The Midwinter Executive Conference

January 24, 2011
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Center Store Success Starts With Consumer Insights, FMI Panel Agrees
Supermarkets need to change their center store operating philosophy from one that focuses on traditional category management to one that starts its planning with a focus on customers, panelists at FMI’s Midwinter Executive Conference said Monday.

Days of Shopper Loyalty Over, Expert Says

Shopper loyalty to a given store is a thing of the past and so food retailers need to be constantly creating the brands, stores and shopping experiences that can attract today's empowered consumer, Wendy Liebmann, CEO of consulting firm WSL/Strategic Retail told attendees at the Food Marketing Institute's midwinter meeting on Phoenix Tuesday


“We should assume no one will be loyal anymore,” Liebmann said. That means that simply having a store conveniently located isn't enough for retailers to garner shopper trips these days, she explained.


With today's shopper comparing prices online and with friends via Facebook and other social media, food retailers need to be honest, relevant and flexible in what they offer shoppers and how they reach them, she said. In terms of the what, food stores have an opportunity to be a larger presence in the healthcare segment because shoppers are searching for advice in that area, she noted. In terms of reaching consumers in different ways, she mentioned curbside pickup and home delivery as options to be considered.


“Break every rule, stretch your brand,” she advised.


Center Store Success Starts With Consumer Insights, FMI Panel Agrees

Supermarkets need to change their center store operating philosophy from one that focuses on traditional category management to one that starts its planning with a focus on customers, panelists at FMI’s Midwinter Executive Conference said Monday.
“We have to put shopper demand at the front of the process,” said John Lewis, president and CEO, Nielsen Consumer North America, a division of The Nielsen Co. “It is a battle for trips.”
While discussion at the Phoenix conference is focusing on national brand manufacturer roles in helping supermarkets, the same lessons mentioned can be used by private label manufacturers.
Consumers are looking for convenience and meal solutions, Lewis said. They have season
al food needs as well as special occasion food needs, such as birthday parties, for which they shop. Supermarkets should recognize and merchandise for those occasions.
More listening to consumers and more consumer research is needed, agreed the panel of supermarket and national brand company executives which Lewis chaired.
National brand manufacturers need to provide shopper insights to help retailers, the panelists said. The same principle holds for private label suppliers who want to increase the role private label plays in center store.
In-store signage can help make shopping trips more convenient for consumers, noted panelist Dave Bornmann, vice president, grocery and non-food, for Publix Super Markets Inc. Publix also has introduced an online ordering system which allows shoppers to pick up their groceries curbside at a local Publix, he added.

Center store accounts for 73 percent of supermarket sales and 77 percent of profits, Lewis noted.



How About a Flash Mob To Get Consumer Attention?

Ohio-based Dorothy Lane Market Inc. has used a flash mob in one of its stores singing about food, along with Twitter, Facebook, a blog and weekly e-mails to reach shoppers and keep them enthusiastic about and shopping at its three stores, Norman C. Mayne, CEO, told attendees at the Food Marketing Institute’s Midwinter Executive Conference Monday. Mayne also is MI’s midwinter meeting chairman.
In private label, Dorothy Lane markets a premium private label line in keeping with its stores’ gourmet brand image, Mayne told PLBuyer following his official presentation. Dorothy Lane has offered private label for about 10 years, he said.
Customer research is a key component of Dorothy Lane’s operating strategy. It knows, for example, that 11 percent of its annual sales come from the top 1 percent of its customers. The top 30 percent of customers account for 85 percent of sales, Mayne said.
Dorothy Lane stages special events, such as Lobstermania, in which it sells and then cooks lobsters for customers in store parking lots, to engender customer loyalty. “It’s a lot of warm fuzzies and its good business,” Mayne said.

One promotion that gets the Dorothy Lane name to unexpected places is giving shoppers gift certificates for taking photos of Dorothy Lane-branded grocery bags in exotic places. Dorothy Lane bags have been photographed at the North Pole and on a U.S. space shuttle, Mayne noted.







PL Will Be Part of New Voluntary Front of Package Labeling

Private label products will soon be sporting new front-of-package nutritional labeling as will name brand products, a panel of industry representatives announced during a press conference at the Food Marketing Institute’s midwinter meeting in Phoenix Monday.
The new Nutrition Keys labeling program will place calorie, saturated fat, sodium and sugar information on the front of packaged goods.  The information is encased in white thumbnail-shaped boxes. Products with the new labeling are expected to begin hitting store shelves later this year.
The program “will extend to store brands,” said Ric Jurgens, chairman of the board and CEO with Hy Vee Inc. Jurgens also chairs FMI. Hy Vee is committed to using the new labeling on all its stores brands and other FMI retailer/board members also are committed 100 percent to the program, Jurgens said in a response to a question from PLBuyer. “I think you’ll see it very soon,” he said of the new labeling on private label offerings.
FMI joined with the Grocery Manufacturers Association (GMA) in announcing the new guidelines. The initiative is a voluntary one, done in response to calls from first lady Michelle Obama for industry action, said Pamela Bailey, GMA’s president and CEO. Asked if the industry was trying to do something before the Food and Drug Administration came out with new labeling guidelines, Bailey said the industry moved in response to Obama’s request and because “the consumer has been waiting.”
The new labeling will not mean abandonment of such retailer programs as Hy Vee’s NuVal nutritional scoring system, Jurgens said. The two systems will work together to inform consumers, he said. NuVal scores items on a 100-point scale of nutritional quality.

A $50 million industry-funded marketing campaign will launch in the fall to support the new labeling.




First Night Party

A FMI emcee welcomes attendees to a first night party at FMI's Midwinter meeting in Phoenix

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