The first health food store was opened in Berlin in 1887 and the cooperative was founded in 1927. The basic idea of a cooperative may certainly also be a decisive factor in the fact that, despite competition among each other, there are several cooperations under the umbrella of Reformhaus eG. Former niches such as muesli, organic, sustainable and regional products as well as the very latest vegetarian or even vegan diet have now reached the entire retail trade. This also promoted the willingness to establish cooperations with the primary goal of bundling marketing campaigns and expanding digitization. In the meantime, around 50 percent of sales are grouped together in such marketing groups.
Since 2018, the marketing groups “well bought” (75 health food stores), ReformhausHandels GmbH RHH (203 health food stores in DACH), monthly hit (14 health food stores), Vita Nova (161 health food stores) and the Vitalia branch (86 health food stores) have merged to form the ReformAlliance. This large association bundles marketing budgets in print, POS and online.
A special feature is that around 50 major health food manufacturers are taking part in the marketing measures and making their budgets available. It is particularly a question of moving health food as a business type even more into the foreground of consumers at the moment.
Established health food store label from Pirmasens
“Encourage regular customers, activate occasional customers, rejuvenate target groups”, is how Joachim Escher, managing director of Reformhaus Escher GmbH & Co.KG, names the main marketing goals. The trained pharmacist and father of five has set up a chain with 33 branches in the second generation together with his wife Marion Escher. He is continuously expanding his branch network in the southwest from Saarlouis to Schwäbisch Gmünd. The company headquarters in Pirmasens in Rhineland-Palatinate is located in the middle of a clear catchment area and offers ideal location conditions. His market area extends far into the Saarland to the east, to large parts of Baden-Württemberg to the west and scratches to the north at the southern tip of Hesse. Only the sparsely populated French border region prevents expansion in the south as well.
Online health food stores rely on cooperation
Escher is one of the top health food stores in Germany. With 250 employees, the company generates around 18 million euros annually. On average, at least five percent of the population shop in health food stores. “This gives us a potential of 95 percent that needs to be leveraged,” says Escher.
The advantages of the health food store have been particularly evident since the beginning of the pandemic: high proportion of regular customers, manageable areas, queues at the checkout only at peak times, familiar faces among employees. All of this ensures trust, together with advice and high-quality products – an invaluable USP. Unfortunately, too many consumers still have the old, dusty health food store in their heads. “But anyone who knows our branches will see that the modern health food store doesn’t have much in common with this image from the 1980s,” says Escher with certainty.
The Vita Nova Group, to which his company belongs, renovates between 15 and 20 health food stores every year. “Today our customers expect high-quality products in an equally high-quality ambience,” explains Escher. The old trading principle “location, location, location” also applies to health food stores. This is exactly why he combines many renovations with simultaneous moves to prime locations. The competitors of health food stores are not other health food stores, but food retailers, drug stores, pharmacies, health food stores and organic supermarkets – and online retailing anyway.
Many products have outgrown their niche. Escher considers it difficult for individual health food stores to face this competitive situation. “This is where the associations help: the regional marketing associations have the task of optimizing marketing ‘around the church tower’.” In addition to classic flyer advertising and advertisements, homepages, Facebook and Instagram are also on the agenda here. In addition to local health food stores, online health food stores are also gaining in importance.
The ReformAlliance, together with the Reformhaus eG, takes on supraregional advertising for the “health food store” type of business: print and online campaigns or cooperations such as “eatsmarter” are intended to make the health food store better known. “Half of all health food stores in Germany and Austria participate in the advertising budget together with the manufacturers, but everyone benefits from the campaigns.”
Online health food stores: don’t miss the train
“Nothing works without the Internet and networking is getting closer and closer,” predicts Escher, but sees this as a basis for opportunities and potential. He considers that online customers only weaken offline business as outdated. Rather, every turnover achieved online can result in twice as much in offline business if online and offline worlds are appropriately interwoven – keyword omnichannel. In addition, the retail landscape has not only been changing since COVID-19, the pedestrian zones are getting shorter, inner-city locations and shopping centers are losing their flair due to the restrictions.
Together at the very top
Thinking online ultimately means being found and seen. To keep an eye on the best possible ranking and to be able to stand up to the top dogs in the online shipping market and their overwhelming competition. Amazon is also represented on the Internet with relevant offers. Closing ranks is also the name of the recipe here. It has been more than ten years since the 17 health food store owners of Vita Nova, with a total of 161 stationary shops Vita Nova Internet GmbH have launched.
This independent company takes over everything to do with e-commerce for Vita Nova: the online shop, marketing measures such as newsletters, Facebook, Instagram, advertising, as well as the entire logistics. The other groups and Reformhaus eG also operate their own online shops. According to the motto “One for all and all for one”, the health food stores, together with the cooperative, want to strategically advance the topic of a central online shop for all health food stores and rely heavily on digitization. There is also an exchange with other successful cooperatives. Overall, there is great optimism in the industry, the health food stores want to face the market, but they also know that you have to face it. The course for a successful future seems to have been set by online health food stores and cooperations.
Also read: New Retail: Thanks to digitization, the way out of the crisis works