15 years and beyond.

How one approaches many things in life can often determine how successful you will be and as such considering one’s approach is key. The two key approaches that I think should be considered is ‘Seek to understand before being understood’ (Stephen Covey’s 7 Habits of Highly Effective People) and always looking at why you SHOULD do something rather than why you SHOULD NOT.

Next up is being clear on what you are trying to achieve which is broken down into the What?, the Why?, Who is required to do this? And How will you go about it and measure that change?

Tied into both of the above is The Place Principle developed by the Scottish Government and COSLA which is a succinct summary of why collaboration is critical to success.

Like any business or organisation a Town should have a Vision which engages the heart and spirit which is executed through a strategy which covers the People, Execution and Structure required to deliver which then creates a plan with a number of objectives, each with its own set of milestones.

Clear and achievable objectives are critical to success and the aide-memoire covers a process for how to identify an objective, factors that influence the objective and ultimately how to select the best course of action to achieve that objective (the execution). It also covers the reality of what happens when things don’t go to plan – do you continue, challenge or cease? Throughout the process data underpins the execution through tracking change.

The final two related areas are on understanding what Place Marketing is and being clear about your unique proposition is and making sure it is aligned with the community. Reinforcing this is the increasingly important digital profile and footprint required to put you on and keep your light burning bright on the’ map’.

The physical space of a town determines its character is another key consideration. From how buildings are used and the increasing need for more diverse building uses to the public realm that people value, engage with and maintain.

The aide-memoire can be downloaded HERE.

All amendments, additions, deletions and extensions are welcome. Please contact me (Matthew Hopkinson) by email (matthewh@didobi.com) or via Didobi

Posted in High Streets, Places, Planning, Public Realm, Scotland's Towns Partnership, town centre first, Town Centres, Towns, Uncategorized | Tagged , , , , , , , | Leave a comment

The Next Ten Years of Grocery Retailing?

Given we are less than 10 weeks away from Brexit and the possible end of the grocery world as we know, writing a post about retailing a decade ahead seems foolhardy (spoiler alert; it is).  But bear with me.

Let’s assume that our UK politicians stop behaving like village idiots before March 29th. (yeah, I know). Perhaps for example they could, just for once, heed the voices of those who know what they are talking about.  In this case the retailers staring at the destruction of their supply chains with no alternatives being put in place that don’t jeopardise product supply and raise costs and prices, perhaps significantly.

So let’s forget Brexit and assume grocery retailing as normal is to continue.  The Asda-Sainsbury merger decision is due in late Spring now, but otherwise let’s assume things are as they are now.  Which is not a good thing! Food retailers are in quite a lot of difficulty; not across the board but in many cases. There is a sense that the “legacy” retailers need reviving. The question is how?

I recently read a December 2018 report by McKinsey on Reviving Grocery Retail (in the UK and the US).  To some extent it covered known ground, but it did it quite succinctly.

McKinsey note that the mainstream grocery retailers have been in an era of value destruction brought on by changing consumer habits and preferences, the emergence of aggressive competitors and of ecosystems (Amazon, Alibaba) and the onslaught of new technologies.  They recognise such trends are often present but point to the sheer pace and intensity of their interactions at this current time.

For McKinsey there are six areas where legacy mainstream retailers can fight back:

  1. Define a distinctive value proposition; convenience, inspiration, value for money
  2. Shape your ecosystem – and either go big or get out
  3. Put technology to work in every part of the value chain
  4. Win back lunch and dinner
  5. Rethink all of your real estate
  6. Innovate ten time faster.

Again, to a degree, there is nothing that new here, but instead it is the combination of these that is critical.  These six areas are really responses to the three drivers mentioned earlier.  And it would seem that for long-standing retailers it is much harder to adjust than for new and more focused retailers.

So what we seem locked into in the UK is a downward spiral of cost-cutting.  Where Tesco and its delicatessens and fish/meat counters being cut back and indeed the whole rationale for the Asda/Sainsbury merger. We have endured this cutting over quite a number of years now. Yet after all of this can we really say that any of our ‘leading’ food retailers has yet made real inroads to the competition or to these six imperatives? To some extent they are still in the denial game and playing the tunes of the new competition.

Are any of them inspiring, truly convenient for consumers and with innovation for the customer at their heart (and innovation which actually helps the customer rather than being for technology or cost cutting sake)?  I struggle to see where?  Even on real estate and the store portfolio where there has perhaps been the the most movement, has this been clear or focused enough yet?  Or simply rather serendipitous?

There is  a long way to go, both in terms of the actions needed by the leading players and in the freedom of action currently allowed to the discounters and others.  That’s why ten years ahead is foolhardy – we might just be at the tipping point for radical reinvention.  But only if we have the retailers able to grasp the existential threat they are under.

Now we just have to get out from under the other existential threat of Brexit and the harm it potentially can do.

Posted in Amazon, Asda, Brexit, Competition, Consumer Change, Customer engagement, Food Retailing, Property, Reinvention, Retail Change, Retail Failure, Sainsbury, Store Closures, Tesco, Uncategorized | Tagged , , , , , , , , , | Leave a comment

Yours for £1 (not really)

It was an eye-catching gimmick, and it did the job, getting media coverage (and me onto the radio (again)). In early February, at a London auction The Postings shopping centre in Kirkcaldy was put up for sale with a reserve of only £1.    Was it outrage, amusement or a wry shaking of the head that followed?  Or simply, well that’s Kirkcaldy  perhaps?

But, as the pension fund sellers were quoted: “The reserve price of £1 is generating significant attention and we expect to get a considerable amount at the auction.”

The fact it was Kirkcaldy does not really matter though and there are good and less good things about Kirkcaldy, as there are with all towns.  And this shopping sale was being sold as a development opportunity that could help the town centre strategy. The point really was about another milestone in the change sweeping retailing – a 1980s shopping centre for £1.  In the event of course it went for a lot more than that (£310,000 with apparently 12 bidders interested), which suggests someone has an eye for an opportunity in Kirkcaldy, even though the same day the Marks and Spencer in the town closed.

More interesting though was the story of another retail sale at the same auction.  This time in Dumfries where the Midsteeple Quarter project are hell-bent on taking over what they can in the town centre and reinventing and running it for the good of the local community.

Fed up with absentee and/or indifferent landlords, the plan has been to buy back the high street and establish a properly based mixed economy on local talents and needs.  Negotiations with the owners of two high street buildings in the Midsteeple Quarter had apparently been well under way, but suddenly the site was put up for auction. Yes, the sellers were the same pension fund as in Kirkcaldy.

With only a week or so’s notice, the Dumfries folk set about building a fund to bid at the auction.  Perhaps this was always doomed to fail, but the energy it released will build momentum for other things of a similar ilk.  In less than a week, a crowdfunder raised over £23,000.  This proved to be insufficient as bidding quickly rose over £100,000, settling on £142,000. A currently mystery bidder now owns these two buildings.  It is to be wished they have the good of Dumfries at heart, but there is something more important underneath this as well.

At one level this story is a failure – the idea for the community to buy these buildings did not work.  But, such energy and enthusiasm (and money) in such a short space of time bodes well for the future.  The funds will be repurposed to another community venture in the high street. The whole saga (can sagas be 5 days?) demonstrates the local desire to see places reinvigorated by and for the local community.  We need to make it easier to do this and to ensure town assets are actively used for the good of the local community.

But more than that, landlords and property need to begin to work more closely with local community groups and understand the desires and talents that are around in all of our towns. We are not short of ideas, but are often short of the right opportunities. Community involvement, and community ownership are vital components of the future of our places – but that sense of pride and energy to do things also underpins existing owners and operations, and it needs to be engaged with and not fought.

Go and take a look at the Midsteeple Quarter Project and what they want to do for Dumfries. And if you are local think about getting involved. If you are not local then seek out what is happening in your town.

Posted in Buildings, Community, Community Development, Creative Places, Dumfries, High Streets, Kirkcaldy, Landlords, Localisation, Places, Property, Regeneration, Retail Change, Scotland's Town and High Streets, Scotland's Towns Partnership, Shopping Centres, Town Centre Living, Town Centres, Towns, Uncategorized | Tagged , , , , , , , , , | Leave a comment

#Woolies10

I was out at the country on the tenth ‘anniversary’ of the closure of the last Woolworths store in the UK – 6th January to be exact.   I had already contributed to an element of the ‘celebration’/‘remembrance’, so didn’t feel too left out.  In my case, any thoughts I had were rather put in the shade by the publication by – amongst other things – Woolworths expert Graham Soult (@soult, www.cannyinsights.com) on “#Woolies10 – Ten Years On: What has become of Woolworths’ Former Stores?” (Available for free download from www.cannyinsights.com).

Woolworths closed in the UK in 2009, some 10 months short of what would have been a centenary of operations in the country at the heart of Britain’s high streets.  I have covered aspects of this before, and in particular how the company came to occupy a cultural and social place in the shopper’s psyche.  Britain’s streetscape owes a debt to Woolworths as Kathryn Morrison’s excellent book shows, but it is far more than the physical buildings, as grand as many were.  The nostalgia for Woolies demonstrates the affections held for it by many – though we should note that these people (me included) are probably (in some cases substantially) the wrong side of 50, as the company’s heyday was in the early 1980s at the very latest. I have noted their customer numbers before:

This nostalgia formed the basis of a half-hour radio programme on BBC Radio Scotland on the 23rd December.  In it Kathryn Morrison, myself and employees, managers and customers of Woolworths explored the memories it evokes (see the BBC video teaser).  As Kathryn noted on Twitter, nostalgic but also poignant.

So why does Woolworths continue to fascinate?  Graham Soult in his report points out that the 807 stores that closed in the 2008/9 collapse are equivalent to 2500 Tesco Express Stores or 63 John Lewis stores.  This was a collapse of a big retailer with a particular place in society (even if that place was a shadow of its former glories).  That place was physical but also social and cultural. Most retailers never attain this combination of reputations.

woolies ten report

#Woolies10 brings the story of this collapsed store estate up to date.  I can not do justice to the effort and insight involved in preparing this short report.  I would encourage anyone with an interest in Woolies or British high streets to read it.  A few things were reinforced for me.

  • The vast majority of stores remain in active use – the closure was not a location issue but a trading issue
  • Almost half of the occupiers are those who to some degree have an offer similar to Woolworths – it was performance and operations that was the problem
  • Churn is found in over a third of locations i.e. current occupiers are not those that took over the sites initially. A number of these are pound stores where the occupants have themselves collapsed or been taken over.  Change is a retail phenomenon and indeed the sites have proved resilient.

There are many other points that the report notes, but space precludes coverage of all of these. The detail is well worth reflecting upon, including the relative small numbers of stores that have been demolished, been subdivided or gone away form retail use. The insight it gives to change over the last decade is fascinating.

There is also a nice coda on the ‘ghostsigns’ of Woolies.  This is of course written in the shop architecture which often remains, but some more transient physical signs or fascias still exist or get uncovered.  I was particularly pleased to see that one sign from a store has been incorporated in a bar/roof terrace now on the previous site!

Finally, and this is not a challenge to @soult to document all Woolworths everywhere!  I was actually in South Africa on the anniversary date.  Woolworths as the photos below show is alive and kicking there, though it bears no resemblance to the UK operation, sharing more than a little of its DNA with Marks and Spencer.  But that as they say is a very different story.

woolies franschhoekwoolies hermanus

Posted in Architecture, Buildings, Churn, Closure, Consumers, Corporate History, Ghost Signs, Heritage, High Streets, Historic Shops, History, Pound Shops, Poundland, Retail Failure, Shopfronts, Store Closures, Streetscapes, Towns, Uncategorized, Urban History, Woolworths | Tagged , , , , , , , , , , , , , | 1 Comment

Retail Disruptors – the spectacular rise and impact of the hard discounters

Retail Disruptors

The rise of the hard discounters is a well-observed phenomenon of continuing research endeavour and commentary.  In the UK, as is well known, Aldi and Lidl have captured considerable market share over the last decade.

UK Grocery market Share

‘Retail Disruptors’ by Jan-Benedict Steenkamp and Laurens Sloot is a new addition to the literature.  It focuses on the rise of the discounters generally and the reasons for and impact of their success.  It is very accessibly written, targeted mainly at the trade and professional audience.  The three sections of the book cover the strategies of the hard discounters followed in turn by the potential counter strategies for retailers and manufacturers respectively.  It attempts to adopt an international perspective and broad coverage, though inevitably this is a little partial. It is an easy and enjoyable read with the added benefit of being informative and at times thought-provoking, probably especially for practitioners including manufacturers.  These are often ignored in the consideration of the impact of discounters.

I did enjoy a reminder of the quote by the Tesco Chief Financial Officer from 2008 saying that ‘discounters were only having their moment in the sun’.  A decade on, sunburn must be an occupational hazard.  The reasons for this continuing success is well explored, but I do wonder about the constant refrain in the media (and this book) that even those with Audis and BMWs now shop Aldi/Lidl.  Car ownership is not what it was and many such vehicles are leased/rented, and so that much more prevalent than in previous decades.

I was also taken by the strong arguments for consumers welcoming the reduction in choice (as well as price) offered by Aldi/Lidl, and I would link this to the disruptive impact this has on local markets.  In the same way as Wal-Mart did in the US/Canada 20-30 years ago the arrival in an area of Aldi/Lidl recalibrates the local competition expectations.

The book concludes that discounters have a natural share of 20-25% but the exact outcome depends on the competition and the fight back.  For existing retailers a number of strategies are outlined (fightback, downgrade, value improvement and value redefinition) depending on the situation.  Details of these are well worth exploring.

If 20-25% is the natural share in the UK, then Aldi/Lidl will double in size in coming years.  That is enough to keep any Jack’s up at night!

Reference

Jan-Benedict Steenkamp and Laurens Sloot (2019) Retail Disruptors. Kogan Page. ISBN 978-0-7494-8347-0.

 

Posted in Academics, Aldi, Competition, Consumer Choice, Discounters, Food Retailing, Jack's, Lidl, Market Shares, Pricing, Retail Change, Retailers, Strategy, Uncategorized | Tagged , , , , , , , , , , , | Leave a comment

Food, health and data: developing transformative food retailing

Byrom and Medway

In early November 2018, a book on Case Studies in Food Retailing and Distribution was published, edited by John Byrom and Dominic Medway.  Amongst the very wide ranging and interesting chapters, was an effort by myself and two colleagues from the University of Tampere in Finland (Hannu Saarijarvi and Sonja Lahtinen).

Our chapter, entitled “Food, health and data: developing transformative food retailing” analyses the developing relationship amongst food retailing, consumption and diet and health, reflecting on this intersection between health policy and retailing.  Retailers often view themselves as being under threat from this increased interest in health policy, perceiving ever tightening restrictions as the only likely outcome.

However the chapter argues that whilst this may be true to a degree (and we see this in recent proposals in Scotland), it is also the case that food retailers have an opportunity to take on a greater role and a greater responsibility regarding consumers’ health and wellbeing.  Digital data of various forms suggests a new proactive, transformative role for retailers, arising not only from the weakness of current practice but also the opportunities of building a closer, more helpful, relationship with consumers’ lives.

There is a revolutionary opportunity to reconfigure the food retailers’ role, not only competitively but also societally.  This brings implications for consumers, companies, academics and society at large.

Implications of transformative food retailing

Stakeholder Implications of transformative food retailing
Consumers Enhancing value creation; increasing human agency; elevating identity projects; creating a sense of safety and certainty; granting access to information; assisting in informed choices; improving dietary intake; promoting healthy lifestyles
Companies Offering a way for differentiation; establishing new markets for new start-ups; motivating role reconfiguration; initiating strategic changes; inspiring new service design; reformulating service offering; engaging with different stakeholders; innovating new marketing processes; humanizing brand image; cultivating social responsibility
Academic community Stimulating new retailing research avenues; advancing multidisciplinary collaboration; spurring new research methods; bridging the gap between scientific knowledge; business practitioners and society; increasing research relevance and social impact
Society Increasing the role of businesses in solving societal challenges; capturing societal potential of retailing; altering dominant social structures; stimulating social action; informing decision-making; raising public awareness of the impact of dietary choices for health; addressing socioeconomic differences; improving public health; providing new retailing-led public policy guidelines

Our chapter concludes:

“Food retailing is at a crossroads. It is viewed increasingly as part of the problem of health and diet in society.  It need not, however, be like this.  There is a choice to be made between a battle over regulation or an embrace of digitalization, data availability, and health concerns.  Transformative food retailing offers new venues for value creation, both for firms and customers, and points toward potential areas of strategic differentiation. New uses of customer data play a pivotal role and provide a new means for building customer loyalty. Changes in consumer behaviour toward healthier food consumption at the individual level contribute to potentially major impacts at societal level.  Taken together, transformative food retailing has multiple value potentials and can extend the food retailers’ role from supplying products and services toward facilitating consumers’ personal and societal transformation toward healthier lives. This redefines and concretizes the importance of food retailing in contemporary society.”

 

Posted in Academics, Behavioural Economics, Books, Data, Diet and Health, Digital, Ethics, Food, Food Retailing, Health, Loyalty, Loyalty Schemes, Retailers, Social Change, Uncategorized, Well being | Tagged , , , , , , , , , , , , , | Leave a comment