Jan 21, 2014

The Central Group: Innovate Beyond Your Products

Growing a sticky brand is a fine balance. It’s like a well mixed cocktail. One part operational excellence, one part innovation and one part commitment to the end result.

The foundation of a sticky brand is operational excellence. Marketing hype scratches off quickly. It might get you in the door, but if you can’t deliver consistently you’re not going to stay around for long. But operational excellence on its own isn’t enough either. What do you offer that delivers real, tangible value to your customers?

It’s the combination of operational excellence, innovation and tangible results that allow organizations to challenge the status quo, and make a significant mark in their industry.

The Central Group has experienced substantial growth over the last decade by focusing on the balance of operational excellence, innovation and commitment to the end result. They are a manufacturer of point-of-purchase displays and packaging that are used by large consumer brands like Colgate and Nestlé.

Focus on the result

Customers come for the products, but stay for the results.

Rick Eastwood, President of The Central Group, is very clear on what his company delivers, “We’re not in the business of selling displays and packaging. We’re here to help our clients get their products out the door.”

Central’s mission is “Improving performance at retail”. This is their lens. It gives their team a clear understanding of how their products are used, where they should focus their energies, and keeps them alert for new ideas.

To support their clients and their mission, Central launched the ROI Lab in 2008. It started as a retail sandbox, and has grown into one of the most sophisticated retail labs in North America. The lab enables CPG companies like Colgate to work with Central’s design team to innovate and test packaging, merchandising and display concepts. They can set up the space to mimic various retail environments, and conduct research with live shoppers to see how programs will work. The lab provides consumer packaged goods companies a platform to validate their in-store marketing concepts before they implement them.

The ROI Lab is only a piece of Central’s focus on the end result. They developed the Applied Innovation Program, which wraps their clients in data, from manufacturing costs to in-store performance. They go well beyond the black box mentality that is so prevalent with merchandising, and work with their clients to be very aware, responsive and accountable to how displays and packaging are driving in-store performance. The belief is the numbers don’t lie.

The ROI Lab and Applied Innovation Program have helped Central form a substantial competitive advantage. It shifts them from a manufacturer of displays to a firm that is deeply committed to the end result, their customers’ results.

Be ready when opportunity strikes

Some of your best innovations are unplanned.

The original idea for Central’s ROI Lab was a retail showroom. They were creating a space to showcase varying merchandising options, and use it as a sandbox to test out ideas. But the name, the ROI Lab, took it in an unexpected direction.

Rick explains, “The VP of Marketing at Colgate Canada got wind of our lab, and requested a visit.” Central was shocked. Why was Colgate interested in their lab? Don’t they have their own? It turned out they didn’t.

Colgate was interested in testing their merchandising options, and it was that little bit of interest that motivated Central’s management team to double down on the concept. They studied retail labs from all over the world, established partnerships with key technology providers like IBM, and invested in a world class lab.

Central saw the potential for the ROI Lab, because they have a history and a culture of innovation. In 1990 they became the first high value corrugator in North America to offer full color printing. And if you purchased a pair of Sorel boots or Bauer skates in the 90’s they came in a box made by The Central Group.

Their culture of innovation helped them seize the opportunity. They were clear on their mission, “improving performance at retail”, and the opportunity made sense. By creating a retail lab they could shift from a manufacturer to a strategic partner.

Easy in, impossible out

Rick Eastwood describes Central’s strategy as “easy in, impossible out.”

There’s no escaping the relentless march of commoditization. Central would not retain their clients, or acquire new ones, on the ROI Lab alone. It’s their manufacturing capabilities that get them in the door, and their capabilities and pricing are second to none. If they lose sight of their cost structures or capacity they could lose key accounts in a heartbeat.

Central is very purposeful in their approach to manufacturing, but as Rick points out efficient manufacturing is table stakes, “Any firm can produce an attractive, cost-effective and functional corrugated display. The differentiator is will it work.”

Central makes their brand sticky by offering rich value-add services such as the ROI Lab and the Applied Innovation Program. They wrap their clients in data and intelligence, and give them insights they couldn’t gain anywhere else. Once the clients begin using the data and research capabilities they are hooked. Central’s relationship shifts from being a supplier to a strategic partner.

For example, when Colgate introduced their Sensitive Pro-Relief line to retailers in Canada they launched it at Central’s Innovation Center. Colgate brought a different retailer to the Center each day, and used the ROI Lab and boardrooms to demonstrate the product and their merchandising strategy.

The launch was very successful and it reinforced Central’s relationship with not only Colgate, but the various retail partners. It demonstrated they were far more than a manufacturer, and a company deeply committed to retail performance. It made their brand even stickier.

Innovation is complex

The Central Group’s approach to innovation and customer results is complex and challenging. They have a lot of moving parts, and they are blazing new trails as they combine manufacturing, research and merchandising to bring tangible value to their clients. The story illustrates the complexity of not only growing a sticky brand, but the complexity of growing a sustained competitive advantage.

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