Stocktake: Retail investment and innovation

It is gratifying to note the investment by Rand Capital Coffee in opening eight Starbucks stores; as well as the launch of the designers collab, Always Welcome; despite Nielsen festive season figures which point to cautious consumer spending.

Starbucks to open eight stores in SA

Starbucks in South Africa is opening eight new stores in four weeks – from mid-November to mid-December – in Cape Town, Stellenbosch, Johannesburg and Pretoria. The store opening schedule begins on 19 November with Canal Walk, and includes other prime Cape Town locations at Cavendish Square, Stellenbosch, Tyger Valley Shopping Centre, the V&A Waterfront and Camps Bay; in Pretoria at Castle Gate Mall; and in Joburg in Rosebank. By the end of 2020, Starbucks will have employed an additional 69 full-time employees and promoted 21, who are globally referred to as partners in the group, to foster a sound sense of equality and shared vision. This brings the total complement of permanent employees to 300.

“Starbucks is an iconic global brand, and when the opportunity arose to expand it into my home country, particularly as this is one of few remaining scalable regions where Starbucks is yet to have a strong presence, I grabbed the chance,” said Adrian Maizey, owner and CEO of Rand Capital Coffee, the custodian of Starbucks in Southern Africa. He adds that Starbucks operates on a licensing model as opposed to a franchise. About bucking the prevailing trends in the pandemic-affected hospitality industry with such a major investment, Maizey said business models should always be built on solid foundations to withstand economic downturns, and at the same time, be flexible enough to identify and embrace change when needed.” He said their challenge as newcomers to the increasingly discerning coffee market, is to better inform the public about all that Starbucks has to offer.

Evolving consumer groups

Nielsen Retail Intelligence MD for Sub-Sahara Africa, Kelly Arnold, has warned that the festive season this year will be very different for retailers as Covid has changed consumer spending habits. Nielsen has identified four emerging patterns to help predict the drivers of pandemic purchase decisions in future. When applied to the context of the many upcoming holidays and year-end festivities, these reset patterns now highlight some important new behaviours that could emerge this season:

• Basket Reset: Holiday spending and gifting will be refined based on what and whoare considered essential for each consumer. This will require retailers and manufacturers to redefine what’s festive and capitalise on the broadened assortment of what consumers might consider ‘giftable’ this year. From a necessity that can no longer fit the budget, to a product that has been harder to get in stores this year, there will be big shifts in what defines a ‘gift’.
• Homebody Reset: Gatherings will be smaller and more intimate, with many planned at the last minute. This might see the introduction of so-called‘Single-Serve Celebrations’ that cater to needs for convenience, health and budget consciousness, by offering serving sizes and packages conducive to small or socially distanced gatherings.
• Rationale Reset: Consumers will spend more onthemselves, prioritising self-care this year. Retailers might then look to engage with empathy and recognise the trade-offs consumers will need to make. There is also scope for just-in-case solutions that cater to consumers who may be waiting to see whether they are able to physically celebrate a festive occasion or not.
• Affordability Reset – Online shopping will power more holiday consumer behaviours than ever before, creating a need to convert impulsivity. Withlimited physical touchpoints with consumers, it’ll be vital to create spontaneity, even in an online environment.

Dream designs

Always Welcome is a co-operative founded by leading South African designers and manufacturers, in collaboration with Garreth van Niekerk and Alan Hayward from creative consultancy, Coraltree Projects. Comprising a retail gallery and events activation programme, Always Welcome is now taking a bold new step into a showroom space at Hyde Park Corner (located in the upper mall of the shopping centre, opposite Tasha’s) where various furniture makers, weavers, ceramicists, and photographers will display their work as a collective in spaces designed to emulate living rooms, dining rooms, bedrooms and the like.

The interiors of the Always Welcome Nomadic Retail spaces will be realised in partnership with bespoke retail designer, Stephen Klein of Klein Concepts, in collaboration with the branding and art direction of Vincent Truter; along with key local design groups such as Earthcote, Real Paint and River Fabrics. The aim is to represent the possibilities of a ‘dream house’ built exclusively using South African design, with colours and lighting embracing an uplifting sense of renewed hope and Summer blooms. From product launches, to event collaborations with other retailers in the same environment, to Meet-the-Maker talks and in-store family lunches, Always Welcome’s programme will engage new customers and dedicated design audiences alike. The following design houses will be showcased in the first ever Always Welcome Nomadic Retail Collective: Houtlander, Dokter and Misses, Mash T, The Urbanative, Trevor Stuurman, Joe Paine, Gone Rural, Wessel Snyman, Orlando lighting, Lothar Böttcher, Okra Candles, Indigenus Planters, SMTNG Good Studio, Coco-Mat, Coral Stephens Handweaving, Vorster & Braye.

This week in numbers:

113 elephants

Local packaging manufacturer Tuffy, on average, recycles 544 311 kilograms of plastic per month –  which is the weight of approximately 113 elephants. Tuffy has joined forces with WWF SA to create greater awareness around the waste-to-landfill impact on the environment through on-product messaging, in-store communication, and other relevant activities. For every pack of refuse bags sold, Tuffy will donate a portion of the refuse bags’ sales in support of the vital conservation work done by WWF SA. Tuffy is a founding member of the SA Plastics Pact, a national initiative developed by the WWF SA in 2019 whereby various key stakeholders have set a series of ambitious 2025 targets to establish a circular plastics economy for South Africa.

QUOTE of the week:

 

“Correctly framing your marketing messages can lead to a 300% increase in conversion rates,” said Craig Hannabus  strategy director at Rogerwilco, in RetailingAfrica.com.

 

*Stocktake is a weekly roundup of current FMCG retailing and brand news, curated and edited by Retailing Africa Publisher & Editor, Louise Burgers. Keep the industry updated and send your announcements and news to: news@retailingafrica.com.

Louise Burgers (previously Marsland) is the Publisher and Editor and Co-Founder of RetailingAfrica.com. She has spent over 20 years writing about the FMCG retailing, marketing, media and advertising industry in South Africa and on the African continent. She has specialised in local and Africa consumer trends and is a passionate Afro-optimist who believes it is Africa’s time to rise again and that the Africa Continental Free Trade Agreement (AfCFTA) will be a global gamechanger in the next decade.

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