Neighborhood Goods launches in-store concept focused on CPG brands

Dive Brief:

Neighborhood Goods launched an in-store concept called The Marketplace, which focuses on CPG brands. The first location opened in Austin earlier this month.
The first set of brands the retailer will offer includes Jaden Smith's Just Water, DTC low-sugar gummy brand BeHave, street-style noodle company Chop Chop and snack brand DaDa, according to an announcement emailed to Retail Dive.
Neighborhood Goods will feature the brands on the menu at its Prim & Proper restaurant. The company said it plans to open additional locations later this year.

Dive Insight:

Neighborhood Goods opened its first store in late 2018, which focused on curating a selection of digitally native brands, some of which might not have had a physical presence otherwise.

The company, which describes itself as "the modern retailer reinventing the department store," has housed brands such as Rothy's, Stadium Goods, Maude and Dollar Shave Club. But The Marketplace allows Neighborhood Goods to tap into a new product segment.

"From our earliest days, we've been thinking about how to thoughtfully feature CPG products in our spaces. Like so many others, we find the CPG space to be exciting and compelling, but, as with many of our other brands, hard to find and sample in-person," Co-founder and CEO Matt Alexander said in a statement. "With The Marketplace, we bring our same curatorial philosophy — balancing established and up-and-coming names with local partners — to a new category."

As the limitations of selling exclusively online become apparent, direct-to-consumer brands have begun to find value in having a physical presence — whether through concepts like Neighborhood Goods, pop-up shops, partnerships with traditional retailers or permanent locations of their own.

Curating digitally native brands in a physical store is something regional incubator For Now has also adopted. The concept, which has stores in Boston's Seaport district and Nantucket, typically works with around 20 emerging brands for three to four months at a time.

Both For Now and Neighborhood Goods also focus on the community aspect of the experience featuring events. For Neighborhood Goods, integrating the CPG brands it's selling into the menu of its restaurant takes in-store product testing to the next level by allowing consumers to try out brands in a more organic way.

"For so many of these brands, customers become aware of them through fleeting moments on Instagram. With our restaurants, we saw the opportunity to reframe these products in a more social context, allowing for people to enjoy some of the products through an elevated menu or, simply, while shopping our space with friends," Alexander said.

The new concept comes on the heels of Neighborhood Goods' Austin location relaunching after shutting down within 24 hours of its initial opening due to the pandemic.