CHICAGO -- Two on-line grocers are helping to define the future of mass retailing, according to a marketing specialist who spoke at the International Housewares Show here last week.
Streamline, Westwood, Mass., and Peapod, Evanston, Ill., are developing ways to customize products and services on a mass scale, creating "solutions for the home" and locking in customer loyalty, said Martha Rogers, a partner in marketing1to1 / Peppers and Rogers Group, Stamford, Conn., and a professor at Duke University's Fuqua School of Business.
Rogers said the two companies operate on the principle that more and more, successful marketing means finding products for customers, not the other way around.
"The traditional retail system is overheating," with too many products and too little shelf space, she said.
"People are starved for time. Consumers don't want more choice -- they want what they want. Streamline knows things about you that you didn't know yourself, and they never let you run out of anything."
Rogers' remarks came as part of her keynote address at the International Housewares Show last week.
Despite snowstorms, the show, sponsored by the National Housewares Manufacturing Association, Rosemont, Ill., was expected to draw more than 60,000 attendees during its Jan. 10 to 13 run, a spokeswoman said.
Rogers said the convenience Streamline offers has earned it a 94% customer-retention rate. For a customer, she asked, "What would it take for you to switch? The answer is you wouldn't, because you don't want to wait for others to get up to speed on that learning curve."
Rogers said 27% of U.S. households are on-line for at least 12 hours a week, and 20% of all packaged goods will be sold direct in the next four years.
On-line retailers have the ability to remember individual customers and their needs, a key to securing loyalty, she said. "Better customer loyalty can translate directly into a better bottom line."
Rogers said traditional supermarkets' loyalty programs are a step in the right direction, but "unless they take the information they get and do for their customers things nobody else can do, they're still not truly marketing one-to-one. Transactional information will only tell you so much. Then you have to talk to people."