Whole Foods as a bustling food court of artisanal brands, tasting stations with smiling t-shirt clad brand ambassadors offering morsels of everything from cricket flour-made snacks to drinkable soups has become a piece of Americana.

Unfortunately, like the local Sears store or the neighborhood theatre, it may be going the way of the Dodo bird.

Yesterday’s feature in the Wall Street Journal gave us a glimpse of a challenged, misbranded future that may be coming early next year.

The article spoke directly to the disappointment in growth numbers from price decreases and the changing face of the brand as it turns away from its core positioning as a platform for artisanal local food innovation that has defined it for over a decade.

Behind the scenes, this is what made Whole Foods tick so personally and loudly. It was the essence of its allure to the wellness conscious shopper and generations of food entrepreneurs.

From low-cost loan programs supporting innovative brands in the early days, to the unique local first approach, Whole Foods was early on driven by a forager model. Business development outreach to local and regional brands easing the way for smaller companies to find visibility next to national brands on its shelves.

Making the offerings in NY different from Seattle or Nashville. Local flavor on a national platform piecing together a brand magnet that captured my generation of shoppers.

On the artisanal side, Whole Foods was the chosen launch pad, bringing food innovation to the market as local market test cases. And crafting brand loyalty in a brilliant way with New Yorkers supporting their Brooklyn artisans and locals in Austin, their hot sauce manufacturer.

Certainly, the cost of supporting a brand through this high-touch model was real, but it netted out on both side as it built customer and vendor loyalty in quite amazing ways.

At 5am on a weekday, the loading docks were a combo of tracker trailers from huge distributors and sleepy people in their SUVs schlepping ice packed insulated crates of product in a few cases at a time and stocking their shelves with loving care.

This spawned as well, a national ecosystem of shared kitchens, boutique distributors, merchandising organizations and an entire community of small companies working from the farms to the stores, sharing a conviviality that extended to the folks on the loading docks to the personalities of the buyers on the floor.

Yesterday’s piece in the WSJ hinted towards the dismantling of this community, announcing that in the new year vendor demoes (aka tasting stations) would be gone as well as all merchandising would be handled in store. And by default, a greatly reduced number of local brands in the stores paying for support services.

This will result in both less support staff for Whole Foods certainly, a different on-floor structure but the end of the store as a platform for bringing local and artisanal product to market.

To be clear, this has been coming for the last 2-3 years as the company shuffled unsuccessfully for more profitable models. Smaller brands started moving to other chains to find distribution. In-house 365 brands and cobranded solutions replaced segment after segment to drive higher margins and stronger affinity to nationally distributable products.

Here’s the rub.

Whole Foods has a broken bottom line and obviously needs to make some hard decisions.

But, this decision feels like one made by the financial arm of grocery chain out of fear, not one made by a well-capitalized highly innovative parent company that is cognizant of cost reductions but fully aware of the value of the brand itself as the key for customer acquisition and loyalty.

I view Whole Foods as a Petri dish for a new way of defining grocery, not by following in the footsteps of the big chains and just slashing costs. But by creatively rethinking the model and the brand, not emasculating it.

Grocery is all about thin margins and product shrinkage.

Why? Because organic produce, innovative ingredients and healthy food are by definition expensive and perishable. And for the most part, better for it and the lure for customers. That’s the built-in conundrum of the model.

Obviously, it makes sense to figure out how to grow and distribute organic at economies of scale that bring it to the consumer at better prices with higher margins.

But I also believe that healthy, innovative and local is the core of their brand and the largest and smartest savings come less at the management of the artisanal brands and more at the infrastructure of distribution itself.

That squeezing the producers in the supply chain is not innovation, simply line item cutting in the face of profitability without much imagination. You can easily squash the smallest vendors for the least gain, while rethinking distribution as currently structure for over a century is where the true game changer could—I think must—happen.

I expected more creativity honestly from Amazon.  They are simply smarter than this.

I expected both innovation to do things differently and a respect for the brand itself as something that made thousands of us to shop at Whole Foods regardless of price. We are the base to be leveraged, not alienated.

There is very much a balance possible here through innovation though not by becoming the very thing that Whole Foods was founded to replace.

I am still pragmatically optimistic that visionary M & A people at Amazon will see that the only solution here is a new one.  A new way.

We don’t need another Albertsons, we need a smarter and more pragmatic Whole Foods that can redefine the supply chain to benefit of us all.

I sent this post to Jeff@amazon.com so we shall see if anyone is listening.

—————-

See my other post on the Whole Foods acquisition.

Communities simply happen.

In spite of the limitations of the platforms they are built on and regardless of the hosting mechanics that never quite seem to fit.

In the last decade or so social networks have been what tied our world together and communities what created value and gave the networks their souls. A symbiotic and parasitic relationship that typifies our connected world.

Up to now possibly.

As the social nets have become overtly controlling and commercial, this relationship has become more strained. And the more familiar I become with the dynamics of the communities built on the blockchain the more I see the potential to turn this paradigm sideways.

From hanging out in these coin-based markets, regardless of which coin or  competing platform they are built on, the possibility for a changed community dynamics seems possible.

And any time behavior is capable of being platformed in new ways, change is not only feasible but carries the possibilities of massive cultural transformation along with it.

I don’t pretend to have an answer, not I think does anyone, but in these early market communities there is a different dynamic at play.

Different in how ties are being formed and portending I think a reconfiguring of what marketing could mean in this new reality.

This idea came together for me around the idea of internetworking communities that I head my old friend Bill Thai talking about from one of his events on Necker Island.

The construct is that if rather than the broad social networks that we live on today, where we waste so much time pining for connection, there has been cropping up an alternative built on the blockchain, reshuffling the hierarchy of communities and networks.

Staring with the communities first as deep commercial decentralized connections, wired together establishing network interoperability cross them.

This is slippery to get your head around.

But what you sense is a real migration in place, off of the social nets where we are more and more stymied for expression and more and more harvested for the value of our data for media dollars.

Where the innate friction in this new paradigm—and there is friction of course—is pushed into the background by the pure possibilities of it all.

There are a number of still developing points that I can’t quite place but keep waking up thinking about.

Our core humanity and need for community is not transactional in nature so why the blockchain?

This one is hard to internalize.

Maybe it’s the resilience of community itself. It exists today on the matrix of the social nets so why can’t it exist in a transactional framework like the blockchain?

Community adapts and possibly peer-to -peer and the sense of ownership that it conjures up is more relevant as a platform. Or maybe it’s a good option cause the one we have today are so poor.

The past year has highlighted the limitations of our social nets as a platform for anything other than patter, and show and tell. The need is real and could drive this shift as our community needs follow us wherever we are.

Many of the coin-based communities are neither pure communities nor marketplaces, but a hybrid, market economy defined in a new way.

Once you remove the traditions of standard currencies from the platform the dynamics changes and this fresh hybridness takes over.

There is a stronger sense of ownership by both sides of the market and with it, a more generous reality of compensation that has the core value/compensation equation but different in yet inchoate ways.

It’s more convivial because trust is built into the transaction yet it is transactional not social by nature.

The dynamics of this are real, though not at all understood.

Marketing on blockchain-based marketplaces has the potential to be completely different.

This is the hardest one for me to come to grips.

When we moved online we brought with us our core behavioral needs. We evolved but the dynamics of groups and the needs of each of us are constant and will remain so.

But if you hang out in these marketplaces, the dynamics are more about community and less about networks. The KPIs that have driven marketing on the nets are out of place.

Engagement around the value of exchange feels natural though.

So what happens as the content producer on Steem want to grow their business footprint? Will this platform simply bring along with it all the crap from the social nets and start that media based mosh pit of target, find, touch, nourish, transact?

Or will it create its own dynamics where value in itself is the driver of attention?

Or is it as I’m prone to believe, a hybrid where community group dynamics will take on a new form in these market communities, starting out with a purer value-based engagement like we see in communities of interest today?

Moving forward

This relationship between private currencies, interconnected hybrid market economies and the changing face of communities and marketing is I think at the very beginning of change.

The craziness of ICOs will level out.

The behaviors of people and companies as they start to slowly reinvent our businesses and economies is just getting started.

If there is anything that we’ve learned from the crypto world is that the time to start engaging and shaping change is definitely right now.

(My site and this 1/2/2017) post were hacked and recreated below.)

This is what’s on my radar entering 2017.

These aren’t predictions so much as topics of interest.  Some I’m working on, some invested in, some chasing after the best ideas on how to get involved.

For predictions, see the brilliant post by Fred Wilson from yesterday.

Here goes!

Humanization of the social nets

The social nets showed their raw side in 2016.

They proved themselves incapable of platforming true serious debate. Structurally they appeared miswired to deal with human touch at scale and balance gesture and conversation, nuance and emotional beliefs.

I reject the idea that closed small groups are the only answer to true conversation and that social nets only really work face to face. Somewhere in the intersection of how our broad social nets host communities of interest lies the answer.

I’m presuming that Facebook is already working on this. I think Twitter has some unique advantages but appears too caught up in fear of failing to take advantage of this market opportunity.

I posted most recently on this here.

Rebirth & reification of the episodic, long-form conversation

The truth today is grey at best.

And conversations require nuance of thought and regardless of the complexity of the topic, some patience.

Blogs and podcasts, extended groupings in real life will become the town halls they were a half dozen years ago. I see this as less retro and more an awareness that gestures alone are not speech and that brands of value can’t be built on the back of hyperbole and mechanized content publishing.

In the face of ignorance and hate, we need intelligence, articulation and openness.

And as well, the skills of thoughtful analysis and storytelling will become the most important train of leadership and success.

The miscast intention of growth hacking and the data-before-thought trend will be pushed aside and market awareness, brand integrity, customer connections, and behavioral consumer understanding will be the first words on our whiteboards as we map our future.

Marketing as the art of communications with the market is overdue to be reimagined.

Local as a workable model

The more our population centers in vertical urban centers, the more real the smart city becomes and the more that logistics become a tool not a challenge to new solutions, the more essential the reality of local as a business model not just a market, becomes essential.

This is both the largest of messes and the ultimate opportunity.

Today, especially in the consumable goods industries, artisanal is a broken concept and invariably hits the wall within the margin crush of distribution, transportation, retail oligopolies.

In effect, local is both the answer and the problem.

The opportunity that must get fixed through the intersection of government cutting back restrictions, partnerships with the smart city infrastructure itself and a cutting into the monopolies of distribution model

Robotics as a panacea for the artisanal food conundrum

Artisanal as a model for consumable is fraught with issues of scale and margin.

I ran into this video last month and it sparked the idea that hand made is ready for disruption.

That one way to solve our food problem is to harness technology itself. The consumerization of robotics as a potential answer.

Crazy—I don’t think so.

I think that as this becomes the answer, where technology is a tool in the artisanal for hand-made and personal.

Think of science fiction caricatures of agriculture on Mars as a reality in Brooklyn to feed the metropolitan area.

Every backyard as part of a web of supply for an unfeedable urban demand.

Top down/bottoms up distinction will start to vanish

I’ve been touching on this for a year now.

That the pendulum of innovation is moving from the bottom to the top, from the individual to the enterprise, from ideas at incubators to corporations with the resources to truly accumulate and parse the data that sits behind most everything.

This is not obviating the startup culture certainly but nothing changes the world than the huge ship of the enterprise embracing it.

From changes in how we work, from incorporating IoT and I think the most profound, the resurge of understanding that enterprise sales, strategic selling into the world’s largest entities will become a rare skill as much if not more so that the need for the most brilliant programmers.

Location as a point of commercial value

Today, location data is free. Ubiquitous.

I think that proximity, dynamic location that includes not just where thing are but where they are in relations to everything else will come of age.

And that this will redefine location as free to a dynamic that is part of a business model itself.

Maybe through IoT finally surfacing out of the chaos of devices to a platformed software model. Maybe driven to address the mobile aspect of the changing workforce.

I know that many are tackling this and the groundwork for this to break open becomes more real daily.

What I am clear on is that this will happen in the enterprise first.

Happy New Year to all!

Through change comes opportunity. Through surprise comes the push to understand the why of what happened.

We certainly have lots of change and loads of surprise to take away from 2016.

And there are lots of opportunities in front of us.

We need impossibly bold ideas to transform our world.

We need to reset the bar of value considerably higher, based on cultural and global societal needs and tempered by the very possibility to impact meaningful changes in today’s world.

If we look at the most sweeping changes we benefit from every day—be they Uber, AirBnb, Bikeshare, Facebook, Slack or Twitter—I believe these will be seen over time as simply building blocks for a new set of changes we need to address.

From clean energy to a healthy food supply to cybersecurity to communications platforms to the impossible congestion on our roads.

We don’t need to disrupt these areas as much as we need to rethink them completely.

I’m honestly not in awe of how far we’ve come. I’m completely in awe of where we can get to now.

I think the scale of the needed changes will potentially reconfigure how we approach innovation itself.

For over a decade now we’ve evolved the concept of work and the structure of entrepreneurship from a bottoms up point of of view.  It’s changed our world and got us to where we are.

We have incubators, not unlike the old Hollywood studio system, that warehouse talent with a capital-first perspective, shuffling a broad array of people through a pitchfest for capital.

I’ve been part of this and it’s been an essential step.

But I wonder if this process needs to be rethought as well.

Whether in the upcoming years, this will still be spearheaded by team and founder as sacrosanct, and not one driven by the clarity and boldness of the ideas themselves as the organizing force?

Whether the idea of a startup will not change somewhat as more corporations with the reach, the resources and the data repositories will not become the capital sources tying innovation directly to infrastructure to leverage formative changes with less friction.

Whether this idea of change from the bottom up was a stage in itself?

Not about the aggregate of countless micro efforts but the need for big ideas that could capitalize on the massive potential we have today. Turning huge problems into a elegant, far-reaching solutions. Change built on the human capital and dynamics in our networks themselves.

I grew up in the tech industry as part of the revolution that a few people in a loft or garage could prototype something that could rewire our world.

It worked well and we are all the beneficiaries of this.

I wonder though if five years from today, the greatest changes we experience on the streets will come out of incubators and pitch fests. Or whether something else is brewing.

We are living the reality that the impossible is indeed possible. That unfathomable logistics are simply a step to take, not a show stopper when resourced.

I believe that we are entering an era where potentially, like in the entertainment industry, the creative idea is the starting point. The organizing principal.

The creative vision where possibility supersedes the mechanics of fundraising, team building, market penetration and the rest.

All are of course critical.

But I wonder whether we’ve turned a huge corner of both need and probability that the impossible can indeed happen in a new way.

Not that each and every piece is not critical of course. That iteration and execution aren’t essential, just that without the idea, without the vision, its just mechanics and skills.

Like walking into a factory or workspace  or an industrial kitchen. Simply desks and metal and technology.

With vision and creativity and an incubated idea, there can be magic that changes the world.

Try something.

Wake up early tomorrow and take a walk around your town or your city.

Think through how people move around. How transactions happen. How healthcare is instituted. How we live our lives. How we communicate cross time and space.

Never has a bigger ship with built in dynamics for larger and faster change been so verdant for rethinking. Where need and possibility intersect so easily.

Our world has so changed. Dramatically and for the better.

I have to wonder if the process of innovation itself, may not be next piece to re-imagine.

A requisite to even larger changes, rethought to suit the possibilities of the times themselves.

Community as a market strategy, as a channel and in some cases a business model, is the personal bias of my career.

It’s my way of understanding the world.

Truthfully, it’s always been somewhat ineffable and perplexingly inchoate. You can arrange the pieces in perfect order with invariably powerful results when it works, but it is as well, always unpredictable.

This is changing.

Community as an entity is becoming on one hand more critical for commerce, on the other, more deterministic, and more tangibly coupled to the networks they spring from.

And while the networks that wire our world become fewer, more powerful and data smart, community where human touch and collective engagement gather, becomes more critical as an after effect.

Networks today while some lament their impact on privacy and their monopolistic power, are the necessary counterpoints, in fact the subset of each community we participate in.

The dynamic between the networks we frequent and the communities we engage with define in many ways who we are as people and inevitably, whether the companies we work for and the causes we hold dear are successful.

It’s in this pairing of networks and communities where I start my work, with a handful of basic truths that regardless of the uniqueness of the community, invariably hold true.

The more I adhere to these ideas as starting points, invariably the better the results.

Networks are the strings that tie our world together, but communities are what gives them meaning.

Networks are a common factor, while horizontal communities are by definition unique and invariably-vertically focused. Maybe it’s a cause or a belief or a shared obsession, but communities are formed around common interest, not around friendships or place.

Saying that a network has an identity is a stretch; having a community without one is neigh impossible.

Network infrastructure is where technology shows itself at its best, but communities are where emotion and empathy, self organization, action and engagement happen.

Networks get continually smarter but this intelligence at its core is about driving the human connections to aggregate behaviors and beliefs than can form communities where the real work gets done.

The smarter the networks, the more extensive connections can surface. The more possibilities that in the end game communities can be formed.

Networks are the tangible things we can leverage, communities are the aspirational goals we set for them when they capture the imagination of a market.

The world’s population is already platformed on the social nets. The objective is discovering the hooks to surface and tie people together from this massive strata of humanity.

When we scratch this out on whiteboards and intersperse all these elements, leadership is something that surfaces as the key focus to channel enthusiasm into action, beliefs into organizations based on a collective drive. Discover the leaders and the language they use to tell their stories and you have a strong place to start.

Neither networks nor communities are tied to place as much as they are grounded in time.

Where people are matters of course and we need to understand the dynamics of speaking to people where they are, platform by platform.

But community, the aggregate of connection around a singular topic or belief, happens cross them all.

In time, not really in a place.

In some instances (though more rarely), communities exist at an address like your URl. On a bar stool at your neighborhood wine bar, but more and more, community is less and less like a club, more and more like an impromptu gathering regardless of location.

Platforming communities may indeed be a myth.

Community simply happens. Often in spite of the poverty of the infrastructure.

I want to believe in a platform that will enable every brand to manage its own community but I simply can’t discover it nor for all my attempts. Can’t seem to build it either. Trust me I’ve tried.

We certainly use vertical single-function solutions like Kickstarter to transact around a common community goal, but the community is not in one place, it is spread out across the web.

It lives everywhere but there.

This is a perfect wave.

Sometimes things just stack up and point to a new future.

Usually the pendulum swings in art, culture and technology, with emphasis on one extreme over another. One movement in reaction historically to what preceded it.

I believe that we are seeing a merging of opposites to a common goal.

It’s not data collection that matters, its interpretation. It’s not networks with increasing strong AI that matters, its where the smarts of the networks ends up coalescing around the human connections of the people in community groups.

A digital world driving an analog value.

There are few times where the science of data collection is at one with the needs of human expression.

It is happening right now.