After the Yogurt Wars: How to Overcome the New Retailer Paradox

About ten years ago, yogurt stopped being a standard dairy staple and became something else: a snack, a health food, a dietary supplement, a culinary pass to the world. Today, the Greek yogurt variety that started the craze is joined in the dairy aisle by Indian lassi, Icelandic skyr, honey-sweetened Australian yogurt, and a panoply of vegan, probiotic, and health-conscious alternatives. The average supermarket carries over 300 varieties.

Standing in the dairy aisle can feel much like picking a movie on Netflix — a drawn out, often irritating experience. A simple choice has become an encounter with abundance, and it doesn’t feel as great as we thought it would.

In 2004, just one year before Chobani — the brand that launched the yogurt renaissance — was founded, Barry Schwarz published his book The Paradox of Choice. In it, he foresaw this condition — the complexity of choice that has led to a decrease in general satisfaction, and the rise of a distinctive phenomenon: decision fatigue.

As a retailer, how can you counter these effects to improve the shopping experience? It’s time to hone in on what your brand does best.

1. Focus on Key Product Offerings

We are living in the aftermath of the Yogurt Wars. Although the yogurt market grew from $4 billion in 2004 to $9 billion in 2016, for the past two years sales have decreased and the market is shrinking. Years of fighting between major brands and newcomers led to an endless push for differentiation — and retailers were all too willing to stock the ballooning numbers of resulting brands. Now consumers, retailers, and brands are all set to lose.

It’s time for retailers to focus on key product offerings and see themselves as a destination. DTC companies have become a major threat to retailers precisely because they offer this kind of experience. Brands from Casper, which offers limited versions of its popular mattress, to Glossier, which provides makeup products in highly anticipated limited runs, have excelled at creating an aura of boutique expertise.

That’s not to say all retailers need to pursue the boutique model, but stocking distinctive brands or experiences that are unavailable anywhere else can be an effective antidote to overwhelming choice. Think: sushi bars and nutritionist assistance at grocery stores, retail space dedicated to unique local suppliers, or investing in partnerships with DTC companies to exclusively stock their products.

2. Couple Variety with Guidance

It’s hard to make a case for a reduction in retail offerings in a culture that embraces diversity, worldliness, and self-expression.  But that doesn’t mean you can’t use marketing to make shopping simpler for those seeking more seamless and curated experiences.

There’s a lot to learn from Stitch Fix, a pioneering online retailer that offers “personal styling for everyone” through its subscription service. A simple website directs potential customers through a questionnaire that prepares them for their first clothing delivery, from which they can pick items to keep. Named the “World’s Most Innovative Retailer” in 2019, this disruptor is shaking up the way retailers are selling and distributing products. Other online retailers, such as Rent the Runway, which stocks and delivers designer brands to subscribers, are closely following in its footsteps while introducing new “rental-wear” distribution models to the concept.

For an example from the grocery industry, consider GIANT Food Stores’ new concept store in Philadelphia. Branded as Heirloom Market, the store — which has two locations in the city — carries products that are carefully selected to meet the tastes and needs of local shoppers. Natural and healthy options don’t stand out against a backdrop of hundreds of alternatives. Instead, they are independently curated and marketed to customers along with specialty offerings, such as artisanal baked goods from local bakeries. If a customer can’t find something, in-store technology helps them find what they need and order it for next-day delivery. Heirloom Market fits within the fabric of the city while providing a guided and helpful experience to its audience.

3. Don’t Stray Outside Your Lane

Consider the question: does Burger King really need to offer tacos? Crossovers and mashups have become a clichéd marketing tactic today. Supreme, the popular streetwear brand and skateboard shop, has become notorious for mocking this kind of marketing by unleashing limited lines of hammers, bricks, and fire extinguishers.

But these kinds of moves are beginning to irritate savvy consumers, who are starting to notice that such investments in product stunts are distracting from quality products and experiences. While ironic product lines might work for Supreme – an irreverent, pop-infused brand – they might not work for Barbour – a brand that succeeds on the reputation of key jacket models with cross-generational appeal. When marketing has made things more complicated than they have to be, it’s time for brands to remind consumers that they can still deliver what they set out to deliver in the first place.

As consumers increasingly seek to define their own individual brands, retailers race to provide the options necessary to enable this kind of expression—even when it comes to yogurt. But now a new paradox has emerged. While brands offer more choices, retailers are losing distinctiveness themselves—the ability to be differentiated by singular products or experiences that stand above the rest. In order for retailers to survive in the age of distraction and decision fatigue, they have to refocus on their best products and the expert guidance that customers want.