Consumers are happy to spend big at Christmas so retailers need to have all categories covered and be prepared to go premium if they want to celebrate their festive sales
There’s no doubt we all like to push the boat out at Christmas. Whether it’s a turkey big enough to feed the family twice over, a few quid more on a bottle of wine, or simply a more indulgent box of chocolate biscuits, the festive season is seen as a reason to indulge, and as a result c-store owners get the gift of a higher basket spend.
Raj Aggarwal says that he sees a big jump in festive sales at his Spar stores in Wigston and Sheffield, especially if he stocks items the supermarkets don’t.
“Supermarkets are more aggressive in the way they sell their seasonal items so there is no point in competing on price. But we can offer something different, particularly with new products,” he explains.
Simon Biddle, owner of Biddle’s Simply Fresh in Redditch, Worcestershire, finds the festive season is one of the best times of year to attract customers who don’t usually use his store.
He says: “We get our regulars coming in who buy our vegetables, but we do see some new customers buying things, too. It’s nice to see some fresh faces at Christmas and you definitely pick up some new custom over the season.”
To get the most out of the period, retailers need to get in early, though. Raj has had festive stock such as crisps and nuts on shelves since September.
“Promoting from early on allows us to get into customers’ heads,” he says. “Even if they don’t buy the product there and then, subconsciously they will remember it’s there and come back and buy it at another time.”
For Raj, Christmas shopping doesn’t really get going until December, but begins to ramp up once Halloween is out of the way.
David Knight, owner of two Knight’s Budgens stores in West Sussex, believes Christmas is starting earlier every year, often helped by a change in the weather. He gets started on his Christmas plans even before most shoppers have had their summer hols. “We do an initial plan in June and July when we get all the Christmas catalogues from suppliers and then start to look at the range we are going to offer.
“We had our first Christmas stock in store in the last week of August, with large tubs of ambient food coming in early. If the weather turns and is cold like it is now, then people will come in and buy.”
Mcvitie’s has it covered
McVitie’s has a host of treats to sweeten the season.
The Milk Chocolate Digestives Postbox Tin contains McVitie’s Milk Chocolate Digestives in a novelty tin. The new product has an rrp of £10 for a 400g tin.
Joining it is the McVitie’s Moments biscuits selection, presented in premium packaging. Aimed at attracting the younger shopper, McVitie’s Moments is available in a 400g box with a rrp of £10.
Old favourites are making a return, too. McVitie’s Victoria premium this year has new packaging for added Christmas appeal, while McVitie’s Jaffa Pole is set to be a key player in the Christmas space (rrp £6).
Also back for 2017 in modernised packaging is McVitie’s Family Circle, the everyday assortment brand.
David believes premiumisation has become a common theme in his stores, and this is especially true over the festive period. “People are definitely buying more luxury items for Christmas and tend to go for the best, or better products than they normally would.
“More customers seem to be buying the premium ranges. We think people are finding things tough in January and November, but are splurging the cash in December.”
In response, David has developed a more sophisticated snacking range to take account of demand for premium party snacks. “We can compete on price in some areas, but in other areas it is better for us to go premium,” David adds.
Simon agrees that the festive break provides an opportunity to sell more premium items. “People are definitely more extravagant at Christmas and tend to buy higher value and premium items. The rest of the year people are careful with money but, at Christmas, I think people are off work so don’t really care about saving.”
Splashing out even extends to the price shoppers will pay for those must-have mince pies, according to Harj Dhasee, owner of Nisa Village Stores in Mickleton, Gloucestershire. He says: “In the run up to Christmas, shoppers will buy the regular six-pack of mince pies for £1. But one or two weeks before the big day, they will start buying the more expensive ones.”
The statistics back up the retailers’ view that Christmas is an excuse to splurge. A HIM Research & Consulting study reveals that shoppers generally spend more on festive food than at any other time of the year, with 39% of shoppers more inclined to buy premium options. Shoppers under 35 are much more likely to trade up at Christmas than other age groups (HIM, February 2017).
The Christmas dinner
Last Christmas, UK shoppers consumed approximately 10 million turkeys, with the meat taking centre stage at most festive dinner tables (YouGov). But with fresh food such an integral part of the Christmas lunch, making sure you can keep up with demand without seeing too much wastage can be a challenge.
Simon finds that demand for fresh produce peaks “just before Christmas”. “By Christmas Eve, we want to be low on fresh produce and restock when the market re-opens after the holidays. We don’t want to have anything hanging around between Christmas and New Year,” he says.
Simon adds: “Sprouts and potatoes tend to be the biggest sellers, but broccoli and cauliflower sell really well, too. A lot of people say that the produce in my store keeps fresher than the supermarkets.”
Local produce is particularly important to Christmas shoppers, with 52% of customers looking to buy fruit and vegetables locally (HIM, February 2017). Consumers also value locally-sourced meat and fish, with 49% also aiming to buy the produce from a local source.
David Knight reports that his meat-ordering service attracts lots of custom, from when it launches in October, right up until Christmas Eve itself.
“We do a local meat order service, working with our local butcher all year round. People come in and order their turkey breast, lamb and pork joints and pigs in blankets for Christmas. It makes up about £2,000 to £3,000-worth of sales,” he says.
One way of avoiding the waste of fresh is to offer frozen alternatives, and this year Birds Eye is focusing on providing a traditional Christmas offering.
Helen Fraser, senior brand manager at Birds Eye, says: “Birds Eye knows that families tend to trade up to something a little more premium over Christmas, such as our frozen Petits Pois, which have always been worth paying a little more for.
“With families often focused on the table centrepieces – turkey, ham and Christmas pudding – frozen Petit Pois are convenient and easily accessible amid the mad rush of the shopping aisle and kitchen.”
Over the Christmas period, Birds Eye experiences an increase in pea sales – directly related to the popularity of roast dinners over the same time period. The brand is hoping to capitalise on festive shoppers switching to trusted, quality brands.
Fraser adds: “At Birds Eye, we make every effort to ensure only the best-quality peas make it into freezers, working to a strict two-and-a-half hours picked-to-frozen policy and working with farmers who pour every ounce of love into the peas they tend to.”
This Christmas, the brand will be back on TV with its With Love From Birds Eye campaign.
Other retailers make sure they aren’t left with any New Year hang-overs by making it easy for shoppers to pick up all that they need quickly, especially helpful since 64% of consumers make a Christmas food and drink shopping list (HIM, February 2017).
Simon always makes sure his store is “clear and well stocked” to allow for the Christmas rush. “What we do at Christmas is give people more space to shop. We put two fresh racks outside the store so people can pick their own. We need lots of different places around the store where people can buy their fresh produce so that we don’t have any blockages.”
With many shoppers unwilling to brave the crowds in the supermarkets, local neighbourhood stores can come into their own at this time of year.
“Some people can’t get into the supermarkets, or can’t be bothered to queue to park, so decide to buy their fruit and veg from us,” Simon asserts.
Raj has also seen shoppers choosing to shop at his store instead of the multiples. He says: “People will choose to shop at convenience stores because they benefit from local products and not having to carry their food very far. Some people don’t want to go to the supermarket to do their usual Christmas shop and we cater for them.”
Small stores can also mop up the Christmas spend from those who need items last minute, having forgotten those essential extras such as stuffing or condiments.
Irish stuffing manufacturer Mr Crumb has added a fresh roasted garlic & herb stuffing to its portfolio in response to increased consumer interest in more diverse flavours and vegetarian options.
The premium Irish stuffing is hand-produced in small batches and can be cooked in the microwave in just two-and-a-half minutes, or 12 minutes in the oven for a crispy finish. The stuffing is available in 225g trays and has an rrp of about £2.
Aiming to offer something a little different is Tigg’s sauces and condiments. Tigg’s executive director Jacob James says: “Tigg’s can add something different to food this Christmas. All-natural ingredients and unique flavours make Tigg’s the perfect festive food match. The vibrant colours are purely down to the ingredients used; nothing artificial is added.”
Tiggs has recently launched Tiny Tigg’s, a smaller, more convenient variety available in 25g tear and squeeze mini portion packs (rrp £1).
Pladis unveils npd and £1.3m marketing spend
Pladis is giving consumers a greater choice of savoury biscuits and investing in its biggest-ever Christmas brand campaign.
New under the Carr’s premium savoury biscuit brand is Carr’s Batons. The range is the first new product launch from the brand in several years and is designed to tap into the premium nibbling trend.
Carr’s Batons come in three flavours: Cheddar & onion; tomato, emmental & herb; and rosemary & sea salt. They are presented in 100g boxes (rrp £1.49).
Jacob’s Cracker Crisps sour cream & chive is the latest addition to Jacob’s caddy range.
The new product is available in 230g tubs (rrp £3.49) and features festive packaging.
The cracker crisps range launched in February and has been a hit with consumers looking for a crunchy snack while on the go or at home. The sour cream & chive caddy, like the rest of the cracker crisp range, contains oven baked crisps, with no MSG, artificial colours or flavours, and is suitable for vegetarians.
The Carr’s and Jacob’s brands are coming together with McVitie’s master brands in a £1.3m Christmas campaign entitled ‘Merry Biscuits Everyone’, designed to ‘bring to life’ the role Pladis brands play at Christmas.
The campaign includes on-pack promotions, in-store activities and POS across the independent channels.
Pladis trade communications controller Hena Chandarana says: “We’re really excited about this year’s campaign – our biggest and most integrated yet.
“We’ve injected some real Christmas magic into our creative approach.”
It’s not all about the mains at Christmas, though, as sales of desserts also move up a notch. David says that having a good range of home-baking items is essential in ensuring his store has a bumper Christmas.
“Home baking is a huge market for us,” he says. “We definitely experience a home-baking sales uplift as people watch programmes such as Great British Bake Off in the autumn and want to start baking for Christmas.
“People tend to make traditional Christmas fruit cakes and we always have to make sure our displays of such items stand out,” David adds. “We bring in more stock on big stands and bring in an extra-premium range of fruits. Customers want to use the best and freshest ingredients in their home bakes.”
Dr Oetker UK executive head of marketing Jan McKee points out that Christmas is the biggest occasion in the home-baking calendar, representing £35.6m-worth of sales in 2016.
She adds: “More consumers are baking in the run-up to Christmas, having been inspired by the Great British Bake Off in the autumn and creating both traditional Christmas recipes as well as fun, creative cakes for children’s parties and family gatherings.”
McKee believes retailers can take advantage of increased demand in the category by getting in early on the Christmas action. “It’s important to begin stocking Christmas products as early as October as some consumers prefer to plan ahead, particularly those opting to bake traditional Christmas puddings or cakes.
“However, be aware of the day of the week that Christmas falls on and that many consumers choose to shop last minute. In fact, the final week of Christmas last year recorded sales of £7m, showing how shoppers will delay purchases.
“Christmas 2017 falls on a Monday so be prepared and fully stocked for those last-minute shoppers purchasing during the final weekend of the season.”
Harj points out that his shoppers do leave it late to grab their Christmas treats. “I have noticed that people like to leave the main Christmas items until the last minute,” he says, “but they don’t mind paying a bit more for something a bit special, such as luxury Christmas puddings or trifles.
“People are looking for the simple pleasures in life and that is what Christmas food can give them. Customers are looking for something away from the norm.”
Harj believes people are becoming more adventurous in their choices, too. His customers are looking to add a different twist to the usual festive favourites, such as different types of pavlova and yule logs.
He adds: “Shoppers are looking for a feel-good factor at Christmas and aren’t afraid to try new things. Every year, we do really well with our festive desserts.”
Empire Bespoke Foods is aiming to tap into the make-it-at home trend with its DIY gingerbread kits, which sit alongside its range of luxury Italian Christmas panettone and German gingerbread.
Nick Thomas, Empire Bespoke Foods sales and marketing director, says: “Italian panettones and German gingerbread are Christmas favourites and independent retailers will have noticed them making steady progress into mainstream channels. Empire Bespoke Foods offers differentiation through the premium quality of Chiostro Di Saronno. This year, to add even more sparkle, the brand has extended its flavoured panettone range with a sparkling wine variant.”
Thomas adds: “The extensive range of festive treats from Empire Bespoke Foods can be tailored to suit whatever retail space is available. Our Christmas range is full of European delicacies for hampers, shop floor and till points; everything you need for a differentiated offering and a successful festive season.”
When it comes to selling cakes for the Christmas season, Premier Foods seasonal marketing controller Jess Ali advises retailers to think carefully about where they position their sweet festive goods in their store.
She says: “To take advantage of the impulsive nature of shopping for cakes, always position small cakes at eye level so they take centre stage.
“Using secondary siting and merchandising cake with other Christmas-themed products will encourage cross-category purchases and increase basket spend.”
Indian snacks to share
Cofresh is aiming to capitalise on the growing consumer demand for new flavours and taste adventures with a wide choice of Indian nuts and savoury mixes for the festive season.
The company recently invested in a new pack design, advertising, PR and social media activity for its range of authentic snacks. Sales in its core range of Asian mixes have grown more than 40% this year, it reports.
Best-selling lines include: Bombay Mix sharing bags (325g); Chakri Rice Sticks; potato-based Mix-Ups; and the newly-launched Ruff Nuts coated peanuts.
Debbie King, director of commercial sales & marketing at Cofresh, says: “Sales of sharing bags – ideal for the key selling times of Christmas and New Year – have also increased significantly in line with the growing popularity of the Big Night In, a trend driven predominantly by millennials and the Netflix generation.
“These are just perfect for festive get-togethers with family and friends,” King adds.
King also advises retailers to display sharing bags close to the till point as she says “high-visibility maximises impulse purchases”.
Cofresh nuts are available on useful clip strips to create extra selling space without compromising on shelf space.
Last year seasonal biscuits delivered £6.5m in sales for the convenience channel (IRI Litmus, w/e 1 January 2017), and are an item that sells well throughout the run-up to the big day itself as consumers buy in advance to stockpile at home.
Simon says his customers stock up to get the festive treats they want. “I have noticed that people tend to buy things earlier now. Over the past couple of years, people have been buying tins of biscuits and cheese crackers well before Christmas.
“Festive stuff that will keep for a couple of months gets bought well in advance. It is a trend now that people will start buying for Christmas throughout autumn.”
Matt Collins, sales director, convenience, at KP Snacks, agrees. “By mid-November, 53% of shoppers have bought food intended for Christmas, with some even shopping as early as September, so it’s crucial that retailers stock up well in advance,” he says.
For 2017, the company has added a new variant to its range of nut caddies. A salted caramel flavour joins original salted, dry roasted and honey roasted, all rrp £4.
Collins adds: “Last year sales of our nuts doubled at Christmas so we are looking to capitalise on the opportunity again by ensuring the caddies are available to retailers early. We are also supporting the launch with FSDUs to ensure maximum visibility in store.”
Hena Chandarana, trade communications controller at Pladis UK, believes that retailers should take advantage of the eager Christmas shopper. “The UK is a nation of biscuit lovers and consumers buy even more at Christmas. Shoppers will be starting to plan their Christmas shop early so aim to have all seasonal stock available from October to help secure strong festive sales,” she says.
Chandarana adds that consumers will also return to familiar festive biscuits “time and time again”.
“Core and existing ranges make up 90% of sales and must-stock brands, including Pladis’ range of number-one best-sellers, should be displayed prominently in store to attract shoppers to family favourites.”
Mince pies are firm festive favourites and last year sales of Co-op mince pies soared 37% compared with the previous year, as shoppers continued to return to traditional festive treats (Co-op annual sales data, 2016).
Premier Foods’ Ali agrees that family favourites attract a large amount of attention. “Each Christmas there will be new products for retailers to stock up on which will help excite shoppers, getting them into the festive spirit. However, many families will also have seasonal favourites that they look out for year after year.
“At Premier Foods we supply the convenience channel with the nation’s favourite cake brands: Mr Kipling and Cadbury Cakes. We offer products such as Mr Kipling Mince Pies, Mr Kipling Frosty Fancies and Cadbury Festive Flake Cakes, which shoppers are familiar with and trust. With Christmas a time for sharing and indulging in a sweet treat, it is a key cake occasion for retailers to take advantage of.”
All the extras
It is estimated £22bn is spent by UK households at Christmas, with the average household spending £796. Yet only £159 is spent on food and drink (YouGov 2016), illustrating how non-food items such as wrapping paper, cards, decorations and gifts are an important offer.
The battery market, in particular, is highly seasonal with sales often peaking on Christmas Eve as shoppers stock up on batteries to use in toys and gadgets to give away (Panasonic Energy Europe).
James Tuck, marketing manager at GP Batteries, believes that batteries are experiencing such sales growth at Christmas because gadgets are now becoming a Christmas present norm. “The Christmas months last year saw our sales jump by 40%. It’s a huge time of year for all battery manufacturers,” he says.
“Even at Christmas, customers are very value focused, so multi-pack or bogof offers tend to do well – even better if they are at the checkouts.”
Tuck also believes that batteries themselves will soon be considered as gifts, making them an even more important category for retailers. He adds: “Increasingly you’re going to see batteries becoming gifts in their own right – in the form of powerbanks for mobiles and tablet devices.”
He adds: “We already have great products out there, but a new range of premium-design powerbanks will be hitting the shelves soon and we’ll see that market becoming much bigger in the short term.”
Ramesh Shingadia, owner of two Londis stores in West Sussex, believes batteries can be a bit of an after-thought for convenience retailers and planning for the category can be “complex”. But a project with Panasonic last Christmas brought home to him how valuable the category can be to independents.
He says: “Our batteries had previously been hidden behind the counter with a cheap own-label battery supporting the brand leader. However, a few simple changes, as recommended by Panasonic, really did deliver powerful results.”
Batteries were sited at the front of the store or at the till point, to great effect. “Not only did we see a staggering 400% sales increase after just eight weeks, we also saw a jump in sales of 300% on Christmas Day and Boxing Day alone,” he adds.
Tim Clark, sales manager at Panasonic Energy UK, adds that as consumers are becoming more environmentally-conscious in their choices, those retailers who offer alternative products such as rechargeable batteries can capitalise on the peak in demand at Christmas.
Natalie Carney, trade marketing manager at Varta for UK & Ireland, believes battery sales increase from Halloween right up until the end of the Christmas season. She says: “The pre-Christmas period is pivotal for battery manufacturers, providing the opportunity to reaffirm messaging around consumers not forgetting their batteries for Christmas.
“A significant number of toys are still battery powered, and whether included or not, they will still need replacing. Therefore, by offering point-of-sale merchandising, battery manufacturers can maximise impulse purchases and reach more customers.”
Alongside batteries, Christmas cards for that forgotten neighbour or relative can provide a welcome income stream for stores. Julie Jones, of Morton PO & Stores in Lincolnshire, says that shoppers won’t come to her store especially to do their Christmas card shopping, but if they suddenly realise they’ve forgotten to get one then it’s essential she has a card to cover every scenario.
“We get in Christmas cards from mid-October. We do boxes of cards for about the £2 mark and we also have the singles. We make sure to have single cards for everyone in the family – mum, dad, sister, brother.
“The boxes of cards are popular in the run up to the last day at school as all the children will give them out before they break up for the holidays.”
David doesn’t go big on gifts for Christmas, but concentrates on offering a range that is both right for his customers and which fits into his store.
“We don’t go after the gifting market too much because we don’t have the space in store, we would rather focus on fresh food,” David admits. “But we are doing a premium range of gifting candles, which went down very well last year.
“We do a big selection of decorations and tinsel that people can buy to decorate their homes,” he adds.
Raj likes to stock a few gifting items, too. “We often get in teddy bears, Christmas cards and other gifts that are out of the ordinary, to try to grab customers’ attention,” he explains.
Christmas isn’t all about the money, though. It’s the time of year when staff can get into the spirit and go to town on making the store look the part. Simon says he uses the holiday season as an opportunity to add a Christmas feel to his store. “We have a few decorations in store, including holly at the front of the shop and a few different displays. I think people like to come in and see a traditional display,” Simon says.
David follows suit: “We also deck the store with lots of decorations to give it a festive buzz.”
Food to go with a festive flavour from Urban Eat
More than 10,000 Urban Eat turkey feast sandwiches and 9,000 turkey, bacon & stuffing sandwiches were sold during the peak festive trading week last year, according to Urban Eat sales data.
Urban Eat is hoping for similar success this season with a festive range that comprises: turkey feast sandwich; turkey, bacon & stuffing sandwich; brie & cranberry wrap; and piggies under blankets sub roll.
The line-up is presented in festive packaging for standout, and the brie & cranberry wrap features an improved recipe. Rrps range from £1.99 to £3.49.
Isla Owen, senior marketing manager for Urban Eat, says: “Excitement is building and our high-selling range is sure to get consumers in the festive spirit early.
“These tried-and-tested favourites capture the magic of the season and this themed range gives retailers the opportunity to take advantage of what’s long been a thriving market.”