Little People, Big Sales
It may be time for grocers to rethink their merchandising approach toward their youngest consumers.
Babies and toddlers have one important characteristic going for them when it comes to shopping: They bring their parents to the store, or at least provide a compelling reason for Mom and Dad to make frequent visits for their high-volume purchases of food, diapers and related necessities. It's therefore crucial that retailers treat them as the VIP customer base they are.
Interestingly, however, a quick scan of the numbers generated in the baby product aisles can be somewhat misleading. For instance, experience has shown that baby product sales rise and fall with the birth rate — the more babies born, the more baby products sold. On aggregate, this is certainly true, but even in times when there's no baby boom and total category sales are down, the astute retailer can do extremely well with the category. It just takes being better positioned that the competition.
And while there's no baby boom currently in progress, sales of essential baby products are expected to increase over the next few years, according to MarketsandMarkets, a Dallas-based market research firm, which predicts baby food sales will reach $14.17 billion in North America by 2014, an increase of 4.9 percent. (For more about baby food trends, turn to page 51.)
When it comes to baby products, most supermarkets have placed the emphasis on the two largest groups of products, baby food and diapers, which are not only the most commodity-driven components, but also the largest tenants of shelf real estate.
"Retailers understand that Mom is looking for convenience, so there is an opportunity to expand the baby section," says Michelle McGlaughlin, SVP of sales for Alexandria, Va.-based Lasinoh Laboratories, maker of natural feeding products, who gives props to leading supermarket chains with baby clubs, such as Kroger and Safeway.
The baby section allows retailers to pull together items from grocery, HBC and nonfood aisles, and perhaps even some from the produce and dairy departments. In addition, some OTC remedies that are suitable for babies and young children can move into the baby care aisle because they're often neglected in their traditional shelf placement amid various adult remedies.
"Finding safe medicines for babies is challenging for parents," remarks Amy Fox, VP of product innovation at Los Angeles-based Hyland's, a maker of natural homeopathic remedies, including cough and cold medicine for babies. A parent looking for an OTC product suitable for a young child would be able to find it next to the food, lotions and other infant accessories.
Natural feeding is another segment of the baby food category that's becoming much more popular with mothers but is somewhat neglected by supermarkets. Even if the supermarket carries a large-enough assortment of nursing accessories, it's often not the first place a new mom thinks of going to purchase these products.
"There is a real growth in natural feeding, with over 85 percent of moms initiating breast feeding today," Mc-Glaughlin says. "A mom about to go back to work needs over 50 servings of breast milk stored in the freezer, which means that they need pumps, bottles, nipples and storage bags. I think that it's really important to understand that a nursing mother is a brand shopper, so brand blocking on the shelf is essential. The retailer should put together all the products of a particular brand."
Promoting the baby section and all of its various products, both conventional and specialized, is crucial to category success. "Brands have a responsibility in understanding and helping the retailer get Mom to the store and down the aisle," McGlaughlin says.
"Retailers understand that Mom is looking for convenience, so there is an opportunity to expand the baby section."
—Michelle McGlaughlin, Lasinoh Laboratories
Building a Better Baby Section
An integrated baby section can be a tremendous help for time-starved (and often sleep-deprived) parents, where they can easily shop for and locate new and specialized products, including conventional, natural and organic foods; diapers; grooming accessories; skin care; and even toy and novelty products.
The following four factors can help a supermarket position itself as a leader in the baby product category:
- Create a "baby wellness" or other aptly named section
- Emphasize special products that help define the section
- Competitively price traditional baby foods and diapers
- Aggressively promote the section to shoppers