Supermarket News

How Will 2012 Food Trends Impact Private Brand

\"\"As the end of the year approaches we have entered what I like to call the “list season” you know – top ten lists, trend lists and general predictions from all around this globe. This first list comes from the trade magazine Supermaket News. 2012 Food Trends to Watch is written by Phil Lempert The Supermarket Guru. He is the food trends editor and correspondent for NBC News’ Today show, where he reports on consumer trends, food safety and money-saving tips, as well as showcases new products. He makes monthly appearances on ABC’s The View, and has appeared numerous times on The Oprah Winfrey Show, 20/20, CNN, CNBC, Discovery Health and MSNBC, as well as on local television morning and news programs throughout the country. Lempert is also contributing editor of Supermarket News; as well as a content partner with SN which includes custom consumer surveys and other projects.   He has been profiled and interviewed by USA Today, The New York Times, The Christian Science Monitor, The Wall Street Journal, Forbes, Newsweek and Ad Age , and is interviewed by hundreds of publications each year.

How will these trends impact your Private Brands and your customers?

2012 Food Trends to Watch

2011 brought us higher food prices at unprecedented levels, crops and livestock destroyed by global weather catastrophes, nations at war over the lack of food supplies, and more food recalls from unique points of origin. Americans love their foods – in supermarkets, on television, at restaurants and now even on their mobile phones – we are a nation obsessed with food trucks, molecular gastronomy and struggling to eat as local as we can. All of which has built a foundation for what may be one of the most exciting – and game-changing years in the food world: Welcome to Food 2012.

Trend #1: Food Prices
There is little doubt that in the coming years, we will continue to see food prices rise based on environmental conditions as well as higher production costs. The costs of fuel, feed, packaging, food safety coupled with a higher demand for export all will factor into the retail price on the shelf. Many of the savings tactics most shoppers deployed in 2007 as the recession began are still being used each time they shop for groceries – using coupons, frequent shopper cards, shopping lists, shopping at non-traditional foods stores and even trading down their choices to less expensive brands are part of the regular routine. Look for consumers to shave costs by augmenting their recipes by decreasing the amount of the more expensive meats and seafood and adding more non-meat proteins that are filling and less expensive, including whole-wheat pasta, tofu, lentils, brown rice and vegetables to recipe.

Look for supermarkets to offer \”lay-away\” plans for larger purchases including holiday dinners that are tied into frequent shopper plans and offer bonus discounts (put $200 in your lay-away fund and store adds 10% bonus) and resurrect the bargain bins from the bygone department store era for deeply discounted opportunistic buys to compete with the dollar stores and outlets. Expect shoppers to use their mobile devices to calculate a price per portion cost rather than the unit price of individual products listed on the shelves. Just as the younger generation uses social networking as part of their everyday lives, expect this generation to be the \”forever frugal consumer\” using more coupons (higher than any other demographic) and searching for deals on line (63% spend 3 hours or more each week – double that of any other group). Besides saving money, perhaps this will even force Americans to finally slim down.

Trend #2: Never Shop or Eat Alone Again
The rise of food blogs has set a foundation for group food experiences. Food trucks tweet their locations and flash food raves assemble underground at midnight. And it is not about the food. It is about connection, conversation and a sense of community. It is estimated that 30% of today’s U.S. workforce is made up of independents – as a result they have a greater desire to be in a shared food experience — “let’s meet and eat” if you will.

Apps like Foursquare, GoWalla, Living Social and Yelp have shown how “group” is better than “self.” Expect to see super food apps that bring previously unknown people together with common likes; to eat, prepare and shop together. Organic and coordinated through these apps, these communities will emerge based on specific channels of food interest (e.g., Greek foods, raw foods, beef, vegetarian, gluten-free) versus the communities of old built around similar demographics or socio-economic traits.

One key to success will be embracing LoSoPhoMo — mobile marketing enhanced by the location, social and camera features of mobile devices. Expect the next app updates to include “social rewards” for these groups who shop together — much like the original concept of warehouse clubs – offering steep discounts for its members.

Trend #3: The Baby Boomers keep right on truckin’
The generation of 76 million who started turning 65 years old last year will control 52% of the total $706 billion spend on groceries by 2015 – making them the largest food influencers and purchasers. The Baby Boom generation (which comprises shoppers aged 48 to 65) is expected to have a longer average lifespan — 74.1 years for men and 79.5 years for women — and as a result are becoming more interested in those foods and beverages that offer them health and wellness benefits. Nostalgia plays a key role with this generation, and expect to see more icons such as Cheech & Chong (now hawking Fiber One), Pan Am and all 60s music tracks leading this generation to new and old brands and into the supermarket. Boomers are much more brand and store loyal. Expect supermarkets to cater to the Boomers, not only by offering the foods, beverages and services to satisfy their growing interest (and need) for health — but to take a good look at the physical shopping experience, to make sure that the aisles are wide, to lower the shelves and most importantly to make them feel welcome and respected.

Read the entire article to see all 12 of the trends.

Bi-Lo Brookshire Grocery Food Lion Hannaford Lowes Foods Safeway Save-A-Lot Supermarket News

Innovation Drives Private Brand Promotions

\"\"This week the weekly supermarket trade magazine Supermarket News features this great article on the Top 10 Private Brand promotions from retailers all across the country. Each of the retailers and their promotions have been featured here, however the list is a nice way to see best practices. The list includes: Bi-Lo, Brookshire Grocery, Family Dollar, Food Lion, Hannaford, HEB, Lowes Foods, Safeway, Sav-A-Lot and Winn-Dixie.

Leadership Qualities: Top 10 Store-Brand Promotions

A car giveaway and free baseball tickets are just a few of the inventive ways retailers are building store-brand loyalty. SN recognizes the Top 10 promotional efforts

If store associates believe in a brand, chances are their support will rub off on shoppers.

That\’s the thinking behind a ground-breaking, private-brand promotion Family Dollar conducted last year.

The retailer sent coupons for its new Family Gourmet cookies to 48 stores so that employees could try them. Several weeks later, it ran a contest to see which stores could sell the most cookies. Those that did won cash prizes.

The event generated such a large sales lift that Family Dollar rolled out the cookie contest chainwide. The sales lift was equally as good.

“We wanted to incentivize our team members to drive sales of the cookies to foster greater trial among our shoppers,” said Mary Rachide, Family Dollar\’s private-brand divisional vice president. Rachide did not divulge the sales lift.

The effort is why Family Dollar is one of 10 retailers SN is recognizing in its second annual Top 10 list of distinguished store-brand promotions.

Indeed, retailers recognize that private-label success relies on more than just product innovation. It also requires a marketing plan that gets consumers interested in and excited about the brand.

As a result, companies are beefing up promotional activity, running everything from high-value sweepstakes like car giveaways to delivering free bags of groceries filled with private-label foods directly to consumers\’ homes.

SN selected the following initiatives based on a variety of criteria, including originality; high-value prizes; ability to generate consumer excitement about and engagement with the brand; Web-centric capabilities; and ties to a cause-marketing platform. All programs were executed over the last 18 months.

They appear in alphabetical order.

1. Bi-Lo Goes Out to the Ball Game

MAULDIN, S.C. — Bi-Lo tapped into America\’s pastime to stimulate trial of its store brands last spring.

Consumers who purchased four participating Southern Home and/or Top Care items in one transaction with their loyalty card received a voucher valid for two free tickets to a 2010 South Carolina Gamecocks or Clemson Tigers home game at Carolina Stadium in Columbia, S.C., or Doug Kingsmore Stadium in Clemson, S.C. Vouchers were redeemed at the stadium.

Bi-Lo distributed about 2,500 tickets in the so-called “No Dough” promotion, according to Katie Batista, Bi-Lo\’s events and sports marketing manager.

The goal was to drive sales in its private-label division, while rewarding customers with something out of the ordinary just for shopping with Bi-Lo.

Store-brand loyalty comes from product trial, so finding ways to motivate shoppers to make a private-label purchase is critical, Batista told SN.

“The Bi-Lo No Dough promotion allowed our customers to try something that they may never try on their own,” Batista said. “They were able to taste a great product and realized that their pocketbook was not being hit as hard.”

Bi-Lo hopes that next time shoppers are in the store, they\’ll purchase a store brand over a national brand, even when they\’re not given baseball tickets to do so.

2. Brookshire\’s Grocery Camaro Giveaway

TYLER, Texas — Brookshire Grocery Co. leveraged its sponsorship of the Texas Motor Speedway to promote its Food Club brand.

Brookshire\’s loyalty card data show that households that never purchased a store brand try its brands for the first time during a promotion.

While it frequently offers such incentives, it went a step further last year when it designed a high-value sweepstakes: a car giveaway.

From Sept. 1 to Oct. 12, shoppers earned an automatic entry to win a 2010 Camaro 2SS by purchasing any three Food Club items.

The goal of the promo, called Three to Get Ready, was to encourage non-buyers to try its brands, and current purchasers to try something new.

“We wanted to drive awareness of our [Texas Motor Speedway] partnership, while stimulating trial of our store brands,” said Chris Hardin, Brookshire\’s director of corporate brands and category management.

The retailer designed the promotion to be fun and exciting, as well as engage shoppers and build larger shopping baskets.

“It really doubled as a means to induce trial, and display our involvement in lifestyle activities that our customers are connected with,” Hardin said.

While Brookshire has been the official grocery store of Texas Motor Speedway for five years, this is the first time that it connected the partnership to a store-brand promotion.

Hardin said the initiative was a success, citing loyalty card data showing a 14% increase in transactions that had three or more Food Club items during the promotion.

3. Family Dollar Targets Employees

CHARLOTTE — As an employer of 45,000 people, discount chain Family Dollar Stores knows how valuable store associates can be in promoting brand awareness.

That\’s why it targeted them in a promo supporting the launch of its new Family Gourmet edible grocery line.

It sent coupons for free boxes of Family Gourmet cookies to stores so that employees could try them. Soon after, it ran a contest to see which stores could sell the most. Those that did won cash prizes.

“The Family Gourmet brand is new, and we wanted to encourage our store team members to try the products,” said Mary Rachide, Family Dollar\’s private-brand divisional vice president.

The contest started out as a 48-store test. Sales of the cookies increased so much that Family Dollar expanded it chainwide.

Store participation was high, and sales results were strong, according to Rachide.

Under another program, called “Taste of Family Dollar,” employees at the chain\’s corporate office in Matthews, N.C., were served lunch made completely from store brands.

Such efforts are designed to position employees as brand champions, according to Rachide.

“We believe that our store team members are uniquely positioned to be in-store ambassadors for our brands,” said Rachide.

Its employees are some of its most loyal shoppers, and customers look to them for their advice about the products sold in its stores, said Rachide.

“If we can encourage our store team members to try our products and have good experiences with them, they will share those experiences with their families and friends, and be much more likely to proactively recommend them to other shoppers in our stores,” said Rachide.

4. Stock-Up Sale at Food Lion

SALISBURY, N.C. — Food Lion motivated shoppers to buy not just one, but dozens of store brands when it ran its private-brand “Super Sale” early last year.

Shoppers earned $10 in savings redeemable on a future trip when they stocked up on 40 of its Food Lion- or Home 360-brand products.

Those who bought less were also rewarded. Shoppers who had four items earned $1 in savings; six, $1.50; eight, $2; 10, $2.50; and 20, $5.

The purpose of the Private Brand Super Sale was to offer Food Lion and Bloom customers additional savings, drive brand awareness and invite potential new shoppers to try its private-brand products, said Food Lion spokeswoman Tenisha Waldo.

“In today\’s economy, customers are looking for the best quality and value. By offering a financial incentive for shoppers, we were able to reward our loyal customers and put money back in their pockets,” said Waldo.

Meanwhile, Food Lion is on the leading edge when it comes to private-label mobile promotions. For instance, it ran a “Breakfast Club” mobile offer good for $1 off Food Lion-brand instant oatmeal.

The temporary offer was given to all those who texted “oatmeal” to 467467. Savings were automatically downloaded to shopper loyalty cards.

Separately, when Food Lion opened a new store in Wilmington, Del., the first 100 customers who entered the store received a free Food Lion reusable bag filled with private-label products.

Read the entire article and learn about the remaining six promotions.

Private Label Buyer Store Brand Decisions Supermarket News

The Private Brand Movement is All the Buzz

\"\"The history making Private Brand Movement Conference continues to receive alot of press, it is exciting to note that there were press in attendance from many trade magazines and websites including: Private Label Buyer, Private Label Magazine , Super Market News, Store Brands Decisions and Retail Wire.  You can read all of Carol Angrisani\’s coverage for Supermarket News on their blog Total Access. Here is a sample post.

Premium Products

Sam’s Club made a strong statement in private label this year when it introduced an ultra-premium vodka called Rue 33. Sold under the chain’s Member’s Mark label, Rue 33 is a refined wheat vodka from the Cognac region of France. A 1.75 liter bottle sells for $28.

The goal was to offer a private-label spirit that represents the highest of standards at a great value.

Sam’s Club is now using that strategy is other categories.

The latest news is that it’s wooing high-end beauty buyers with Sophyto, a professional, natural skincare regime.

“Every Sophyto anti-aging product delivers professional results, yet is formulated with pure, natural ingredients,” according to marketing materials.The Sophyto “daily renewal” kit sells for about $30, and includes a cleanser, serum and moisturizer.Maurice Markey, Sam’s vice president of private brands, mentioned Sophyto in a presentation at the Private Brand Movement conference.Both Rue 33 and Sophyto make it clear that Sam’s Club is positioning itself as a destination for the most discriminating of shoppers. It’s a smart move, because while there, these buyers can load their carts with the many other products Sam’s Club sells.

Read all of the Supermarket News coverage.

Supermarket News

Feel the Heat of Private Brand OTC


This week grocery trade magazine Supermarket News published a story on the growth of Private Brand in HBC. According to the story the growth of Private Brand over the counter medicines has been spurred by the bad economy the growth of instore clinics. I would add the significant National Brand OTC recalls to the list.

Private-Label Fever

The recession has led to a steady increase in over-the-counter medicine sales, but private-label brands are enjoying most of the benefit

When struck with coughs, colds or the flu, shoppers are becoming more likely to seek advice from their supermarket pharmacist and turn to over-the-counter remedies for relief.

The reasons are straightforward. In-store clinics have become more prevalent. And, the prolonged recession has caused many people to lose their health insurance, and led many others to avoid copays for doctor\’s visits and prescription drugs for less serious illnesses.

“The recession has also aided sales [of OTC medicines] because more consumers are on a budget and may turn to OTC remedies for their symptoms instead of opting for costly doctor visits or insurance copayments. And, because consumers are hyper-conscious of missing work and consequently earning smaller paychecks, they turn to OTC remedies to help them get through their workdays,” notes a May report on the state of the Cough and Throat Remedies market from Mintel International.

Read the entire story.

Supermarket News

The Power 50 Makes It\’s Mark

\"\"Grocery trade magazine Supermarket News recently released its annual “Supermarket News Power 50” for 2010 and the list has few if any big surprises. The categories big players dominate the top fifteen so of course they are also big Private Brand players. The one notable exception is the first Lady, Michelle Obama who is recognized for her work on combating obesity and her commitment to local food. The other exception comes in at #39 and is notable the “New digital consumer.”

The Top 10

1.            Mike Duke, president and CEO, Wal-Mart Stores

2.            Steve Burd, chairman, president and CEO, Safeway

3.            David Dillon, chairman, and CEO, Kroger Co.

4.            Craig Herkert, president and CEO, Supervalu

5.            Michelle Obama, first lady, United States of America

6.            John Rishton, CEO, Ahold

7.            Charles Youngstrom, co-president, Aldi U.S.

8.            Pierre-Olivier Beckers, CEO, Delhaize Group

9.            Danny Wegman, CEO, Wegmans Food Markets

10.            Jim Sinegal, CEO, Costco Wholesale Corp.

Conventional Supermarkets

11.            Charles C. Butt, chairman and CEO, H.E. Butt Grocery Co.

12.            Ed Crenshaw, CEO, Publix Super Markets

13.            David Shapira, chairman, president and CEO, Giant Eagle

14.            Ric Jurgens, chairman and CEO, Hy-Vee