The Foodie's Delight

January 29 2013

The Winter Fancy Food Show in San Francisco just wrapped up it’s annual three day food wholesale extravaganza, where 1,300 new and established food producers show off their latest and greatest for buyers, and where the food world gets a jump on the 2013 market trends. Some of the projected trendy foods for the upcoming year include smoke-preserving, gourmet popcorn (although we've been eating this one for years), and barrel-aged hot sauces. Products like these are often produced in small batches and made with high-end and specialty ingredients. Americans are spending more on food, and there is a growing market for locally-made, "handmade" products. In NY, this trend has been ably represented by the almost twee, fetishized Brooklyn artisan food movement. 

How does one roll out a small-batch, personal food idea in the gourmet food market? Venues that provide exposure to reach the consumer willing to cough up the dough for specialty items include farmer’s markets, food festivals, independent gourmet groceries, and—if you’ve really hit it really big—Whole Foods, who try out artisan foods on a local and regional trial basis. There are also small-scale distributors that base their business around getting these specialty products out of their respective cities and beyond their local cult-following. Mantry.com, for example, sends a monthly curated selection of specialty food items from all over the country in one small, fancy wooden crate. Sending a nicely presented container or unique, beautifully packaged foods is a wonderful gift idea. And they’re all pretty. Aesthetics and packaging play a large role in this new food movement—if we’re paying top dollar for a jar of lavender honey, we want it to look like we did so.  

So what's the take-away? While locally-made food is on trend, actually getting it out into the marketplace and onto consumer's tables is a long road. The brand story has to be completely aligned: taste, presentation, the name of the product or line of products, identity design, language and more. That is the front end piece, and many artisan food producers have a neat handle on this part of their business. The harder part, as always, is delivering the product for a price that consumers can stomach, and rolling out the brand into enough markets where one can sell a sufficient amount of units to break even, and ultimately, make a profit. The practicalities of margins and making money are always the issue when you are operating outside the mass market, no matter what arena you are in. 

USDA data showed that in 2010, Italians spent 14.4% of their income on food, whereas Americans only spent 5.5%. It seems that this number is rising, so there is clearly room in the market for new tastes and new trends. Pass the smoked pickles, please!

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On Diamond Watch

January 17 2013

Marilyn Monroe could not have imagined it when she starred in How to Marry a Millionaire, or in Gentlemen Prefer Blondes. She didn't ever know that a company named Swatch existed, coming to prominence in the 70s with disposable fashion poppy plastic watches. She certainly wouldn't have thought that one day Swatch would add the company she invited to "TALK TO ME!" in "Diamonds are a Girl's Best Friend" to their stable of companies.

Yesterday, it was announced that Harry Winston, the renowned Fifth Avenue jeweler known for their fabulous and fabulously expensive diamonds, had been purchased by Swatch for the tidy sum of $750M. That could definitely buy some ice! I learned that Harry Winston was the first jeweler to lend beautiful baubles for a walk down the red carpet at the Oscars in 1943. And interestingly enough, that they also own Omega watches. Harry Winston is apparently going to focus on diamond mining rather than retail sales, and so was open to being purchased.

Now, I totally understand why Harry Winston might want to get out of the retail business, and focus on mining and supplying high quality diamonds to other jewelers and wholesalers. No doubt it makes sense from a bottom line perspective, as they already have a tremendous amount of brand equity after years of adorning celebrities and socialites. To me, the interesting part of the story is that the choice they made was to sell to Swatch, a company that is looking to expand into the high end of the market (or way high end). It's almost as if they abandoned the brand by selling to a buyer with no real credentials in the uber luxury market.

Established brands sell for many reasons and to wildly different suitors. Family businesses in the third generation are frequently uninterested in carrying on the family business, or want to expand beyond what is possible with their existing capital. That is what happened with Kiehls, when they sold to L'Oreal for an estimated $100 million. They simply couldn't build out the brand, or service the customer in the way they were known for, or move squarely into the global economy and 21st Century without an influx of cash, and so decided to sell.  I don't know if they had to sell, or chose to sell their venerable brand. And I don't know generationally about Harry Winston, but I am a bit curious about this particular suitor winning their hand. What would Marilyn say? 

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H & M and COS, A Low and (some) Version of High Fashion

January 03 2013

The last few times I've been in London, where fast fashion is a way of life, I stumbled into what appeared to be a chainlet named Company of Style, aka COS. Initially, I didn't know that the simple, pared down designs and palette at COS was the work of a new brand design studio at H & M.

It turns out that COS is H & M's foray into a higher price point, although most items are still priced under $100.00 and thus very accessible for what seems to be well-made, streamlined design. Their tagline is Timeless, Modern, Tactile and Functional, and I have to admit that I'm seduced by this brand. I really feel that they got it right — it's very strong, controlled brand management, and is a concept that will do well no matter where it travels. The store design, by William Russell of Pentagram, London (love them! I loved working with Michael Beirut from Pentagram in the past), and his angular, restrained store design and layout brings the architectural quality of the clothing to life. Other retailers should heed how well H & M is managing and rolling out this brand. The store has already opened in 51 stores in the UK, France, the Netherlands, Italy and Sweden, of course. They have also just opened their first shop in Asia.

Of course, I'm awaiting their entry into the US market, where their brand of chic simplicity at an affordable price point will play very well in urban and exurban centers. C'mon over, COS!

 

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