Progressive Grocer - November 2014 by ensembleiq

PLUS! 2014 Category CaPtainS P. 35

2014

Mile-HigH Market Fresh Fare by King Soopers Page 22

(L-R) Lee Lucero, store manager; Chad Bring, produce manager; Cristina Villa, assistant store manager

November 2014 â&#x20AC;˘ Volume 93 Number 11 $10 â&#x20AC;˘ www.progressivegrocer.com

America’s Smoothest Lager

Shrimp Paella

ÂŠ2014 Goya Foods, Inc.

Your shoppers ďŹ nd this and other great recipes at goya.com

*Nielsen Strategic Planner, Total US (dollar sales), 52 weeks ending 8/30/14

November 2014

features 154

Volume 93, Issue 11

cover story

fresh food

Progressive grocer / Mercatus grocery Leaders roundtabLe:

Building a Game-changing Digital Commerce Strategy PG chats with retailers about their data analytics initiatives.

grocery

137 Produce

Savoring South America New players and creative campaigns are driving sales of fresh and favorful imports.

144

Cover photo by tim benko

Produce category Focus

store oF the Month

122 Lunchbox heroes

Get ’Em While They’re Young Hoping to infuence future eating patterns, retailers and manufacturers strive to get better-for-you items into kids’ midday meals.

frozen & refrigerated 133 Frozen dough, bread and roLLs

Totally Chill Purveyors of dough and baked goods see freezing as integral to their success.

Cool Enough for School An urban store with a college right up the street, Fresh Fare by King Soopers has become a fxture in its bustling suburban Denver neighborhood.

146 PMa PersPectives

features 35 category ManageMent

Tater Tactics Potato suppliers get savvy with spuds in ways that speak to Millennials and more.

Strengthening the Shopper Experience PG’s 2014 Category Captains winners understand that boosting baskets means transcending brands to drive sales across the store.

Think Fast Grocery stores are uniquely suited to help Millennials make healthier choices.

2014

November 2014 | progressivegrocer.com |

equipment & design 148

570 Lake Cook Rd, Suite 310, Deerfield, IL 60015 224 632-8200 • www.progressivegrocer.com

Displays

Deck the Halls Holiday display equipment can help make the selling season merry and bright.

EDITORIAL Editorial Director Joan Driggs 224-632-8211 jdriggs@stagnitomail.com Chief Content Editor Meg Major 724-453-3545 mmajor@stagnitomail.com Editor-in-Chief James Dudlicek 224-632-8238 jdudlicek@stagnitomail.com Managing Editor Bridget Goldschmidt 201-855-7603 bgoldschmidt@stagnitomail.com Senior Editor Katie Martin 224-632-8172 kmartin@stagnitomail.com Senior Editor Anna Wolfe 207-773-1154 awolfe@stagnitomail.com Digital Editor Kyle Shamorian 224-632-8252 kshamorian@stagnitomail.com Art Director Bill Antkowiak bantkowiak@stagnitomail.com Contributing Editors Kathleen Furore, Bob Ingram, Jenny McTaggart, Jennifer Strailey and Christina Veiders

technology 152 progressive views

Grocers Move Forward With Mobile Food retailers focused on the potential sales impact of smartphones are pulling out all the stops to get it right.

nonfoods 156 HealtH, Beauty & wellness

Family-planning Rebirth A new openness pervades sexual wellness marketing and merchandising, with women leading the charge.

161

pg pet special section

Tackling Pet Obesity Grocers should leverage opportunities for animal wellness.

departments 11 EDITOR’S NOTE: ALL THE CATEGORy DETAILS 12 BRAIN FOOD 14 IN-STORE EVENTS CALENDAR: JANUARy 2015 16 MINTEL: BREAKFAST CEREALS 18 NIELSEN’S SHELF STOPPERS/SPOTLIGHT: PACKAGED MEAT/REFRIGERATED BACON 20 ALL’S WELLNESS: TAGS — yOU’RE IN? 166 WHAT’S NExT: EDITORS’ PICKS FOR INNOVATIVE PRODUCTS 168 THE SUPPLIER SIDE 170 THE LAST WORD: ATTITUDE OF GRATITUDE

| Progressive Grocer | November 2014

ADVERTISING SALES & BUSINESS VP, Group Publisher Jeff Friedman 201-855-7621 jfriedman@stagnitomail.com Midwest Marketing Manager John Huff 224-632-8174 jhuff@stagnitomail.com Western Regional Sales Manager Elizabeth Cherry 310-546-3815 echerry@stagnitomail.com Eastern Marketing Manager Maggie Kaeppel 630-364-2150 • Mobile: 708-565-5350 mkaeppel@stagnitomail.com Northeast Marketing Manager Mike Shaw 201-855-7631 • Mobile: 201-281-9100 mshaw@stagnitomail.com Marketing Manager Janet Blaney (AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY) jblaney@stagnitomail.com 630-364-1601 Account Executive/ Classified Advertising Terry Kanganis 201-855-7615 • Fax: 201-855-7373 tkanganis@stagnitomail.com Advertising/Production Manager Courtney Warnimont 224-632-8215 • Fax: 888-847-1791 cwarnimont@stagnitomail.com Classified Production Manager Mary Beth Medley 856-809-0050 marybeth@marybethmedley.com MARKETING & PROMOTION Director of Market Research Debra Chanil 201-855-7605 dchanil@stagnitomail.com Audience Development Manager Shelly Patton 215-301-0593 spatton@stagnitomail.com List Rental The Information Refinery 800-529-9020 Brian Clotworthy Reprints and Licensing Wright’s Media 877-652-5295 sales@wrightsmedia.com Subscriber Services/Single-copy Purchases 978-671-0449 or email at Stagnito@e-circ.net

President & CEO Harry Stagnito Chief Information Officer Kollin Stagnito SVP, Partner Ned Bardic Chief Brand Officer Korry Stagnito VP & CFO Kyle Stagnito VP/Custom Media Division Pierce Hollingsworth 224-632-8229 phollingsworth@stagnitomail.com Production Manager Anngail Norris Human Resources Manager Sandy Berndt Corporate Marketing Director Bruce Hendrickson 224-632-8214 bhendrickson@stagnitomail.com Promotion Director Robert Kuwada 201-855-7616 rkuwada@stagnitomail.com VP/Events John Failla 201-855-7634 jfailla@stagnitomail.com Director of Digital Media John Callanan 203-295-7058 jcallanan@stagnitomail.com Audience Development Director Cindy Cardinal

STAGNITO BUSINESS INFORMATION PUBLICATIONS

Progressive Grocer (ISSN 0033-0787, USPS 920-600) is published monthly by Stagnito Business Information, 570 Lake Cook Rd. Deerfield IL 60015. Single copy price $10, except selected special issues. Subscription: $135 a year; Canada $164 (Canada Post Publications Mail Agreement No. 40031729. Foreign $270 (call for air mail rates). Periodicals postage paid at Deerfield, IL 60015 and additional mailing offices. Printed in USA. POSTMASTER: Send all address changes to Progressive Grocer, P.O. Box 1842 Lowell, MA 01853. Copyright ©2014 Stagnito Business Information All rights reserved, including the rights to reproduce in whole or in part. All letters to the editors of this magazine will be treated as having been submitted for publication. The magazine reserves the right to edit and abridge them. The publication is available in microform from University Microfilms International, 300 North Zeeb Road, Ann Arbor, MI 48106. The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

LET’S TALK REFRESHMENT. ble April Availa

2015!

When consumers want refreshment, they look for Hershey’s brands the most. Our portfolio leads the market, with a growing 38 percent Mint share* due to successful, incremental innovations that are driving the category. So if you want refreshing proﬁts from your category sales, let’s talk.

*Nielsen, 52 weeks ending 12/31/13

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Category Solutions your

Maximize your Sales and Proﬁt with General Mills’ Category Growth Solutions

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▪ Valuable Shopper Insights along the Path to Purchase. ▪ Measurable Category Growth Drivers. ▪ Merchandising Strategies to Activate Category Growth.

editor’s note

by Jim Dudlicek

All the Category Details

t’s increasingly apparent that category management needs to be a top priority for grocery retailers. As supermarkets compete with other channels bent on getting a piece of the grocery action — fresh as well as center store, and digital as well as brick-and-mortar — efective category management partnerships between grocery retailers and their CPG suppliers are essential. It’s not just about brands — it’s also about entire categories, and the synergies that can be leveraged among every category throughout the store. Even more so, the idea of category management is rapidly morphing into “need state” management, as the folks at the Category Management Association have long been preaching. Delivering not simply products, but solutions to specifc consumer needs, is the new normal for grocery retailing. Tat’s why PG aims to hold the category management standard high with its annual Category Captains Awards, presented for the 18th time, in this issue, starting on page 35. As with our Editors’ Picks new product contest and other awards programs, we received loads of fantastic entries. And, as with those other contests, we received loads of questions regarding criteria, background, support material and other entry requirements. So, much as I did for our Editors’ Picks issue in September, I thought I’d take the occasion of this month’s column to ofer some behind-thescenes insights and advice for future Category Captains entrants:

It’s not just about the products: As its name

suggests, this is a category management contest. Te fact that you launched new products in a particular category is not enough to demonstrate captaincy. It’s not just about brands: It’s great if your brand

is selling well or even leading the growth in its category. But this contest isn’t about the success of individual brands — it’s about how targeted

initiatives lift entire categories or, better still, extend that growth to complementary categories. No CPG company is an island: Te

best category management initiatives are created in close partnership with retailers to develop a customized program for each grocer. We want to hear about programs you’ve developed with specifc retailers. Tey don’t want to be mentioned publicly? Fine — we don’t have to publish the name, but if we know who it is, it adds weight to your entry. Facts and figures: Sales is a numbers game, so

we need to see data showing category lift. Again, if you don’t want exact numbers made public, we don’t need to publish them, but they’ll help our team accurately judge your success.

Grocery retailers demand excellence from their suppliers. We want to know you’re doing your darndest to keep those baskets full.

Getting the picture: Make sure to include images representative of your entry. A logo doesn’t tell us much except who you are, and even product shots don’t necessarily illustrate a category management campaign. Shelf sets, demo tables, signage — these all speak to category promotion. Oh, and one more thing, since we get asked about this a lot: Being the only entry in a

category does not guarantee your being named a Category Captain. It could be that we feel your eforts merit only Category Advisor recognition. We regularly award Advisor for categories in which there is no Captain. And we may decide, based on the quality of the entries, not to honor anyone at all for a given category. Grocery retailers demand excellence from their suppliers, so there’s no reason that PG shouldn’t expect the same. We want to know you’re doing your darndest to keep those baskets full. PG

Jim Dudlicek Editor-in-Chief jdudlicek@stagnitomail.com Twitter @jimdudlicek

November 2014 | progressivegrocer.com |

Accolades / Insights / Trends / Opportunities

Giant Eagle’s Shapira Nominated to USPS Board of Governors David S. Shapira, executive chairman of Giant Eagle Inc., has been nominated to serve on the U.S. Postal Service’s (USPS) nine-member board of governors. Shapira’s nomination, which followed closely on the heels of USPS’ announced plans to begin delivering groceries, was made by President Barack Obama and requires approval by the Senate. Shapira led Giant Eagle, the Pittsburgh region’s largest private company, as chairman and CEO for 32 years, and has been executive chairman since 2012. With approximately $9.9 billion in annual sales, Giant Eagle has 417 stores throughout western Pennsylvania, Ohio, northern West Virginia and Maryland.

Debunking Retail Wage Myths Retail pay is on an even keel with other industries, despite the perception that the industry offers lower-paying wages, according to the Washington, D.C.-based National Retail Federation (NRF). A study found that retail workers with similar levels

Animal Proteins Gain Ground

As consumers incorporate more protein into their diets, a new survey finds that animal proteins like meat and fish are among the most popular, with 60 percent of respondents saying they eat such foods every day. According to The NPD Group, shoppers identified beef and chicken as the best sources of protein, followed closely by fish. Proteins such as pork, ham, shellfish, lamb and bacon trailed further down the list. Additionally, respondents were also less likely to cite dairy and eggs as the best sources of protein, Port Washington, N.Y.-based NPD found. —The NPD Group’s “Protein Perceptions and Needs”

of job skills and experience earn wages comparable to employees in other sectors — an average of $30,984 per year for retail workers, compared with $32,004 for nonretail. Experienced retail workers earn even more than their peers in other industries. Fulltime retail workers between the ages of 25 and 54 make

an average of $38,376 per year, slightly higher than the $37,968 earned by nonretail workers. Further, when compared with other industries, the retail industry has a higher percentage of workers age 35 to 54 earning between $48,000 and $72,000 annually. —NRF’s “Wages in the Retail Industry: Getting the Facts Straight”

What’s Trending on Progressivegrocer.com … Sell-by/Use-by Confusion

PG’s most recent poll question asked readers which department presents the most confusion surrounding sell-by/ use-by dates. Here’s how the votes stacked up as we went to press with this issue:

14% 16%

17%

| Progressive Grocer | Ahead of What’s Next | November 2014

27% n Meat n Prepared Foods n Refrigerated n Deli n Produce

26%

22,400

Number of attendees converging in Anaheim, Calif., for the Produce Marketing Association’s 2014 Fresh Summit

Families who rely on food banks receive less than one gallon of milk per person—per year. You have the power to help change that. Activate The Great American Milk Drive in-store. Make a diference in your community. See a diference in your bottom line. Call or email to learn more. 800-945-MILK | retailers@milkpep.org ©2014 America’s Milk Companies.SM

in-store

January 2015 is...

events S

Get Organized Month National Hot Tea Month National Oatmeal Month National Slow Cooking Month National Soup Month

1 awolfe@stagnitomail.com.

Good thing it’s also National Bloody Mary Day.

Celebrate National Cream Puff Day by stocking the bakery with these perennial favorites.

New Year’s Day E-mail your calendar submissions to

National Chocolatecovered Cherry Day

Cross-promote pasta, sauce and grated cheese in honor of National Spaghetti Day.

Winter Fancy Food Show begins and continues through the 13th.

On the occasion of National Gourmet Coffee Day, sample your most unusual varieties.

Review your Valentine’s Day inventory and promotions.

For National Whipped Cream Day, feature cans of whipped cream and cartons of heavy cream.

In recognition of National Glazed Doughnut Day, create a Pinterest board with your staff’s favorites.

Martin Luther King Jr.’s birthday (Jan. 15, 1929) observed. For National Popcorn Day, set up displays of popcorn poppers and popping corn.

In honor of National Soup Month, focus on the cold-weather favorite in prepared foods.

National Shortbread Day

Create your store’s events calendar in honor of Get Organized Month.

On National Cheese Lover’s Day, sample familiar and unusual cheeses, and don’t forget the condiments.

National Chocolate Cake Day

National Tempura Dayy

National Hot Pastrami Sandwich Day

It’s National Granola Bar Day, so set up massive displays and special pricing. National New England Clam Chowder Day

National Blueberry Pancake Day

| Progressive Grocer | Ahead of What’s Next | November 2014

Host a DIY Pizza Night class in honor of National Pizza Week.

National Strawberry Ice Cream Day

Celebrate National Southern Food Day by offering gumbo and fried chicken in n the prepared food section, and pecan pie in the bakery.

Mark National Corn Chip Day by sharing your staff’s favorite recipes for chili corn chip pie.

Offer samples of freshly brewed tea to mark National Hot Tea Month.

On National Hot and Spicy Food Day, feature appropriate products in every department.

In honor of National Pie Day, highlight of all the flavors you offer.

On National Croissant Day, make it a special TGIF with a coupon for the flaky pastry.

It’s National Baking Month and National Bittersweet Chocolate Day. Time to get creative!

Ditch New Year’s Resolutions Day — tweet a coupon for snacks instead.

National Peanut Butter Day. Sixty percent of consumers prefer creamy over crunchy.

National Hot Chocolate Day

DRIVE SALES WITH A FESTIVE RETAIL PROMOTION FROM MODELO ESPECIAL November 1–December 31, 2014

67 %

IMPORT RANKED

BY DOLLAR

SHARE CHANGE

SALES

DOLLAR SALES LIFT

WHEN FEATURED AND DISPLAYED

15%

VELOCITY

15.0

16.0

12.0

8.0

-3.0

DOMESTIC PREMIUM LIGHT

-2.0 DOMESTIC PREMIUM

-1.0 EUROPEAN IMPORTS

0.3 IMPORTS LESS CROWN

1.0 TTL BEER

MODELO ESPECIAL

0.0

IRI weeks ending 11/04/13 thru 01/05/14 Total U.S., Multi-Outlet + Convenience, Total U.S. Convenience 2 IRI, Total U.S., Food & Drug, weeks ending 11/03/13 thru 01/05/14 3 IRI, Total U.S., Multi-Outlet + Convenience, weeks ending 11/03/13 thru 01/05/14 NOTE: Sales velocity based on average weekly dollars per $MM ACV

CONTACT YOUR LOCAL CONSTELLATION BEERS SALES REPRESENTATIVE

Serve responsibly.™ Modelo Especial® Beer. Imported by Crown Imports, Chicago, IL

SALES VELOCITY % CHANGE VS. YEAR AGO

Mintel Global New Products Database Category Insights For more information, visit www.mintel.com or call 800-932-0400.

Breakfast Cereals Market Overview l Overall breakfast cereal sales in the United States have remained stagnant over the past few years. l

This slowdown is linked to many factors, among them competition from other breakfast options such as breakfast biscuits, sandwiches, bakery items, cereal/ snack bars and shakes. The hot cereal segment is expected to experience further growth and interest, particularly given how cold cereal manufacturers are increasingly entering the segment.

Mintel predicts the breakfast cereal market will grow 4 percent by 2018, boosted by stronger sales in the hot segment.

key issues Hot cereal companies are addressing the perception that products such as oatmeal are timeconsuming to prepare. Indeed, convenience

claims drive new product development in this segment. l

U.S. consumers are most interested in health- and nutritionbased (high-fiber, high-protein, vitamin-/ nutrient-enriched, lowsugar, sustained energy) attributes when shopping for breakfast cereals.

Superfood ingredients, such as quinoa and chia seeds, have piqued consumer interest and are making their way into both hot and cold products. l

While the majority — 89 percent — of U.S. consumers who eat cold and/or hot cereal do so at breakfast, other eating occasions are gaining popularity. The second most common eating occasion is snacking, with 33 percent claiming they eat cereal in this manner.

the cold cereal segment dominates, both in terms of u.s. sales and new product development. that said, in the united states, the hot cereal segment saw stronger sales growth of 7.2 percent between 2011 and 2013, versus a 0.7 percent dip for cold cereals.

What Does it Mean? l

There’s particular scope for more new product development focused on high protein, satiety, ancient grains and gluten-free, areas with notable consumer interest but more limited new product development.

In line with consumer findings, companies would do well to focus on the snacking, meal and

dessert occasions by flagging satiety/high-protein content, indulgent flavors, and/or portability (e.g., grab-and-go single-serve packs). l

There’s also scope for significantly more hot cereal new product development, given the inherently healthy image of products such

| Progressive Grocer | Ahead of What’s Next | November 2014

as oatmeal, and growing interest in hot cereals from cold cereal players, as evidenced by Kellogg’s Special K Nourish hot cereal product line. l

Hot cereal manufacturers should take the opportunity to target children — an area in which the segment has fallen short.

They say you can’t compete on price and be proﬁtable at the same time.

What a crock!! Truth be told, consumers go where they can get the best deals. So you need to offer competitive prices every day, not just once in a while. But we don’t expect you to sacrifice your profitability in the cereal category in order to be competitive. ve. MOM Brands® knows how to help retailers keep profitable,, while still keeping ng

price-sensitive consumers in their stores. Considering we have proof that consumers save, on average, 31% vs. other national brands*, it’s clear that we’re not just making stuff up willy-nilly.

Bottom line, MOM Brands is the only cere cereal company committed to saving families money a helping retailers and li you make money. like E Every day. No lie, no kid kidding, no bull.

Find out more at MOMbrands.com/bull *Source reference: Nielsen scan, Total US All Outlet (XAOC), 52-week ending 10/30/2010 and 10/26/2013.

Front End

Market Intelligence By The Numbers GRoCERY’S ToP 10

Shelf Stoppers

Packaged Meat Largest Sales Increases in Supermarkets by The Nielsen Co. (52 Weeks Ending Aug. 30, 2014)

Sales % Change Dollars (Millions) 2014 2013 Bacon-Beef and Canned

$10.4

% Change 2014

Units 2013 -9.1%

20.0%

-2.9%

18.7%

Bacon-Refrig.

2,865.3

10.2

5.9

0.2

1.2

Sausage-Dinner

2,002.1

6.3

4.1

2.1

6.2

295.4

5.3

-1.9

-1.2

0.1

Bratwurst and Knockwurst Lunchmeat-Nonsliced-Refrig.

368.6

4.9

0.9

3.2

1.1

2,036.9

4.8

-4.0

-0.4

-3.2

1,113.8

4.7

-0.6

-3.3

2.4

101.8

1.9

2.1

2.6

3.8

Frankfurters-Refrig.

1,658.9

-0.9

-2.6

-3.2

-2.0

Lunchmeat-Deli Pouches-Refrig.

1,598.0

-4.6

-0.3

-3.5

0.5

4.0%

0.7%

-1.1%

0.4%

Lunchmeat-Sliced-Refrig. Sausage-Breakfast Franks-Cocktail-Refrig.

Total Category

$12,070.5

NielseN’s Spotlight

Whether it accompanies eggs at breakfast, completes a BlT or crumbles into salads at lunch, wraps around shrimp for an appetizer, or adds salty, smoky accents to a soufflé at dinner, bacon is biggest among older bustling families, empty nesters and senior couples who particularly enjoy its easy prep, versatility as an ingredient, and hearty retro flavor.

CRoSS-MERCh Candidates

Consumption Index: Refrigerated Bacon LIFESTYLE BehaviorStage

Cosmopolitan Affluent Comfortable Struggling Centers Suburban Country Urban Spreads Cores

Modest Working Towns

Plain Rural Living

Total

wITh ChILDREN: startup Families

101

103

136

104

small-scale Families

117

128

111

113

109

112

115

Younger Bustling Families

141

118

122

114

104

111

116

Older Bustling Families

136

130

142

150

157

159

144

Young Transitionals

independent singles

• •

senior singles

•

established Couples

100

113

111

121

107

empty-nest Couples

103

108

129

125

116

136

121

senior Couples

113

114

135

125

118

138

126

Total

100

107

110

100

HHs with young children only <6 small HHs with older children 6+ large HHs with Children (6+), HOH <40 large HHs with children (6+), HOH 40+

No ChILDREN: Any size HHs, no children, <35 1-person HHs, no children, 35-64 1-person HHs, no children, 65+ 2+-person HHs, no children, 35-54 2+-person HHs, no children, 55-64 2+-person HHs, no children, 65+

n Very High Consumption (150+)

n High Consumption (120-149)

Average Consumption=100

| Progressive Grocer | Ahead of What’s Next | November 2014

• Ethnic HBC • Automotive Supplies • Charcoal, Logs and •

•

Accessories Disposable Diapers and Training Pants Ice Sugar and Sweeteners Unprepared Meat, Poultry and Seafood-Frozen Dough Products More oNLINE

Dig up actionable e research and additional al intelligence at Progressivegrocer.com

Without regulatory expertise, the attention of a corporate dietitian, and a streamlined process, a nutrition shelf tag program isn’t worth the investment.

All’s Wellness By Barbara Ruhs

Tags — You’re In? The decision of whether to introduce a nutrition guidance program at the shelf should depend on cost and potential impact.

arly in my career as a supermarket dietitian, I implemented a nutrition shelf tag program without the assistance of a nutrition shelf tag company or product nutrition database. Since I didn’t know then that these companies and resources existed, I reviewed USDA’s foodlabeling regulations and visited stores to create tag listings for products that qualifed for four basic nutrition tag types, based on their Nutrition Facts labels. Customized tag artwork was created in consultation with our marketing and merchandising teams, and scan clerks executed nearly 1,000 tags in the retailer’s 50 stores across the state.

Costs and Benefits My primary goal was to help improve shoppers’ health by providing nutrition guidance at the point of purchase. A year later, various nutrition shelf tag companies, including NuVal, Guiding Stars and Vestcom, pitched their programs to my company, offering a more comprehensive plan to identify and tag qualifying products. At the time, the cost of an annual license for one of these programs varied from $30,000 to $100,000, based on the number of stores displaying tags. Te ROI of nutrition shelf tags was one of my frst considerations in deciding to implement a tag program. Aside from Guiding Stars, there’s little published research on the ROI of nutrition shelf tags; however, the American Heart Association has seen a 3 percent to 5 percent sales lift associated with its Heart Check icon, displayed on qualifying items at the point of purchase. With more than 40,000 products lining the shelves of the average supermarket, the impact of a shelf tag program is enhanced by executing more tags. Ideally, a threshold of greater than 10 percent of all products should have some sort of nutrition tag to be relevant. Make sure that tags appear throughout all departments, especially in key

| Progressive Grocer | Ahead of What’s Next | November 2014

categories, to gain customer awareness and value. To accomplish this, several types of tags must be part of the overall strategy. For example, in the frozen entrée section, many products may not qualify as “hearthealthy” or “low-sodium,” but a calorie-threshold tag (500 or fewer) may work better. Although Guiding Stars research suggests that the system shifts consumer choice toward healthier items, I was concerned that the program wasn’t truly educating customers on how to select better choices, but rather training shoppers to look for stars.

Making Qualified Health Claims Te U.S. Food and Drug Administration (FDA) considers shelf tags extensions of food labels, so tags are limited to the agency’s approved labeling claims and must meet its defned nutrition qualifcations. Forget about creating tags for superfoods, probiotics, or other cutting-edge buzzwords or nutrition trends, as these types of claims aren’t among those sanctioned by FDA for product packaging without liability risks. To remain compliant, nutritional shelf tag companies must continuously update their nutrition facts databases with product formulation changes and new product additions. Te bottom line: Tags need to be refreshed on a regular basis, and without regulatory expertise, the attention of a corporate dietitian, and a streamlined process, a shelf tag program isn’t worth the investment. Most retailers fall short in engaging customers through nutrition tag programs, and most haven’t maximized the vast nutrition information at their fngertips. Tose that do so will bring about healthier, more engaged and loyal customers. PG Barbara Ruhs is a registered dietitian and the founder of Phoenix-based Neighborhood Nutrition LLC (www.neighborhoodnutrition.com). Follow her on Twitter at @BarbRuhsRD.

A Taste of Sweet Excitement comes to Store Shelves!

— Introducing —

Zing Zero Calorie Stevia Packets and Zing Baking Blend Stevia & Cane Sugar Canister TM

Real ingredients. Perfect sweetness.

The Zing™ sweetener brand was created with the discriminating Millennial demographic in mind – the younger shopper searching for products with authentic ingredients and a pure sweet taste they can believe in. This exciting generation now has their very own sweetener, Zing™ – a taste of sweet excitement™ . Learn more at zingstevia.com.

ZingTM Zero Calorie Stevia Sweetener

ZingTM Baking Blend

■ Made with only real ingredients of

■ Stevia & pure cane sugar blend

stevia leaf extract and dextrose ■ Zero calories per serving ■ 1 packet = sweetness in 2 teaspoons of sugar ■ 40-count box of single-serve packets

■ 5 calories per serving ■ Bakes and browns like sugar for delicious,

golden-brown cakes and cookies ■ 1 canister sweetens like 2.5 lbs. of sugar ■ 20 oz. canister with an easy pour spout for quick measuring and a snap-closed lid

Store of the Month

Fresh Fare by King Soopers, Englewood, Colo.

Cool Enough for

School

An urbAn store with A college right up the street, Fresh FAre by King soopers hAs become A Fixture in its bustling suburbAn Denver neighborhooD.

By Jim Dudlicek

o into any King Soopers supermarket in Colorado, and you can expect to receive the Customer 1st experience that Cincinnati-based parent company Kroger has advanced to great success throughout its stores across the United States. Go into Fresh Fare by King Soopers, in Englewood, Colo., and you’re likely to receive an

experience unlike most other stores. Tat’s because this suburban Denver grocery store is one of a growing number of urban-format markets being developed by the Centennial State-based banner, in an efort to better serve the unique needs of each community in which it operates. “Tey love it,” Store Manager Lee Lucero declares of his customers in this town of about 32,000 people, right next door to the University of Denver campus. “It’s a local store. Tey like the variety, the freshness.” It’s a good bet they like the environment, too.

| Progressive Grocer | Ahead of What’s Next | November 2014

KING’S COURT (L-R) Chad Bring, produce manager; Cristina Villa, assistant store manager; Deborah Foland, deli manager; Tami Canaday, Starbucks lead; John McIntyre, meat manager; and Lee Lucero, store manager

Te store’s architecture was designed to be refective of the surrounding neighborhood, with an attention to detail that carries exterior elements to the interior design. Making the most of a compact footprint, architects delivered a soaring design to maximize vertical space, decorated with, among other fxtures, a historic photo mural that includes an image of the Denver Seminary, which formerly occupied the store site. “Te high windows and skylights have helped reduce electricity use,” Lucero says. “It’s beautiful when the eastern sun shines through in the morning.” Handpicked by Kroger management to spearhead this PhotograPhy by tim benko

new 30,000-square-foot concept store after winning a Food Marketing Institute (FMI) Store Manager Award grand prize in 2012, Lucero praises King Soopers for being “a very open-minded organization” when it comes to trying new things. “We cater to our guests,” he says. “We look at the customer’s needs and wants, and that’s how we merchandise.” Tat means more local products, from meat and produce to center store items. And it means more organic and natural products. Te layout was created with an emphasis on fresh departments, including produce, bakery, deli and a signature meat market. november 2014 | progressivegrocer.com |

Store of the Month

Fresh Fare by King Soopers, Englewood, Colo.

“Te T entire front end of the store is merchandised as organic,” Lucero says. “Tis store has more organic products than most King Soopers locations. We have a couple aisles that are strictly natural items.” CERTIFIED FRESH The Englewood Fresh Fare carries many produce items that other King Soopers stores don’t have.

Naturally Local Fresh Fare caters to shoppers seeking freshness, variety and quick meal solutions at afordable prices, ofering a “food-centric” shopping experience. Featuring produce from local growers delivered daily, more than 100 USDA-certifed organic fruits and vegetables are available, along with an expanded

| Progressive Grocer | Ahead of What’s Next | November 2014

selection of fresh, pre-cut fruit and veggies. “We contact growers and get items in that other King Soopers don’t have,” Lucero explains. Prominent signage notes the number of fresh produce items available each day; on the day of Progressive Grocer’s visit in early June, it was 203. Colorado-grown tomatoes, peaches and corn are among the 80 to 90 local produce items on ofer. Produce bins are fashioned from pine boards culled from trees killed by beetles, a problem in Colorado forestry. Atop produce displays are photos of growers “to show the local appeal,” Lucero notes. (Similar signs call out other Colorado-based suppliers around the store, and the wooden motif is carried throughout.) A Boar’s Head branded sandwich and panini shop is a highlight of the deli department. Te store’s Bistro ofers hot, chef-prepared meals and sides, and the Chef Shop sells entrées, vegetables and salads that are ready-to-eat and ready-to-heat. Tere’s also Chester Fried Chicken — seasoned, double-battered and unique to the banner. Among the prepared food items available on the day of PG’s visit: apricot-glazed Cornish hen, enchiladas, beef empanadas, tamales, spanakopita, coconut-

crusted tilapia and grilled asparagus. Combo meal specials are popular with customers, including trafc from students and staf at the university, just 3 miles from the store, Lucero says. Fresh sushi is made fresh in-store daily. Tere are fresh salad, hot soup, and olive and antipasti bars, along with grab-and-go salads. Tere’s also a Murray’s Cheese Shop, the New York-based specialty cheese merchant with which Kroger has formed a partnership to operate curated cheese counters at many of its stores across the

King Soopers History King Soopers was established in 1947, when Lloyd J. King opened his first store, in Arvada, Colo. By the time the banner was acquired by the Dillon Cos. in 1957, it had grown to nine stores. Dillon merged with Kroger in 1983. Staffed by more than 22,000 associates, the banner operates as part of Kroger’s Denver-based King Soopers/City Market division, encompassing 143 stores located along Colorado’s Front Range, from Cheyenne, Wyo., to Pueblo, Colo., and in the foothills west of Denver and Colorado Springs.

We cater to our guests. We look at the customer’s needs and wants, and that’s how we merchandise.” —Lee Lucero, store manager

Store of the Month

Fresh Fare by King Soopers, Englewood, Colo.

| Progressive Grocer | Ahead of Whatâ&#x20AC;&#x2122;s Next | November 2014

Fresh Fare by King Soopers 3495 S. University Blvd., Englewood, CO Grand opening date: Dec. 12, 2012 Total square footage: 30,000 Selling area: 24,000 square feet SKUs: 45,000 Employees: 105 Checkouts: 11 Store hours: 6 a.m.-11 p.m.

November 2014 | progressivegrocer.com |

Store of the Month

JUST THE FACTS Store Manager Lee Lucero details the store’s organic and natural produce offerings to PG Editor-in-Chief Jim Dudlicek.

Fresh Fare by King Soopers, Englewood, Colo.

country. At this Fresh Fare location, one of 18 Murray’s shops in King Soopers stores, shoppers can fnd 130 specialty cheeses. Fresh Fare’s in-store bakery ofers party cakes unique to this location, as well as other exclusive cakes and mufns. “We do more scratch baking than the other locations,” Lucero says. Te store also premiered a cookie display concept called Cookie Hut, which features products from four Colorado bakeries. Te baked goods ofer a fne complement to the store’s Starbucks location, which ofers free Wi-Fi and its own outside entrance. “In the mornings, people are lined up,” Lucero notes. “It’s a destination for our customers.”

Fresh, Fresher, Freshest Fresh Fare’s butcher shop ofers natural pork, and both natural and organic beef and poultry, including some locally raised beef and chicken, along with the store’s own Private Selection Choice Angus

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Store of the Month

A CUT ABOVE Shoppers can find 130 varieties of specialty cheeses at this Murray’s Cheese counter, one of 18 at King Soopers stores.

Fresh Fare by King Soopers, Englewood, Colo.

and Grass-Fed beef. An island cooler displays natural and organic meat, Red Bird chicken, and Simple Truth branded organic items. Shoppers can get prime beef cut to order, along with varieties of domestic lamb and veal. Tere’s an assortment of thick, handmade gourmet burgers made in-store daily, along with valueadded options like skewers, fajitas, and stufed and marinated proteins. Lucero notes that the store’s specialty meat case, at 16 feet, is twice as long as those at other King Soopers locations. Te seafood counter displays more than 50 varieties daily from around the world, including salmon, swordfsh, tuna, halibut, walleye, steelhead, shrimp, crab, live lobsters, oysters, littlenecks, clams and mussels. It’s all part of the store’s Easy for You seafood program, Lucero explains: “Te customer can choose the seafood; we’ll season it for them and put it in a bag that they can just put in the oven.” Better-for-you products abound in every department. Te store ofers a selection of wheat-, lactoseand gluten-free products, and an assortment of GETTING UP TO BUSINESS Lucero and Dudlicek survey the sales floor from the mezzanine, where the deli and bakery prep kitchens are located.

| Progressive Grocer | Ahead of What’s Next | November 2014

natural and a d organic i ffrozen meals, treats and snacks, including Kroger’s new Simple Truth brand. Health-centric needs are further addressed by the store’s Optimum Wellness Shop. Located in the pharmacy (next door to the main store), it offers more than 1,500 natural vitamins, with a staf nutrition specialist on hand to help shoppers with their personal health-and-wellness goals.

Mile-high Solutions With a smaller footprint than most supermarkets, every square foot counts. So, to maximize the selling area, Fresh Fare takes advantage of vertical space for back-of-house functions.

better. We’re not saying our olive oil is better than any other on the supermarket shelf. That’s for you to decide. For us, this little word is a challenge. It’s what inspires us to never stop looking for ways to improve. Better is the reason we harvest our olives so that they never touch the ground. Better is why we replaced the typical dribbly pourer top with a more precise Pop-Up Pourer. These innovations may seem like little things. But sometimes, it’s the little things that make all the difference.

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Store of the Month

SOLE MATES Fresh Fare offers 50 varieties of seafood and will prep it for easy finishing in home kitchens.

Fresh Fare by King Soopers, Englewood, Colo.

“All of our back-room and cooler storage is upstairs, so we can use all 30,000 square feet for sales space,” Lucero notes. Also on the upper level is the kitchen, where deli and bakery products are prepped for display and sale below. One other King Soopers has a similar arrangement, but only features the prep areas upstairs, not storage, Lucero explains. And with so much backof-house above, it takes careful coordination with the company’s logistics team to schedule loads at times when there’s enough available staf, he adds. But logistics was just one of the challenges surrounding the launch of this store. “Anytime you have a store unique to a division, there are challenges because it’s the frst time you’re doing it,” says Kelli McGannon, director of public afairs for King Soopers. “It’s trial and error, because you don’t know what won’t work and what will.” Further, the store is at one of the state’s busiest intersections, and trafc in and out of the store, which is below street level, can be hectic. During PG’s June visit, there was also construction going on, presenting yet another, albeit temporary, challenge. Of the store’s 11 checkstands, none are selfcheck — and proudly so. “We want to focus more on customer service,” Lucero declares, noting that the banner does use self-check at other stores, where appropriate. King Soopers sees the urban-format store as a winner in a changing, ever-more-cosmopolitan Denver. Under construction at the time of PG’s visit was a multiuse retail and residential development, anchored by a King Soopers market, in the heart of the Mile High City near historic Union Station and Coors Field, the latter home

| Progressive Grocer | Ahead of What’s Next | November 2014

BUYING IN STATE Prominent signage calls out products from local suppliers.

to Major League Baseball’s Colorado Rockies. Expected to be a destination for city dwellers, commuters, tourists and sports fans, this new store is slated to open in early 2015. Meanwhile, Fresh Fare in Englewood continues to draw E rraves from loyal customers. “Te store was intended to be part of the community,” McGanp non says, and that was evident from n oopening day, when King Soopers presented a check for $161,000 to p tthe American Red Cross to help with costs associated with the w Colorado wildfres that summer. C “Our new store formats are iinspired by our customers and building stores that are refective b oof the community they serve. Our goal was to create a store exO perience that would be embraced p by our customers and associates,” b McGannon says. “Tis store is M a part of our overall vision. Our stores have to be relevant to the community they serve, and we can’t do that with a one-sizefts-all.” PG

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Category ManageMent Ca

2014

Strengthening the Shopper experience

PG’s 2014 Category Captains winners understand that boosting baskets means transcending brands to drive sales across the store.

By Jim Dudlicek, Bridget Goldschmidt and Jenny McTaggart

ake the experience the hero, not the product. Tat was the mantra of former PepsiCo boss John Scully, and it’s certainly a philosophy that has turned the best companies into selling machines. In an age where shoppers are looking for not just “stuf,” but also a personalized experience that makes them feel they’re truly understood by retailers, it’s an attitude that merchants of all stripes would be well advised to follow. Shoppers want solutions, and meeting or exceeding such expectations is the diference between a good retailer and a great one. And the great ones are partnering efectively

with their CPG allies to deliver on their promises. The concept of category management is rapidly transforming into “need state management,” according to the Category Management Association’s Gordon Wade, who notes that while traditional grocers are struggling with leakage to other channels that have proved themselves better equipped to deliver in certain categories, supermarket retailers must leverage their strengths to drive traffic throughout the store and cultivate a f lourishing customer base. Tat means partnering well with suppliers that can create customized solutions for the highly regionalized tastes of grocery shoppers around the country, by turning November 2014 | progressivegrocer.com |

2014

Category ManageMent

valuable customer insights into actionable and monetized solutions that keep people coming through the door. Now in their 18th year, Progressive Grocer’s Category Captains awards honor CPG companies for their category management prowess, as demonstrated by their partnerships with grocery retailers. Tis year, there were 105 total winners among those selected as Category Captains, our top honor, and Category Advisors, our honorablemention designation. From perimeter to center store, suppliers continue to demonstrate their understanding of retailers’ needs to address shopper demands and offer innovative ways to achieve them, elevating the visibility and relevance not simply of their own brands, but also of their entire categories and, increasingly, other categories throughout the store. Top category managers understand how shoppers think. For example, as more shoppers look to retailers like Amazon for diapers, Procter & Gamble has stepped up its game to keep grocers top of mind with baby care consumers. Cross-merchandising with complementary products and stressing performance claims are proving successful at keeping shoppers in center store for their baby needs. Meanwhile, as sales of canned tuna have dwindled, Bumble Bee Seafoods has leveraged consumers’ desire for transparency and responsible sourcing, rallying retail support for its partnership with the World Wildlife Foundation (WWF) and the Marine Stewardship Council (MSC). And Hormel’s joint venture MegaMex Foods is driving growth across the multicategory ethnic food segment by joining with retailers to maximize regional preferences in authentic Mexican foods. Other standouts: Anheuser-Busch and E&J Gallo continue to build upon their historic successes in the spirits department, while Zevia is breathing new life into carbonated soft drinks. Enjoy Life has built the “free-from” category from a few niche products into a mainstream destination. Kraft has created a new category to meet growing demand for high-protein options, with its refrigerated snack packs. And several categories achieved shared captaincy — an indication of how impressed we were by exemplary entries in categories such as candy, soft drinks, bagged salads and vitamin supplements. Working together to understand consumer behavior can be a sure-fre method for retailers and manufacturers to deliver sustainable category growth, and retain shopper loyalty, as alternative channels like e-tailers hit upon better ways to deliver the goods. Best practices abound on the following pages …

Methodology Progressive Grocer ’s annual Category Captains competition applauds the outstanding category management initiatives implemented in the retail grocery sector over the 12-month period ending Sept. 8, 2014. The list of winners reflects some of the best strategic thinking and execution in the category management field, as revealed in the winning companies’ summaries on the following pages. Our Category Captains awards program is predicated on the accuracy and completeness of the entries submitted for consideration, all of which are weighed on an equal footing. As such, the best entries not only deliver a selection of facts relating to a manufacturer’s or a brand’s most recent category management achievements during the specified measuring period, they also tell a compelling story of challenges confronted, strategies developed and implemented, and the collective results of trading partners working together toward a common goal. In essence, the actual entry submitted is the key to the judging process in this competition. In winning entries, a company’s importance and influence in a given category are represented as comprehensively as possible. This keeps the awards process dynamic from year to year, as well as leaving open the possibility that up-and-comers can be recognized alongside well-established players. The award criteria factored into the judging of the entries were as follows: Product innovation Creativity in merchandising, marketing, promotion and advertising Consumer insights Innovative, dynamic category management tools Demonstrated commitment to meeting retail customers’ specific needs Effectiveness at differentiating a line or brand within a category Effectiveness at lifting sales for a brand’s products in the category Effectiveness at lifting an entire category’s sales for a retailer Fact-based evidence of market-specific or accountspecific sales results that support the vendor’s claims of excellence To win the premier Category Captain award, contestants are required to demonstrate excellence in all of the above criteria in their entries. Category Advisors also exhibit high competence, but to a lesser degree and/or in fewer of the above areas, and thus are ranked lower overall than the threshold set for Category Captaincy. Both designations reflect outstanding contributions to the industry at the category level.

| Progressive Grocer | Ahead of What’s Next | November 2014

2014

Category ManageMent

InDeX oF tHe WInnerS GENERAL MERCHANDISE BaBy Products category captain: Procter & Gamble category advisor: Seventh Generation Home cleaners category captain: Seventh Generation PaPer Products category advisor: Seventh Generation

GROCERY — FOOD & BEVERAGES alcoHolic Beverages — Beer category captain: Anheuser-Busch alcoHolic Beverages — Wine category captain: E&J Gallo Winery BaBy Food & consumaBles category captain: Nestlé Nutrition Baking ingredients category captain: J.M. Smucker Co. category captain: General Mills (Flour) category advisor: General Mills (Baking Mixes) category advisor: John B. SanFilippo & Son Inc. (Nuts) BreakFast — drinkaBle category captain: Kellogg Co. category advisor: Nestlé Nutrition BreakFast — Hot cereal category advisor: General Mills BreakFast — ready-to-eat cereal category captain: General Mills category advisor: Kellogg Co. BreakFast — toaster Pastries category captain: Kellogg Co. candy & gum category captain: Hershey Co. category captain: Wm. Wrigley Jr./Mars canned & Packaged Beverages — coFFee category advisor: J.M. Smucker Co. category advisor: Massimo Zanetti Beverage USA

canned & Packaged Beverages — Juice category advisor: Good2Grow

cookies & crackers category captain: Kellogg Co. category advisor: General Mills

canned & Packaged Beverages — soFt drinks category captain: Dr Pepper Snapple Group category captain: Zevia category advisor: LaCroix Beverages Inc.

desserts category captain: General Mills

canned & Packaged Beverages — tea category advisor: Unilever canned & Packaged Foods — Boxed dinners category captain: Kraft Foods Group category advisor: General Mills canned & Packaged Foods — dry Packaged Potatoes category captain: Idahoan Foods category advisor: General Mills canned & Packaged Foods — seaFood category captain: Bumble Bee Seafoods canned & Packaged Foods — sHelF-staBle vegetaBles category advisor: General Mills canned & Packaged Foods — souPs category captain: General Mills canned & Packaged Foods — sPreads category captain: Ferrero USA (Bread Spreads) category captain: J.M. Smucker Co. (Fruit Spreads) category captain: J.M. Smucker Co. (Nut Butters) commercial Baked goods category captain: Flowers Foods condiments & dressings — mayonnaise category captain: Unilever

etHnic Foods category captain: General Mills category captain: Hormel Foods (MegaMex) Free-From Foods category captain: Enjoy Life meat snacks category captain: Jack Link’s natural & organic Foods category advisor: General Mills salty snacks category captain: Kraft Foods Group category captain: Flagstone Foods category advisor: General Mills category advisor: Kellogg Co.

FROZEN FOODS Baked goods category advisor: General Mills BreakFast category captain: Kellogg Co. category advisor: General Mills entrées category advisor: General Mills category advisor: Pinnacle Foods Inc. ice cream & novelties category captain: Unilever meat suBstitutes category captain: Kellogg Co. Pizza category captain: General Mills

conFections category captain: Ferrero Rocher

snacks category captain: General Mills

convenient WHolesome Foods category captain: General Mills category advisor: Kellogg Co.

vegetaBles category captain: General Mills category advisor: Pinnacle Foods Inc.

| Progressive Grocer | Ahead of What’s Next | November 2014

2014

Category ManageMent

HEALTH, BEAUTY & WELLNESS AntiperspirAnts/DeoDorAnts Category Captain: Unilever BAlAnCeD/DiABetiC nutrition Category Advisor: Abbott Nutrition CosmetiCs Category Advisor: Procter & Gamble Foot CAre Category Captain: Merck Consumer Care HAir CAre Category Advisor: Unilever otC AnAlgesiCs Category Captain: Bayer HealthCare skin/sun CAre Category Captain: Merck Consumer Care VitAmins/supplements Category Captain: Pharmavite Category Captain: U.S. Nutrition Category Advisor: Bayer HealthCare

PERIMETER BAkeD gooDs Category Captain: CSM Bakery Products Category Advisor: Bakery Crafts DAiry — eggs Category Advisor: Eggland’s Best DAiry — mArgArine Category Captain: Unilever DAiry — reFrigerAteD BAkeD gooDs Category Captain: General Mills DAiry — yogurt Category Captain: General Mills Deli — meAt Category Captain: Dietz & Watson

reFrigerAteD pAstA & sAuCes Category Advisor: Rana Meal Solutions reFrigerAteD sAlAD Dressing Category Advisor: Litehouse Foods superpremium JuiCe Category Captain: Bolthouse Farms

PERIMETER — VARIABLE/ FIXED-WEIGHT PRODUCE AVoCADos Category Advisor: Del Monte Fresh Produce BAnAnAs Category Captain: Chiquita Brands

Deli — prepAreD FooDs Category Captain: Tyson Foods Inc.

Berries Category Captain: Dole Fresh Vegetables

reFrigerAteD Dip Category Advisor: Del Monte Fresh Produce Category Advisor: Wholly Guacamole

FresH-Cut Fruit Category Captain: Del Monte Fresh Produce

reFrigerAteD meAt snACks Category Advisor: Kraft Foods Group

FresH-pACkeD VegetABles Category Captain: Dole Fresh Vegetables lettuCe Category Advisor: Green Giant Fresh musHrooms Category Captain: Monterey Mushrooms

WHAT THE SUCCESSFUL RETAIL PROFESSIONAL IS READING THIS YEAR.

pACkAgeD sAlADs Category Captain: Dole Fresh Vegetables Category Captain: Chiquita Brands peArs Category Advisor: CMI pineApples Category Advisor: Del Monte Fresh Produce

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potAtoes Category Captain: United States Potato Board Category Advisor: Idaho Potato Commission speCiAlty proDuCe Category Advisor: Frieda’s Inc. VAlue-ADDeD VegetABles Category Captain: Mann Packing Co.

PERIMETER — OTHER AutomAteD retAil Category Advisor: Outerwall Front enD serViCes Category Captain: Blackhawk Network

| Progressive Grocer | Ahead of What’s Next | November 2014

COMMITTED TO CUSTOMER ENGAGEMENT. Recognized 12 years in a row for Category Management excellence. Pharmavite Customer Value Proposition “A trusted, strategic partner who provides innovative shopper-based insights and solutions that create loyalty among shoppers to our customers’ categories and Pharmavite’s products” ®

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2014

General Merchandise

Category Captain Baby Care — Diapers

Procter & Gamble

Te Procter & Gamble baby care team for two major discount retailers leveraged shopper research and innovative shelf capabilities to enable the retailer to maximize its share on P&G’s Big Bang launch, which included extending Swaddlers into sizes 4 and 5. Consumers responded favorably to the execution, generating signifcantly higher awareness than average. Te team leveraged product innovation and shopper-based design to step-change their growth rates versus balance of market. Research with moms reinforced that baby care was stale and ofered little reason to trade up, but performance claims were the top opportunity to do so. At one retailer, a signage solution included an opportunity to incorporate additional assortment via QR codes. At the other, a shelf solution integrated baby wipes into the diaper section and end cap displays (research showed 96 percent of moms who buy diapers also buy wipes, but only 20 percent actually buy them on the same trip). Adding wipes to the diaper aisle helped build the basket and aided moms who may have forgotten to add the item to their shopping lists.

Category Advisor Baby Care — Wipes

Seventh Generation

In 2014, Seventh Generation focused on understanding and optimizing pricing strategy across its priority categories. Tese learnings helped the company and its retail partners better understand the likely impact of optimizing everyday price on sales and proft dollars. In addition, it provided an increased level of confdence to implement an everyday pricing strategy that provided a competitive retail price while maintaining a premium to conventional baby wipes, to proftably grow the business for the retailer and the manufacturer. Based on its extensive research, Seventh Generation provided an expert understanding of the green shopper, enabling the company to partner with retailers to meet the needs of the growing green consumer segment. Te strategy has driven signifcant results: In the four months since the price change rolled out, retailers that implemented the strategy have posted strong dollar sales gains.

Category Captain Home Cleaners

Seventh Generation

Seventh Generation teamed with a leading regional retailer to ofer an innovative consumer merchandising program that drove category sales and dramatically increased the retailer’s social media presence. Te challenge was to educate shoppers on the retailer’s responsible-retailing initiative featuring nontoxic products. Te retailer and Seventh Generation worked together to create a co-branded campaign that featured a Facebook sweepstakes for an energy-efcient laundry room makeover, branded product giveaways, dedicated weekly e-mails and a monthly newsletter with coupons and sustainable-living tips, end cap displays, POS materials, and other promotional tools. Overall, the retailer’s dish and laundry detergent categories experienced signifcant growth over the year-ago period, with category performance remaining strong in the four weeks post-promotion.

| Progressive Grocer | Ahead of What’s Next | November 2014

Category Advisor Paper Products

Seventh Generation

Seventh Generation aimed to introduce its 100 percent recycled bathroom tissue and paper towels into the mainstream grocery and mass-merchandise channel. Based on research showing that consumers are willing to trade up to “authentic” green products, the company leveraged strong growth of other green household product categories, including cleaners and detergents. By combining its understanding of the green consumer with POS and household transactional data, Seventh Generation could help its retailer partners better understand and

meet the needs of the growing green consumer segment. Te company’s products allowed retailers to command a higher price and deliver a higher proft margin than conventional brands, with higher dollars per occasion, repeat purchases and total basket size. Retailers teaming with Seventh Generation grew the total paper category, bucking the national trends.

GROCERY — FOODS & BEVERAGES

Category Captain

Alcoholic Beverages – Beer

Anheuser-Busch

Building on the success of its Balanced Portfolio Approach, introduced in 2012, Anheuser-Busch spent the past year digging deeper into its data to deliver more precise strategies and tactics to its retailer partners. Te beer maker expanded its program to look not only at which retailers were winning, but also why they were winning. A-B gathered data from nearly 40,000 retail outlets from various syndicated providers, while also compiling revenue and unit sales from various sources, all at the store level. For the frst time, the company could see what the top 25 percent of stores were doing, versus the bottom 25 percent, considering such factors as space, assortment, features, display and price, and then share suggestions with its partners. Te Balanced Portfolio Approach helped retailers grow beer dollars (6.2 percent) and gain category share of market (up 0.62) in 2014. November 2014 | progressivegrocer.com |

2014

Grocery — Foods & BeveraGes

Category Captain

E&J Gallo Winery

Nestlé Nutrition

Alcoholic Beverages — Wine With an eye toward Millennials, E&J Gallo Winery conducted one of the largest studies ever on wine consumers and their motivations, which has been the basis for much of its category management work in the past year. In one example, the company introduced the industry’s frst limited-release seasonal wines under the Apothic brand. To support the launch, Gallo developed a multifaceted media plan, as well as innovative in-store promotions, that created consumer excitement. During its season, Apothic Rosé was the No. 1 rosé in the U.S. market, despite limited distribution and selling time. Apothic Dark and Apothic Red were the fastest-growing SKUs in the category after Dark launched. At two major national chains that really got behind the launch, wine sales outpaced the competitive market signifcantly. Another of Gallo’s recent category management achievements is the introduction of the industry’s frst proprietary category management and schematic automation systems. Gallo’s team has been able to transform a major retailer’s manual planogramming into an automated yet customized, store-specifc process, achieving signifcant savings.

Baby Food & Consumables As the infant nutrition category dollar share market leader, Nestlé provided relevant innovation across all stages of the category, from birth to toddler. Responding to consumer needs, the company introduced Gerber Good Start Gentle for Supplementing, aimed at moms who supplement breastfeeding, as this is the fastest-growing segment in formula. Less than four months after its March launch, the product had garnered a 39 dollar share of the total supplementing segment. Other successful new products included probiotic Gerber Soothe Colic Drops, stage-based fruit or yogurt pouches, and Fruit & Vegetable Blend Tubs. Te company also helped retailers educate moms on the appropriate nutrition for their infants’ development, and tested various merchandising concepts across several retailers to further increase sales and consumption. As well as ofering merchandising support, Gerber helped drive shoppers to the category and beef up baskets with two national baby events, while Nestlé provided customized 360 shopper marketing support.

Category Captain Baking Ingredients

J.M. Smucker Co.

Birthdays are a year-round top driver to the baking aisle, so when Pillsbury’s Funfetti brand reached its 25th birthday, Smucker’s created products and strategies to drive the category further into this $37 billion-plus multicategory occasion. A new line of Bold Frostings met consumers’ needs by guaranteeing the desired color and eliminating the concern of staining. Trough a virtual shopping test to understand shelving dynamics, Smucker’s discovered that Funfetti items drove better category performance when shelved adjacent to like items; retailers realized improved fndability and overall segment performance. Smucker’s developed a comprehensive communication strategy, including television, public relations,

social media, a contest, coupons and in-store execution. Te company then teamed with a leading national retailer that was experiencing declining frosting sales. Tis retailer’s shoppers were more likely to plan their baking shopping experiences. Smucker’s initiated coupon mailers to loyalty card members and implemented optimal shelving tactics, and category sales rebounded.

| Progressive Grocer | Ahead of What’s Next | November 2014

THANKS A BUNCH! Chiquita Brands International would like to thank our valued retail partners for selecting Chiquita Bananas and Fresh Express Salads as Category Captains once again.

We are committed to bringing our consumers the best, most ďŹ&#x201A;avorful fresh produce possible.

2014

Grocery — Foods & BeveraGes

Category Captain

Category Advisor

General Mills

Baking Ingredients — Flour General Mills’ Gold Medal is the branded share leader in the four category. Te company has helped yield steady returns for the category, which has experienced a three-year dollar volume compound annual growth rate of 4.5 percent. General Mills is currently fnalizing research to complete an update of its “Flour Category 101” toolkit before the end of the year. Retailers can leverage this information to optimize assortment and shelf layout, as well as merchandising and pricing tactics. In addition, General Mills recently completed its “Baking Path to PurchasePath to Sweet Cravings 2014” study of consumer attitudes, decisions and behaviors throughout the purchase cycle. Trough a category shelf audit completed with Nielsen, the supplier gained rich insights into four best practices that it shared with retailers nationwide. In terms of product innovation, General Mills launched Betty Crocker Gluten Free Flour, as well as an organic, all-purpose four under its Immaculate Baking Co. brand.

Baking Ingredients — Mixes General Mills is the leader in dollar share in the baking/ pancake mix category and has the highest household penetration. Te company’s Baking Aisle Platform ofered guidance to retailers for optimal category adjacencies and aisle fow, with the goal of optimizing sales in the baking aisle. To drive incremental category growth, General Mills’ Bisquick brand again focused on uses beyond pancakes. In addition to communicating Bisquick’s versatility, the brand rolled out updated packaging that clearly illustrated several uses for the baking mix. In-store, General Mills teamed with retailers to use Bisquick as the anchor for meal solution features or display merchandising, with the goal of increasing basket ring. Additionally, to leverage growth in the natural/organic segment and meet consumer needs, the company launched dry baking items under its Immaculate Baking Co. brand, including a pancake and wafe mix. Te entire line is organic, made without added preservatives and NonGMO Project enrolled.

Category Advisor

Baking Ingredients — Nuts

Fisher Nuts

In the past year, Fisher Nuts, the No. 2 brand in the recipe nut category, has continued to expand its 360 campaign with category innovations and initiatives designed to bring the brand further growth and success. Tis work has helped catapult Fisher to the No. 1 (excluding club stores) brand in the category. Its initiatives included a recipe contest in partnership with Food Network chef

| Progressive Grocer | Ahead of What’s Next | November 2014

Alex Guarnaschelli, a Fisher blogger network featuring 10 key food and recipe infuencers to engage consumers, and the introduction of 24-ounce packaging to provide more convenience for consumers. Tese eforts not only helped grow the category, but also aided in securing incremental distribution with several new retailer customers. For the fscal year ending in June, Fisher Nuts grew 26 percent, and increased overall share by 3.8 points versus last year.

Make Your Moments Golden

An extraordinary treat for any occasion Ferrero Rocher®, the premium chocolate brand with the #1 and #2 selling Premium Segment SKUs in the U.S.1, is proud to be recognized as a 2014 Category Captain

Refers to Rocher 12 Count and Rocher 3 Count skus, respectively. IRI Total US MULO+C YTD through 10/5/14

2014

Grocery — Foods & BeveraGes

Category Captain

Breakfast — Drinkable

Kellogg Co.

Drinkable breakfast segment share leader Kellogg’s dedicated on-the-go (OTG) breakfast/drinkable set ofered two stopping points in the breakfast aisle: an OTG breakfast set and a traditional RTE cereal set. Loyalty card data showed that on average, the set provided 32 percent incrementality to the overall breakfast aisle, which the company attributed to the fact that it targeted a younger, more afuent shopper. Further, a dedicated OTG section was implemented in the stores of 16 major retailers, with highly positive initial results — close to 50 percent incrementality rates, indicating that Kellogg tapped into white space that wasn’t being targeted. In the realm of innovation, the company introduced two new products: Chocolate Mocha & Vanilla Cappuccino Cofee House Shakes, targeting shoppers who enjoy cofee favors and the satiety of the RTD ofering. Tanks to Kellogg’s activities, 41 percent of drinkable breakfast sales are now RTD, a 12-point share increase from 2013.

Sparkling Beverages: Solutions for Consumers, Business for Retailers It has become evident that shoppers need help with meal solutons. Shoppers are under increasing stress. Moms are constantly mult-tasking. Fify-six percent of working moms find it very or somewhat difficult to balance work and family life responsibilites.1 Studies show that 57% of shoppers decide what’s for dinner one hour beforehand and 26% decide earlier that day.2 They are looking for quick solutons that save tme and bundled offers that save money. At home meals are expected to grow 14% by 2020 3, which further necessitates having a foodservice soluton in store. Coca-Cola brands are the perfect complement for all food types. Almost one-third of at-home snacks, lunch and dinner are consumed with sparkling beverages4, and Coke® is the #1 beverage consumed with food. 4 Coca-Cola beverages provide physical and emotonal refreshment with meals and snacks. Sparkling beverages that are consumed at home mean big business for retailers. Relevant and engaging occasion-based shopper messaging can drive increased basket size via bundling.

For more information, visit www.CokeSolutions.com/retail. (1) Pew

Research Center, Breadwinner Moms Report, 2013 NPD Group’s Natonal Eatng Trends 2012. (3) Moments Qualitatve Study, 2013. (4) Consumer Beverage Landscape, 2011 (2) The

ADVERTORIAL

great taste runs in the family ÂŽ

more choice equals more opportunity ÂŠ 2014 The Coca-Cola Company

CokeSolutions.com/retail

2014

Grocery — Foods & BeveraGes

Category Advisor

Breakfast — Drinkable

Nestlé Nutrition

In 2015, Nestlé will mark the 50th anniversary of the launch of Carnation Instant Breakfast, which created the convenient breakfast category. Te company is the market leader in convenient breakfast solutions, with a 71.9 percent share, and controls nearly 98 percent of the powder segment, the category’s largest. Over the past year, Nestlé grew the convenient breakfast category by relaunching Carnation Breakfast Essentials Ready to Drink in a 6-count package at the same SRP as the original 4-count SKU, so that consumers received 50 percent more servings without having to pay more, and by introducing a 22-count value pack in grocery and mass to lift sales through a new value option for consumers and higher basket sizes for retailers. Te company also rolled out packaging to help retailers maximize shelf space. What’s more, Carnation Breakfast Essentials is the only convenient breakfast brand with a no-sugar-added product within the powder segment.

Category Advisor

Breakfast — Hot Cereal

General Mills

General Mills brought innovation to this $1.4 billion category, meeting the need for hearty breakfasts that consumers can feel good about eating and serving. Te company’s hot cereal oferings under its Chex and Nature Valley brands address health (gluten-free), convenience (cups) and unique usage (K-cup) in a category that was ready for new alternatives. Leveraging Keurig technology, the Nature Valley Bistro Cups Oatmeal line expands the potential for new users to the category, as well as an increased dollar ring. General Mills collaborated with retailers to help them understand this opportunity. Trough category research and consumer insights, shelf enhancements, and new products, the company is positioned for growth in the hot cereal category and proftable growth with retailers.

Category Captain

Breakfast — RTE Cereal

General Mills

General Mills continued to drive retailer growth in the increasingly challenging $9 billion RTE cereal category. Despite the growing popularity of breakfast away from home, as well as birthrate declines, the core of the category remained strong, growing at 1.8 percent over the past year. One of the two largest manufacturers in the RTE cereal category, General Mills competed in all segments of the category, ofering mainstream brands (i.e., Cheerios), as well as a natural/ organic brand (Cascadian Farm). Its

| Progressive Grocer | Ahead of What’s Next | November 2014

category management team shared proprietary insights and retailer strategies in distribution, merchandising, shelf work and pricing that led to best practice principles. Knowing that variety is critical to growing RTE cereal, General Mills carried out several leadership initiatives that gathered new in-aisle shopper-based consumer decision information. New Cheerios Protein and Nature Valley Protein Granola cereal were some of its new items that addressed key consumer need states for taste and satiety. General Mills also continued to enhance its Smart Bundler tool, a proprietary capability that optimizes merchandising across manufacturers.

“There’s not enough room in my trophy case for my latest manager of the year award.” Loretta CATEGORY MANAGER

CAN STOCKING

IDAHO® POTATOES

Nobody said that dealing with all the success that comes from stocking Idaho® Potatoes would be easy. But we’re sure you’ll manage somehow.

MAKE YOU

TOO SUCCESSFUL?

idahopotato.com/retail

2014

Grocery — Foods & BeveraGes

Category Advisor

Category Captain

Kellogg Co.

Category Captain

candy, 25 percent gum and 15 percent mints, due to declining sales trends within the gum segment, and fxed the total mix within all three segments. Te company’s step-by-step process for a best-in-class total front end solution included engaging the retail customer at all levels, from senior leadership to daily contacts, to ensure clear, consistent strategies and messaging, with Hershey remaining highly visible throughout the nearly two-year re-rack process. As a result, the grocer’s confection sales now signifcantly outpace those of the grocery channel.

Breakfast Foods — RTE Cereal Kellogg made RTE cereal a pivotal building block in its Evolution of Morning Foods aisle concept, and, as a component of its easier-to-navigate target-age merchandising fow, recommended a doors and windows (D&W) merchandising strategy requiring vertical key brand blocks and highlighting taste. To date, 11 major retailers have implemented the target-age merchandising fow, while 14 have deployed D&W; these retailers experienced sales better than that of the category by 0.8 points. Additionally, a dedicated on-the-go (OTG) cereal section rolled out to stores at 16 major retailers, resulting in better-than-average category performance by a whopping 20 points. In the fast-moving granola segment, although the product has traditionally been included in the natural and organic RTE cereal set, Kellogg advocated separate, dedicated granola sets, which allow consumers to “one-stop shop” for the item. Retailers with dedicated granola sets saw four times the assortment growth, and almost fve times the velocity growth, as accounts with nondedicated sets.

Candy & Gum

The Hershey Co.

Hershey’s Insights Driven Performance (IDP) process, encompassing industryleading insights, capability and proprietary tools, enabled it to help a major Midwestern grocer reinvent and revitalize its front end. For seven years, the retailer had used the same front end racks, which were overdependent on checkout-area categories in steep decline. To remedy this situation, Hershey executed a confection strategy of 60 percent

Breakfast — Toaster Pastries Driven by the recent success of its Gone Nutty platform, Kellogg’s Pop Tarts, the No 1 toaster pastry brand, continued to grow segment share. To celebrate the 50th anniversary of the brand, Pop-Tarts brought back two popular past products, Chocolate Vanilla Crème and Milk Chocolate Graham, as well as introducing a limited-edition Red Velvet Cupcake variety that was so successful it became a permanent item for 2015. Kellogg determined that the toaster pastry set works best when assortment is from 24 to 30 items per store, allowing the best mix of variety on shelf. Leading with core SKUs prevented out-of-stocks and drove more consumers to the set. Additionally, ensuring the correct assortment enabled more consumers to find items during stock-up trips and, as a result, drove overall basket ring. According to Kellogg, an ideal toaster pastry shelf should be at least 4 feet and placed directly across from kids’ RTE cold cereal.

| Progressive Grocer | Ahead of What’s Next | November 2014

One of Progressive Grocer’s 2014 Category Advisors. Now that’s a healthy endorsement.

Word in the aisle—new good2grow® is giving grocery sales a wholesome boost. Since launching the good2grow® brand and two great tasting new favors, our sales have increased by 54% year over year in the grocery channel. Moms and kids alike are giving Strawberry Kiwi and Tropical Fruit Medley rave reviews. And that’s no surprise, because only good2grow® combines the delicious juices kids crave with popular character tops they can’t resist. All that growth adds up to impressive profts—which is defnitely good for retailers.

*IRI Total US Grocery $ Sales Last 12 Weeks Ending July 13, 2014

2014

Grocery — Foods & BeveraGes

Category Captain Candy & Gum

Mars Chocolate North America/ Wm. Wrigley Co.

To help grocery retailers achieve front end success, Mars Chocolate North America and Wrigley introduced racks illuminated with LED lights, already successfully used on cosmetics, produce and other fresh food displays. Te innovative racks — combined with the ideal assortment and shelf pitch — created a brighter environment and made the area more inviting for shoppers to browse the impulse-driven candy and gum category while waiting at checkout, providing a focal point for retailers to convert shoppers. Test markets demonstrated lift across the confection category over 52 weeks, without regard to brand, items or pack size. Further, confectionery sales increased even more when the product was set at a higher angle, with more spacing for maximum visibility. Consequently, Mars Chocolate and Wrigley have placed the racks in various grocery chains across the country, where they’ve performed well, boosting front end grocery sales by an average of 10 percent to 12 percent.

Category Advisor

Canned & Packaged Beverages — Coffee

Massimo Zanetti Beverage USA

Realizing that grocery retailers needed to evolve the cofee aisle to better meet consumers’ higher expectations regarding category variety, product quality, in-store merchandising and shopping experience, or risk losing even more share of the category to alternative retail channels, Massimo Zanetti Beverage (MZB), provider of the Chock Full of Nuts and Hills Bros. brands, along with private label products,

Category Advisor

Canned & Packaged Beverages — Coffee

J.M. Smucker Co.

Hispanics are driving U.S. population growth and are as involved in the cofee category as the general population, making them more valuable shoppers long-term. Meanwhile, cofee continues to grow, driven by the K-cup segment, but is slowing down, despite continued product launches; there has been a lack of innovation within K-cups to meet the taste and favor preferences of Hispanics. Identifying an unmet need, Smucker’s commissioned several studies, discovering that key brands and unique items would drive segment growth and incrementality. Te brand then launched Café Bustelo K-cups, which appealed to Hispanic shoppers with an authentic, fun energy and full-bodied taste. One national account was an early adopter and has performed extremely well; the retailer has experienced a growth in household penetration and is outpacing total U.S. all outlets for dollar and units per buyer, and dollar sales per trip, for K-cups.

made a comprehensive investment in insights to provide its retail partners with an in-depth assessment of coffee consumer attitudes and shopper motivations. Te resulting best practices approach to cofee leadership led to multiple recommendations for grocery retailers on how to optimize cofee sales, including in the areas of category/ product segmentation, aisle optimization and assortment. MZB’s eforts helped cofee category units increase 7.3 percent in the grocery channel over the latest 52 weeks ending Aug. 2 as reported by Nielsen, with category dollar sales increasing 3.5 percent over the same time period.

| Progressive Grocer | Ahead of What’s Next | November 2014

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2014

Grocery — Foods & BeveraGes

Category Advisor

Canned & Packaged Beverages — Juice

Good2Grow

According to IRI, sales for the rebranded Good2grow kids’ beverage line increased by 54 percent year over year in the grocery category, while its share went from 1.9 percent to 2.9 percent. Te company invested in research to ensure that its licensed character toppers were always up to date, and to create optimal pack-out confgurations, including both boy and girl properties, for maximum sell-through on shelf. Merchandising success came from various of-shelf vehicles, along with collaborations with its top licensing partners to create secondary opportunities such as the “Teenage Mutant Ninja Turtles” and “Frozen” programs, along with the Barbie and “Tomas the Tank Engine” DVD initiatives. Te company additionally worked with licensors on unique social media campaigns that gave it more reach, increased its consumer database, and generated value for both Good2grow and its partners. Good2grow drove signifcant margins in a category that’s been in decline.

Face it. Some growth opportunities are more obvious than others. Shoppers want more nutritious grains and protein. You want a boost in sales and profits. Call your rep and â&#x20AC;&#x153;milk and cerealâ&#x20AC;? this opportunity for all itâ&#x20AC;&#x2122;s worth. Learn more at centerstoregrowth.com/CM.

Number 1! 4 Years and Running

DOLE Category Development takes its place in the winner’s circle — AGAIN. Because of our attention to retail partners, commitment to category growth and unparalleled produce category management, DOLE has left other Packaged Salad vendors behind. For the fourth year in a row now, we’ve taken home the Progressive Grocer Category Captain award.

Bragging Rights: Best-in-Class Category Management

DOLE offers retail partners innovative, creative and proﬁt-generating category management across the produce aisle. In packaged salads, fresh packed vegetables and berries, 2014 marks a year of key shopper insights and innovation with the following accolades:

Berries Fresh Packed Vegetables

Packaged Salads

We’d love to talk to you and share testimonials direct from our retail partners. Contact your local DOLE sales representative, or call 831-641-4200 to learn more. © 2014. TM & ® Dole Food Company, Inc.

2014

Grocery — Foods & BeveraGes

Category Captain

Canned & Packaged Beverages — Soda

Dr Pepper Snapple Group

Te beverage aisle has seen a shift toward more craft products in recent years, which has resulted in a resurgence of growth within the gourmet segment of carbonated soft drinks. Dr Pepper Snapple Group (DPS) took a leadership role to help retailers assort and optimize their soft drink space to respond to this growing need. Specifcally, the company worked with a “super-regional retailer,” leveraging the days of supply (DOS) methodology to analyze shelf performance, working with Spectra to uncover demographic opportunities, and studying category/consumer trends to identify assortment gaps. Te work culminated in signifcant dollar, volume and share growth for the retailer. Since the new planograms and revised assortment were implemented in spring 2014, the gourmet carbonated beverage category at the account has increased market share by points, and overall volume has increased 28 percent over the previous 12 weeks, 1.5 times more than the regional market.

Category Advisor

Canned & Packaged Beverages — Sparkling Water

LaCroix Beverages

As sales of traditional carbonated soft drinks sagged, sparkling water was one of the few bright spots in the category, and La Croix helped lead the way. Te company embarked on a series of new product introductions, shelf presentation initiatives based on emerging consumer need states, and a category leadership position to assist retailers in optimizing their beverage revenues

Category Captain

Canned & Packaged Beverages — Soda

Zevia

Over the past year, declines in the sales of low-/zero-calorie CSDs have accelerated. Consumer research showed diet pop consumption was down because of the perception that artifcial sweeteners are unhealthy. Zevia — a zero-calorie, stevia-sweetened CSD — leveraged familiar packaging and favors to achieve rapid penetration among diet CSD shoppers. Te brand identifed two key groups — Millennial shoppers and Hispanic households — that signifcantly underindexed for diet CSD consumption and overindexed for Zevia. Another key insight: Shoppers responded to the platform appeal of the brand, versus a particular favor, suggesting that broad assortment was a key driver of incremental sales. One major national grocery chain doubled its selection of Zevia from four to eight favors; another reset its shelves and added vertical space to convert Zevia from single-stacked 6-packs to double-stacked, an adjustment that doubled inventory at shelf and signifcantly reduced out-of-stocks. Te company created attractive feature/display programs that not only provided a hot price point to drive multiples purchasing, but also generated signifcant margins for retailers. Finally, Zevia worked closely with supermarket dietitians to build awareness; programs such as shelf tags, in-store sampling and “dietitian recommended” displays helped revitalize category sales.

and enhanced proft margins in a declining soft drink marketplace. LaCroix brought excitement and innovation to the sparkling water category through new favors, themes and packaging; strategically efective promotional calendars; and engaging social media platforms. LaCroix was at the helm of a sparkling water category up nearly 20 percent at grocery. Te company’s partnership with a major discount retailer created new shelf sets to set apart “pure” from “sweetened” brands, thus boosting awareness. Inclusion of the product in advertising, café meal combos and seasonal displays further drove sales.

| Progressive Grocer | Ahead of What’s Next | November 2014

Driving category

growth & profit through innovation

Infant Nutrition

Innovation

With L. reuteri, a probiotic clinically shown to reduce crying time by 50%*

Constantly improving our product lineup

Pouches

Graduates

#1 pouch brand**

Developmentally appropriate nutrition

Gerber® is the only brand that offers an innovative line of products that are part of a nutrition feeding system based on a baby’s development from birth to preschool. *Clinically shown in colicky breastfed infants after 1 week of feeding **Source: Nielsen xAOC Data — last 12 weeks ending 8/16/14 All trademarks are owned by Société des Produits Nestlé S.A., Vevey, Switzerland. © 2014 Nestlé

2014

Grocery — Foods & BeveraGes

Category Advisor

Category Captain

Unilever

Kraft Foods Group

Canned & Packged Beverages — Tea With K-cup technology driving growth in the cofee category, Unilever saw an opportunity to grow its tea Kcup pack sales by expanding Keurig brewer usage during additional dayparts, including lunch and dinner, thereby driving incrementality for the category. Tis year’s launch of Lipton Iced Tea Lemonade and Classic Unsweetened Iced K-cups was supported by the Lipton Be More Tea campaign starring the Muppets in both a commercial, which aired during the Oscars, and digitally. Additional awareness and trial were driven by a targeted direct mailer with product samples and of-shelf display, including foorstands, displays and sidekicks. Te efort culminated in Lipton K-cup packs driving almost half of the incremental dollar sales for the entire tea machine dispense category during the latest 52 weeks and market share leadership during the latest 12-week period.

Canned & Packaged Foods — Boxed Dinners Setting out to reinvigorate boxed dinners and help ofset center store declines, Kraft, which holds a 42 percent share of the category, took a macro view of consumers’ needs/desires and shopper patterns/attitudes. While maintaining the familiar favor profle and brand image of Kraft Macaroni & Cheese, the company removed artifcial colors from its shapes varieties, adding 6 grams of whole grain and slashing sodium by 15 percent. Kraft also relaunched its Back to Nature mac & cheese, which ofers 100 percent USDA Certifed organic ingredients. Te company leveraged retailer-specifc shopper insights and fnancial metrics to optimize the dinner aisle by boosting productivity and shopability, and prompted major retailers to make each of their stores strategically address its market through a deep dive into shopper data. By employing such data and its comprehensive knowledge of the dinner occasion, Kraft initiated change that will drive long-term growth and value at retail.

Category Advisor

Canned & Packaged Foods — Boxed Dinners

General Mills

Te dry packaged dinner (DPD) category, one of the largest in center store, is highly important to retailers, as 73 percent of households shop the category more than six times a year on average, purchasing three units during each trip. From its work on consumer path-to-purchase insights, included in the “Dinners Revolution” category story, the company identifed strengths, opportunities and future growth strategies. In partnership with Nielsen, General Mills again audited nearly 3,000 stores across the United States to develop a Gold Standard Planogram, which aimed to maximize sales for the category and across each segment by providing detailed guidance for share of space, share of facings, number of shelves, and an optimal number of SKUs. Retailers saw signifcant category lift by leveraging this holistic approach. Te company also provided retailers with merchandising best practices that maximized lifts on ads and displays, and introduced 16 DPD items to the market.

| Progressive Grocer | Ahead of What’s Next | November 2014

Category Captain

Canned & Packaged Foods — Bread Spreads

Ferrero USA

As the leader in the growing hazelnut bread spread segment, Ferrero USA’s Nutella brand partnered with retailers to drive innovation and maximize sales and profts. Nutella has delivered on two fronts in the past year: product and merchandising innovation. Nutella & Go was developed after shopper research showed that consumers wanted a convenient on-the-go snacking version of Nutella. Te product has quickly become the secondfastest mover in all of spreads. Meanwhile, Nutella continued to support merchandising innovation, conducting shopper studies to provide learnings on how to maximize sales by leveraging shopper insights. Te Nutella Shopper Insights research conducted with Edgewood Consulting afrmed that hazelnut was now a mainstream segment. Nutella also commissioned a category management shelf set study to identify best practices to drive hazelnut sales growth. Te No. 1 barrier to hazelnut spread growth was lack of visibility and consistent placement within bread spreads. Retailers that have adopted Nutella’s “MVP” principles are enjoying higher sales rates.

2014

Grocery — Foods & BeveraGes

Category Captain

Category Advisor

Idahoan Foods

General Mills

Category Captain

shelving recommendations and shared them with retailers in a bid to propel category sales. A national retailer leveraged these insights and blocked the natural segment together, realizing signifcant segment growth postreset. Smucker’s invested heavily in reaching the natural consumer at all touchpoints on the path to purchase, including social media. As a result of marketing support and strong trial and repeat rates, Smucker’s Natural has signifcantly boosted incrementality to the category, without compromising sales of core products and private label. Similar tactics helped another national retailer boost sales amid a push for health and wellness in center store categories.

Canned & Packaged Foods — Dry Packaged Potatoes Idahoan and Kantar conducted a full category assortment optimization study to drive growth at Idahoan’s retail partners, allowing them to identify their optimal product mix. Te company also worked with retailers to create planograms based on consumer shopping patterns, employing Nielsen and internal primary research that enabled Idahoan to develop Te Optimal Set, which lays out the most efcient use of retail space. One grocer, faced with declining potato sales, received recommendations that included optimizing the entire category as well as the adjacent stufng and gravy categories. By better allocating space to sales by category/segment, adjusting the assortment to include more incremental SKUs and aligning the shelf to ft Idahoan’s consumer decision tree, the retailer was able to take the category from -7.9 percent in dollars to 7.7 percent, per Nielsen. Additionally, Idahoan introduced the award-winning six-SKU Steakhouse Premium Casserole line, featuring favor profles previously unavailable in dehydrated potatoes.

Canned & Packaged Foods — Fruit Spreads

J.M. Smucker Co.

With a mature category such as fruit spreads, an evolving consumer base — namely, Millennials — has challenged the category in recent years. Smucker’s commissioned research to understand category dynamics, and found that there was a need for a quality product with pure, natural ingredients. Four new Natural Fruit Spreads were launched in 2013, followed by two Natural Squeeze items and two Natural jar line extensions. Smucker’s developed new

Canned & Packaged Foods — Dry Packaged Potatoes A perennial dry potato category leader, General Mills ofered a broad portfolio of SKUs that brought users to the category and boosted sales for all products, innovation that supported consumer needs and built the category, convenient options that served busy families, and highimpact promotional strategies that engaged consumers. Te drawing power and SKU variety of the Betty Crocker brand facilitated diferentiation and kept the category invigorated and moving forward. Last year, General Mills conducted a full category shelf audit with Nielsen and leveraged Willard Bishop activity-based costing into total category proftability to validate its shelf set recommendations and help the company collaborate more efectively with retailers. Implementing these recommendations helped retailers improve shopability and ensured a fair share of space for the most productive SKUs, thereby driving sales. With four new products this year and conversion of nine SKUs to single-serve pouches, General Mills continued to bring loyal buyers to the category.

| Progressive Grocer | Ahead of What’s Next | November 2014

“Together with our retail partners, ensuring that the marine stocks we ﬁsh remain healthy is more than a responsibility. It is central to our long-term success as businesses.” Chris Lischewski President and CEO Bumble Bee Foods, LLC

DELIVERING CHANGE ON THE WATER, ONE CAN AT A TIME Seafood is the world’s most-traded food commodity. In fact, every day more than 3 billion people depend on it as their primary source of protein. This demand, when paired with unsustainable fishing practices, puts unnecessary pressure on the world’s marine stocks, placing the long-term vitality of the seafood we love in jeopardy. The path to securing a healthy future for the world’s marine life lies in growing the number of sustainably managed fisheries, which can maintain or even increase their abundance of fish. That’s why Bumble Bee Seafoods has released Wild Selections ®, a new line of wild-caught, premium seafood from fisheries certified sustainable to the Marine Stewardship ouncil standard. 13 cents from the sale of each can of Wild Selections ® supports World Wildlife Fund conservation efforts - including marine protection and fisheries improvement programs. A minimum of $1,000,000 will be donated by 12/31/18. © 2014 Wild Selections.

2014

Grocery — Foods & BeveraGes

Category Captain

Canned & Packaged Foods — Nut Butters

J.M. Smucker Co.

Smucker’s pursued growth opportunities through its Jif brand to meet the evolving needs of consumers and shoppers. For example: Jif Whips, a whipped peanut butter product ideal for spreading and dipping, and ofered in a unique tub package. Smucker’s commissioned category need-state research to expose an innovation white-space opportunity in nut butters. Tis research resulted in the introduction of Jif Whips, creating new usage opportunities for consumers. Smucker’s also executed improved retail execution and management strategies to ensure incremental category growth, including in-aisle signage, product packaging, and in-store demos that highlighted the product with ideal snacking carriers. Te brand collaborated with key retailers to ensure optimal placement of shippers and display locations near the produce and snacking sections. Te retail strategy drove in- and out-ofaisle merchandising that resulted in an increase in category purchase occasions. Smucker’s also revealed a need for a revised category shelving recommendation that included a snacking and convenience section within the shelf set. Te brand heightened its collaboration with retailers to ensure optimization of the nut butter shelf set and an optimal shopper experience for category buyers.

Category Captain

Canned & Packaged Foods — Seafood

Bumble Bee Seafoods

Continuing its leadership role in worldwide fshery sustainability, Bumble Bee Seafoods ventured into a partnership with the World Wildlife Foundation (WWF) and the Marine Stewardship Council (MSC) in 2013. Te partnership required retailer support, which Bumble Bee pursued via category management and other eforts. Te manufacturer launched the Wild Selections program, featuring logos of both WWF and MSC on its product labels. Meanwhile, members of Bumble Bee’s sustainability and processing staf made joint presentations with the WWF to individual accounts to describe program details. Based on its analysis of consumer demographic data from IRI’s ShopperSights, follow-up meetings were held with targeted retailers in regions with high-index scores of shoppers who were environmentally oriented and predisposed to this segment. Bumble Bee recommended customized, full-section schematic placement using JDA’s Space Planning. Te vendor stressed the long-term benefts of its program, noting that the short-term unit and dollar sales were projected to be small because of the relatively high prices (versus commodity-priced brands). Bumble Bee developed supportive materials, while also recommending merchandising tie-ins.

Category Advisor

Canned & Packaged Foods — Shelf-stable Vegetables

General Mills

General Mills commissioned custom research to provide a strategic understanding of the entire meal aisle. “Meal Aisle Vision” resulted in best-in-class fndings and strategic thought leadership to help retailers better understand all categories within the aisle, including shelf-stable vegetables, a $5.1 billion category with broad reach, frequent

| Progressive Grocer | Ahead of What’s Next | November 2014

trips and larger baskets. Additionally, a custom Nielsen panel study was performed for the Green Giant brand, to better understand the shelf-stable vegetable consumer and advise retailers how to maximize their performance around SKU optimization, best practice shelving, and merchandising efectiveness during holiday windows. General Mills recommended segmenting by vegetable type, with emphasis given to green beans, peas and corn, the major drivers within the category, by placing multiple facings at eye level and specialty items at the top of the shelf to maximize proftability.

2014

No one stirs up data on coffee like Massimo Zanetti Beverage Massimo Zanetti Beverage is pleased to be recognized as a Coffee Category Advisor by Progressive Grocer Magazine. We invite you to discover how our proven category research can help you increase sales and drive growth in the coffee aisle. To disCover A World ThAT is “Coffee CoMPleTe,” ConTACT rod riCkMAn AT rriCkMAn@MZB-usA.CoM TodAy.

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2014

Grocery — Foods & BeveraGes Category Captain

Commercial Baked Goods

Flowers Foods

Category Captain

Canned & Packaged Foods — Soup

General Mills

Te soup category, estimated at $5.6 billion, is the largest within the meal aisle. Over the past year, soup has experienced slight declines, with RTS soup down 2 percent. General Mills’ RTS Progresso consistently outpaces both wet soup and RTS meal trends. Te company focused on investing resources to understand the soup category, including drivers of growth. Its “Soup’s On!” growth model launched in 2014, carrying the message that sustained category growth is driven by focusing frst on the fundamentals, then growth drivers and fnally diferentiators. Activation against this plan yielded 3 percent to 4 percent category growth for General Mills’ best-in-class retailers.

Flowers Foods worked to manage the changes hitting the commercial baked goods category, while helping deliver strong leadership and growth for its retailer partners. Before Hostess’ exit from the market in November 2012, Flowers’ fresh packaged bread dollars were up 9 percent, while the category was down 0.4 percent. Year to date through August 2014, Flowers continued to achieve strong growth, up 7.8 percent in sales. Nature’s Own, now available to more than 80 percent of the U.S. population, ofers the top three best-selling loaves of bread. Te company also has a brand powerhouse in Wonder, which it acquired in July 2013 during the Hostess liquidation. Meanwhile, Flowers launched Cobblestone Bread Company (CBC), a line of premium breads and rolls targeting Millennials, and has strategically used social media to connect with this consumer group. Using automated scripts and analysis tools, Flowers has optimized retailers’ shelf confguration and assortment at store level. In addition, the company gave its retail partners impartial business recommendations, based on consumer insights from various sources.

Category Captain

Condiments & Dressings — Mayonnaise

Unilever

Te $1.8 billion mayonnaise and whipped dressing category is on the decline, with negative growth this past year, and while Unilever’s brands outperformed the category, there’s still more ground to be gained. But Unilever’s equity-building initiatives demonstrated mastery of the category and success in leveraging key opportunities for growth, such as a multiyear recipe strategy and a focus on better-for-you variants (such as mayo with olive oil, showing strong growth); quality ingredi-

| Progressive Grocer | Ahead of What’s Next | November 2014

ents; and squeeze-bottle packaging. Unilever provided strong shelving guidance to give visibility to its fastest-moving jar, Hellmann’s 30-ounce Real Mayonnaise. Te company worked with retailers to move mayo out from under pourable salad dressings and give it a full vertical block, which provided an opportunity to move the squeeze bottle to eye level and capture more sales with this convenient, more proftable form. Creating distinct shelving segmentation allowed the consumer to see value in both of these formats, driving baskets up an incremental $5 for dual users of jar and squeeze forms. Retailers adopting the new shelving saw strong category growth — just what center store needs.

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2014

Grocery — Foods & BeveraGes

Category Captain

Ferrero Rocher

General Mills

Confections

Convenient Wholesome Foods

Premium chocolate accounts for a modest 10 percent of candy sales, but a more impressive 25 percent of total candy growth. Yet the category is underdeveloped in food and mass retailers, according to Ferrero Rocher. In the past year, Ferrero Rocher supported a category development initiative to identify strategies and plans to increase premium chocolate sales in the food channel, “Go for the GOLD.” Te program was built on an objective, fact-based foundation ranging from trade probes and retail discovery, to shopper insights and path-to-purchase research, along with advanced analytics. Edgewood Consulting Group was a major partner in this research. GOLD has four key elements: Growth (look for growth opportunities, such as gift-ready packaging, new products and multiple sizes); Organize (shelve the premium chocolate section, based on shopper insights); Leverage power brands; and Develop (work on plans to implement best practices to capture the sales opportunity). Retailers that adopted the GOLD principles experienced higher sales rates.

Convenient wholesome foods (CWF), made up of grain, fruit, and toaster pastries, represents about 30 percent of the $16 billion cereal aisle. General Mills strove to drive category growth through objective category insights, innovation and brand support, and factbased shelf strategies. As consumers continue to gravitate toward better-for-you snacking, the grain segment is taking center stage. Specifcally, grain bar consumption has grown by 94 percent over the past 10 years, which is more than double, followed by fruit snacks (up 44 percent). General Mills holds the largest grain share and has grown dollar share versus last year. As category leader, General Mills continued to drive sustainable innovation. Te company launched Nature Valley Breakfast Biscuits in January, followed by Fiber One Streusel Bars in June. Meanwhile, its category management team continued to recommend best-inclass shelving principles, including space expansion for the grain snack category. Retailers that expanded this space saw an increase in grain category sales rates of more than 23 percent.

Category Advisor

Convenient Wholesome Foods

Kellogg Co.

Kellogg continues to be a hungry No. 2 in the $3.13 billion wholesome snack category, with a 25.7 percent dollar share. Constructed from multiple studies, the company’s Framework for Growth enables its snacks team to devise customer-specifc tactics targeting key shopper segments. To capture available upside in bars, Kellogg collaborated with multiple parties to grow the category through a focus on the fundamentals, leading with a health-to-indulgence shelf fow, while learning laboratories ensured that investments in future growth provided appropriate direction to retail partners. To date, 36 percent of the marketplace is using this framework. Trough its partnership with In Context Solutions, Kellogg visualized, tested and implemented new shopper-based shelf-merchandising strategies, groundbreaking aisle fxtures and a more efcient planogram room process. Meanwhile, in the area of product innovation, Nutri-Grain Harvest, building upon handheld breakfast insights, drove incremental growth, with 12.3 percent of sales coming from exclusive households.

| Progressive Grocer | Ahead of What’s Next | November 2014

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2014

Grocery — Foods & BeveraGes

Category Captain

Category Advisor

Kellogg Co.

General Mills

Cookies & Crackers

Kellogg’s Keebler Simply Made cookies met consumers’ desire for “the next best thing to homemade,” while Keebler Pitter Patter cookies expanded options in a category dependent on variety-seeking shoppers. Te company tested retailer programs to overcome barriers to purchase and developed customized decks for key customers. Kellogg’s Cheez-It Grooves was a primary driver of sustainable innovation that built upon an emerging cracker growth segment, hand to mouth, leading to 16.2 percent category expansion. For the on-the-go segment, the company introduced four SKUs of sweet and savory Kellogg’s Cups, merchandised in displays, register racks, cooler toppers, dump bins and sidekick racks, as well as the traditional cookie/cracker aisle. Kellogg also discovered that top-performing retailers had three key onthe-go shelving priorities: allocating 16 feet to this growing segment, blocking products vertically by occasion and locating the section at the end of the cookie/cracker aisle.

Cookies & Crackers

Te emerging better-for-you cookie segment comprises $888 million and is growing at 4.8 percent over last year. Te increased consumer interest in more nutritious snacking means that such items will outpace total food growth over the next 10 years at a 5.4 percent projected growth rate. What consumers seek in betterfor-you snacks includes ingredients they can recognize and pronounce, natural/organic items, and portion and calorie control. Realizing that the key to a successful snack product is threefold — taste, health and convenience — General Mills made its frst foray into the segment with the Fiber One Cookie. As the Fiber One consumer is actively trying to lose/manage weight, the single-serve, fber-dense treat was a logical choice. Launched in June 2014, the item has already managed to rack up $5 million in sales. Trough category research and consumer insights, General Mills and its retail partners are positioned for growth in this growing segment.

TASTE THE EXTRAORDINARY FLAVORS OF CYPRUS Cyprus is the jewel of the Eastern Mediterranean with a tradition of ﬁne food culture going back to antiquity. Quality and freshness are at the core of Cypriot home cooking, so it's no surprise these elements are key to all products Cyprus exports. Explore the foods of Cyprus and discover a world where the past and present explode in a burst of fresh ﬂavors. FOR FURTHER INFORMATION PLEASE CONTACT Cyprus Embassy Trade Center 13 East 40th Street New York, New York 10016 Email: ctcny@cyprustradeny.org Tel: 212-213-9100

We’re proud to be recognized as a leader.

As a 2014 Category Captain, Nature’s Own, Tastykake, Wonder Bread, Cobblestone Bread Co. and all of the Flowers Foods brands are adding to an established history of innovation in the Commercial Baked Goods category. Our entire company is focused on meeting and exceeding customers’ expectations while providing retailers with solutions that lead to success.

2014

Grocery — Foods & BeveraGes

Category Captain

General Mills

Desserts

Te $1.8 billion dessert category has experienced fat growth in recent years, but dollar share leader General Mills worked hard to sweeten the business via new studies to better understand dessert trends, consumers and shoppers. Tis research includes new and more robust path-to-purchase work looking beyond desserts to the broader sweet-craving need state, a dessert mix category and baking aisle consumer segmentation study, and a new Nielsen dessert assortment study and corresponding assortment tool. To assist retailers for the 2014 holiday season, General Mills refned its bake center merchandising guidance to include a retailer-specifc assortment recommendation for both Tanksgiving and Christmas. Te occasion-based set continued to be a best-in-class shelf set, incorporated into roughly 75 percent of planograms. Meanwhile, General Mills continued to infuence retailers to optimize the baking aisle, key adjacencies and aisle anchors. Tis year, the company introduced 16 new items to build on its innovation platform.

Ethnic Foods

Shelf-stable Mexican food is a $4.6 billion category with steady growth: It has a two-year compound annual growth rate of 2 percent. Te category is a strong contributor to the meal aisle as the second-largest category in dollar sales, and the proft leader. General Mills, maker of the Old El Paso brand, brought forth insights through resources, including its recent “Explore Mexican 3.0.” Tis category plan focuseed on three key principles that are refned annually: market trends, consumer research and shelf audits. General Mills advised its retailer partners to implement one Mexican destination with a “vertical occasion-based” shelf set, optimize distribution to refect regional consumption patterns, and leverage meal solutions merchandising to increase Mexican household consumption. Meanwhile, the company provided category leadership through product innovation. In 2013, General Mills debuted the Stand ‘N Stuf Soft Tortilla & Dinner Kit. Building of the success of that launch, an additional dinner kit ofering was introduced in July.

Category Captain Ethnic Foods

Hormel Foods/MegaMex

Hormel Foods and MegaMex Foods, its joint venture with leading Mexican food brand Herdez, are deeply invested in the ethnic food segment and collaborate with retail partners to grow their business. Te manufacturers’ category management teams conducted two studies to support shopper needs and build sales overall in the ethnic food segment. A community alignment study drove the link between the regional origins of Mexican consumers living in the United States and products that appealed to their specifc

| Progressive Grocer | Ahead of What’s Next | November 2014

regional tastes and preferences, resulting in better marketing and, ultimately, driving sales. For one Mid-Atlantic retailer, the study helped boost pepper sales and also provided insights on preparation and usage for certain key categories in specifc regions, to develop relevant merchandising vehicles. Hormel and MegaMex found new ways to build category volume and incremental items in the basket by expanding authentic Mexican-focused “snacking solutions” in the chip aisle. Additionally, a Mexican aisle study revealed appropriate aisle/category adjacencies and the shopper decision process, quantifying the “size of the prize” for each level of change to make it actionable for the retailer.

Category Captain Meat Snacks

Jack Link’s Category Captain Free-from Foods

Enjoy Life

Enjoy Life’s consumer-centric approach has helped the company maintain a leading brand position in allergy-friendly, or “free-from,” foods, for the past 12 years. Enjoy Life has also supported the category’s growth by working closely with retailers, using a combination of analog and digital tools to provide information on ingredients, product variety and technology. Trough geo-location partnerships, Enjoy Life could pinpoint where its products reside, down to the individual SKU at a specifc retailer. Te technology allowed the company to ofer consumers incentivizing POS discounts via smartphones. All of this drove trafc into retailers’ stores and helped grow category sales. Te analog/digital approach allowed Enjoy Life’s retail partners to experience 50 percent sales growth in 2013, according to the company.

Jack Link’s teamed with several grocers to perform an opportunity gap analysis showing gaps versus other classes of trade for meat snacks. Based on that data, the company developed custom assortment recommendations. One was to ofer pantry-loading larger bag sizes unavailable in other channels; Jack Link’s suggested adding bag sizes above 8 ounces in its Original Beef Jerky, Teriyaki Beef Jerky and Turkey Jerky varieties. Following this advice, a Southeastern grocery chain added Jack Link’s 9-ounce bags to its assortment. Now the chain’s meat snacks are growing at 43 percent, while Jack Link’s is increasing at 59.8 percent. Another recommendation was to ofer more alternative proteins such as turkey and pork, since they have a healthy profle and provide satiation. A Western regional grocery chain that adopted this recommendation has seen exponential growth of its alternative-protein meat snack business — Jack Link’s turkey products are up 156.9 percent at this chain alone.

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November 2014 | progressivegrocer.com |

2014

Grocery — Foods & BeveraGes

Category Advisor

Category Captain

General Mills

Kraft Foods Group

Natural & Organic Foods General Mills helped retailers drive growth in natural and organic foods across several store categories, including RTE cereal, canned vegetables and salty snacks. Its Cascadian Farm label is the top organic RTE cereal brand and also drives growth in granola and nutrition bars. Te company’s niche foodie brand, Muir Glen Organic Tomatoes, has realized healthy growth over last year through such features as celebrity chef endorsements and successful recipe-based social media activity. Te company’s clean-label snack foods, including its Food Should Taste Good brand, drove category growth in popcorn, veggie chips, and corn and tortilla chips. General Mills’ Small Planet Foods Division invested in research to assist retailers in better understanding key categories and provided guidance to ensure in-store activities delivered increased sales, higher category penetration and higher cross-category purchases. Turnkey category platforms focused on placement, distribution and productivity, while category management consumer insights tools were used to better understand consumer behavior.

Salty Snacks

With snack nuts and seeds seeing some of the highest growth in the salty snack and smarter snacking/wholesome snacking segments, Kraft decided to capitalize on this fact to double the snack nut and seed in-aisle business by 2020, for $7 billion in total U.S. growth. Realizing that long-term growth begins at the shelf, the company reinforced such core fundamentals as vertical brand blocking, horizontally blocking by nut type, leveraging signpost brands and reducing clutter through optimization. Kraft’s national calls and road shows then made the case for the efectiveness of a shelf reset. In response, many retailers nationwide followed the company’s lead. For the full year 2013, dollar growth grew 1 percent for the category, 1.4 percent for Kraft’s Planters brand and 4.5 percent for retail brands. Comparatively, year to date through July, the category grew 4.3 percent, with Planters up 3.7 percent and retail brands up 3.3 percent.

Category Captain Salty Snacks

Flagstone Foods

Ann’s House of Nuts, an operating company of Flagstone Foods, has been in the private brand trail mix business for more than 40 years. Based on consumer research the company conducted in 2012, it developed category segmentation to help drive assortment insights and innovation. It also gained great insight into package types and sizes, as well as category usage. Last year, a team from Ann’s House of Nuts

| Progressive Grocer | Ahead of What’s Next | November 2014

met with a regional grocery chain that wanted to focus and reinvent its existing private-brand trail mix business. Ann’s House of Nuts recommended a base assortment and subsequently continued to drive additional items. Te retailer created a more prominent trail mix section adjacent to snack nuts, and supported the category with TPR and feature and display merchandising. An analysis of current consumption trends showed the retailer’s trail mix category was up 18.2 percent in dollar sales, driven by its own label, which increased 132.1 percent.

Are you unlocking the full potential of , The original hazelnut spread ? ®

As the #1 selling hazelnut spread in the U.S.1, Nutella is proud to be recognized as a 2014 Category Captain. In fact, Nutella represents 3 of the 10 top-selling nut spread SKUs in the U.S.1 Nutella is responsible for creating the fastest-growing subcategory in the spreads aisle.2

IRI Total MULO+C, 52 WE 10.05.14

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2014

Grocery — Foods & BeveraGes

Category Advisor

General Mills

Kellogg Co.

Salty Snacks

Consumers have more interest in better-for-you snacks, which expected to outpace total food growth over the next 10 years. To help retailers capitalize, General Mills brought capabilities and excitement to the category through consumer insights, shelf enhancements and new products, including Chex Mix Popped, a mix of butter-favored popcorn, corn and wheat Chex pieces, stick pretzels, and chocolate-favored candies, ofering 50 percent less fat than regular potato chips. Chex Mix was fully engaged in the social sphere, with more than 1.8 million Facebook fans and 13,000 Twitter followers. Best-in-class shelving improved shopability, variety and assortment to drive additional category growth. General Mills worked to give customers fresh new ideas and improve speed to market by experimenting with diferent packages, sizes and favors across channels.

FroZeN Foods Category Advisor Baked Goods

General Mills

While frozen baked goods (FBG) is a relatively small category (about 4 percent of the frozen department in dollar sales), it has a big impact. When FBG is purchased, the basket ring outpaces total frozen, dairy and dry grocery basket ring averages. General Mills drew on internal cross-functional expertise, coupled with third-party insights, to provide its retail partners with recommenda-

Salty Snacks

A standout of Kellogg’s salty snack lineup is Pringles, which consistently grows share by driving incremental consumption through on-trend favor oferings like bacon and sriracha, and expanding its user base through such innovations as Pringles Tortilla Chips and Pringles Stix. While the overall category grew 2 percent through 2014, Pringles was up nearly 5 percent. In response to customer requests, Kellogg developed Te Aisle of the Future, which organizes the salty snack aisle according to shoppers’ preference: by segment or type. Te company also made recommendations for the alternate placement of snack items in both large and small grocery formats. Trough these insights, many retailers reconsidered the placement of high-penetration snacks in front-of-store locations, realizing signifcant sales gains. Additionally, the company’s product fow and signage solution, which clearly highlighted the section’s parameters, as well as which items could be found there, drove meaningful sales gains at a national retailer.

tions that delivered maximized results. Proprietary capabilities enabled the company to deliver retailerspecifc counsel on layout, space and adjacencies that maximized frozen department sales rates. By aligning categories that promote cross-purchase and by separating high-penetration categories, retailers could create a push-pull efect through the aisle to encourage impulse purchase and build the basket. General Mills leveraged its successful Pillsbury brand to promote Grands! Freezer-to-Oven Biscuits through digital media, message stream and a word-of mouth campaign. Media spend increased, and communication revolved around food ideas, holiday messaging and increasing new product awareness.

| Progressive Grocer | Ahead of What’s Next | November 2014

Time to celebrate our 2014 awards with our valued partners

2014

Thank you for helping us earn the 2014 award for Category Advisor.

2014 CATEGORY ADVISOR

Frozen Foods Vegetables

Frozen Foods Meals

Through insights, meaningful innovation, and retail solutions, Pinnacle Foods is committed to being a trusted partner delivering complete category solutions.

2014

Frozen Foods Category Captain Breakfast

Kellogg Co.

Although the overall frozen food business is declining, frozen breakfast contributes to 20 percent of the department’s growth dollars year to date, one of only fve growing frozen categories. Kellogg’s iconic Eggo brand represents the point of entry into frozen breakfast, with the highest trial (43.8 percent) and exclusive base of households (40.3 percent) in the category, as well as the strongest repeat rate, at more than 30 percent. A Nielsen Category Market Structure Audit uncovered insights regarding the importance of segmentation in handheld sandwiches. By capitalizing on the healthy handheld segment, Kellogg’s Special K brand attracted female shoppers who previously

wouldn’t buy breakfast sandwiches. Further innovations included Eggo’s frst handheld entrées and the brand’s Tick & Flufy Chocolate Minis — the frst all-chocolate wafes introduced in the category. Additionally, a health-and-wellness trigger study led to customized decks at top retailers, as well as relevant insights specifc to Hispanic consumers.

Category Advisor Entrées

General Mills

With sales of more than $14 billion and 93 percent household penetration, the frozen multiserve entrée category is important to manufacturers and retailers. General Mills led the subcategory through new item introductions, comprehensive consumer support and category management capabilities that drove the entire category. Te company launched Old El Paso Frozen Mexican Entrées

Category Advisor Breakfast

General Mills

Frozen breakfast outpaces all other frozen department categories in unit growth, second only to desserts/ fruit/toppings in dollar growth. Extensive merchandising and pricing studies helped General Mills develop the most efective and realistic strategies for each of its retail customers. Te company’s Pillsbury Toaster Strudel, which rolled out fun limited-edition favors and more real fruit in its fruit SKUs, is the top driver of frozen breakfast incremental volume. When Toaster Strudel is in the cart, basket ring is 119 percent higher than when it’s not. Since convenience is key in the category, Pillsbury’s Heat-N-Go product line, offering consumers a pre-favored, portion-controlled, microwave-and-go morning solution at a $1 price point, proved highly incremental to the category, appealing to price-sensitive shoppers. Additionally, the brand capitalized on strong savory-segment growth by investing in the Toaster Scrambles pastry line, adding 50 percent more meat, better-tasting cheese and more flling, as well as two new favors.

in August 2013 and delivered three new line extensions in September 2014. A robust consumer campaign included digital, in-store sampling, FSIs, Box Tops for Education and a TV campaign. A full suite of tools, capabilities and insights gave retailers quantifable opportunities and actionable go-to-market strategies, benefting retailers and overall category health. An assortment optimization tool provided the ability to model the category impact of changing item mix. Using these insight-driven tools, General Mills worked with retailers to identify specifc opportunities to drive loyalty, increase trips and retain more dollars.

| Progressive Grocer | Ahead of What’s Next | November 2014

The Complete Nutritional Drink is the

Convenient Breakfast Share Leader!*

• The Original Breakfast Drink • Ready-to-Drink provides great value per serving • A Strong Selling Brand for Households with Kids Age 13-17 • Good Nutrition From the Start

2014

frozen foods Category Advisor Entrées

Pinnacle Foods

The multiserve dinner/entrées category is an important section in the frozen aisle, with 51 percent penetration, yet household reach and sales have declined. Challenges: heaviest buyers leaving the category, due to small serving sizes and lack of variety; limited family-size options; and shoppers no longer seeing value in premium items versus alternatives. Last March, Pinnacle Foods launched Birds Eye Voila! Family Size products, generating $5.1 million in new sales for the segment, 27 percent of them incremental to the category. Driving a renewed interest in the mature category, Pinnacle received positive feedback and results from retailers and consumers praising the convenience, quality, portion size and f lavor selection.

Category Captain Meat Substitutes

Kellogg Co.

MorningStar Farms (MSF) is the brand leader within the frozen meat substitute category and, more broadly, within veggie food, natural/organic and gluten-free prepared entrées. In 2014, MSF introduced seven SKUs, with innovation driving a little more than half (52 percent) of total growth dollars for the brand and generating $14.6 million in frozen meat substitute sales. Te company has pioneered in-aisle solutions for retailers for merchandis-

Category Captain

Ice Cream & Novelties

Unilever

Tere has been impressive growth in super-premium packaged ice cream and frozen novelties, chiefy attributable to unique innovations. Unilever, with its Breyers, Ben & Jerry’s and Magnum brands, drove growth across the category. With the launch of its Breyers Gelato Indulgences line, Unilever created a shelving solution, implemented by most major retailers, that placed all gelato brands in a destination door, helping drive overall gelato sales growth into triple digits for the year. Also contributing to super-premium segment growth was the launch of Ben & Jerry’s Cores, which combined two favors of ice cream on either side of the pint, with a favored ribbon in the center. On the novelties side, Unilever introduced several items under its Magnum brand, including a Double line produced with proprietary technology. Unilever also created shelf trays, frame clings and in-store media to call out innovations that brought new shoppers to the category.

ing meat substitutes adjacent to natural/organic and gluten-free entrées, rather than as a standalone category adjacent to various less-relevant categories. Retailers that adopted a Healthy Living destination within frozen experienced category velocities 10 percent greater than those that stocked the product as a stand-alone category. Kellogg’s study to identify, prioritize and resolve barriers to purchasing MSF resulted in deep understanding of the barriers for nonusers of the category, supporting the company’s aisle recommendation to shelve all relevant products in a Healthy Living destination.

| Progressive Grocer | Ahead of What’s Next | November 2014

the sustainable seafood advantage: a guide to driving retail sales growth Consumers are beComing partiCularly keen on adding more seafood to their diets.

Wha tes, consumers are thinking more carefully about their choices than ever before. They want to know that the foods they eat are good for their health, and they want to know that their selection is not harming the planet. Whatâ&#x20AC;&#x2122;s more, conscientious shoppers want to know that the retailers they trust will work with them to make good, sustainable seafood choices.

As consumers increasingly seek out healthy seafood options that are eco-friendly, retailers can proft not only by stocking high-quality, sustainable fsh and shellfsh products, but also by educating their shoppers about how the seafood they stock meets scientifcally sound defnitions of sustainability. This whitepaper explores the challenges and opportunities within the retail sustainable seafood market, from understanding what sustainable seafood is to effectively guiding retail shoppers for maximum sales opportunities. AdverToriAl

Health-minded shoppers head for the seafood section Doctors, dietitians and nutritional gurus increasingly recommend that consumers stick to a diet rich in fruit, vegetables, low-fat protein and fsh. As a result, sales of these so-called “perimeter foods” have been steadily outpacing their center-store counterparts. In fact, a 2013 Nielsen report noted that nearly all perimeter categories experienced volume growth in 2012 as shoppers allocated dollars away from packaged center-store options.1 Consumers are becoming particularly keen on adding more seafood to their diets. They’re paying attention to research indicating that the omega-3 fatty acids found in fsh promote heart and brain health2, and they like what they hear about seafood providing one of the best sources of low-fat, nutrient-rich protein. In fact, an NPR/Truven Health Analytics poll found that 30 percent of Americans now eat seafood at least four times a month.3

U.S. Seafood SaleS growth (in billions)

$17.1 $14.7

These consumers are adding a diverse mix of ocean fsh and seafood products to their carts: Finfsh represent the top-selling seafood category, followed by shrimp, other prepared seafood, crustaceans and mollusks.4 Nielsen data show that seafood now accounts for 5 percent of all fresh food sales (e.g. meat, deli, produce and bakery)5, and according to 2013 research from Packaged Facts, U.S. sales of seafood reached $14.7 billion in 2013, up from $13.3 billion in 2008. Packaged Facts predicts the retail fsh and seafood market will reach $17.1 billion by 2017, representing 3.1 percent annual compound growth.

$13.3

2008

2013

2017 projected

Source: Packaged Facts “Fish and Seafood Trends in the U.S.” report, 2013 ADveRToRIAl

http://www.nielsen.com/content/corporate/us/en/newswire/2013/consumers-and-the-growing-quest-for-fresh.html; 2 http://www.mayoclinic.org/ diseases-conditions/heart-disease/in-depth/omega-3/art-20045614; 3 http://www.npr.org/blogs/thesalt/2013/02/11/171743185/ most-americans-eager-to-buy-seafood-thats-sustainable; 4 Nielsen Perishables Group FreshFacts® data for 52 weeks ending July 26, 2014; 5 Nielsen Perishables Group FreshFacts® data for 52 weeks ending July 26, 2014

Sustainability attracts–and confuses–consumers Consumers are looking for more than good taste and healthful products when they select seafood and other grocery items. Sixty-two percent of Americans say they consider whether the foods and beverages they consume are sustainably produced6, reported the International Food Information Council (IFIC) Foundation’s 2014 Food and Health Survey. This increasing awareness of sustainability and other factors that impact how and where food is produced has helped make organic foods one of the fastest-growing categories in the industry: Data from the U.S. Department of Agriculture (USDA) indicate that between 2004 and 2012, sales of organic foods grew 145 percent to reach $27 billion.7 As consumers increasingly are adding sustainability to their decision-making criteria and seafood to their shopping carts, it stands to reason that demand for sustainable seafood should be at Seafood purchaSe influenceS high tide. Indeed, the NPR/Truven Health Analytics poll revealed that 80 percent of frequent Any fsh-eaters said they consider it importance important or very important that Species in healthy stock/ 70% the seafood they purchase was not endangered sustainably procured; consumers Retailer purchased from 63% ages 18 to 24 are the most likely to consider sustainability importCountry of origin/catch area 61% ant and to cite wild-caught, catch Sustainably sourced 61% method, and organic as important, From well-managed/ 55% according to a 2013 Mintel report.8 regulated farm-raised fsh The NPR/Truven Health Analytics Dolphin-friendly 53% survey also found that nearly half Caught in the wild 51% of all Americans are willing to pay (not farm-raised) more for sustainably caught fsh. This demand for sustainably procured options, combined with a willingness to pay extra for them,

half of all americans are willing to pay more for sustainably caught fish.

Neither important nor unimportant

Not very important or not important at all

22%

28%

10%

26%

13%

30%

10%

32%

13%

31%

16%

35%

14%

Catch method

44%

37%

19%

Organic

38%

34%

28%

Source: Mintel “Fish and Seafood – US – 2013” report

6 http://www.foodinsight.org/surveys/2014-food-and-health-survey; 7 http://www.ers.usda.gov/data-products/chart-gallery/ detail.aspx?chartId=35003&ref=collection#.UgTqIxb3Djc; 8 Mintel, “Fish and Seafood – US – 2013” report

ADveRToRIAl

consumer definitions of ‘sustainability’

43% Eco-friendly/ environmentally responsible practices

Good product/ tastes good/flling

Safe/natural/ no chemicals

25% Quality/fresh/ reliable

Source: Carbonview “Value-added Seafood 360 Report,” September 2014

How sustainability impacts seafood purcHase decisions Familiarity with the practice of sustainability

72% Heard of it/know a little about it

15% Very familiar

13% Never heard of it Source: Carbonview “Value-added Seafood 360 Report,” September 2014 AdverToriAl

adds up to a thriving sustainable seafood market. But at the same time, misconceptions and misleading information about sustainability abound, even among consumers who express interest in sustainable seafood. For example, a 2014 Carbonview survey of more than 1,000 U.S. moms ages 25-54, who had purchased value-added seafood within the past six months, found that while the majority had at least heard of sustainability, fewer than half were able to accurately describe what it means.9 The survey also suggested that consumers weren’t sure how or where to look for information. Among the respondents who claimed to be familiar with sustainability, three in four were not aware of the sustainability certifcations on seafood packaging. The good news? Shoppers who care about seafood sustainability make it a priority when deciding which products to buy. The Carbonview research found that survey respondents who claimed to be very familiar with seafood sustainability issues were more than twice as likely as the average respondent to indicate that sustainability factors into their purchase decisions. These fndings indicate that educating consumers is absolutely essential for retailers hoping to build awareness, trust and greater demand for sustainable seafood. The following section covers common questions that retailers and shoppers may have about sustainable seafood, including why consumers should choose sustainable options and how to locate and select fsh that has been produced using scientifcally informed sustainable methods and best management practices. 9

Carbonview “Value-added Seafood 360 Report,” September 2014

Seafood SuStainability 101 What is sustainable seafood? Sustainability is a method of harvesting or using a resource so that the resource is not depleted or permanently damaged. It also entails using “best management practices” procurement methods that will not have a negative impact on other wildlife or the ocean habitat and don’t pollute surrounding areas. The National Oceanic and Atmospheric Association (NOAA) further describes sustainability as “catching or farming seafood responsibly, with consideration for the long-term health of the environment and the livelihoods of the people that depend upon the environment.”

What makes a seafood fshery sustainable? According to ecosystem-based fsheries management strategies advocated by many government and scientifc organizations worldwide, effective, science-based fshery sustainability practices should include: • Preventing overfshing of target and non-target fsh species • Managing the effects of fshing on habitats • Managing the incidental mortality of non-fsh species • Taking into account effects on the food chain in ecosystems that are caused by fshing

Importance of sustaInabIlIty In seafood purchase decIsIons (on a scale of 1: not important at all, to 5: extremely important)

32%

3 2

29% 5%

1 2% Source: Carbonview “Value-added Seafood 360 Report,” September 2014

69%

of those “Very Familiar” with sustainability say it’s extremely important to their purchase decision.

• Managing for environmental change • Managing for the social and economic needs of fshing

communities and economies

Why is sustainability important? If any fsheries are managed unsustainably, it can have an adverse impact on the environment. By choosing sustainable seafood, the consumer is helping promote responsible production. The National Fisheries Institute emphasizes that “our investment in our oceans today will provide our children and future generations the health benefts of a plentiful supply of fsh and seafood tomorrow.”

Source: Carbonview “Value-added Seafood 360 Report,” September 2014 AdverTOrIAl

Are wild fsh healthier or better for the environment than farmed fsh? Not necessarily. Responsibly run aquaculture farms can be safe for the environment. Moreover, farmed fsh provide an important supplement to the wild-caught seafood supply, especially as global demand for seafood continues to grow.

Opportunities for retailers In addition to educating their shoppers, retailers can also consider partnering with a nonproft and/or a trusted supplier that specializes in seafood sustainability based on scientifcally supported techniques. These organizations can provide guidance and detailed information on a range of questions and procurement needs, and may even help drive sales. In 2010, French grocery retailer Carrefour partnered with three ShopperS who are well-informed seafood brands and the Marine Stewardabout Seafood SuStainability make ship Council (MSC) to launch a two-month it a priority when deciding which program called les Jours Bleus (the Blue productS to buy. Days), aimed at encouraging consumption of certifed sustainable seafood via unique 10 promotional displays. The promotion was so effective in driving awareness and consumption of sustainable seafood that Carrefour repeated it in 2011 and 2012. The success of les Jours Bleus shows how retailers have an opportunity to be more than just educators. Retailers can also lead their shoppers into new waters by proactively showcasing sustainable seafood products and information through such promotional tactics as: â&#x20AC;˘ Using in-store sampling and demonstrations to introduce customers to new or unfamiliar sustainable seafood products â&#x20AC;˘ Installing point-of-sale signage highlighting new products and explaining how and where the products were procured ADveRToRIAl

http://www.msc.org/business-support/campaigns/les-jours-bleus-2012

• Offering sustainable seafood recipes

and cooking techniques • Including sustainable seafood brochures with the purchase of any seafood product • Leveraging point-of-sale signage to convey information about the various types of seafood sustainability certifcations and label statements • Educating supermarket staff, both in and out of the seafood section, about science-based sustainability and the various certifcations so they can act as educators and advocates for sustainable seafood Consumer interest in healthy, high-quality, environmentally sound seafood will only continue to grow in the years ahead. Retailers have an enormous opportunity to both drive and beneft from that interest. Those that provide not only high-quality sustainable seafood products but also useful, credible information about sustainable seafood can drive greater customer loyalty as well as rising fnancial tides.

SuStainable Seafood certification Ideally, you and your customers could rely on a universally accepted, science-based certification for sustainable seafood products. Although there is no one “official” certification similar to the USDA’s Organic certification, the National Oceanic and Atmospheric Association (NOAA) is currently exploring development of a sustainability certification mark, which would serve as the first sustainable seafood certification from a governmental institution. In the meantime, your customers are likely to be seeing the following non-governmental certifications currently in use on some products: Marine Stewardship Council (MSC) Certified Sustainable Seafood – MSC is an independent nonprofit organization and the global leader in sustainable seafood certification and eco-labeling. Global Aquaculture Alliance Best Aquaculture Practices (BAP) Certification – The alliance coordinates the development of certification standards for hatcheries, farms, processing facilities and feed mills. SCS Global Services’ Aquaculture Stewardship Council (ASC) Certification – SCS Global Services provides third-party environmental and sustainability certification, auditing, testing and standards development to a number of industries, including seafood.

About PAcific SeAfood Pacific Seafood launched in 1941 as a small, fresh seafood retail operation in Portland, Ore. Over the years, the family-owned business expanded to become a vertically integrated seafood processing and distributing company to meet customers’ needs and a growing market. Pacifc Seafood produces seafood products from Alaska to Mexico, has facilities in seven Western states and participates in the global seafood trade market. It is a founding member of the National Fisheries Institute, which established the Better Seafood Bureau, and a member of the West Coast Seafood Processors Association. The company also is active in promoting a healthy and sustainable seafood industry by supporting fsheries awarded Marine Stewardship Council eco-labels. Pacifc Seafood is under the leadership of Frank Dulcich, the founder’s namesake and grandson. Visit Pacifc Seafood’s website, Facebook or Twitter to learn more.

Pacifc Seafood 16797 SE 130th Ave. Clackamas, OR 97015 www.pacifcseafood.com

AdvERTORIAL

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The Holy Grail of Retail: Delivering Shopper Centricity for Competitive Advantage Wednesday, November 19, 2014 â&#x20AC;˘ 2:00 pm ET/1:00 pm CT/11: 00 am PT As the retail industry grows ever more intense and diverse, consumers are demanding that theyâ&#x20AC;&#x2122;re recognized as individuals. However, few retailers have successfully implemented a holistic shopper centric approach across strategy, marketing and merchandising and most have a challenging road ahead if they want to leap ahead and gain this competitive advantage. In this one-hour webinar, LoyaltyOne will discuss industry leading shopper centricity best practices and solutions to overcome the challenges grocery retailers face in delivering on the full potential of shopper centricity. Specifcally you will learn: 1. Why a shopper centric approach is essential to the long-term success of every grocery retailer 2. Where most grocery retailers are successfully employing customer centricity today and what are the most valuable opportunities going forward 3. How real-world, practical recommendations enable grocery retailers to see measurable improvements through a customer-centric approach across pricing, promotion, assortment and marketing.

Moderator: Graeme McVie, VP & GM, Business Development, LoyaltyOne

Presented by:

Jennifer Acevedo, Editor-in-Chief, Retail Leader

Sponsored by:

2014

FROZEN FOODS

Category Captain Pizza

General Mills

Consumption trends have driven frozen pizza to be a $4.5 billion “anchor” category in the frozen department, boasting

high penetration, high purchase frequency and strong incrementality. General Mills’ Totino’s brand, one of the category leaders, is among the most productive within the segment. Tis year, General Mills ofered a variety of insights for retailers on how frozen pizza delivers a great value. Fixing the mix and recommending optimal assortment were two ways the company advised retailers to position the category for growth. In addition, Totino’s continued to invest heavily in Hispanic marketing, since the brand has the leading Hispanic consumer spend in both the pizza and frozen snack categories. General Mills created a three-step process to help retailers ensure they carry the most productive assortment to drive category growth. Te process includes understanding regional demand (an assortment tool helps retailers make regional distribution decisions), optimizing the shelf and stocking the most incremental SKUs.

Category Captain Snacks

General Mills

Over the past year, the $4.5 billion frozen snack category has grown 1.2 percent in dollar sales, slightly outpacing the frozen department. General Mills, maker of the Totino’s brand, is one of the leaders of this large, complex category. Trough extensive use of consumer segmentation, point-ofsale analytics, Willard Bishop ABC analysis, DemandTec, the Nielsen Shelf Audit tool, Demand Transfer, the “Nielsen Assortment Study,” consumer research, virtual store technology and the “Path to Purchase Study,” its category management team delivered thought leadership to retailers. In April, the company released “Fire Up Frozen Snacks 2.0,” an update of its inaugural frozen snack growth story in 2013. With these insights, General Mills created a growth framework for customers to align their priorities against and take a targeted approach on how to ignite growth within the category. Meanwhile, in July, the company launched Totino’s Bold Rolls, which ended up being 20 percent to 30 percent incremental to the brand.

| Progressive Grocer | Ahead of What’s Next | November 2014

2014

Frozen Foods Category Captain Vegetables

General Mills

As the most frequently consumed category in the frozen aisle, frozen vegetables is critical to the department’s success. Category leader General Mills, which produces the iconic Green Giant brand, helped its retailer partners grow the segment by working to develop innovation to drive future growth, and by investing heavily to support the present category. In October 2012, General Mills released “Vitalize Frozen Veg,” a category growth story that equipped retailers with shopper insights and key action steps to unlock growth. Meanwhile, in response to consumer concerns about a “confusing shelf and packaging,” Green Giant launched new packaging, and encouraged retailers to increase shelf capacity by changing their boxed vegetable portfolio to a vertical orientation. Te company brought a full suite of tools, capabilities and insights to its customers, including an assortment study conducted with Nielsen to dig deeper into incrementality within the category. Last but not least, Green Giant’s consumer spending increased signifcantly.

HeALTH, BeAUTY & WeLLness Category Captain

Antiperspirants/Deodorants

Unilever

Te antiperspirant/deodorant category represents nearly $2.9 billion in retail volume, but from a household penetration perspective, the category has remained relatively fat, hovering below 80 percent over the past two years. Overall engagement in the category remains quite low. To help mitigate this, Unilever made a concerted and consistent efort to develop, hone and deliver insights-based shelving guidelines to its trade partners. In spite of a confusing environment,

Category Advisor Vegetables

Pinnacle Foods

Working in a category with fading household penetration, Pinnacle Foods aimed to improve trafc to a frozen aisle that’s not part of many younger shoppers’ routines. It’s perceived as confusing and hard to shop, with limited innovation and overly processed, poor-quality products. Pinnacle’s answer was to bring the appeal of fresh produce to frozen vegetables, a concept it calls “Froduce.” Te company launched shopper-ready packing products to help create a shopper-friendly section, converted its Recipe Ready items to standup bags for better shopability, partnered on campaigns to promote the fresh benefts of frozen products and encourage veggie consumption to combat childhood obesity, and leveraged assortment optimization tools to customize product mix for each retailer’s needs. Eforts resulted in signifcant awareness for the category and positive feedback from retailers, as well as consumers, who praised the products’ enhanced shopability, freshness, quality and value.

consumers continued to seek out “new” and “more” within the category, and manufacturers responded by providing incentives to trade up. Tis year, Unilever launched a female line extension, Dove Advanced Care, creating an entirely new niche and price tier within the category. In the spirit of continuing to “premiumize” the category, the line brought specifc shelving requirements: Unilever was able to land Dove Advanced Care in the desired eye-level position in 90 percent of its key retailers. Tis, coupled with the innovation’s strong communication plan, has furthered long-term success of the category.

| Progressive Grocer | Ahead of What’s Next | November 2014

2014

HealtH, Beauty & Wellness Category Advisor

Balanced Nutrition/Diabetes Management

Abbott Nutrition

Abbott Nutrition, maker of the Ensure and Glucerna brands, developed bestin-class category management relationships with retailers to help them grow the adult nutrition/diabetes management business. Currently valued at $1.1 billion,

the category has increased 4.8 percent during the latest 52-week period versus a year ago. At one national retail account, Abbott proposed a “multiples strategy” that included a promotional ofer to drive units per visit within the category, particularly among the retailer’s best shoppers, as well as an initiative to promote tradeup and cross-purchasing from regular to specialty items. As a result of its eforts, the retailer’s total adult/diabetes management category increased 1.4 percent in units/visit, while visits/ household grew 2.7 percent. In another example of Abbott’s hard work, the company helped improve the shopability of a retailer’s balanced nutrition section. Its newly merchandised set fully rolled out in January, and by midyear, the category was up 7.8 percent, versus a 4.3 percent increase in the total market.

Category Advisor Cosmetics

Procter & Gamble

Te cosmetics category has had a major feature and display focus on new items, due to the trend-driven nature of the business. Tis presents a challenge for manufacturers and retailers, as there’s signifcant turnover of base brands. Procter & Gamble’s Cover Girl brand set out

| Progressive Grocer | Ahead of What’s Next | November 2014

to fnd a new, diferentiated way to link the brand, its key consumer target and a key pop-culture event to drive new and existing business. Creating a retailer “hook” to drive multiple items in the basket (buy $20 items, get movie ticket), P&G created the frst-ever new and base activation, leveraging the launch of the “Hunger Games” movies across a customizable marketing plan. Te plan drove category expansion; 10 percent of total volume came from current buyers purchasing more, mascara sales rose, and category base business consumption was driven disproportionately. Further, the brand closed its share-of-display gap during a typically dark period for nonholiday display. Te plan attracted new shoppers, increased sales/units per basket and drove brand share leadership to its highest share weeks for the fscal year.

Category Captain Foot Care

Merck Consumer Care

Maker of the Dr. Scholl’s brand, Merck Consumer Care drove the success of the $1.3 billion-plus foot care category by investing in category, channel, consumer and shopper insights. Merck undertook a comprehensive consumer segmentation study identifying key consumer profles, need states, and foot health goals and attitudes, along with product usage. Additionally, the company’s marketing and sales teams uncovered various opportunities to improve the shopping experience. In response, Merck and Dr. Scholl’s adopted a consumer-centric marketing approach and a shopper-centric merchandising strategy to retain current shoppers while attracting new ones to such core sub-brands as Massaging Gel and P.R.O. (Pain Relief Orthotic). Tese core businesses were then complemented by new consumer-driven platforms, Active Series and Work. Merck further transformed the category through such endeavors as the rebranding of DreamWalk, a line targeting women-specifc needs. As a result of such eforts, Merck maintained a strong 43.6 percent share of the category.

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2014

HealtH, Beauty & Wellness Category Advisor Hair Care

Unilever

In a marketplace where hair care is saturated with countless product choices, Unilever invigorated growth in a maturing category. Its trendconscious TRESemmé Keratin Smooth line contributed a quarter of overall category growth, with products designed to deliver a salon experience at home. Te line was able to grow a somewhat saturated category, delivering doubledigit growth within four classes of trade — food, drug, mass and value — with some of the most signifcant lift at grocery. Additionally, Unilever leveraged a salon trend for Moroccan argan oil by launching its Suave Professionals Moroccan Infusion line at retail. Te line became highly incremental in the overall category, both through category expansion and new buyers. Te launch was supported by a robust 360 campaign: sampling/coupons, FSIs, in-store displays and shopper marketing, advertising and PR, digital and social media, and a sponsorship with NBC’s “Fashion Star.”

Category Captain OTC Analgesics

Bayer HealthCare

Bayer HealthCare developed a new vision for its retail partners, theorizing that the greatest growth within the analgesic category will come from focusing on health state opportunities. Te company encouraged retailers to leverage critical shopper insights and create activation strategies around health states that lend themselves to solution selling. Its extensive research identifed three specifc health states that provide the most potential: heart health, arthritis and sleep. For all three health conditions, Bayer conducted conditionbased assortment research that identifed the specifc items that were of greatest interest to shoppers. Several retailers have begun to implement customized-solution selling approaches that best meet the unique needs of their shopper base. Although there are many contributing factors, Bayer HealthCare contends that its health state framework played an important role in rejuvenating category growth in 2013. Following three years of virtually zero dollar sales growth, analgesics grew 4.9 percent, according to IRI.

Category Captain Skin/Sun Care

Merck Consumer Care

Merck Consumer Care, maker of the Coppertone, Solarcaine and Bain de Soleil brands, invested in consumer and shopper research for an efective go-to-market strategy in the sun care category. To keep innovating in this highly dynamic category, Merck conducted extensive consumer attitudinal research fnding that sun care usage is heavily driven by occasion. Tis became the foundation for launch-

ing the lightweight Coppertone Clearly Sheer line in convenient lotion, spray and travel forms. Clearly Sheer focuses on need-based occasions such as Sunny Days and Beach & Pool, creating new cross-purchasing and basket-building opportunities. Merck’s innovation investment yielded great results: Te $1.2 billion sun care category was up 1.5 percent in multioutlet retailers, according to IRI, despite a difcult early season due to a cool, damp spring. Additionally, Coppertone maintained its top position in sun care through engaging consumer activation strategies that spurred sales during the peak summer purchase occasion.

| Progressive Grocer | Ahead of What’s Next | November 2014

1 VITAMIN MANUFACTURER

MARKET DRIVER. The US Nutrition Grocery shopper is highly valuable, as over two-thirds are CORE grocery shoppers.

Average

BASKET BUILDER. When a US Nutrition product is in the basket of a Core shopper, the basket size is 2 times larger.

60%

817814USN-BM

37% AVG.

OPTIMAL SOLUTIONS

US Nutrition’s new product innovation platforms are attracting a younger user to the Vitamin category.

55%

Under Age 54

SUNDOWN GUMMIES

INNOVATION LEADER.

% Dollars

Source: Nielsen Household Panel, Q2 2014 1Nielsen Expanded All Outlets Combined, 52 weeks ending Sept 27, 2014 (Excludes Private Label).

2014

HealtH, Beauty & Wellness Category Captain

Category Captain

Pharmavite

U.S. Nutrition

Vitamins/Supplements Trough new consumer research, Pharmavite identifed that most consumers shopping the vitamin category were not only searching for a specifc product, but also seeking health beneft claims. In response, Pharmavite developed a new proprietary need-state landscape design that collapses the category’s 80-plus segments into 19 simple health solution platforms. Pharmavite also created six distinct consumer segments based on age, gender, attitudes toward health and wellness, and category purchase motivations. Te company helped its retailer partners understand need states specifc to their markets, providing insight that fed development of assortment, pricing, planogram and promotional strategies. Category sales trended six points higher in stores with the need state/health condition shelf segmentation, versus stores without this merchandising segmentation change. With these strategies and product innovation, Pharmavite helped deliver a category sales trend 440 basis points greater among its retailer partners.

| Progressive Grocer | Ahead of What’s Next | November 2014

Vitamins/Supplements Maintaining key category relationships with major grocery retailers across the country, U.S. Nutrition relied on deep consumer insights and continual product innovation. Te company strove to bring in new users and further engage current users in a fat marketplace. U.S. Nutrition identifed a need by younger consumers for new delivery forms, resulting in the launch of Nature’s Bounty Hair Skin & Nails in gummy form, which helped to create a new segment for younger women consumers and is currently ranked No. 1 in trial among dozens of new items at a leading U.S. grocery chain. Te company’s Sundown Naturals

brand introduced an innovative line of glutenfree gummies, growing at triple digits, with a ffth of volume incremental to the category, and attracting new, younger users. U.S. Nutrition partnered with a major West Coast grocer to develop a newly formatted health-and-wellness destination anchored in center store. Grounded in insights gleaned from consumer segmentation research, the new format is slated for continued rollout due to sales success versus results at traditional-format stores.

Category Advisor

Vitamins/Supplements

Bayer HealthCare

Vitamins, minerals and supplements (VMS) has been the fastest-growing category within total OTC, yet its growth has brought challenges. Bayer HealthCare worked with its retailer partners to navigate the process while growing sales and proftability. In the past year, Bayer developed several core principles to help guide decision-making across the category. A critical element of this framework was a deep understanding of consumer and shopper insights. Bayer commissioned several new studies to ensure that the principles and strategies developed were aligned with what both the shopper and retailer required for ongoing success. In the end, Bayer identifed six guiding principles to help retailers and manufacturers efectively manage the category. Retailer response has been extremely positive. Although there are many factors that have helped sustain VMS gains, the efort helped the category grow 3.3 percent in dollar sales this past year.

November 2014 | progressivegrocer.com |

2014

Perimeter Perimeter Category Captain Baked Goods

CSM Bakery Products

In the past year, CSM Bakery Products has made signifcant investments to grow and strengthen its partnerships with its in-store bakery customers. With one grocery partner in particular, CSM provided category assessments with data from Nielsen Perishables Group, and developed strategies to drive proftable top-line growth. Te regional chain needed category management expertise to boost its cake category market share. Specifcally, the retailer wanted to drive trafc and increase shoppers’ basket size. CSM identifed opportunity gaps in the decorated cake and cupcake segments. Te company recommended a redesign of decorated cakes, as well as a remerchandised cake case. It also stressed the importance of introducing new dessert cupcake varieties. Other ideas included a new promotional program and cake decorator training. After implementing the changes, the retailer saw decorated cakes jump 14.4 percent in dollars and 19.2 percent in units. Meanwhile, the dessert cake program increased 2.1 percent in dollars and 3.6 percent in units, with a market share gain of 1.1 percent. Te cupcake program, for its part, gained 1.3 percent in market share, with an impressive 21.1 percent lift in dollar sales.

Category Captain Dairy — Eggs

Eggland’s Best

Eggland’s Best LLC collaborated with a major national grocery chain to help grow the egg category 10 percent in dollars over the prior year. Te specialty egg segment is up double that, at 20 percent. Eggland’s Best relied on a detailed analysis to share category information on a monthly basis, creating a real-time view of the category for the retailer’s category

Category Advisor Baked Goods

Bakery Crafts

Bakery Crafts took bakery ordering to the next level, modernizing retailers’ category management capabilities in the process. Te company recently introduced its iPad-based Bakery Ordering System (BOS), which allows customers to place orders 24 hours a day, seven days a week. Placed in the grocery bakery, the system enables a customer to place an order anytime, regardless of whether someone is working in the bakery department. Te customer selects a cake design category, and then chooses a design from a variety of options. Once the customer has found the preferred cake design, she has the ability to further customize it. All of the information is stored electronically, so there are no more lost orders. Te management portal for the system allows for total customization throughout the ordering and production process. Bakery managers are given access to systemgenerated reports — a feature that wasn’t available to the bakery before. Since the application rollout, grocers that have implemented the BOS have seen double-digit growth in the sales of cakes/cupcakes.

management team. Te company used a total Nielsen data package, providing an in-depth but succinct summary of timely sales trend data and insight analysis of the egg brands in the category. Eggland’s Best also suggested a robust promotional strategy, as well as the Weekly Trend Analyzer, which quickly analyzed and identifed weekly trends of every shell egg SKU that the retailer places on its shelf. Detailed reporting allowed the retailer to keep track of annual trends, and develop a robust promotional calendar that included promotions at special times of the year, such as holidays.

| Progressive Grocer | Ahead of What’s Next | November 2014

SODA WE DIDN’T DIDN’T JUST JUST CREATE CREATE AA WE

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CATEGORY’S FUTURE FUTURE CATEGORY’S

ZERO CALORIES CALORIES •• NO NO SUGAR SUGAR •• NO NO ARTIFICIAL ARTIFICIALSWEETENERS SWEETENERS

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3,000 3,000

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2,500 2,500 2,000 2,000

R:R2: 92% 9% GG 0 CAA 0-0’2 ’1’1 -’20 C

1,500 1,500 1,000 1,000 500 500 0

2010 2010

2011 2011

2012 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E 2012 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E Total Natural Zero Calorie Total Artﬁcially Sweetened Zero Calorie Total Natural Zero Calorie Total Artﬁcially Sweetened Zero Calorie

•• Zevia Zevia appeals appeals to to the the shoppers shoppersof oftomorrow tomorrow--strong strongvolume volumeskew skewtotomillenial millenialand andhispanic hispanic households households • Zevia is the #14 low/zero calorie CSD brand in total US food stores - the only independent • brand Zevia is low/zero calorie CSD brand in total US food stores - the only independent in the the #14 top 20 and fastest growing brand in the top 20 and fastest growing • Zevia owns 82.9% of the alternatively sweetened CSD category in total US Stores • Zevia owns 82.9% of the alternatively sweetened CSD category in total US Stores Robert Gay, SVP Sales & Marketing, 303.866.2427, robert@zevia.com Robert Gay, SVP Sales & Marketing, 303.866.2427, robert@zevia.com

Source: SPINS/IRI Total US Food, 12 weeks ending 6/15/14. Beverage Digest Nielsen, Wall Street Research. SPINs Data Total US - Food Channel 12 weeks ending 10/5/14 Source: SPINS/IRI Total US Food, 12 weeks Note: ending 6/15/14. Beverage Digest Nielsen, WallUSStreet Data Total US - Food Channel 12 weeks ending 10/5/14 Dollar growth and share based on Total Food,Research. 12 weeksSPINs ending 6/15/14. Note: Dollar growth and share based on Total US Food, 12 weeks ending 6/15/14.

2014

Perimeter Category Captain Dairy — Margarine

Unilever

In an efort to revitalize the margarine segment, Unilever strove to change perceptions of the category so that margarine, like butter, could be perceived as simple and real. In a multiyear strategy, Unilever launched two SKUs with clean ingredient lists and expanded this initiative to the full I Can’t Believe It’s Not Butter line with a new simple formula, new packaging, and a focus on “100% Taste, 0% Artifcial Preservatives.” To accommodate this category “revolution,” Unilever focused on assisting retail partners to align on three key opportunities: clear segmentation of margarine/ spreads, butter and spreadable butter; improved brand blocking, as brand is a core consumer decision driver; and facing increases on the core 15 SKUs that drive half of category dollars. Unilever developed shelving concepts that achieved an enhanced shopping experience with scalable fxtures. Te company sees a continuing opportunity to work with retail partners to spur additional category usage; eforts are already reversing a downward trend. Unilever worked to turn the tide of consumer perception to a more simple and real experience, and aims to continue growing baskets in the margarine segment.

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2014

Perimeter Category Captain

Category Captain

General Mills

Dairy — Refrigerated Baked Goods

Dairy — Yogurt

General Mills’ Pillsbury brand is the dollar share leader in the refrigerated baked goods (RBG) category. Te brand helped its retailer partners succeed by providing industryleading insights and capabilities to accelerate customer growth. For instance, the insights and learning from General Mills’ path-to-purchase study led to the creation of the category growth story “Re-Fresh Dough.” Tis program reinforced the importance of RBG while also demonstrating that signifcant growth is possible by focusing on three key areas: holidays, everyday usage and improved shopability. As the share leader in the category, Pillsbury made the category more shopable through packaging improvements. Te brand also focused on reaching new households and educating Hispanic consumers about the category. In June, Pillsbury launched two new indulgent product lines: Pillsbury Melts and Cinnabon Cinnamon Rolls.

Te yogurt category continues to be a catalyst for growth across the store, and General Mills’ Yoplait brand played a signifcant role, with a focus on consumer insights, marketing and innovation. Te category’s dollar sales were up an impressive 7.5 percent in 2013, and Nielsen estimated that it could grow another $2.5 billion by 2019. General Mills released a new yogurt category growth story in February 2014, which leveraged category insights to highlight opportunities to optimize the shelf set, assortment and merchandising. Te key messages of the category growth story were to lead through expanding consumption, winning with all segments and driving growth with the Greek segment. In terms of product innovation, Yoplait launched new favors in its Greek portfolio, as well as developing a mix-in line via a partnership with Hershey’s. In the kid segment, Yoplait continued to generate innovation by bringing kids’ favorite characters to yogurt.

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2014

Perimeter Category Captain

Deli — Prepared Foods

Tyson Foods

Leveraging its leadership in the growing prepared food category, the Tyson Deli team further developed its Tyson Deli 360 business review process to expand upon its category management, consumer, B2B and shopper marketing programs. Te deli team focused eforts on continuous improvement of its business review process, including industry trends, retailer performance benchmarking, causal analysis, opportunity identifcation and growth strategy. Its newest tool is the Tyson Deli GAP Study, which is de-

Category Captain Deli — Meat

Dietz & Watson

Dietz & Watson succeeded in category management by taking a specialized approach in each market, to cater to the needs of specifc consumers. Trough a variety of analytical tools, the company tailored protein assortments, deli meat display size and promotional strategies. Beginning in October 2013, Dietz & Watson formed an extensive partnership with a major regional retailer, with an emphasis on store-level assortment and staf development. To ensure optimal favor, Dietz & Watson used fact-based consumer sales indexing (provided by Nielsen Spectra) to understand the demographics and lifestyles of shoppers at individual stores. Te company also used point-of-sale store data to identify assortment opportunities and analyze growth and decline trends. Using consumer and sales performance data as an analytical framework, Dietz & Watson created unique store tiers to determine the amount of investment required to maximize deli sales at the store level. Te company additionally invested in and led of-site training. Implementing the tiered program at the retailer resulted in 9.9 percent growth in the deli bulk meat category from January to July 2014.

signed to help retailers better understand how they stack up against competitors. It provides evaluative tools to compare operations and results within a retailer’s own organization and establishes for the industry the marketing and operational elements most closely tied to industry-leading sales performance. Te study focused on 500 best-in-class stores across the country, divided into four demand/sales performance levels. Further, the study collected thousands of pictures and data points to document in-stock compliance, in-store POS, pricing, stafng and department adjacencies. Tis allowed the deli team to identify common elements of high-performing stores; provide retailers with quantitative data on their banners’ performance, and recommendations for improvement; and suggest areas of opportunity.

Category Advisor

Refrigerated Meat Snacks

Kraft Foods Group

By addressing consumers’ need for portable products, their desire for healthier foods, and the widely noted increase in snacking, Kraft’s Oscar Mayer P3 Portable Protein Pack capitalized on major CPG trends and current retail environments. Consumers have long eaten packaged meats as snacks, including meal combos, but there were few true snacks in the meat case until P3, which combines

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three forms of protein in one easy-to-consume package. Te emerging protein snack category, spearheaded by Kraft, represents a $19 billion storewide opportunity over the next few years, according to Nielsen. Oscar Mayer has additional snack product launches planned for 2015, while a cross-business unit partnership with Planters nuts will further shape the category. In collaboration with retailers, Oscar Mayer is working to identify and carve out dedicated space for refrigerated meat snacks within the case, creating a new destination dedicated to the items, not just an adjacency to meal combos.

Driving ambition.

without preservatives, we launched an exciting recipe contest, created the Fisher Fresh Thinkers blogger network, and continued our successful partnership with Food Network. We look forward to another year of growing together with our customers and continuing to drive category growth.

To learn more about Fisher, call 847-214-4318

2014

Perimeter Category Advisor

Refrigerated Pasta & Sauces

Rana Meal Solutions

Rana made strides to awaken a sleepy category, and while we’d like to see deeper involvement in category manage-

ment initiatives with grocers, we’re impressed by the potential this company presented for its retailer partners. Rana tied its ability to drive the category to six key platforms: unique artisan brand positioning, a new level of product quality, standup paper packaging, a larger pack size, unique favor assortment and segmentation, and in-store demos. With national distribution in more than 10,000 stores and growing, Rana claimed that pasta category growth among its customers was double that of others. As a brand, Rana showed impressive growth, received multiple accolades for its products and brought innovation to a stagnant category. We look forward to continued success from Rana and seeing how it takes its retailer partnerships to the next level.

Category Advisor Refrigerated Dip

Del Monte Fresh Produce

Del Monte Fresh helped a Southeastern retailer create excitement in the perimeter with a special program based on Del Monte Fresh’s new Guac product. Working with the sales team at Del Monte and decision-makers at the retail chain, the Del Monte category manager frst defned the refrigerated dip category to indicate sales potential for guacamole. Based on IRI syndicated data, guacamole dollar sales grew year over year both nationally and regionally in the Southeast, so the bar was set high for Del Monte Fresh Guac. Te category manager also executed monthly analysis from division- to SKU-level sales, and created category reviews for the retailer. Year to date ending July 2014, Del Monte dollar sales increased 37.6 percent — a lift eight percentage points greater than its main competition at the retailer.

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| Progressive Grocer | Ahead of What’s Next | November 2014

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2014

Perimeter Category Advisor

Refrigerated Salad Dressing

Litehouse Foods

Category Advisor Refrigerated Dip

Wholly Guacamole

Wholly Guacamole dips drive the refrigerated guacamole dip category, and the brand consistently outpaces category growth. The company launched a range of pack sizes for family, party and on-the-go use, with 2-ounce mini cups becoming the biggest growth driver by addressing convenience and portability trends. Marketing efforts included targeted web ads, traditional print, television media and direct consumer interaction through social media. Seasonal and holiday trade deals within retail, as well as crosspromotional POS and online promotions with other brands, furthered the brand’s reach. Cross-promotions with nonproduce items helped get the brand in front of the consumer in other areas of the store. Its success helped drive growth in the overall avocado category, while consumer education on the health benefits of avocados created a new generation of users.

Greek yogurt reshaped the yogurt category in fewer than four years, now making up nearly half of the products in the category. Litehouse Foods saw that consumers were looking to Greek yogurt to provide their families with higherprotein options, and identifed an opportunity to create a salad dressing with a Greek yogurt base; Opa by Litehouse Greek yogurt salad dressing was the frst such product on the market. Greek yogurt salad dressing has since grown to 2 percent of the refrigerated salad dressing (RSD) category, and is responsible for 52 percent of its dollar growth, with Opa accounting for 96 percent of that in the Greek yogurt RSD segment. Litehouse also supported the trade through demos, couponing and a strong consumer pull program. Te company’s team of market analysts worked with its retail partners to provide the best product and schematic recommendations for their particular regions and target consumers.

Category Captain Superpremium Juice

Bolthouse Farms

Over the past 12 months, Bolthouse Farms developed an innovative “category blueprint” shelf space optimization for the super-premium juice (SPJ) category. SPJ experienced explosive growth, and shelf space management become a critical issue. For many retailers, the produce department where SPJ primarily resides hasn’t engaged in rigorous category management or shelf space optimization beyond the basic SKU rationalization and “one in-one out” tactics. While shelf optimization

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can be difcult to implement, according to Bolthouse Farms, it yields higher category growth opportunities. With one of its frst blueprint recommendations, despite shelf space reductions for Bolthouse Farms, a key Southeast retailer realized overall growth for the SPJ category and Bolthouse Farms. Looking forward, Bolthouse Farms recognizes that if category sales grow 15 percent year over year, the category will double in only four years. Terefore, the company is now working with a key national grocer and mass merchandiser to test two aspects of its category blueprint eforts: shelf space optimization and shelf space expansion.

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2014

PERIMETER — VARIABLE/FIXED-WEIGHT PRODUCE PERIMETER — VARIABLE/FIXED-WEIGHT PRODUCE

Category Advisor Avocados

Del Monte Fresh Produce

Del Monte Fresh Produce has been the exclusive supplier of Hass avocados to a Southeastern retailer over the past few years. Based on IRI syndicated data for year to date ending July 2014, dollar sales increased 15.8 percent versus the year-ago period. Del Monte Fresh attributed the positive results to a variety of initiatives, including a strategic ad calendar. Te avocados were also featured in the retailer’s cooking program, which increased product and brand awareness. Meanwhile, Del Monte Fresh’s marketing eforts were supported by merchandising support at the retail level. Last but not least, a Del Monte Fresh merchandiser conducted store audits to assess product quality and check displays, and has continued to educate retail personnel on best practices.

Category Captain Berries

Dole Fresh Vegetables

As berries continued to play an important role in driving consumer trafc, Dole’s category management team focused on logistics, introduction of 4P category management and technology innovations to support its programs. Unfortunately, berries are susceptible to quality breakdown due to poor cold-chain management, as well as in-store handling. Te addition of berries to Dole’s Full Service Solutions program enabled the vendor’s logistics department to provide almost half of the typical produce

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Category Captain Bananas

Chiquita Brands

According to Chiquita Brands, the best strategy for enhancing banana category management isn’t through a category-specifc approach, but through the eyes of the shopper. In the past year, Chiquita commissioned the Total Shopper Study, which focused on understanding who is and isn’t buying bananas, to develop the right strategy for its retail partners. In one example, Chiquita identifed an opportunity at a regional grocery chain where banana sales were declining under the current banana supplier. Based on Chiquita’s understanding of the consumer, the company hypothesized that the retailer was selling the wrong banana size. Chiquita’s research found that banana consumers prefer a banana fnger measuring 8 inches to 9.5 inches. Trusting Chiquita’s expertise, the retailer asked the company to handle distribution across the entire chain. Since the switch, banana category volume declines have reversed, and the category has experienced 13.7 percent volume growth.

department sales with one common logistics solution. Introduction of 4P management was the top priority of Dole’s category management department. With signifcant changes in data availability — including panel, demographic and scan — Dole provided customized solutions per retailer cluster. Dole also increased its investment in data and technology, using the California Strawberry Commission’s price elasticity tool to maximize everyday retails, along with developing a promotion strategy tied to demand versus supply. After one retailer applied Dole’s recommendations on product, merchandising and ad support, its bushberries mix increased 5.5 points, resulting in a total category increase of 15 percent in dollars and 14.5 percent in units.

| Progressive Grocer | Ahead of What’s Next | November 2014

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2014

Legal Notce

If you purchased Shell Eggs or Egg Products produced in the United States directly from any producer from January 1, 2000 through July 30, 2014, you could be a Class Member in a proposed class acton setlement. This legal notice is to inform you of proposed Settlements between Plaintiffs and Defendants Midwest Poultry Services, LP (“Midwest”), National Food Corporation (“NFC”), and United Egg Producers/United States Egg Marketers (“UEP/USEM”), reached in the class action lawsuit, In re Processed Egg Products Antitrust Litigation, Case No. 08-md-02002, pending in the United States District Court for the Eastern District of Pennsylvania, and also to inform you of a second amendment to the Sparboe Settlement. Who is included in the Setlements & Second Sparboe Amendment? The Settlement “Classes” include all persons and entities in the United States that purchased Shell Eggs and Egg Products, in the United States directly from any producer from January 1, 2000 through July 30, 2014. Due to the recent Settlements, the prior Sparboe Settlement is amended to add to the Sparboe Settlement Class direct purchases of Shell Eggs and Egg Products from March 1, 2014 through July 30, 2014, expanding the Class Period to make it comparable to the more recent Settlement Classes. What is this case about? Plaintiffs claim that Defendants conspired to limit the supply of Shell Eggs and Egg Products, which raised the price of Shell Eggs and Egg Products and, therefore, violated the Sherman Antitrust Act, a federal statute that prohibits agreements that unreasonably restrain competition. The settling Defendants deny all of Plaintiffs’ allegations. What do the Setlements provide? Under the settlements, Plaintiffs will release all claims against Midwest, NFC and UEP/USEM. In exchange, Midwest will pay $2.5 million; NFC will pay $1 million; and UEP/USEM will pay $500,000, into a settlement fund for the beneft of the Classes. Plaintiffs also will receive documents and information that Plaintiffs’ attorneys believe will aid in their analysis and prosecution of this Action. What does the Sparboe Setlement provide? There is no monetary relief under the Sparboe Settlement. Sparboe agreed to provide substantial and immediate cooperation to Plaintiffs, which the Court already found conferred substantial benefts upon the Class. The second amendment merely conforms the Sparboe Class to the recent Settlement Classes. What do I do now? If you are a Class Member your legal rights are affected, and you now have a choice to make. Participate in the Settlements: No action is required to remain part of the recent Settlements or the amended Sparboe Settlement. If the Court grants fnal approval to the Settlements and the Second Sparboe Amendment, they will be binding upon you and all other Class Members. By remaining part of the Settlements, you will give up any potential claims that you may have against Midwest, NFC, UEP/USEM and Sparboe relating to the claims alleged in this lawsuit. You may be eligible to receive a settlement payment at a future date.

PERIMETER — VARIABLE/ FIXED-WEIGHT PRODUCE

Category Captain Fresh-cut Fruit

Del Monte Fresh Produce

In fscal year 2013, Del Monte Fresh made a signifcant diference for a Midwestern grocer’s fresh-cut fruit category. Te retailer’s sales had been fat compared with the previous year — and, to compound matters, the cut fruit segment’s sales were underperforming compared with the market. Del Monte Fresh suggested a new program, based primarily on its products, to replace the retailer’s in-house program. To help facilitate the changeover, Del Monte Fresh’s category manager used several tools. Spectra categorized each store, based on demographic attributes, into cluster groups to determine what size each store’s fresh-cut fruit section should be. In addition, the data provider identifed the stores with the greatest sales potential, determined by store size and shopper demographics, to optimize promotions and in-store displays. Meanwhile, Del Monte Fresh developed new planograms. Te vendor is regularly evaluating the program, including the retailer’s POS and pitch data, which helps to identify slow-selling items, under- and overperforming stores, and, with respect to shrink, items experiencing heavy losses. Not surprisingly, the retailer has experienced solid category growth, with year-to-date sales through nine periods up 6 percent.

Ask to be excluded: If you wish to exclude yourself from the Sparboe Settlement as amended (if you had no purchases before March 1, 2014) and/or the recent Settlements and wish to retain your rights to pursue your own lawsuit relating to the claims alleged in this lawsuit, you must formally exclude yourself from the Classes by sending a signed letter to the Claims Administrator postmarked on or before March 6, 2015.

Category Captain

Object: You may notify the Court that you object to the recent Settlements and/or Second Sparboe Amendment by mailing a statement of your objection(s) to the Court, Plaintiffs’ Counsel, and Defense Counsel postmarked by March 6, 2015. Detailed instructions on how to participate, opt out or object are on the settlement website.

Based on its landmark 2014 “Lettuce Interaction Study,” Dole Fresh Vegetables made signifcant changes in its fresh-packed business to address how consumers shop the category. Specifcally, Dole relied on three key solutions: 1) redefning category roles, defnitions, synergies and strategies on fresh-packed vegetables; 2) technology and data-driven solutions with new capabilities to use insights across retail; and 3) transportation and logistics solutions. Te company helped retailers develop their strategies to better manage commodity vegetables alongside valueadded oferings with integrated pricing, promotion and new product initiatives. Retailers employing Dole’s pricing initiatives demonstrated above-average returns (4.5 percent increase in shipments and 5.2 percent increase in retail sales dollars).

Who represents you? The Court appointed Steven A. Asher of Weinstein Kitchenoff & Asher LLC; Michael D. Hausfeld of Hausfeld LLP; Stanley D. Bernstein of Bernstein Liebhard LLP; and Stephen D. Susman of Susman Godfrey LLP as Interim Co- Lead Class Counsel. You do not have to pay them or anyone else to participate. You may hire your own lawyer at your own expense. When will the Court decide whether to approve the Setlements and/or the Second Sparboe Amendment? At 9:30 a.m. on May 6, 2015, at the United States District Court, James A. Byrne Federal Courthouse, 601 Market Street, Philadelphia, PA 19106, the Court will hold a hearing to determine the fairness and adequacy of the recent Settlements and the Second Sparboe Amendment, and consider any motion for an award of attorneys’ fees and incentive awards and reimbursement of litigation costs. You may appear at the hearing, but are not required to do so. Please note that the Court may change the date and/or time of the Fairness Hearing. Settlement Class members are advised to check www.eggproductssettlement.com for any updates. How can I learn more? This notice is only a summary. www.eggproductssettlement.com.

For

information,

www.eggproductssetlement.com

visit

Fresh-packed Vegetables

Dole Fresh Vegetables

2014

PERIMETER — VARIABLE/FIXED-WEIGHT PRODUCE Category Captain Mushrooms

Monterey Mushrooms

Category Advisor Lettuce

Green Giant Fresh

By partnering with companies that share the same commitment to growing and packaging fresh produce every day, Green Giant Fresh (GGF) delivered industry knowledge and category expertise, benefting both the trade and consumers. Tis year, GGF revitalized the lettuce category by introducing Little Gem Lettuce and Living Butter Lettuce to its line, which includes Iceberg, Green Leaf, Red Leaf, Romaine and Romaine Hearts. Te Romaine Hearts package was recently updated for better on-shelf presence, with new graphics featuring serving suggestions, a QR code linking to helpful tips, and a larger window for more product visibility. Little Gem Lettuce, an exclusive European variety, ofers a unique addition to produce departments as a frst-ofits-kind snacking lettuce. At one retailer, following an in-store demo in July 2014, sales of Little Gems jumped more than 250 percent and elicited positive shopper feedback. Meanwhile, Living Butter Lettuce, packaged with its root ball attached, delivers longer shelf life and high quality, leading to less retail shrink, stable pricing and labor savings. Furthering transparency, consumers can scan on-pack QR codes to learn about where their food was grown, health benefts and preparation tips.

Category Captain Packaged Salads

Dole Fresh Vegetables

Dole Fresh Vegetables has led the packaged salad category in achieving 9 percent growth, along with 22.7 percent brand growth, by relying on a mix of product innovation and retailer customization. In 2014, category growth was driven by the kit segment (26.4 percent); Dole considers itself the market leader. Meanwhile, Dole’s new Power Up

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Asked by several of its retail partners to tie the proftgenerating mushroom category into a department- or store-wide strategy, Monterey tailored solutions to meet the specifc needs of each retailer. In one case, the retail partner wanted to determine how much it could increase purchases and overall pounds sold to its current mushroom customers. Monterey provided a promotional strategy that rotated key items through the course of 13 weeks, as a result of which units increased 16.7 percent (while the retailer’s market grew only 0.5 percent) and pounds increased 14.9 percent (while the market grew only 2 percent), with sales still coming in close to the retailer’s region’s average: 1.5 percent versus 1.4 percent for the region. A secondary goal was then set to determine best promotion retails; Monterey validated that staying between 8 percent to 16 percent of everyday retails maximized the retailer’s sales, profts, pounds and unit growth.

Greens capitalized on the explosion of kale-based products, including salads. Te vendor’s “One Dole” approach of integrating “total produce” across product platforms resulted in customized solutions for key retailers. Dole re-evaluated its custom 4P approach, recognizing that no two retailers are the same in terms of assortment, promotions or pricing strategy. Te company’s customized store cluster initiatives integrated Spectra, retailers’ shopper card data, Simmons data and two proprietary Dole databases. Last but not least, Dole broke new ground with advancements in employing shopper data to drive sustainable category growth.

| Progressive Grocer | Ahead of What’s Next | November 2014

2014

PERIMETER — VARIABLE/FIXED-WEIGHT PRODUCE Category Advisor Pears

CMI

Category Captain Packaged Salads

Chiquita Brands

With sales of $4.3 billion, value-added salads are considered the most important produce category in terms of true proft and overall dollar sales. Recognizing the importance of this segment, Fresh Express developed a multifaceted category management program to maximize its potential. Fresh Express worked with Willard Bishop as part of the consultancy’s “2013 Super Store Study” to help determine which produce categories warranted a decrease in space due to low proftability. It turned out that while only 36 percent of produce SKUs generated a true proft, 83 percent of those SKUs in value-added salads contributed positive profts. Fresh Express advised its retailer partners to allocate up to an incremental 4 feet to their sets, and the results were impressive: Out-ofstocks were reduced by 3 percent to 5 percent, while sales jumped between 10 percent and 15 percent at several regional grocery chains. Meanwhile, Fresh Express’ consumer research helped identify six distinct groups, and uncovered motivations and insights for each segment’s purchase behavior. Te company leveraged this research to launch several SKUs focusing on consumers’ desire to add more greens to their diets.

Category Advisor Pineapples

Del Monte Fresh Produce

A regional retailer that sells Del Monte pineapples was looking to increase sales poundage after a declining quarter. Del Monte Fresh’s category management team stepped in to help by looking at FreshLook Marketing syndicated data, an analysis of market and regional POS sales trends, and MarketTrack pineapple promotional ad trends. Te company then reviewed Spectra demographic data in conjunction with the retailer’s POS data, and generated an analysis of each store’s potential

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CMI generated new interest in the pear category this year with its Sweet Gourmet Pears program. Te initiative was designed to bring ordinary pears into the spotlight as a gourmet food item, and to help consumers learn tips to pick the perfect pear. It included a suite of graphic components; complementary grab-and-go, pouch bags in Red, D’Anjou, Bosc and Bartlett varieties; a stackable standard box for shipping bulk fruit; and colorful supporting point-of-sale materials. In addition to these visual elements, a large component of CMI’s program focused on educating consumers on pear ripening. CMI used category management data to track the success of the program, discovering that its eforts drew in consumers who didn’t generally purchase pears. Retailers reported that pear sales increased signifcantly throughout the promotion period. Te Bartlett pouch bag drove $771,000 in retail, while the Bosc pouch bag helped that subcategory increase by $291,000 versus the same period last year.

retail sales in pounds versus actual retail sales in pounds to fnd disparities in store performance. Tis process was essential in identifying stores that needed to focus on handling and merchandising best practices. Working with a Del Monte sales merchandiser, the targeted stores were audited, and recommendations were made to reduce shrink and maximize sales potential. Acting on the information, the retailer implemented an everyday low-price strategy and increased ad activity more than 30 percent from the prior year. As a result, year to date ending July 2014, revenue increased beyond 30 percent, while volume exceeded 35 percent.

| Progressive Grocer | Ahead of What’s Next | November 2014

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2014

PERIMETER — VARIABLE/FIXED-WEIGHT PRODUCE Category Captain

Category Advisor

United States Potato Board

Idaho Potato Commission

Potatoes

Te United States Potato Board’s (USPB) Category Optimization Partnership program brought together the board, a retailer and that retailer’s designated potato supplier in a nine-month program designed to identify key opportunities within the category that are unique to the retailer. Te partnership with a Midwestern retailer-distributor and the Michigan Potato Council reversed negative performance trends with customized strategies that focused on assortment, merchandising and customer engagement, and boosted availability of local native varieties. USPB further determined that in-store demonstrations were a successful strategy for stimulating shoppers to try new potato types and recipes, and teamed with the retailer on 10 in-store demonstrations using Michigan white potatoes, leading to a direct positive impact on sales, and demonstrating the importance of potatoes to the produce department and the store.

Potatoes

In addition to ofering merchandising recommendations, the Idaho Potato Commission (IPC) gave retailers that wanted to boost their potato category sales an in-depth analysis. Tis involved at least fve stores at a grocery chain, with preferably fve distinct potato sets. Using proven statistics and pictures from the stores, IPC analyzed the layouts of the potato sets, keeping best practices in mind, and prepared a report, which also included a product mix or display analysis of the potato sets of all competitors within a 5-mile radius of each store. Te commission employed sales numbers, when available, to determine the best possible layout; it was imperative that sales match facings to prevent shrinkage. Retailers then received a PowerPoint presentation with a comprehensive category review and IPC’s recommendations on how to lift sales for the entire category. In most cases, at least some of the recommendations were put into practice, with positive results.

Category Advisor Specialty Produce

Frieda’s Inc.

Frieda’s Eat One Fruit a Day Tat Scares You campaign, launched in 2014, encouraged consumers to try something new in the produce department. At the retail level, the specialty produce company worked with clients to select key “scary” fruits to promote in-store through signage and creative merchandising. Frieda’s also created the #FearNoFruit hashtag for social media activity around the campaign. Te company additionally garnered signifcant media

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attention for the 2014 iteration of its National Love Your Produce Manager Day awareness campaign, which seeks to recognize the critical impact that produce managers have on raising U.S. produce consumption. In the area of unique new produce items, Frieda’s exclusively ofered California red and purple artichoke varieties, enabling retail clients to add vigor to their commodity artichoke displays and excite shoppers. Te Californiagrown Stokes Purple Sweet Potato was another successful exclusive seasonal specialty. Further, the company’s retail Hatch Chile program continued to grow.

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2014

PERIMETER — VARIABLE/FIXED-WEIGHT PRODUCE PERIMETER — OTHER Category Advisor Automated Retail

Outerwall

Category Captain

Value-added Vegetables

Mann Packing Co.

Te No. 1 core vegetable producer, with a 30 percent dollar share, according to Nielsen, Mann Packing provided quality, innovation and volume growth for retail partners across the country. A northern California retailer teamed with Mann’s exclusively to focus on growing its core vegetable segment. By maintaining the core selection, focusing promotions on key consumption periods and collaborating to drive the retailer’s promotional strategy, the company delivered growth of 17.1 percent in dollars and 11.6 percent in units. Mann’s also provided several new items that drove growth: Broccolini (a proprietary trademarked natural hybrid), sweet potatoes (crinkle-cut and cubes), and Brussels sprouts. Similar successes were reported with both the Mann’s brand and its private label products at retailers in other states. Innovations launched by the company in 2014 included a flm-seal lid tray concept that reduced packaging by roughly 40 percent, saving 1.4 million pounds of plastic from landflls each decade.

Category Captain Front End Services

Blackhawk Network

Te prepaid category has expanded rapidly as consumers continue to demand more choices for gift cards, telecom products and alternative payment options like prepaid debit. Tis demand has drastically changed the front end, with prepaid being front and center. Blackhawk Network stepped in to help its retailers best manage the category and ultimately foster consumer loyalty to their stores. In 2014, the company developed a data-driven retail optimization program

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Outerwall, the company behind the Redbox movie and video game rental kiosks, drove growth in an otherwise underused retail space. In addition to acquiring ecoATM, an automated kiosk that buys back most used mobile electronics directly from consumers, and expanding Coinstar Exchange (formerly Alula), which enables a consumer to quickly exchange an unused gift card for a cash voucher, leading to incremental purchase in-store, Outerwall invested in its core businesses, giving Redbox a major brand refresh through redesigned kiosks and light-box artwork. On average, Coinstar customers who receive cash vouchers and use them at the store at the time of the transaction increase their purchase amount by 10 percent, while 55 percent of Redbox customers also shop at retail partners’ stores when they rent. Additionally, Outerwall shared with retail partners its research on the automated retail category to defne segments, identify infuential trends and further understand the consumer.

that estimates efective peg usage by product, based on real sales and consumer demand. Called “automated planogram optimization,” this technology let retailers maximize their sales while providing convenience for customers. Blackhawk found that in-store and out-of-store factors contributed to consumers’ purchase behavior, which included factors such as geography and display layout. On the back end, additional placement factors included brand blocking, where groups of products were kept together, and grouping subsegments. Up until recently, much of the design that accounted for these complex factors was produced manually. Blackhawk’s solution made store-level planograms a scalable reality.

| Progressive Grocer | Ahead of What’s Next | November 2014

First in their hearts. First on the list. Congratulations to our team members and partners for helping Unilever become a Category Captain in 4 categories and a Category Advisor in 2 more. Itâ&#x20AC;&#x2122;s our combined dedication to insights, innovation and solutions that make our family of brands a winner with consumers and retailers alike.

ÂŠ2014 Unilever GEN14088

2014

Category ManageMent

ones to Watch

Given time, these concepts ought to bear significant fruit for retailers.

By Jim Dudlicek

ith each year’s crop of Category Captains entries, we typically receive a few that don’t quite ft a specifc category, are about early-stage programs that haven’t yet shown signifcant payof, lacked certain specifcs or otherwise didn’t quite meet our award criteria — yet they do show promise, and we feel they deserve some attention. Here are a couple of those entries, and we’ll be watching for further development as they gain a foothold in the coming year:

ConAgra’s Frozen Accelerator

ConAgra Foods and Kantar Retail have collaborated on a web-based tool to help retailers optimize their frozen food portfolios while predicting the dollar sales impact as a result of those changes. Its cross-category focus made it hard to classify within PG’s category designations, and we would have liked to see testimony from specifc retailers. Te Frozen Accelerator analyzes merchandising, assortment and shelving performance, and then suggests an efective plan for both frozen food brands and retailers. In developing the tool, ConAgra and Kantar analyzed three years of data in the frozen food department to determine the traits of top-performing retailers. Tese principles were further broken down across single-serve meals, multiserve meals and frozen desserts. Te research aided companies in identifying bestin-class principles, among them the timing and frequency of merchandising, the proper product assortment, and how products should be displayed on shelves. With these principles incorporated into the Frozen Accelerator, the tool can review account performances, help develop a plan, and determine how it supported

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customers’ needs and built sales overall in the category. As ConAgra explains, the Frozen Accelerator is all about “getting back to basics” and focusing on perfect execution of MAPS principles. From the underperformance of single-serve and multiserve meals, and frozen baked desserts (which collectively account for 16 percent of frozen sales), Kantar identifed eight to 11 merchandising, assortment and shelving principles per category. According to ConAgra, retailers following these principles see signifcantly better velocity, growth and buyer conversion. “As retailers continue to be exposed to both the principles and the web-based tool, we want to see the poorer-performing retailers see sales trends more aligned with best-in-class results,” ConAgra notes. “As we move forward, we look forward to seeing more and more wins as the merchandising, assortment and shelving principles are put into place, ensuring growth in these important categories.”

ZoomSystems’ RazorZone

Tis pilot system is a novel approach in a category prone to shrink, and we’re interested in seeing more long-term results, and comparisons with retailers not using the system. ZoomSystems’ RazorZone is an automated solution created to help stores minimize consumer and internal shrink while increasing razor sales and improving the customer experience. Te machines provide an efcient use of space, the ability to educate and market to consumers, and improved out-of-stock rates and labor efciency. Retailers have struggled to fnd an efective solution for reducing razor shrink without jeopardizing sales. RazorZone aims to beat this paradigm by providing increased sales and decreased shrink while ofering marketing opportunities for brands and more efcient product management for retailers. RazorZone says its unique technology

| Progressive Grocer | Ahead of What’s Next | November 2014

2014

CATEGORY MANAGEMENT

essentially eliminates shrink, because the product can’t leave the store unless it’s been paid for. As such, RazorZone has introduced a checkpoint into the supply chain

that has never before existed. RazorZone gives the customer immediate service without the need to wait for a store associate to unlock product. With its inventory-tracking function, there are fewer out-of-stocks, allowing for more sales. Te solution ofers a wide range of opportunities to infuence the customer purchasing decision, including trade-in, trade-up and trade-across; product information and comparisons; product promotions; the ability to accept and dispense coupons; and the ability to show the value of product upgrades. Additionally, RazorZone provides brands with added marketing value, ofering in-aisle digital signage at the point of purchase, including a fullmotion video on an attract loop. According to ZoomSystems, RazorZone’s pilot locations saved hundreds of dollars a month by eliminating shrink, the average sales price in the category increased by double digits, and sales more than doubled. PG

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Grocery

Lunchbox Heroes

Get ’Em While They’re Young Hoping to influence future eating patterns, retailers and manufacturers strive to get better-for-you items into kids’ midday meals. By Bridget Goldschmidt

When I first began tinkering with recipes, I thought, ‘What would I want to serve to my kids?’” —Ginny Simon, Ginnybakes

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t’s not exactly health food, but there’s something diferent about the fveSKU cookie line that recently debuted exclusively at Austin, Texas-based Whole Foods Market in time for the back-toschool season. Te Certifed USDA Organic, Verifed NonGMO cookies, available in such indulgent varieties as Vanilla Cupcake and Chocolate Layer Cake, will be available at “many other retailers” in 2015, asserts Liane Weintraub, co-founder and CEO of Hicksville, N.Y.-based Tasty Brand. “Our new Sandwich Crème Cookies are both classic and modern at the same time,” Weintraub explained at the July launch. “Te nostalgic favors take you back to a cherished time. Te organic attributes and absence of artifcial ingredients are what today’s consumers want for their families.” Weintraub and company co-founder Shannan Swanson spent more than a year developing the line’s “classic American bake-shop favors,” all but one of which are vegan, in

close collaboration with Dwight Richmond, Whole Foods’ global grocery purchasing coordinator. For his part, Richmond admitted, “Sandwich crème cookies are an American classic, but they haven’t always been the cleanest in terms of ingredients.” Tasty Brand, however, had come up with a product “that our shoppers can enjoy and feel good about sharing with the whole family,” he said. To promote the cookies, Tasty Brand teamed with the La Farge, Wis.-based Organic Valley cooperative of dairy farmers to hold “milk-and-cookies” demos throughout August at the chain’s stores nationwide. A subsequent campaign, running Oct. 15-28, featured the cookies at two packages for $6, and a major promotion, also at Whole Foods, is planned for the entire month of January, according to Weintraub. “Generally, we promote heavily during key ‘lunchbox’ times of year — back-to-school (August/ September), Non-GMO Awareness Month and Halloween (October), winter back-to-school (January), and Gluten-free Awareness Month (May),” she

| Progressive Grocer | Ahead of What’s Next | November 2014

Grocery

Lunchbox Heroes

Ginnybakes, one of the companies contacted for this article, has placed its better-for-you cookies, bars and bake mixes in Costco, Target, Publix and Stop & Shop, among other grocers.

notes of her company, which also makes similarly “clean” fruit snacks and lower-sugar, bite-size star-shaped vanilla and chocolate chip cookies in portion-controlled 100-calorie packs. Along with Whole Foods, Mrs. Green’s Natural Markets, a banner of Irvington, N.Y.-based Natural Markets Food Group, has been championing better-for-you lunchbox solutions through such venues as its in-store dietitians’ blog posts and events like the Back to School Family Health Fair, which featured vendors sampling their nutritious products, in addition to “giveaways, food & fun,” at the chain’s West Windsor, N.J., store. Natural/organic food stores are certainly in the vanguard of ofering more healthful options for kids to bring to school, with the ultimate aim of creating a new generation of more nutritionally aware eaters — research such as the long-term “Nestlé Feeding Infants and Toddlers Study,” published in 2011, suggests that children’s eating habits develop early in life and are heavily infuenced by family members — but the trend has spread to more mainstream operators, as evidenced by the fact that Miami-based

Turn on to Juice Since most children’ school lunches contain a beverage, what can health-conscious parents pack that their thirsty young scholars will actually enjoy drinking? Katie Bennett, brand marketing manager at Atlanta-based Good2Grow, has an idea: her company’s product lineup. “It’s an all-natural, great-tasting way to add fruits and veggies to kids’ lunchboxes,” explains Bennett. “The popular character tops make mealtime fun, too. And the spill-proof tops keep the product where it should be — inside the bottle — until kids are ready to drink.” Good2Grow introduced two new fruit-andveggie blends last April, with each 6-ounce bottle containing one combined serving. Next up: In 2015, the company will roll out Grape and Fruit Punch Juicy Waters flavors. “These 8-ounce beverages will be organic, 25 percent juice and only 30 calories,” says Bennett.

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Starting From Scratch Among manufacturers of kid-oriented items, a primary consideration is the ingredients, which not only need to be healthful, but also yummy, to satisfy both young consumers and their concerned parents. For some, that means taking things personally. “My family is my inspiration in all aspects of my business,” observes Ginny Simon, founder and CEO of Ginnybakes, whose recently introduced product line of bite-sized Ginnyminis comes in lunchbox-friendly snack packs. “When I frst began tinkering with Ginnybakes recipes, I thought, ‘What would I want to serve to my kids?’ I searched for high-quality, organic ingredients in order to develop delicious, gourmet treats and snacks. As all Ginnybakes products are gluten-free, made with only premium, whole-food ingredients and no artifcial preservatives, they’re a mindful indulgence the whole family can enjoy.” Simon adds that the company is working on additional favors for Ginnyminis, which are currently available in chocolate chip oatmeal bliss, butter crisp love and chocolate chip love varieties. “Finding treats that are not only delicious and nutritious, but [also] what kids will eat, is a balance that we’ve struck with our cookies and bars,” asserts Jerri Graham, founder of Westport, Conn.-

To get the healthier word out, the company teams with its retail partners for “’bundle’ promotions to educate consumers on our new economical 6-pack refills,” she says. “The higher ring and retailer profitability help to ensure that even our promotions are adding value to the category, versus simply reducing price and value.” In tandem with many of these promotions, “we have run pallet and quarter-pallet programs,” adds Bennett. “This both drives trial and reiterates the refill pack model. Consumers choose their favorite character SippaTop Cap, save the cap and re-juice on our refill packs.” What’s more, that kind of success at retail is just the beginning, she believes. “We expect to see manufacturers, both large and small, continue to shift their innovation focus to the betterfor-you space,” notes Bennett. “Millennial moms know what they want for their kids: products that are fresher, healthier, more real, and free of things like BPA and GMO ingredients.”

| Progressive Grocer | Ahead of What’s Next | November 2014

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Grocery

Lunchbox Heroes

Finding treats that are not only delicious and nutritious, but [also] what kids will eat, is a balance that we’ve struck with our cookies and bars.” —Jerri Graham, Nothin’ But Foods

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based Nothin’ But Foods, whose oferings include premium snack bars and a 1.4-ounce 2-pack of granola cookies in Cherry Cranberry Almond and Chocolate Coconut Almond favors, both made from “a few real ingredients, tastefully combined.” Te company’s non-GMO products are also free of gluten, eggs, wheat and butter. A similar focus on health can be seen among highvisibility brands as well. Los Angeles-based Snack it Forward LLC is rolling out nationally the Sunkist Fruit 2.0 line of 100 percent freeze-dried fruit, which is fat- and -gluten free, with no added sugar or colors. Te line’s vibrant packaging holds Fuji Apple, Banana, Strawberry or Red Seedless Grape slices. According to Snack It Forward’s Nick Desai. “Sunkist Fruit 2.0 is a focused product line with the goal in mind of ofering a high-velocity, low-SKU intensive program to enhance retailer produce oferings in a time when consumers are seeking convenient and new better-for-you snack options.” Likewise, Kellogg Co.’s current crop of portable snacks includes Nutri-Grain Fruit and Oat Harvest Bars, a soft-baked blend of whole grains and oats with a sweet flling, available in Country Strawberry and Blueberry Bliss varieties. Te bars contain 5 grams of fber and 4 grams of protein.

Crowd Control Once a company has developed a familyfocused better-for-you item, it must decide on appropriate placement. Melissa’s Clean Snax, which the Los Angeles-based specialty produce company’s director of public relations, Robert Schueller, describes as “healthy, ‘granola-like’ bite-sized snack foods [made] with chia seeds and faxseeds, two known superfood items, [and] sweetened with honey,” are featured in produce departments, although the product line is shelf-stable for six months. Tis merchandising strategy serves to play up the section’s healthy halo for consumers. When Clean Snax debuted in August, Melissa’s “promoted [it] as a back-to-school/at-work healthy snack item this fall for kids and parents alike,” he says. “We have focused [our] eforts … in natural

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Grocery

People will stop accepting products loaded with preservatives as they become more aware of the longterm impact these sorts of products will have on the overall health of their children and themselves.” —Jerri Graham, Nothin’ But Foods

Lunchbox Heroes

food retailers, and retailers seeking gluten-free snacks.” Te promotional push included informational signage. For Nothin’ But, front and center (store) is where it’s at. “Placing our products near the checkout, and also alongside traditional wheat-, butter- and egg-based cookies, makes them stand out even more from the crowd,” says Graham, who also believes “that the best way to get people to love our products is to sample them out at every opportunity. When children sample our cookies at stores, they often make the initial buying decision when they taste it. Te fnal decision takes place when their parents read the ingredients and know that this is one treat they don’t have to worry about.”

Gimmick-free Zone Making sure kids get a healthy start in life by introducing them to nutritious foods early on is a trend that’s here to stay — and could also pay of in supe-

rior school performance: A 2009 University of Alberta study of 5,000 children found that those who ate an adequate amount of fruit, vegetables, protein and fber, with less calorie intake from fat, did better on literacy tests than those who ate foods high in salt and saturated fat. “As more parents and children begin to read the labels of the foods they eat, there will be a change in the products available,” predicts Graham. “People will stop accepting products loaded with preservatives as they become more aware of the long-term impact these sorts of products will have on the overall health of their children and themselves. [Items] that are free of preservatives, and are naturally delicious treats that don’t rely on gimmicks or fake ingredients, will be the future of shelf-stable, lunchbox-friendly products.” PG Find out more about the category by visiting Progressivegrocer.com/lunchboxheroes.

Private Brand Evolution in the New Life Stage Ecosystem The evoluton of today’s retail industry is consumer-driven. Major cultural shifs are happening in every region of the world as gaps between young and old, and wealthy and poor populatons contnue to grow. A global rise in single person households, more women in the workforce and urbanizaton in many countries are just a few of the trends driving demand for customized innovaton across product categories and retail channels.

Two forces combine to create life stages in any society: the generaton in which one was born, and one’s household structure at a speciﬁc point in tme. With the help of our research partners at The Hartman Group, the global consumer insights strategists at Daymon Worldwide recently released, “Retailing to Today's Life Stage Diversity” a detailed white paper that examines each life stage and what retailers should consider when planning to deliver business-building solutons.

Innovaton is at the heart of the mater, as a means to both differentate from compettors, and most importantly, meaningfully engage with core consumers. Private Brands are in an excellent positon to provide that innovaton through new products and services that speak directly to target consumers’ partcular lifestyles, values and needs. Understanding those specific needs, however, can be difficult given today’s more diverse household and demographic landscape.

There are four key life stages to examine, including, Young Singles, Young Families, The Empty Nest and Older Singles, each with its own set of characteristcs and lifestyle/product preferences. The impact of life stage on consumer preferences, needs and purchases are only just being discovered by retailers and manufacturers ﬁghtng to more meaningfully engage with core consumers at the neighborhood level. Global retailers and suppliers can use the power of life stage

The experts at Daymon Worldwide believe the key to understanding the needs of an evolving, complex consumer base is the phenomenon of life-stage. Life stage affects the fundamentals of how shoppers in specific markets and neighborhoods behave, and frankly what they really want, offering powerful opportunites for retailers ready to address them.

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Frozen Dough, Bread and Rolls

Frozen & Refrigerated

portion the cookie dough into individual servings and then hen it comes to selling longer-lasting, freeze it so the balls of dough don’t stick together. Tat adds a high-quality dough and baked goods at level of convenience and portion control for our customers.” retail, frozen is the way to go. Frozen items are especially important in the gluten-free “It is critical,” asserts Doon Wintz, segment. “It is a niche market, and most gluten-free customCEO of Chester Township, N.J.-based ers also seek a product as ‘clean’ as possible,” observes Wintz. Wholly Wholesome, which ofers a range “Tat means free from artifcial ingredients, shelf-life of all-natural and gluten-free products extenders and gums. As a result, freezing is not only the best such as pizza dough and pie shells. “If not way to extend the life of the product for the consumer, but frozen properly, the consumer’s experialso to minimize the risk of ence will be diminished, which shrink or spoilage.” means no repeat purchase.” “Freezing allows us to deliver a scratch-made biscuit What’s Inside to consumers with a longer One particular challenge for shelf life,” notes Polly Madsen, makers of frozen dough and marketing manager for frozen baked goods is conveying baked goods at Northfeld, the benefts of their prodIll.-based General Mills, whose ucts, since many shoppers products include the Pillsbury believe fresh products to be Grands! line of frozen biscuits. superior to frozen. “Freezing our cookie dough In an efort “to proas soon as it’s made allows us vide transparency to to use high-quality ingredithe consumer,” Wholly ents, like real eggs and butter, Wholesome is “launchwhile maintaining a long shelf ing a new sub-brand for life without having to use any our gluten-free ofering, Purveyors of dough and baked goods artifcial ingredients,” explains Wholly Gluten Free, to Jen Laska, president of Los better communicate to the see freezing as integral to their success. Angeles-based Gourmet Frozen consumer, and at the same By Bridget Goldschmidt Cookies Inc., which makes Jen time address the growing & Joe’s Cookie Dough. “We need to be transparent and

Totally

Chill

November 2014 | progressivegrocer.com |

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Frozen & Refrigerated

Freezing is not only the best way to extend the life of the product, but also to minimize the risk of shrink or spoilage.” —Doon Wintz, Wholly Wholesome

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Frozen Dough, Bread and Rolls

clear on food allergens,” says Wintz, adding that its “new packaging clearly tells the consumer which of the eight major allergens are in the product (zero, in our case) and also in the production plant (only eggs). Many people who have food allergies have multiple ingredients that afect them.” He further notes that the items’ new look will “better meet the market’s need for attractive, informative and more easily merchandised packaging.” Since “consumers have become skeptical of health claims on packaging,” Jen & Joe’s has, in a similar move, “launched new packaging that puts the ingredient list on the front of the box, with the tagline ‘Ingredients so good they’re on the front,’” notes Laska. “We thought, why not give the consumer everything they want to see up front? We have nothing to hide in our cookie dough. So far, the new packaging has been very well received by retailers and consumers.” Despite these positive moves, however, work still needs to be done in this area. According to Madsen, “Te frozen dough/bread/rolls category needs to communicate [its] benefts more efectively to reverse the current trend” toward fresh items.

Placed and Priced to Move Merchandising and promotions are other key elements in selling frozen dough and baked goods. To make sure its Grands items get noticed — and purchased — in supermarket frozen food sections, General Mills employs a three-pronged strategy. “Lift and merchandising efectiveness [are] maximized when items are in the ad feature and on display in a freezer end cap or bunker,” says Madsen, adding that the company also co-promotes the product line with other Pillsbury items such as frozen Toaster Strudel and engages in digital couponing to encourage trial. “We’ve had some success with [end cap] placement in Safeway over the summer,” afrms Jen & Joe’s Laska. “It was a great way to expose the brand to new customers who might not ordinarily walk down the freezer aisle looking for dessert. We are now moving the product into the permanent frozen dessert section for the fall reset at Safeway across the U.S., and will begin pricing promotions,” which, she says, “have been the most successful during the frst two weeks. … Te benefts drop of after [that]. So we’ll be

sticking to shorter programs.” Te company will also take part in the Pleasanton, Calif.-based grocer’s Just For U discount program, which Laska describes as “a more targeted approach to promoting the product.” “For frozen products, our most successful method of promotion has been retail price reductions with retailer cooperative ads,” agrees Wholly Wholesome’s Wintz, admitting, “Demos are diffcult at best with frozen dough products. In frozen, there is not often the opportunity to build of shelf displays at the point of demo to drive sales, which makes the cost of customer acquisition quite high.” Perhaps to compensate for this disadvantage, the company’s “social media presence has grown signifcantly,” he adds, “and every day, we are increasing awareness of our brand through varying mediums — local to national.” Such eforts appear to be paying of, as Wintz declares the company’s Gluten Free Pie Shell “a breakout hit, and our Gluten Free Pizza Dough Ball is just now hitting a broader launch.”

Jumping Into the Space In the near future, growth in the $1.4 billion category, sales dollars of which, according to Nielsen, were down 2.4 percent for the 52 weeks ending Aug. 30, is a distinct possibility, thanks to new players and evolving consumer expectations. “Many retailers are developing a frozen cookie dough category,” says Laska. “Nestlé has already followed our lead and just launched a frozen cookie dough,” which, like Jen & Joe’s, is carried by Safeway, “and we expect more companies to jump into the space.” She continues: “We’ve also seen a couple of regional brands of frozen cookie dough with a nice, clean ingredient list like ours. I think we’ll see more and more of that in the frozen dough category as consumers demand better products like this.” Wintz, however, is of the opinion that such products will remain the preserve of a certain loyal few. “We believe that as consumers’ desire for convenience grows and in-store bakeries get more creative in meeting [shoppers’] increasingly sophisticated tastes, frozen dough will be more of a niche item that fts a very specifc need,” he notes, “whether that be dietary restrictions or specialty items that don’t have the movement to support instore bakery fresh merchandising.” PG

| Progressive Grocer | Ahead of What’s Next | November 2014

For more on the category, visit Progressivegrocer.com/frozendoughbreadrolls.

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Produce

Fresh Food

Savoring

South America

New players and creative campaigns are driving sales of fresh and flavorful imports. By Jennifer Strailey

outh American produce is taking the industry by storm. From Peru’s fresh sources of Hass avocados, to exotic fruits from Ecuador, to exclusive specialties from Colombia and the succulent staples of Chile, the region is bursting with opportunities for progressive grocers. Te soaring demand in this country for Hispanic and Asian produce, both of which South America cultivates well, continues to play a signifcant role in driving sales, as does the United States’ seemingly insatiable appetite for avocados.

Chile has always been on the radar as a source of excellent-quality Ever on the hunt for new produce from favor sensations, consumers are also drawn to tropical and unique South America, and now Peru is seasonal items from our neighbors to the south. “We have grown tremendously over the last 10 gaining strength years,” says Jessie Capote, EVP and a principal of in the market.” J&C Tropicals, a Homestead, Fla.-based tropicals —Xavier Equihua, supplier specializing in more than 60 produce Peru Avocado items, as well as seasonal specialties, many of Commission which are from South America. November 2014 | progressivegrocer.com |

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Fresh Food

Produce

“Te growth in South American produce is twofold. Te biggest driver is the increase in the Hispanic and Asian demographics in the U.S.,” he notes. “Te other reason many of these products have crossed over is because they are showcased at restaurants, and more retailers are doing a good job of merchandising them.” Powerful promotional campaigns, created by a number of South American industry associations and implemented by retailers around the country, are helping to seal the deal. Te result is a bounty of South American-grown fruits and vegetables in shoppers’ baskets.

GRAPE EXPECTATIONS Grocers created eye-catching displays for The Great Grape Giveaway.

Chile Far from the new kid on the block, Chile is a well-established provider of grapes, blueberries, cherries and other produce to the United States. Its more mature market presence has allowed organizations like the Chilean

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| Progressive Grocer | Ahead of What’s Next | November 2014

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Fresh Food

When Peru came into the Hass avocado game, many in the industry thought the market would crash — that there wasn’t enough demand — but on the contrary, it’s been an amazing success story.” —Jessie Capote, J&C Tropicals

Produce

Fresh Fruit Association to introduce increasingly targeted promotions aimed at keeping the country’s reputation for quality top of mind with retailers and consumers alike. “Gone are the days when we’d push one nationwide promotion program and a few point-of-sale pieces,” says Karen Brux of the San Carlos, Calif.-based association. “Retailers have diferent customer bases, diferent communication needs. We talk with retailers one by one to understand the best way to move the dial in their stores.” In 2014, the Chilean Fresh Fruit Association introduced a promotion called Te Great Grape Giveaway. A total of 298 stores from 17 retail chains across the United States participated in the promotion. Te association hopes to expand on the promotion in 2015, with the goal of doubling the number of entries. Knowing that the way to a consumer’s heart and stomach is increasingly through social media, the Chilean Fresh Fruit Association provides retail marketing and social media staf, along with dietitians who can give retailers the information they need to populate their social media platforms. “Tere are over 48 million Twitter users in the U.S., Facebook has 152 million daily active users in the U.S. and Canada, and Pinterest has 53 million monthly unique users in the U.S.,” notes

Astounding Avocados According to the Hass Avocado Board, year-to-date dollar sales of avocados for 2014 are approaching $850 million, up nearly 18 percent from the previous year. Starting in 2013, the board’s data from IRI regions and markets reflect an expanded retail data set that includes sales and volume from Walmart, Sam’s Club, Target and BJ’s Wholesale Club, in addition to traditional grocery retailers.

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Brux.“If you want to be an efective marketer, you simply have to be utilizing these channels.” Helping consumers fnd new and favorful ways to incorporate produce into their diets is equally important. “More and more produce companies are partnering with complementary products in order to educate consumers on the versatility and many uses of their product,” observes Brux. With this in mind, the association recently developed a new RPC wrap for the Chilean Avocado Importers Association. Te vinyl four-color wrap, which goes around a stack of RPCs, features images of easy usage ideas, including sandwiches, egg scrambles and stews.

Peru Tese days, any mention of produce from Peru is going to bring avocados immediately to mind. “When Peru came into the Hass avocado game, many in the industry thought the market would crash — that there wasn’t enough demand — but on the contrary, it’s been an amazing success story,” says Capote, of J&C Tropicals. Seemingly overnight, Peru became the secondlargest avocado importer in the United States According to InfoTrade data, the volume and dollar value of avocados from Peru in 2014 increased 196 percent and 216 percent, respectively, over the previous year. Of course, it wasn’t really an overnight success. Extensive planning and strategic marketing preceded the U.S. debut of Hass avocados from Peru. Te Peruvian Avocado Commission (PAC) recently wrapped its second annual Monumental Flavor marketing campaign for the fruit, and is already preparing for 2015, which is projected to be its biggest year ever in terms of amount of avocados imported. “It was an unprecedented campaign because 10 of the industry’s top retailers, from Walmart to Costco to Ahold and Safeway, participated around the country,” asserts Xavier Equihua, CEO of PAC, in Washington, D.C. Te campaign included radio advertising in 27 markets for 10 solid weeks, complemented by robust social media engagement. “What we did diferently this time was, instead of a typical radio spot with a retailer tag at the end, we mentioned the retailer’s name right from

| Progressive Grocer | Ahead of What’s Next | November 2014

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Fresh Food

In earlier versions, we couldn’t get the flavors of South America to come across, but with HPP, the cacao juice has the same fresh taste you’d get at the plantation.” —Joseph Montgomery, Agro Innova

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Produce

the start, so it sounded like a joint efort, which it was,” explains Equihua. “It was very successful, and because the ad frequency was so high, consumers really got to know a new player in the market.” Tis year, Peru sold approximately 150 million pounds of avocados in the United States from July through September. “In 2015, we expect to do 200 million pounds in the market in three months,” asserts Equihua. But Peru is more than a grower of Hass avocados. “Chile has always been on the radar as a source of excellent-quality produce from South America, and now Peru is gaining strength in the market,” notes Equihua, who predicts the country will be one of the world’s largest blueberry producers in the next three to four years. Peru is already the largest asparagus supplier to the United States. Te time is right for promoting Peruvian produce in the United States, observes Ricardo Romero, director of the Trade Commission of Peru, Los Angeles. “In the last fve years, Peruvian gastronomy has become a favorite in the U.S. Some specialized magazines have said that Peruvian cuisine is the ‘next big thing’ for foodies around the world,” says Romero. “Tis trend is generating a snowball efect around the United States, because nowadays, there are more restaurants and hotels that are including Peruvian dishes in their menus. In the Los Angeles area alone, there are approximately 84 Peruvian restaurants.” When it comes to merchandising fruits and vegetables from Peru, beyond taking advantage of the POS and other marketing support available from PAC, the commission recommends a number of strategic tips for raising consumer awareness. “Get the produce out of the produce section,”

counsels Romero. For instance, retailers can feature Peruvian avocados for guacamole making, and tortilla chips in a primary location, near the entrance of the store on the morning of a big football game. “Another example of this strategy,” he adds, “would be to place Peruvian asparagus and Peruvian snacks next to the steak counter on a busy Sunday.” Retailers also may want to consider creating a display of lesser-known Peruvian produce. Examples might include sacha inchi, indigenous to Peru and high in omega-3 fatty acids and complete proteins; aguaymanto, rich in vitamin C and antioxidants; and pepino melon, known for its delicate honey favor.

Ecuador Although not as well known for produce in the United States as some of its South American counterparts, Ecuador is home to several new and exciting products that have entered the market in recent weeks. Agro Innova, in Weston, Fla., is appealing to health-conscious Millennials and the Baby Boomer generation with a new functional beverage made from Ecuadorian cacao pulp. CEO Joseph Montgomery, a seventh-generation cacao farmer, is the driving force behind Suavva, a South American line of cacao pulp-based fruit smoothies. “Tere is one part of the cacao pod that has never been explored properly — the pulp,” says Montgomery. “We found a way to commercially extract this pulp, and it has a really nice favor that is tangy, sweet and almost citrusy.” While Montgomery had dreamed of a beverage made with cacao pulp for years, the key to making Suavva smoothies a reality was the advent of high-pressure processing (HPP). “In earlier versions, we couldn’t get the favors of South America to come across, but with HPP, the cacao juice has the same fresh taste you’d get at the plantation,” he asserts. Cacao pulp contains certifed antioxidant activity, as well as several vitamins and minerals, all of which are maintained using HPP. “It’s a way to enjoy the benefts of chocolate without the added sugars and fats of

| Progressive Grocer | Ahead of What’s Next | November 2014

a chocolate bar,” notes Montgomery. Suavva smoothies are available in four favors: Amazing Cacao, Merry Mango, Blissful Berry and Chocolatey Cheer. While J&C sources a host of produce from South and Central America, “it’s mangos that claim the day with South American produce,” says Capote. Te company has been supplying mangos from Brazil since September, and just last month introduced a new specialty mango from Ecuador called Nam Doc Mai. “Tere are hundreds of varieties of mangos, but most people don’t know many of them by name,” notes Capote. Te Nam Doc Mai is a smaller mango, similar to a Francine, but with a twist, he adds.

Colombia While Colombia has been long beloved for its bananas, the country is now looking to become a more signifcant produce player in the United States with pineapples, limes, fresh herbs, and its own Colombian goldenberries, also known as Cape gooseberries. At October’s Produce Marketing Association (PMA) Fresh Summit in Anaheim, Calif., Proexport Colombia exhibited in a 300-square-foot booth, with the idea of exploring business opportunities in the U.S. market. Proexport also brought a delegation of 24 exporters, most of whom are already selling to the U.S. market. “We wanted to reinforce what we are already doing, and also present Colombia as a sourcing possibility for U.S. companies,” explains Juan Barrera, U.S. agribusiness director for Proexport Colombia, in regard to the country’s presence at PMA. With the recent approval of the U.S. Animal and Plant Health Inspection Service (APHIS), goldenberry (uchuva) producers and distributors from Cundinamarca and Boyaca, mountainous regions in Colombia, will soon be able to export this exotic fruit to the United States without cold treatment, a beneft that will reduce costs and shipping times. “We believe we can start exporting to the U.S. in a month,” says Barrera of the goldenberries. With Hass avocado sales hotter

than hot, it isn’t surprising that Colombia is also exploring the possibility of exporting avocados to the United States. “Everything is set up to start promotions,” notes Barrera, who says the East Coast would be its target market. “We’re hopeful that if we’re not exporting Hass avocados by the next PMA, then defnitely by the following one, in Orlando.” PG

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November 2014 | progressivegrocer.com |

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Fresh Food

Produce Category Focus: Potatoes

hile potato sales have historically remained fat, a spate of innovative products, cleverly targeted packaging and strategic promotions has positioned tubers to take of like never before. One important change has been a shift in potato marketing, as suppliers and industry organizations consider the Millennial shopper. Tese adults, 18 to 33 years old, represent an infuential demographic of more than 51 million consumers. And potatoes may be just what these young consumers seek. Te Denver-based United States Potato Board’s (USPB) research indicates that Millennials are looking for foods that are fun, afordable, healthful, unprocessed and convenient. In a board-commissioned study, FreshFacts Nielsen and the Boulder, Colo.-based consumer research agency Sterling-Rice Group found that 38 percent of Millennials report choosing the potato variety best suited for the preparation they have in mind, suggesting that signage and cross-merchandising may be even more critical in reaching this demographic. Millennials also shop with a diferent agenda from previous generations. Te USPB-commissioned research found that 51 percent of Millennials’ shopping occasions were to buy for a single meal. Tus, they’re more likely to grab a handbasket than a cart at the grocery store. Tis new breed of shopper has inspired

Houston-based MountainKing Potatoes to introduce a number of new products designed to lift sales of potatoes. “Our research indicates that [shoppers 35 and under] are more adventurous and more willing to try new and diferent things; however they are also very attuned to not throwing things away,” says John Pope, VP of sales and marketing. “Tis is why it’s important to sell potatoes in 1-, 2- and 3-pound units, as opposed to 5- and 10-pound bags exclusively.” MountainKing’s new Half-Pallet Grill Bin, which attracts attention with the look of a stainless-steel backyard grill, holds 84 5-pound bags, 130 3-pound bags or 100 tray packs. Its Tater Town Stack Boxes, which feature MountainKing’s Steak House Bakers (fngerlings), hold 64 3-pound bags, 96 roaster bags or 96 tray packs. For Millennials and other shoppers who buy with a particular menu in mind, MountainKing also recently introduced high-graphic display wraps that suggest pairing potatoes with other dishes. Four new wraps are available for Steak House Roasters, Steak House Bakers, Crawfsh Reds and Seafood Market Reds. According to the company, the display wraps have boosted sales of 3-pound Seafood Reds and 4-packs by 53 percent. “We see a very strong correlation between people who buy fresh fsh and small red potatoes,” asserts Pope, “so we created a mesh boil-ready bag for reds that can be dropped right into boiling water for someone doing a clam or lobster bake.” Crossmerchandising these items in the seafood department drives the message home. Fresh Solutions Network, in San Francisco, has also set its

Tater Tactics Potato suppliers get savvy with spuds in ways that speak to Millennials and more. By Jennifer Strailey

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sights on Millennials, with the new Side Delights Roastables line of potatoes. Te company, citing the USPB “Attitudes & Usage Study 2014,” says the demographic is 30 percent more likely to prepare potatoes by roasting than the average U.S. consumer. Available in reds, yellows and a combo pack of both, Roastables come in a 1-pound clamshell container that features a metal bottom for either oven roasting or grilling. Accompanying the potatoes are seasonings from Montana Mex, including Mexican oregano, garlic and ancho chilies. “We set out to target Millennial shoppers with a hot new item that is simple to prepare, needs no cleanup, and features bold, global favors to spice up their favorite side dish,” explains Kathleen Triou, president and CEO, who recommends merchandising Roastables in the convenience section of the main potato table, near creamers, smaller bags and steamable products.

Promotions Spotlighting Spuds Te Idaho Potato Commission (IPC), in Eagle, Idaho, is expanding several of its highly successful campaigns to ensure that the sense of tradition associated with its product stays fresh. Te Great Big Idaho Potato truck promotion has been extended another two years, while Te Potato Lover’s Month will run for eight weeks (mid-January to midMarch) in 2015, rather the traditional four. More than 5,000 supermarket chains and independent retailers participated in 2014’s annual Potato Lover’s Month retail display promotion in February, the most ever in the contest’s 23-year history. Plans for the Great Big Idaho Potato Truck 2015 tour are underway, but specifc destinations, other than mainstays like the Kentucky Derby, are as yet under wraps. To keep tour excitement alive during the of-season, the IPC recently launched a national television commercial featuring a perplexed potato farmer searching for his tater truck. According to the IPC, the TV spot has generated brand awareness and engaged consumers on social media more than any of

Potatoes and Health

its previous commercials. “Idaho invests a great deal in consumer-related marketing to create more demand in both Idaho potatoes and the category as a whole,” says IPC VP Retail/International Seth Pemsler. Te commission also gives retailers access to its in-house team of category management analysis experts. “Te sole job of our promotion directors is to assist retailers in becoming more successful,” notes Pemsler, who adds that these experts in the feld are all former produce managers, buyers and directors. “We encourage retailers to look at them as no-cost consultants,” he observes. One function of the promotion directors is to show retailers data on potato advertising. IPC buys Market Track data to monitor every potato ad that runs during a given time period. As a result, the commission can show retailers comparisons of their own store ads with those of their competitors, to assess the impact of ad frequency, pricing, product variety and presentation. “We show them the actual ads,” says Pemsler. Tis gives retailers an opportunity to see the efectiveness of many factors, including showing prepared potatoes in their ads, versus raw potatoes. “Generic potatoes are not necessarily as enticing as a baked potato with sour cream or mashed potatoes,” he notes. Such were the fndings of the USPB, when it commissioned the Nielsen Perishables Group to track the efectiveness of retail ads that included potatoes over a 52-week period. Te study looked at ads featuring pictures of cooked potatoes versus ads with raw or bagged potatoes, and found that when retailers ran ads with prepared images, they experienced a 23-point higher incremental volume lift. PG

According to the Denver-based United States Potato Board (USPB), one medium-size (5.3-ounce) skin-on potato contains just 110 calories per serving, offers more potassium than a banana and provides almost half the daily value of vitamin C. What’s more, potatoes contain no fat, sodium or cholesterol. New research published in the Journal of the American College of Nutrition shows how potatoes can fit into a weight management program. Funded by the USPB, the study brought together the University of California at Davis and the Illinois Institute of Technology in an effort to gain a

Our research indicates that [shoppers 35 and under] are more adventurous and more willing to try new and different things; however, they are also very attuned to not throwing things away.” —John Pope, MountainKing Potatoes

better understanding of calorie reduction and the glycemic index in weight loss, when potatoes are included in the diet. The study looked at 90 overweight men and women, who were randomly assigned to one of three groups: (1) reduced-calorie/high-GI, (2) reduced-calorie/low-GI, (3) control group with no calorie or GI restrictions. All three groups were provided potatoes, healthful recipes and instructions to consume five to seven servings of potatoes per week. At the end of the 12-week study period, the researchers found that all three groups had lost weight and that there was no significant difference in weight loss between the groups.

November 2014 | progressivegrocer.com |

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Grocery stores’ elevated marketing of affordable prepared foods made with fresh fruits and vegetables stands to resonate loudly with the Millennial generation.

PMA (Fresh) Perspectives By Eileen O’Leary

Think Fast

Grocery stores are uniquely suited to help Millennials make healthier choices.

ighway exit signs help travelers fnd tourist attractions, fuel, lodging and, of course, food — albeit mostly fast food. Rarely do these signs direct people to grocery stores, which ofer a tremendous variety of healthy on-the-go foods, including fresh fruits and vegetables. A syndicated study conducted by Te Hartman Group, based in Bellevue, Wash., and purchased by Produce Marketing Association (PMA), “Outlook on the Millennial Consumer 2014,” some of whose fndings have been discussed in the August and September 2014 PMA Perspectives columns, tells us that convenience and afordability drive busy, cashstrapped Millennials to rely routinely on fast food, even though they know it’s not healthy. Millennials in the study say they’d prefer healthier quick-service foods over “traditional” fast food, if only the healthy choice was also the budget-friendly choice. Tis is a good sign, pointing to an opportunity for grocery stores to help the biggest generation to date — estimated at 80 million in the United States alone — reconcile their desires for convenience, afordability and healthfulness.

A Little Bit of Everything Millennials are indeed a food-forward generation that eats out more often than their older cohorts; however, the number of Millennials who eat out on a weekly basis has actually dropped in 2014, compared with Hartman’s 2011 study of the group. Tis decrease refects a rise in the number of Millennials who are cooking, meal planning and minding their budgets. Nonetheless, this increase in cooking doesn’t necessarily make Millennials avid cooks. While many like preparing food, they’re pressed for time in their daily routines, and short on ideas for easy and afordable meals. Cooking is often relegated to special events or weekends, when time is easier to come by. As a result, fast food remains part of Millennials’ resource-strapped lifestyles. With the demographic teetering between fast food and home cooking, grocery stores are in a great position

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to balance this demographic’s needs. On one hand, supermarkets can ofer healthier prepared foods that Millennials can grab and eat on the way to work in the morning or at their desks for lunch. On the other hand, grocery stores go one step further with the convenience of retail, giving Millennials semi-prepared options and other food purchases that aid their eforts to cook more and appease their propensity for spontaneous meal planning.

Supermarkets: The Original Freshii Salads, burritos, wraps, rice bowls, yogurt parfaits, soups — all easily parlay into competitively priced prepared and ready-to-eat meals and snacks full of afordable fresh fruits and vegetables to satisfy Millennials’ taste for convenient, less-processed, fresh, healthy meals. Te ability to mix and match from soup and salad bars and the prepared food section also complements their DIY, just-for-me attitude. Tis concept actually sounds a lot like Freshii, the fast-food franchise founded in Canada by Matthew Corrin, a Millennial himself. According to the company’s website, Freshii focuses on providing “fresh and nutritious meal choices that energize people on the go.” An expansive array of vivid fresh fruits and vegetables covers the food prep areas. Messaging often elevates

| Progressive Grocer | Ahead of What’s Next | November 2014

the healthful appeal of fresh produce. When hungry people are faced with the choice between a candy bar and an apple, the company says its goal is simple: “Freshii wants to be that apple.” Te restaurants have been a huge hit, with the frst Canadian location running out of food on its frst day before the end of lunch. Today, the franchise has grown to 88 stores in four countries, including 44 in the United States. But there’s a catch: Among the Millennials surveyed by Hartman, many balked at the chain’s prices.

Healthy Shouldn’t be a Tradeoff It’s important to bear in mind how sensitive Millennials are to money matters. Tis generation was hit hard by the Great Recession. Many are dealing with unemployment and crippling student debt. And despite being the best-educated generation to come of age, data from the Washington, D.C.-based Pew Research Center show that two-thirds of Millennials between the ages 25 and 32 lack a bachelor’s degree. But despite everything, price isn’t the whole picture — quality and relevance to values are also extremely important to Millennials, and Hartman’s research shows they worry about the “more, faster, cheaper”

attitude that relying on fast food symbolizes. Grocery stores’ elevated marketing of afordable prepared foods made with fresh fruits and vegetables stands to resonate loudly with the Millennial generation in more ways than one, allowing them to commit to ideals of healthy eating while remaining budget-conscious and mobile, and even giving them recipe ideas to try at home. Supermarket retailers can gain greater access to Millennials’ daily routines by helping them make better choices from a wide range of healthier alternatives to traditional fast food. Before Millennials veer too far of the road toward fast food, thinking it’s the only option, our industry can share the story with this important generation that it is possible to eat healthfully on a budget and on the go. Fresh fruits and vegetables are a big part of that story. PG Eileen O’Leary is the market research manager for Newark, Del.-based Produce Marketing Association. With nine years of experience in research and development, she leads consumer-based research for the association.

in cooperation with

Messe Berlin North America 520 William Street • Suite E 22401 Fredericksburg • Virginia Tel +1.540 372-3777 Fax +1.540 372-1414 www.fruitlogistica.com berlin@exhibitpro.com

Equipment & Design

Displays

Deck the

Aisles

Holiday display equipment can help make the selling season merry and bright. By Bob Ingram

We see tremendous opportunities for supermarkets to maximize their existing selling space by stepping out to the front of the store for seasonal holiday live goods pop-up shops to create a destination.” —Harry Newton, SPC Retail

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ncremental holiday sales in supermarkets depend in great measure on catching busy shoppers’ eyes through the innovative use of displays throughout the store. At Meridian Display, in St. Paul, Minn., Director of Marketing Michelle Lee says: “Black Friday is a big date for us. Many of our customers request freestanding retail displays during the holidays.” Meridian designs, produces, fulflls and ships corrugated point-of-purchase displays. “We ofer express stock displays that can be ordered online and shipped the same day if ordered by 1 p.m. CST,” notes Lee. “Our pre-designed displays save tooling charges, and are cost-efective in quantities over 100. We also have designers on staf who can create custom displays, [which] can be produced in a matter of days.” According to Lee, Meridian’s 24-inch, six-shelf display can hold a variety of items for the holidays, and a customized header can be added, or the product packaging can do the selling.

‘Fast and Easy’ Setup SPC Retail, a division of Structural Plastics Corp., in Holly, Mich., designs and manufactures specialty displays made from recycled plastic, according to Harry Newton, director of sales and marketing. “Our patented ‘Kit of Parts’ system enables us to create thousands of modular, easy-to-assemble displays in minutes, without tools,” he says, “and they are extremely durable indoors or outside.” Among the products Newton cites that can be used for holiday displays are two-and three-step tiered displays, double-sided pyramid displays, tiered rounds, mobile midway carts, and a collection of stackable platforms for creating pop-up shops in power aisles and swing areas in grocery stores. “Because our displays are modular and set up fast and easy,” he points out, ”many retailers use our displays to set up pop-up seasonal areas for holiday trim and ornaments, as well as post-holiday clearance areas in aisles or swing areas.” Specifcally for the Christmas season, Newton says, “we sell a threeand four-tiered round poinsettia display, and we have an evolving line

| Progressive Grocer | Ahead of What’s Next | November 2014

SMALLER PACKAGE SIZES CONTINUE TO SHOW GROWTH

3lb volume

1.5lb volume

+19.4% CONVENIENCE PRODUCTS THRIVING

+10.3% micro/steamer volume

+28.4%

tray volume

+4.3%

YELLOW POTATO VOLUME IS

PETITES INCREASINGLY IMPORTANT Now account for 9.6% of all potato $$

surging

+11.8% volume growing dollar sales up +16.8%

+14.9%

REDS & WHITES VOLUME SOLID AT

+6.6% and +7.4% For more information contact Sarah Reece at sarah@uspotatoes.com

Source: Nielsen Perishables Group FreshFacts ®, 52 weeks ending 8/23/14 vs. YAG.

Equipment & Design

As customers continue to order more online, presentation in-store is more important than ever.” —Kendra Sewell, Pan-Oston

FLEXIBLE FLORAL These floral tables from Cayuga Displays have pull-out drawers for more merchandising space.

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Displays

of specialty displays designed to be modular, fexible and interchangeable, and easily moved and used throughout the store all year round.” Newton notes that SPC is developing a convertible dump bin display that can convert to multiple display confgurations to be used for assorted sizes and types of products in promo aisles or impulse displays. “We see tremendous opportunities for supermarkets to maximize their existing selling space by stepping out to the front of the store for seasonal holiday live goods pop-up shops to create a destination,” he observes, adding that such displays would enable retailers to “take advantage of the many ways food touches all fve senses and is part of every season, celebration and family table.”

Life in the Fastlane Pan-Oston, based in Bowling Green, Ky., makes permanent display fxtures and, as VP of Sales Kendra Sewell afrms, “Our beer and wine racks, foral displays, nesting tables, bakery displays, mobile displays, and in-store cooking demo showcases can be used for the Christmas season.” Te Utopia Technology Group, a division of Pan-Oston, recently rolled out the Fastlane X3, which takes the place of up to six checkout lanes, allowing grocers increased merchandising space on the front end for impulse buys, notes Sewell. “Our enhanced Ergolane is another product that increases front end merchandising space by 24 cubic feet and is the only carousel that allows for a bagger,” she continues. “It is also the frst of its kind to eliminate cashier twisting and turning, which reduces lost time and fatigue.” Sewell adds this caveat, however: “As customers continue to order more online, presentation in-store is more important than ever. Providing

the best shopping environment and customer experience is key to staying ahead of the competition.”

Converting for the Holidays St. Louis-based Presence From Innovation (PFI) specializes in point-of-purchase wood, metal and plastic merchandising equipment and display racks primarily for the beverage industry, along with other sectors. PFI’s team of designers has created custom holiday graphics for display racks. “Te team turned a circular four-shelf rack into a temporary Christmas tree via the insertion of tree graphics,” points out Don Miller, CIO at PFI. “Many of our products can be converted to holiday racks when purchased with custom graphics.” True ROI According to Paul Bloom, VP of marketing at Twinsburg, Ohio-based FFR Merchandising, the company has hundreds of pieces of displayware to promote food products, theft protection products, and more than 1,000 products for spot promotions and product and pricing information. “Our RAZZ System, for instance, has multiple mounting options, allowing for a complete and consistent storewide signing and promotional system,” he says. Further, Bloom notes that FFR has many custom products in the works, including merchandising strips and hangers, category displays, and wire-formed merchandisers and sign holders. Tere’s a growing need to integrate shoppers’ total buying experience, from online to in-store, he asserts, noting that kiosks and interactive displays are becoming more prevalent as a result. However, he adds, “selling physical product in a store remains a core concern. From operational efciencies to loss prevention, in-store merchandising is, and always has been, a very fuid and changing arena.” Meanwhile, at Cayuga Displays Inc., in Cayuga, Ontario, Chris Schotsman, VP of sales and marketing, says: “Floral is big for Christmas. Our fexible tables with pull-out drawers and nesting tables allow the merchandising space to easily be expanded. Also, incorporating fexible merchandisers like barrels and crates adds warmth and a rustic, homey feel. “Any equipment has to be a fexible solution,” he continues. “Supermarkets don’t want to invest in something that only is used for one season, unless there’s true return on investment. Something that can handle volume fuctuations is key. Anything specifc to the holidays has to be disposable or break down so it can be easily stored and set up again at the appropriate time.” PG

| Progressive Grocer | Ahead of What’s Next | November 2014

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