Packaged grocery products are often overshadowed by new categories and high-impulse areas, Nikki Allen finds out why you should make sure you’re stocking and merchandising core grocery effectively, too.
What to stock
Although the popularity of fresh food in convenience has increased in recent years, canned goods are still an important staple for your shoppers.
For Rashpal Singh of Premier Rainbow Hill Stores in Worcester, pricing is more important than ever in the grocery category – especially for brands. “Customers have more trust in price-marked goods, so we make sure about 80% of our core grocery products are in PMPs and we keep up with all the promotions we can,” she says.
Nearly every single household (more than 99%) buys canned food each year, with value being a key reason for their choice.
Dean Towey, Princes director of food manufacturing, says: “The unique selling points of canned food, including the fact that it is convenient, excellent value for money and often has strong nutritional qualities, are the same today as they have always been.”
Condiments, including table sauces and dressings, are equally popular among shoppers. Nick Widdowson, Unilever Partners for Growth range & merchandising controller, says: “Shoppers tend to be brand loyal in this category and aren’t likely to replace one format for another, so it’s important to keep the bestsellers like Hellmann’s, Heinz and Colman’s in stock.”
Snacks are an important component of core grocery, with sharing snacks growing at 6.9%. Kettle is driving this in convenience by revamping its packaging. Andy Verney, Kettle Foods head of impulse, says: “This is a fabulous opportunity for convenience retailers to capitalise on the continuing consumer trend towards more premium snacking options.”
The most important thing within core grocery is to make sure you keep a disciplined range.
Tony Holmes, Bestway sales director, says: “Many retailers are stocking too many products that clutter shelves and confuse shoppers, rather than focusing on the core ranges that account for the majority of sales.”
For example, in the beans, pasta and soups category, 90% of the total sales value comes from the top 20 products.
Getting the right location for core grocery is key. The fixture doesn’t need to be at the front of your shop, but you should ensure the different sub-categories stand out on your shelves.
Holmes says: “Make sure the top-selling canned and packaged sub-categories – canned vegetables, fish, beans, soup and fruit – are centrally located in your ambient fixture.”
Widdowson adds that cooking sauces should also have strong visibility, with bestselling lines placed at eye level. “Retailers should place them in a prominent area, preferably near to products they are usually eaten with, to entice shoppers,” he says.
You can encourage shoppers to buy items like sauces by suggesting recipe ideas, and making it easier for customers to find the grocery items they are looking for. “If you can’t put them together, use PoS material and signage to direct shoppers to the right place,” adds Widdowson.
Promotions are essential in core grocery as they encourage shoppers to stock up and make them feel like they are getting a good deal. “Shoppers often buy canned and packaged products when they are running low on cupboard staples,” says Holmes. Having a multi-buy offer on your bestselling canned products will trigger multiple purchases and drive up basket spend.”
Finally, keep your fixtures well-stocked and, where possible, dual site ambient grocery with fresh products to help inspire shoppers with mid-week meal ideas.
The case for own label
As the quality of own-brand core grocery lines keeps improving, more shoppers are opting for private label rather than branded products.
Fraser McKevitt, head of retail insight at Kantar Worldpanel, says British retailers have stepped up their own label offer this year in response to consumer demand for quality goods at low prices, so independents need an own brand range to compete.
Premium own label products are in 13% growth, which demonstrates the demand for both quality and price.
Own label is particularly popular in ambient grocery, with items like own label pasta having a larger share of the category than branded products. Having at least one own brand alternative in addition to the biggest-selling branded lines will help retailers capture all shoppers.
“Own brand is a big part of our grocery sales,” says Rashpal Singh. “For our shoppers, it’s all about price, so we stock a range of own label grocery lines and we offer promotions. Our biggest sellers in the grocery aisle include products own
Make your range visible. Place ambient grocery items in the centre aisle of your store, using PoS to help products stand out
Get the right price. Communicate value clearly with multi-buys and promotions as price is key to shoppers in this category
Stock price-marked packs. They offer shoppers reassurance that your prices are competitive.
Don’t forget own label. Own brand is especially strong in ambient grocery, so include some private label products in your range to show you offer value
Get to know your shoppers. Find out more about the core grocery products your customers are looking for to build shopper loyalty.
“There is a large ethnic community near our store, and we have both affluent and value shoppers to cater for, so we stock a core grocery range that covers a wide range of needs.
“We have previously spoken to our shoppers and asked them what they wanted, and now we stock a large range of ethnic grocery products, including ambient African-Caribbean brands – we have a three-metre display of them.
“We stock ambient Polish grocery brands, an American range of grocery items, and own-label items – all of which sell well.
“The most important things to get right to succeed in core grocery are availability and pricing. We make sure we are always on top of gaps, and we check our prices with our competitors and adjust them when we need to.
“To display our grocery ranges effectively, we changed our gondolas so people can see the aisle as soon as they come into the store.”