Merchandising Features / Trend Features

A Texas Two-Step

July 5, 2012
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H-E-B At  A Glance

Company Founded

  • 1905

Owner

  • H.E. Butt 

Grocery Co.Headquarters 

  • San Antonio, Texas

Chairman and CEO

  • Charles Butt

H-E-B Stores

  • 329

Market

  • Texas and Mexico

Store Brands

  • H-E-B, Hill Country Fare
  • Hill Country Essentials
  • Central Market
  • H-E-Buddy

The “Fully Fit” moniker is attached to some H-E-B-branded health-oriented selections.

Another brand, H-E-Buddy, features kid-oriented products that are designed to be tasty and nutritious.

Selections are free of trans fats, high fructose corn syrup and partially hydrogenated oils, and have no more than 35 percent of calories from fat, 10 percent of calories from saturated fats and 25 percent of calories from added sugar.

Selections include whole grain breaded chicken nuggets, junior burgers and string cheese.

 “Signature private-label products are a way to create a point of differentiation from the competition so that the customer isn’t just buying because of the price,” says Marcia Schurer, president of Culinary Connections, a Chicago-based food marketing and consulting firm. “They also are buying because of quality and the ability to purchase something that they can’t get anywhere else.”

She adds that H-E-B “seems to have the pulse of the customer market, food trends, the economy and their competition and is developing merchandising strategies with those elements in mind.”

Such strategies include creating co-merchandising displays in stores.

A case in the deli area of the Waxahachie outlet, for instance, had a “meal deal” sign which noted that shoppers who bought Oscar Mayer Deli Fresh ham or Oscar Mayer Cooked ham and Kraft American Singles cheese could get a choice of items for free with an in-store coupon: Kraft Sandwich Shop mayonnaise, Kraft Velveeta, Kraft Easy Mac Cups or Kool Aid.

Another deli display had a sign that noted, “Healthy Savings, Great Tastes Under $8,” adding that persons who bought the four items in the case—H-E-B Beef stir fry, H-E-B Broccoli stir fry, Uncle Ben’s Boil-in-Bag brown rice, and Hill Country Fare canola oil would save $4 with an in-store coupon.

In addition, another in-store coupon—with the heading “Combo Loco, Look What’s Free”—stated that customers who buy H-E-B Classic Selections Self-Rising pizza would get such free items as H-E-B Creamy Creations fruit bars, Hill Country Fare garlic bread, or Five Cheese bread.

“Meal deals are a good way to not just compete with other retailers, but with all fast-food and fast-casual options that customers have within driving distance of their home, work or where they play,” Schurer states. “With so many consumers struggling to make the mortgage payments, using food stamps and being unemployed, I don’t know any retailer who doesn’t need to think about ‘deal’ strategies unless they are selling to a very high income, elite population.”

In addition to spotlighting attractive pricing, the Waxahachie store also is emphasizing customer service and quality—particularly in the meat department.

A sign over the meat case, for instance, contains the photos of 10 store butchers and states, “Fresh Quality Meats Cut With Pride By H-E-B Master Cutters. Total Satisfaction Guaranteed.”

A smaller sign has photos of two seafood associates and states, “Fresh Quality Seafood Sold With Pride By Your H-E-B Seafood Specialist.”

The self-service meat case, meanwhile, features freshly cut beef in overwrap trays, ground beef chubs and value-added selections in case-ready packages.

“H-E-B’s private-label offerings will continue to be strong,” Bishop says.

Among the value-added offerings is H-E-B-branded boneless/skinless chicken breast in Lemon Pepper, Teriyaki, and Sweet Chili varieties, pork fajitas and beef fajitas.

Also available is Hill Country Fare-branded case-ready boneless/skinless chicken breast tenders, chicken wings, leg quarters and wing drummettes.

Air-chilled organic chicken under the Central Market brand includes thighs, breasts and drumsticks, and all-natural H-E-B-branded chicken features boneless/skinless breasts and leg quarters.

Roasted rotisserie chicken and other prepared foods,meanwhile, are marketed in an island hot case display near the deli.

Under signage that states, “H-E-B Chef Prepared Foods, Mealz to Go!” are Mesquite BBQ chicken ($6.99 for a 40-ounce package); Roasted chicken ($4.49 for a 29-ounce bird); and Rotisserie chicken in Original or Lemon Pepper varieties ($6.99 for a 40-ounce package).

Items carry the H-E-B or Hill Country Fare brand.

“H-E-B’s private-label offerings will continue to be strong,” Bishop says. “They are influential in the market and want to offer consumers a good price point.”

And the retailer also is positioned to compete aggressively with Walmart, he states.

“Walmart’s perishables are typically not regarded as the strongest part of their offerings,” Bishop adds. “H-E-B wants to be in the sweet spot where their quality is superior and the price is very competitive.”

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