Monday, November 20, 2017 | Today's Vending Industry News
What's The Difference?

Posted On: 1/18/2006

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Everyone remembers the story of the city-dweller who, at last, went out into the countryside to get a good look at a forest. He was unable to see it, though, because there were too many trees in the way.

The progress of applied science tends to reduce the differences between specialties. For example, the recording of sounds and of images were two radically dissimilar disciplines for a century. The triumph of digital technology has brought them much closer together. Similarly, improved understanding of fluid dynamics has made aeronautical engineering and naval architecture much more alike.

This convergence can induce discomfort during periods when it accelerates, but eventually, everyone benefits, as innovations in one specialty find ready application to others. The difficulty about the process is that it can delude the superficial observer into believing that the remaining differences are unimportant, and/or that they will vanish altogether as time goes by.

There is nothing inherently wrong with superficial observation; somebody has to take the large view. Mapmakers and ecologists need to see the forest as a whole. But it is essential to recognize that the differences are, and always will remain, important. Many biological disciplines require continued attention to the trees.

This is worth keeping in mind, especially in a time characterized by "paradigm shifts." And it has very wide application.

For one thing, the whole idea of "category management" is an example of convergence. Half a century ago, it would have been hard to find many similarities between, say, operating a store that sold hardware and one that sold candy and sundries. Of course, the new ability to record sales and update databases automatically led to the discovery that items form groups (like woodscrews or chocolate bars). While people desiring an item may have a preference, they often will substitute within a group; if you want a brass woodscrew, you may buy a stainless-steel one instead, but you wouldn't buy a capnut or a paint brush. Of course, retailers had known that forever, but they now have ways to quantify it. And the same transaction-capture methodology made it quick and easy to determine which items were most, and least, popular.

Dazzled by this discovery, it was all too easy to overlook the point that consumers do have preferences, and sometimes will not think a stainless-steel screw equally suitable for the application as a brass one. Or, for that matter, that all chocolate bars are interchangeable. It is possible to brush off these annoying minority opinions, as the "big-box" retailers tend to do; but someone should be concerned with the loss of sales and, perhaps, even of customers that results.

On another topic, one of the evolutionary processes that we've commented on over the past three decades is the emergence and solidification of "away from home" as an identifiable market, desiring individually-wrapped products for immediate consumption. In the 1960s, vending operators discovered this market among people in workplaces a long way from their homes, and the full-line revolution ensued. In the early days, alert candy, cookie, cracker and food producers came up with vending-specific products that met the size and shape constraints of the equipment in use at that time.

Over time, people came to expect prewrapped portioned items, and the convenience store industry met that demand. While vendors saw that development as creating new competition, on the longer view, it ratified the monetary value of convenience. We remember innovative easy-open canned desserts failing in the vending market, because the item was also available in a supermarket eight-pack. The consumers of the day were accustomed to buying things in bulk, and worked out the unit price of the supermarket's can at 18¢, while the vendor had to sell it for a quarter. The C-stores helped greatly to build a new public awareness that something when and where it's wanted, in the right quantity, is worth a few more cents.

Once again, though, convergence should not be allowed to obscure important differences. The vending and C-store markets are not the same, although there is a good deal of overlap in the formats demanded. There are dangers in overlooking the difference, and rewards for suppliers who recognize and deal with it.