DW's Blog
Declining Center-Store Sales An Unpopular Position
by DW Green — February 3, 2012
Supermarkets have been losing center-store sales for more than a decade, and the trend is only accelerating. Aside from the usual suspects (big box stores, limited assortment and other uniquely differentiated retailers) center-store sales are going to just about every brick and mortar retailer and online powerhouse. Fact is consumers have a plethora of purchasing choices and shop multiple venues every week. This isn’t a news flash! Why then, do so many food retailers continue to lament about lost center-stores sales and their inability to get customers down the grocery aisles?
I say, “Get over it. Accept it.” Because every dollar you invest in chasing phantom center-stores sales is one less dollar you can spend in areas where you can gain a competitive advantage. How much more produce, or meat, or seafood or bakery or deli business can you do? If you don’t have 40% market share in those departments you can do better. Or how can you improve your merchandising, your customer service or your customer experience? What more can you do to support your community? What are you doing with social media and other interactive technologies? What percent of resources do you allocate to those possibilities? What is the ROI on chasing center-store sales?
I’m not suggesting that retailers give up on center-store sales, but only to accept the reality of why they are going away and allocate precious resources wisely. There are definitely things that can be done to enhance center-store sales:
• Well-merchandised and well-signed end caps (minimize direct vendor and permanent end caps)
• Thoughtful cross merchandising planning
• Comprehensive and well-designed shelf signage:
Specials, TPR’s, staff picks, best category value, story telling, and life style messages.
• In-aisle shelf displays
• Integrated and well-signed natural food, gourmet/fancy food/speciality food sets.
• International foods section
• Product assortment review
I think its wise to unleash creative thinking and resources on areas of the store where you can gain and maintain a competitive advantage. This includes clearly communicating the benefits of your brand. It includes product assortment choices and world-class merchandising. Be smart. Invest valuable resources prudently.
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