May 6, 2009
The Center Store Rebounds
Big food marketers have
rediscovered the center store at the very same time consumers have expanded
their search there for savings from perimeter departments.
"Center
store is back," said Tom Vierhile, a research
director at Datamonitor, told Brandweek. "People
got away from it in the first place because it lacked the pizzazz and sex
appeal"
of fresh, frozen and refrigerated categories across the supermarket.
Manufacturers are introducing
new products and upping ad budgets to get consumers thinking about the
center store and shelf-stable items as alternatives to other areas of the
store.
Del Monte has increased
its marketing expenditures 30 percent overall and recently began a $15
million ad campaign with a "Stretch Your Dollar" theme for its
canned fruits and vegetables.
While many companies
have cut back on new product rollouts, shelf-stable has been the exception.
According to Mintel, 284 of 376 new products
rolled out so far in the second quarter have been center store items.
Krista Faron, a senior analyst at Mintel,
told Brandweek,
"That’s just not something we saw as much of in the past."
Discussion Questions: How
would you compare the center store opportunity today versus the past? Are
retailers and suppliers in synch on building the center store?
BrainTrust
Recent Discussions
Discussion Questions
Poll
I hear a lot of noise on both sides about building center store–have for a long time. But with a few exceptions, it remains bloodless. By that I mean, little creative merchandising that might make consumers linger a little longer. A couple of shelf talkers ain’t gonna do it!
It’s not easy. We’re talking about aisles, shelves and facings ad nauseum. You had a discussion yesterday about SKU rationalization. Maybe finding out what really sells is a way to back into creative merchandising for all products in center store.
I have said in this forum in the past that the center store truly hasn’t changed fundamentally in 100 years. Creativity is required here. Visual merchandising has never been a core competency of the supermarket biz. Grocers need to reach out of this industry to specialty apparel and inject some life into this part of our stores. Some grocers have integrated a refrigerated pasta case in line with the center store gondolas. Others have tried curved aisles. We need some groundbreaking change here. Why not integrate full-course meals through the store, with all ingredients, fresh, shelf-stable, etc., grouped together? Let’s get out of our 100-year comfort zone.
I’m loving the displays I’m seeing down the middle. Not really about savings but some of the big guys here are putting up elaborate gazebo/BBQ/patio set environments to move some of this product. Really jazzes up the store, in my opinion. Also makes it easier to display bulk promos off of that. Where else will 596 Heinz Picnic Paks go?
This era could be the renaissance of center store, as both retailers and shoppers have increased motivation to make it work.
That being said, a few key issues still need resolution: freshness and quality perceptions, and total meal solutions. As retailers revamp aisles there is an opportunity to truly evolve the store, so that there is no longer a “center store.” Shoppers need an integrated store that marries non-perishables seamlessly with the perimeter.
The “Center Store” is not defined geographically. The “Center Store” is defined by the most basic and mundane offerings a supermarket carries. Just because a retailer moves frozen department or bakery to the geographical center of the store doesn’t mean “Center Store” sales will increase.
The volume of the “Center Store” items, whether canned, boxed or jarred, will ebb and flow with the economy. As the economy sours, shoppers will move from fresh to not. Fresh vegetables to canned, cold cuts to peanut butter and jelly, frozen dinners to Hamburger Helper, meat to beans, bakery treats to boxed donuts.
Most products in the “Center Store” are not very exciting and these items innately don’t carry the charisma to lend to exciting merchandising. Retailers should continue to focus on their high margin perimeters where incremental sales will lead to profits as the economy rebounds. As a retailer, I want to be on the leading edge as people start back to buying fresh salmon rather than canned, fresh daily bread rather than bagged and Haagan Daz rather than Jell-O. The “Center Store” will take care of itself.
I believe the time is right for center store re-invention, not just incremental change (like signage, technology and/or displays). Whole Foods and the fact that consumers are more interested in fresh products than ever before have made a traditional grocery center store close to obsolete (other than to P&G companies, but they are especially aware of this movement) to the modern consumer.
A total re-think, like moving center store more towards experience by having those products available to deliver, is in order. How can that space work better for both the customer and the store brand vs. just the vendors?
I think we’re on the precipice of huge movement for center store. (Listen to the consumer clapping in the background.)
I love the coffee aisle at my local A&P/Super Fresh store. I can smell the roasted Eight O’Clock coffee beans the moment I enter it, and I do linger there, to purchase freshly ground coffees and assorted creamer products.
Expanding some of the suggestions mentioned above, stores could make this aisle even more exciting if a barrista were stationed in the aisle, serving, grinding and roasting coffee beans as well, harkening back to the Eight O’Clock full service coffee bar of years past.
As a little kid when I went shopping for my Mom at the local A&P in our community, I was always amazed by its center store aisles, a landscape full of canned cherries, Ann Page peanut butter, preserves, Sparkle gelatin, Cheeri-Aid powdered beverage mix, Ann Page cocoa and marshmallows, Jane Parker potato chips.
The Center Store can indeed be a foodies playground again with the right mix of complementary products.
We’ve got to remember our discussions of about a year ago when new product introductions waned, due not to lack of new stuff, but lack of promotional funds. Yet, back in R&D, they were still truckin’ right along, eventually creating a glut of new stuff–which also created a sort of marketing constipation. (Analogy ends there.) So, some marketing funds are loosening and media costs are more negotiable. But that doesn’t mean that the public is clamoring for the new stuff. It just means that marketers rediscovered the old adage: You can’t control your way to growth–you must sell your way to growth.
While I don’t have extensive food market experience, I have been a store planner. I have never used the term, ‘Center Store’ but from the discussion, I understand what is being discussed. I would only caution those who would, “fire up the barbie and put a barista” in this area of the store.
The center store is where the customer works, selecting those mundane but necessary items to complete the meal or outfit the kitchen. While those in the in-store marketing profession may look at the area as an opportunity to sell more displays to retailers, these displays and activities in the heart of the store may actually be viewed as distractions in a sacred ‘no-cardboard’ zone.
Why not look at how other retail segments sell the basic items. Take Home Improvements stores and how they sell nails, glue, tape, hardware, etc. It is not glamorous but necessary information on availability, applicability, and price/measure is clearly provided.
Although $15 million may be meaningful to Del Monte, it buys almost no mind share at all. Coca-Cola spends over $2 billion a year. Kellogg spends half a billion. Kraft spends a billion. These last 3 firms have been spending like this for many decades. If the Del Monte example is a major new commitment to growing the center store, what’s a minor commitment?
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I hear a lot of noise on both sides about building center store–have for a long time. But with a few exceptions, it remains bloodless. By that I mean, little creative merchandising that might make consumers linger a little longer. A couple of shelf talkers ain’t gonna do it!
It’s not easy. We’re talking about aisles, shelves and facings ad nauseum. You had a discussion yesterday about SKU rationalization. Maybe finding out what really sells is a way to back into creative merchandising for all products in center store.
I have said in this forum in the past that the center store truly hasn’t changed fundamentally in 100 years. Creativity is required here. Visual merchandising has never been a core competency of the supermarket biz. Grocers need to reach out of this industry to specialty apparel and inject some life into this part of our stores. Some grocers have integrated a refrigerated pasta case in line with the center store gondolas. Others have tried curved aisles. We need some groundbreaking change here. Why not integrate full-course meals through the store, with all ingredients, fresh, shelf-stable, etc., grouped together? Let’s get out of our 100-year comfort zone.
I’m loving the displays I’m seeing down the middle. Not really about savings but some of the big guys here are putting up elaborate gazebo/BBQ/patio set environments to move some of this product. Really jazzes up the store, in my opinion. Also makes it easier to display bulk promos off of that. Where else will 596 Heinz Picnic Paks go?
This era could be the renaissance of center store, as both retailers and shoppers have increased motivation to make it work.
That being said, a few key issues still need resolution: freshness and quality perceptions, and total meal solutions. As retailers revamp aisles there is an opportunity to truly evolve the store, so that there is no longer a “center store.” Shoppers need an integrated store that marries non-perishables seamlessly with the perimeter.
The “Center Store” is not defined geographically. The “Center Store” is defined by the most basic and mundane offerings a supermarket carries. Just because a retailer moves frozen department or bakery to the geographical center of the store doesn’t mean “Center Store” sales will increase.
The volume of the “Center Store” items, whether canned, boxed or jarred, will ebb and flow with the economy. As the economy sours, shoppers will move from fresh to not. Fresh vegetables to canned, cold cuts to peanut butter and jelly, frozen dinners to Hamburger Helper, meat to beans, bakery treats to boxed donuts.
Most products in the “Center Store” are not very exciting and these items innately don’t carry the charisma to lend to exciting merchandising. Retailers should continue to focus on their high margin perimeters where incremental sales will lead to profits as the economy rebounds. As a retailer, I want to be on the leading edge as people start back to buying fresh salmon rather than canned, fresh daily bread rather than bagged and Haagan Daz rather than Jell-O. The “Center Store” will take care of itself.
I believe the time is right for center store re-invention, not just incremental change (like signage, technology and/or displays). Whole Foods and the fact that consumers are more interested in fresh products than ever before have made a traditional grocery center store close to obsolete (other than to P&G companies, but they are especially aware of this movement) to the modern consumer.
A total re-think, like moving center store more towards experience by having those products available to deliver, is in order. How can that space work better for both the customer and the store brand vs. just the vendors?
I think we’re on the precipice of huge movement for center store. (Listen to the consumer clapping in the background.)
I love the coffee aisle at my local A&P/Super Fresh store. I can smell the roasted Eight O’Clock coffee beans the moment I enter it, and I do linger there, to purchase freshly ground coffees and assorted creamer products.
Expanding some of the suggestions mentioned above, stores could make this aisle even more exciting if a barrista were stationed in the aisle, serving, grinding and roasting coffee beans as well, harkening back to the Eight O’Clock full service coffee bar of years past.
As a little kid when I went shopping for my Mom at the local A&P in our community, I was always amazed by its center store aisles, a landscape full of canned cherries, Ann Page peanut butter, preserves, Sparkle gelatin, Cheeri-Aid powdered beverage mix, Ann Page cocoa and marshmallows, Jane Parker potato chips.
The Center Store can indeed be a foodies playground again with the right mix of complementary products.
We’ve got to remember our discussions of about a year ago when new product introductions waned, due not to lack of new stuff, but lack of promotional funds. Yet, back in R&D, they were still truckin’ right along, eventually creating a glut of new stuff–which also created a sort of marketing constipation. (Analogy ends there.) So, some marketing funds are loosening and media costs are more negotiable. But that doesn’t mean that the public is clamoring for the new stuff. It just means that marketers rediscovered the old adage: You can’t control your way to growth–you must sell your way to growth.
While I don’t have extensive food market experience, I have been a store planner. I have never used the term, ‘Center Store’ but from the discussion, I understand what is being discussed. I would only caution those who would, “fire up the barbie and put a barista” in this area of the store.
The center store is where the customer works, selecting those mundane but necessary items to complete the meal or outfit the kitchen. While those in the in-store marketing profession may look at the area as an opportunity to sell more displays to retailers, these displays and activities in the heart of the store may actually be viewed as distractions in a sacred ‘no-cardboard’ zone.
Why not look at how other retail segments sell the basic items. Take Home Improvements stores and how they sell nails, glue, tape, hardware, etc. It is not glamorous but necessary information on availability, applicability, and price/measure is clearly provided.
Although $15 million may be meaningful to Del Monte, it buys almost no mind share at all. Coca-Cola spends over $2 billion a year. Kellogg spends half a billion. Kraft spends a billion. These last 3 firms have been spending like this for many decades. If the Del Monte example is a major new commitment to growing the center store, what’s a minor commitment?