Natural Foods Merchandiser
How natural foods retailers respond to 'the Dr. Oz effect'

How natural foods retailers respond to 'the Dr. Oz effect'

The Dr. Oz effect impacts everyone from ingredients suppliers to manufacturers to distributors to brokers. But perhaps the mostand most frequentlyaffected are natural products retailers. How are they responding?

This is the drill: Dr. Oz touts a certain food or supplement or recommends a particular product on “The Dr. Oz Show” and, almost immediately, shoppers flock to natural products stores in search of it. Cases in point, when the celebrity doc told viewers about a study that found arsenic in nonorganic apple juice, grocers across the nation saw organic apple juice sales spike. When Oz called astaxanthin "the next vitamin D" on air, customers clamored for the carotenoid. Rarely does one person’s words impact consumer buying patterns so strongly, but in the case of Dr. Mehmet Oz, his recommendations move markets.

"The Dr. Oz effect," as it’s been coined, impacts every rung of the ladder, from ingredients suppliers to manufacturers to distributors to brokers. But perhaps the most—and most frequently—affected are natural products retailers, who interface with droves of Oz apostles daily.

“From regular customers to new, crossover customers, they seem to come in for one Dr. Oz–recommended product or another daily,” said Joel Patterson, owner of Nature’s Green Grocer in Peterborough, N.H.

Stacy Gangestad, merchandising manager of Valley Natural Foods in Burnsville, Minn., also sees shoppers flock to her stores in search of supplements, foodstuffs and personal care products that Oz applauds on a daily basis.

Keeping up with Oz

While the Dr. Oz effect brings more customers through the doors, it can also be taxing on retailers. “It’s kind of a love/hate feeling,” said Jenny De Roo, multi-store wellness manager at Lakewinds Natural Foods in Minnetonka, Minn. “We love the added customer traffic, but it can be difficult to meet their demands on such short notice.”

So how can busy retailers stay plugged in to what Dr. Oz is discussing in order to prepare for the onslaught? “I follow Dr. Oz on Twitter,” De Roo said. The doctor’s daily e-newsletter has become a valuable resource for retailers, as has his website, doctoroz.com, featuring his blog, videos, recipes, shopping guides and more. Some retailers have even incorporated watching the TV show into their already-packed schedules, either by tuning in during their office hours or recording and sifting through the show’s contents after store closing.

In some cases, manufacturers can tip off retailers to upcoming Oz mentions. “Once in a while, I’ll get a lead from a sales rep or manufacturer that a particular product will be featured,” De Roo said. “But usually we’re not given any warning, and neither are the manufacturers.”

Other times, manufacturers will use an Oz-lauded product to call on new retailers. “We frequently receive calls from manufacturers I’ve never heard of before when something is really in demand,” De Roo said.

For the many instances when product mentions come unexpectedly, retailers know that as soon as one shopper comes in seeking an item, many more are likely to follow. Therefore, they do their best to stock up—and as quickly as possible.

Strains on stock and supply

But stocking brings up another challenge, as retailers aren’t always able to call in more merchandise at a moment’s notice—nor are distributors able to fill orders or manufacturers able to crank out products fast enough.

“When Dr. Oz recommends a product, it exploits one of the most wonderful parts about the [natural products] industry—that it’s composed of small businesses,” Patterson said. “In most cases, these are not huge, production-based companies, and the raw ingredients sourced to produce the products are in limited supply. As a result, stores scramble to place larger-than-average orders, and producers try to quickly source raw ingredients. They’re often unable to get enough, or when they finally do, they’re not able to keep up with production themselves. End result: Stores don't get the product they ordered, and customers are left wanting.”

In such cases when shelves have been emptied or a store doesn’t carry the latest Dr. Oz–recommended product, retailers still are tasked with appeasing consumers. “Products that we don’t currently stock are difficult to review in a quick enough time to get them on the shelves before the demand recedes,” De Roo said. “Usually, we try to offer them something similar to what they are looking for from our current mix of products.”

Fortunately, many of Dr. Oz’s endorsements have staying power, so even if retailers can’t keep up with initial demand, they often can capitalize on those products’ continued popularity. Valley Natural Foods places special tags on products that Dr. Oz has applauded in the past, which Gangestad said definitely drive sales. Other retailers promote availability of Oz-applauded items via their Facebook pages and Twitter feeds.

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