business news in context, analysis with attitude

by Kevin Coupe

The Wall Street Journal reports this morning that Whole Foods is testing a new program at a just-opened store in Brooklyn that "allows customers to scroll through a list of exotic, seasonal produce not sold in the store and order customized amounts for pickup."

A computer kiosk created by Baldor, a local produce distributor, allows customers to choose such items as "pineberries (white strawberries at $7.99 a pound), fresh huckleberries (like dark, thick-skinned blueberries with seeds at $19.99 a pound), apple blossoms ($15.99 apiece) and baby South African pineapples ($5.99 apiece). There is also a kale-Brussels sprout hybrid called lollipop kale sprouts."

The goal of the program is to make available via Whole Foods - which may carry only 400 SKUs of produce - many more of the 5,000 items that Baldor offers, and to do it in a sophisticated market where there will be acceptance not just of unusual products, but also the accompanying high prices.

It is interesting to see Whole Foods piloting a high-cost program like this at the same time that it is trying to play the lower cost game with its "365" stores. That's not to say that it can't successfully play both ends of the field ... just that it takes a different sort of organizational discipline and culture to do so. When I read about this program, I must admit, it seems to me that this is Whole Foods' sweet spot, not a price-driven store ... but maybe that's just because I was underwhelmed by the "365" store I saw last week in Lake Oswego, Oregon. (See that critique here.)

This is what's called "the long tail," and bricks-and-mortar stores are to be encouraged to use technology to make low-demand products available to customers in a way that creates relationships, loyalty, and profits.

It can be an Eye-Opener.
KC's View: