Give 'em Something Free

December 1, 2004
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 Give ‘em Something Free
Sugar-free and fat-free continue to drive growth in gelatin and pudding mixes.
The introduction of dry gelatin desserts and puddings more than four decades ago brought a new market for private label, which has done well in recent months in this category. According to Chicago’s Information Resources Inc., private label gelatin/pudding mixes reached $57 million in sales, up 5.3 percent compared with year-ago data for the same 52-week period. The numbers show merchandising to have little effect on sales, however, what’s more important to growing the category is creating a full lineup of items and meeting consumer needs and changing trends.
The Imperatives:
Sugar-free gelatins and fat-free, sugar-free puddings continue to lead the sales growth in this category, helping consumers satisfy a sweet tooth while staying true to healthy eating trends and addressing pressing health issues such as obesity and diabetes.
The competition in this category is primarily against one major brand leader, and many say the category lends itself to a two-player positioning – the national brand leader and private label. Merchandising strategies should focus on private label set next to the national brand equivalent by flavor, and by offering a full lineup of 25 to 30 SKUs of puddings and gelatins to create a strong private label presence.
The Demographics:
Women are the primary grocery shoppers, and industry trends hold true in gelatin and pudding mixes. Sugar-free items, in particular, have attracted new consumers to the category, especially given the popularity of low-carb dieting in the past year.
Cross-Merchandising Opportunities:
Free-standing shippers have proven effective and successful in cross-merchandising puddings in the produce section. A banana-cream pie display, for example, offers a simple, yet indulgent, dessert solution where the consumer can collect necessary ingredients in one location.
Seasonality:
Desserts in general have sales spikes during the Thanksgiving, Christmas and Easter holiday seasons, and the gelatin and pudding mixes category is no exception to the rule. For this category in particular, however, the summer months also drive sales spikes.
Pricing vs. National Brands:
Private label offers a high margin return for retailers while still delivering a savings of 30 to 60 percent for the consumer.
Gelatins & Pudding Mixes
Sales (in millions) and Promotion Lift
ACTIVITYPRIVATE LABELTOTAL CATEGORY
Gelatins & Pudding Mixes
$ VOLUME $57.0$703.9
% Change Vs. Year Ago 5.3%2.9%
% Dollars, Any Merchandising 29.5%30.6%
% Change Vs. Year Ago 1.7%1.5%
% Dollars, Display Only 2.6%3.3%
% Change Vs. Year Ago -0.1%0.3%
% Dollars, Feature Only 7.0%9.9%
% Change Vs. Year Ago 1.3%0.4%
Source: Information Resources Inc. Total supermarkets, drugstores and mass merchandisers(excluding Wal-Mart) for 52 weeks ending Oct. 3, 2004.

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