Grocers, food makers want a piece of the holiday shopping pie | Crain's St. Louis

Grocers, food makers want a piece of the holiday shopping pie

Rich Wallace starts his holiday shopping around the time most people are planning Memorial Day barbeque menus.

As Dierbergs Markets’ director of center store procurement, Wallace begins booking orders for seasonal specialties up to five months before customers see the goods on store shelves. For some perennially popular items, he’s able to use sales histories to place accurate orders. But, for new items, Wallace and his staff have to employ a little guess work to anticipate what might appeal to shoppers once they leave their summer body aspirations behind in favor of eggnog and an extra slice of pumpkin pie.

“So our job is to give customers a great selection and maximize sales, and try not to get stuck with excess inventory after the season,” Wallace said. “Year after year, there is a consistent pattern. Manufacturers come out with huge variety of seasonal items — baking, specialty variety [products], baking chips, candy, desserts, paper products and more. On top of these things, we’ll see some additional new items or varieties that we are always willing to try because customers appreciate and respond to these items.”

For instance, PepsiCo’s seasonal offerings include Lay’s Wavy Potato Chips Dipped in Chocolate, Cap’n Crunch’s Christmas Crunch and Cheetos Snowflakes, which are white cheddar-flavored, snowflake-shaped versions of the salty snack. The food and beverage maker’s new products for 2017 include Pepsi Salted Carmel, Mtn Dew Holiday Brew and Cheetos Sweetos Holiday Cinnamon Sugar Puffs.

Such offerings help create buzz — and not just because of their sugar content.

“Variety lends itself to impulse purchases and helps keep consumer packaged goods brands relevant by capturing shoppers’ attention with new flavors, colors and packaging,” said Nicole Hill, group strategy director for MarketPlace, a food marketing agency based in St. Louis. “By nature of their limited availability, seasonal items feel more like a specialty purchase, which can also drive brand interest and purchase. Some brands, like Oreo, have made limited time offerings a key component of their strategy, regularly offering flavors that may only be available for a short time and propelling ongoing conversation about the brand.”

Limited edition products can combine classics with unexpected seasonal flavors. They can also give food makers the opportunity to experiment with trending ingredients, creating a chocolate mint bark with quinoa inclusions, for example.

“Offering limited edition and seasonal products helps brands to capture real estate at-shelf and presence in shoppers’ minds, building upon the brand equity of flagship products and supporting occasion-based purchases,” Hill said.

Increasingly, limited edition items feature a dash of peppermint, pumpkin or gingerbread spice, recipes that aim to attract festive taste buds but also spur sales even after the calendar turns to 2018.

“This focus on seasons, rather than specific holidays, is deliberate,” said Diane Haight, senior manager of creative services at Daymon, a strategic branding firm specializing in developing private label brands. “Because not everyone celebrates the same holidays, you have to walk a fine line. We’ve found that focusing the branding and design on the season not only helps avoid potential controversy, it also extends the length of time the product appeals to shoppers. If we brand a product ‘Christmas Candy Cane,’ after Jan. 1, no one wants to buy it anymore. But if you brand it ‘Winter Peppermint,’ you can sell it into February.”

Supermarkets themselves are branching into more season-specific offerings now that suppliers are increasingly willing to take on private label partnerships with more flexible production minimums.

Meanwhile, the holiday payoff is growing for grocers, with consumers spending $123.5 billion at food and beverage stores during November and December of 2016, compared with $119.2 billion during the last two months of 2015, according to the National Retail Federation.

But festooning aisles with seasonally colored boxes sprinkled with snowflakes isn’t always enough to woo customers whose shopping lists are already longer this time of year.

“Both the products and package designs should feel like an authentic fit for the season and the category. They should also feel special and stand out from other offerings in the retailer’s lineup,” Haight said. “The imagery used on the packaging can also help boost its seasonal and uniquely flavor-forward appeal. The design for a limited edition pumpkin spice cereal, for example, might feature real pumpkins, cinnamon sticks and fall leaves. You want these items to stand out on the shelf, and you want them to look like an indulgence.”

Strategically designed store displays are also key to catching customers’ attention, said Wallace, the Dierbergs procurement director. The Chesterfield, Missouri-based grocery chain doesn’t often feature limited edition products in its ads, but customers will substitute them in place of a similar everyday item or add them to their regular shopping list if seasonal specialties are in the right place at the right time, he said.

“The holiday display plan for our stores is set by the end of October, and within those plans are strategic displays built around holiday gift sets or limited edition holiday items,” Wallace said. “So, not only do these products represent additional sales opportunities, they also help with the overall seasonality of the store by adding to the holiday feel and décor.”

And, though some shoppers might not be feeling very festive yet, others start picking up holiday-themed items early. For instance, many craft beer devotees eagerly await certain releases and start sipping seasonal brews as soon as they hit store shelves. Others see this time of year as a sort of scavenger hunt when they can indulge in old favorites and treat themselves to new limited edition items that might not mesh with New Year’s resolutions.

“The winter holidays are all about tradition, so there is a consistency to purchase patterns. But I would add that part of that tradition is trying out new items, flavors and offerings,” Wallace said. “Seasonal items add to the shopping experience and make it fun.”

November 20, 2017 - 3:35pm