Make meal preparation easier by connecting center store with the frozen and refrigerated aisles, and consumers will reward you by purchasing more.
Some things just make sense, like merchandising complementary items across the center store, refrigerated and frozen departments. What’s more, the greater convenience that such a retail strategy offers time-strapped customers can lead to big supermarket sales lifts.
“What our consumer research has told us is that cross-merchandising is most effective if it fulfills a consumer need, such as a meal solution center or a healthy snack center,” affirms Cindy Sorensen, VP, business development at the Midwest Dairy Association, in St. Paul, Minn. “A retailer can really win with consumers by providing solutions to their needs.”
Meanwhile, CPG stalwart ConAgra Foods “has put a fair amount of time into researching dinner prep across the store to try to understand consumer needs and how they shop for them,” says Bob Nolan, the Omaha, Neb.-based company’s VP of consumer insights and analytics. ConAgra’s consumer research yielded “a lot of great feedback” in the form of a “dinner scorecard” showing the items shoppers buy the most and least often, which the company used with five pilot retail customers to discover what their needs were, and build solutions across departments and temperature states.
By determining what the top meals are that shoppers wish to prepare, retailers can deliver against that and drive sales. This should involve building on how they already talk to their customers, whether through giveaways, coupons or other methods. “Find out what the shopper is trying to shop for, and then work backward,” Nolan says.
Nolan points out that meal solution shopper marketing events regardless of whether they make use of multi-temperature state displays, result in twice the sales life of other types of marketing events. Further, the convenience factor is so strong that not everything has to be discounted to encourage purchase. “If retailers offer customers solutions, there’s less pressure on price points,” he counsels. “It’s not about discounts, it’s about solutions. The easier you make it for shoppers to solve their problems, the more they buy.”
Noting the Rosemont, Ill.-based Innovation Center for U.S. Dairy’s tests of several consumer usage-based concepts spotlighting the dinner, breakfast and snacking occasions, Sorensen says: “These solution centers provided lift in all categories featured, with dairy outperforming all categories. Dairy is a trip driver, with high household penetration, and dairy products are included in more shopping baskets than nearly every other category in the store.”
Take milk as an example. “With so many retailers selling milk today, consumers will look for the easiest option available,” explains Sorensen. “If a grocery store locates their milk in the back corner of the store, these shopping trips can easily be lost to other channels.”
Give Them a Sign
The best way to entice shoppers to check out cross-merchandised product is via “traffic-stopping” signs, says Sorensen, “and I’m not talking about price signs, but rather signs that will communicate a value to the consumer. In the case of consumer solutions centers, the signs must communicate what the solution is.” She cites such clear examples as the Innovation Center for U.S. Dairy’s “Fuel Your Day,” “Breakfast Zone” and “What’s for Dinner Tonight?” merchandising concepts.
Additionally, the Midwest Dairy Association “found that consumers were very interested in signs that educate them,” notes Sorensen. “This can be done with information such as educating the consumer about new product entries included on the merchandising center. This signage should be kept current and rotated every four to six weeks.”
For his part, Nolan emphasizes the importance of signage cuing shoppers to buy all of the constituent ingredients for a meal.
Right Placement, Right Equipment
Naturally enough, the location of cross-merchandisers is key. “They should be placed early in the shopping experience,” advises Sorensen. “For example, placing a breakfast zone in the dairy department is too late in the shopping experience to have an impact on shopper behavior. At that point of the shopping experience, most of the purchase decisions have already been made. A grab-and-go cooler should be placed at the entry of the store.”
Sorensen cites a Grab-N-Go! merchandising center installed at a Flemington, N.J., ShopRite as a particularly effective solution. “This center includes milk, juice, eggs and a rack of bread,” she says. “These are items that are most often included in quick trips. ShopRite placed the rack right inside the front door of the store. While this center provides a solution for quick trips, this store has found consumers are more likely to return for their stock-up trips because they know that ShopRite understands them and their needs.”
Another grocer, Festival Foods, owned by Knowlan’s, in Arden Hills, Minn., “does a great job of providing meal solutions right in the front entrance of their stores,” according to Sorensen. “Hand baskets are located nearby so that a consumer in a hurry can grab [one] and pick up all the components for tonight’s dinner, without having to venture further into the store. One recent example included a roll-around cooler with ground beef, grated cheese and bagged salad, next to a display of pasta and spaghetti sauce. Rounding out the full meal solution was a display rack of Italian bread.”
Continues Sorensen: “Train your shoppers that these merchandisers will stay in a permanent location. Meal solutions should be changed on a weekly basis, and items could possibly correlate with ad and digital media support.”
Nolan is also big on what he calls “pre-shop digital engagement,” like ConAgra’s “Ready Set Eat” platform (www.readyseteat.com), which offers a range of recipes and meal ideas, but stresses that in-store is where grocers actually “close the sale. If shoppers have to go to various departments, they may forget to pick up certain items or feel it’s too inconvenient to go all across the store, so may end up opting for QSR instead.”
He recommends that end caps located as close to the frozen and/or refrigerated sections as possible be devoted to themed dinner ingredients and changed on a rotating basis to reflect seasonal interests. Retailers can develop their own dinner themes or work with ConAgra on them.
Advances in equipment have made placement easier for grocers. “I am seeing stores testing refrigerated cases placed in the dry grocery departments,” notes Sorensen. “For example, there are milk coolers being placed in the cereal aisle, and there are coffee creamer coolers being placed in the coffee aisle.” Nolan urges retailers to look for affinities, such as placing a cooler of Hebrew National franks in the hot dog bun aisle to capitalize on summer grilling season.
Another boon is that fact that “there are coolers now available which are dual-temp, combining frozen and chilled space,” Sorensen points out. Nolan is similarly enthusiastic about multi-temperature cases like those at Publix and Winn-Dixie, which enable the display of all meal components in one place.
But how willing are grocers to rethink the way they offer product to consumers? “Retailers are becoming increasingly more receptive to cross-merchandising as their competitive environment has changed drastically over the last five to 10 years,” asserts Sorensen. “The paradigms of measuring success by department are falling by the wayside as retailers look for ways to be successful throughout the entire store and provide solutions to their shoppers. This requires stepping outside the traditional approach of measuring a store’s success by department, and no longer building and setting a store based on operations factors.”
Still, problems in execution remain. “There have been many operational obstacles to getting retailers to” set up coolers in center store aisles, admits Sorensen. “Department managers have been reluctant to share the space cross-departmentally, and, of course, electricity needs have been an obstacle. But finally paradigms are breaking and the proactive retailers are setting their stores based on how consumers shop and, as a result, are growing sales.”
Agreeing that cross-merchandising involves “breaking through some internal barriers” on the part of retailers, Nolan says that the idea is to get them to think beyond individual departments, which he concedes can be “difficult,” as the departments are managed separately and set up by temperature state.
Those retailers that excel at cross-merchandising, however, “have really broken down these barriers by thinking ‘How does our store win?’ instead of being in competition with the other departments,” he adds.
As grocers increasingly accept the need for cross-merchandising, how will it evolve? Rather than continuing to rely on the “quick temporary fix” of portable coolers, more retailers are constructing stores with cross-merchandising solutions such as multi-temperature states built right in, according to Nolan, who believes “this type of thinking will spread much more.”
If retailers offer customers solutions, there’s less pressure on price points.”
—Bob Nolan, ConAgra Foods
“Proactive retailers are setting their stores based on how consumers shop and, as a result, are growing sales.”
—Cindy Sorensen, Midwest Dairy Association