Paul McDonald and Ashwath Rajan drew widespread scorn this week after their company, Bodega, was profiled by FastCompany in an article entitled “Two Ex-Googlers Want To Make Bodegas And Mom-And-Pop Corner Stores Obsolete.” Twitter was calling them “the most-hated new start-up.” That’s not good publicity for any company or organization, novel or well-established.
I’m a strong advocate of Mom-and-Pop Stores, but I feel the outrage is overblown. Every business has competition. Where was the uproar when Uber practically put the taxicab industry out of business or Amazon threw independent booksellers into bankruptcy? Any company, store, or organization that doesn’t have competition today, will have a competitor tomorrow. The goal of all business entities, large or small, is to develop customer retention strategies to secure their base so that customers aren’t enticed to leave. And Mom-and-Pop Stores, by their very nature, can differentiate themselves by creating and building stronger human relationships.
Calling their company Bodega might have not been the best choice or what McDonald and Rajan learned in Marketing 101. According to Miriam Webster, a bodega is, “usually a small grocery store in an urban area specifically specializing in Hispanic groceries.” According to what I read, their company has universal appeal and will not put Mom-and-Pop Stores out of business. Their new product sets up a five-foot-wide pantry box filled with non-perishable items you might find in a convenience store. An app will allow you to unlock the box and cameras powered with computer vision will register what you’ve picked up, automatically charging your credit card.
Sound familiar? Similar to a mini-bar in a hotel room. I don’t remember any outrage when they were first installed in hotel rooms in the 1970’s. Except, of course, the outrageous prices charged for a bag of pretzels or package of cookies. Bodega is pilot testing placement of their product in gyms, dorms, apartment lobbies, companies, etc.
As the original article in Fast Company mentioned, the biggest threat to bodegas, especially in large urban areas, are the landlords raising rents when leases expire that only large chains can afford. My wife and I live in Manhattan where there is a bodega on every corner and many of these establishments have been there for years and will not go out of business any time soon. How do you decide where to shop and spend your dollars? In my case, it’s the bodega where I get a big smile and the staff remembers I’m a frequent customer and asks me about my day.
Paul McDonald and Ashwath Rajan have come up with a good idea. My thought is they need to use a different marketing strategy. Convenience is important; this new idea uses technology to provide products where you work, live or play. Anyone who frequents their favorite bodega is not going to stop just because they can pick up snacks or healthcare items with an app. You run out of milk or need an ice cream fix and those necessities still require a short walk to your favorite bodega.
Do you think the outrage is overblown?