Heinz is the first to admit that grocery has easily been the least sexy category in the c-store sector of late and as such, has failed to capture the imagination or attention of retailers. It admits that it, too, has been rather too relaxed about driving grocery in convenience. Not any more. In the past year the company has overhauled its structures to put more emphasis on the convenience channel and develop products, packs and promotions that will help retailers sex-up their grocery sales.
With Harris International Marketing (HIM) data revealing the average grocery shopper spends 30% more per week than your average c-store shopper, it’s time retailers took more notice of their languishing grocery aisles.
Retailers should examine closely the figures from HIM. Consumers who buy grocery spend £7.03 per trip to the c-store compared to the c-store average of £5.25. Within multiple c-store chains the figures are stark. Of those shoppers asked by HIM, “What is your main purchase/reason for visiting today?” 7% cited grocery. This was ahead of newspapers (6%), and soft drinks and cigarettes (both 4%). Add to this the HIM figure that shows 20% of grocery is bought on impulse within c-store multiples and there is every reason for retailers to adjust their standpoint.
Heinz convenience and impulse customer business development manager John Hyman is clear about the reasons for the neglect of grocery in convenience – modest price points, limited new product development, being taken for granted, perceived minimal impulse opportunity and not being seen by retailers as a distress purchase.
“Our aim is to get a Heinz product in every convenience basket,” adds Heinz customer marketing manager Stuart Burns. “We want to drive our total packaged grocery sales via c-stores from 13% to 38% and that has caused us a major shift in mindset and structure. It has forced us to think differently about how we integrate foodservice and retail within the business.”
Targeted initiatives have resulted from this work and pivot on c-format products, core ranging projects, price-marked packs, category management and tailored marketing concepts.
In early 2006, for example, retailers should be prepared for major four-pack activity on Heinz products to drive weight of purchase, innovative display solutions on sauces in spring (a parasite unit for salad creams is on trial now in Spar stores), and a World Cup-themed promotion for independents, designed to build on the success of this year’s Heinz cricket promotion.
More pricemarked packs will be launched to build promotions, and the review of case sizes – Heinz soups now come in outers of 12 – will continue.
Convenience-oriented products can be expected, with serious focus on food to go. The launch of the easy-open SqueezMe sachet illustrates the point. It came out of Heinz research that found 59% of consumers want a sauce to accompany their hot food purchases. With an rrp of 15p, SqueeezMe removes retailers’ need to provide sauces at their own expense.
“SqueezMe is one of the first examples of Heinz’s new joint approach to developing products,” says Hyman. “Retailers can expect many more.”
The Heinz Hot List for Grocery
The grocery offer plays a key role in how a shopper perceives a c-store’s overall credentials
Shoppers who buy grocery spend 30% more per basket than average
A large proportion of grocery sales come from a small number of core range products (refer to www.shelfmax.co.uk to obtain your own personalised shelf plan for grocery)
Consumers do not expect the same range as offered in supermarkets