CARLISLE, Pa. -- Giant Food Stores here is testing the music sales program of Fresh Picks, Richmond, Va., in four stores, with a fifth set to open in January.
Michael Rigby, president of Fresh Picks, confirmed the test after SN spotted the company's unique fixtures in a unit of Edwards Super Food Stores, a banner of Giant, in New Hyde Park, N.Y. He also said the company has a two-store test going with another chain, which he would not identify. Rigby declined comment when asked if it was in another Ahold division.
However, he did note that Fresh Picks is in serious discussions to begin testing with another major chain. The company now has 85 units, including 54 in Star Markets, Cambridge, Mass.; 25 in Farm Fresh, Norfolk, Va.; and the six new test stores, which started up in the last six months. Rigby expects to have 94 units running by the end of Fresh Picks' financial year in February.
"We are exactly on plan," said Rigby. "We plan to open an additional 300 stores next year."
The Edwards store visited by SN had a 16-linear-foot music section, with a sampling station. Sell-through videos were on the other side of the music racks, and an endcap with computer software from Major Connections, Dallas, was nearby. Executives at Giant Food Stores could not be reached for comment. Rigby would not divulge any details of the test other than those discovered by SN in the store visit.
The Fresh Picks music program is operated on a racked basis, although its inventory management and field communications systems are said by industry observers to be among the most sophisticated in the industry. It offers a range of products, focusing on top-line titles. Fresh Picks offers a modular program that enables a store to get into the music business with a commitment of space ranging up to 40 feet. The program began with Star last year and expanded with Farm Fresh earlier this year.
Fresh Picks has introduced several refinements to its program recently, Rigby said. For example, cassettes are now being offered along with compact discs. "The cassette format is still very viable in many parts of the country," he said. In the Norfolk area, cassettes are 15% to 20% of the sales mix, he added.
The merchandising presentation has also been adjusted to allow for customers to browse multiple titles from a given artist in one facing, as opposed to the single title per facing approach, which Fresh Picks continues to use for top titles, he said.
For the stores in Star Markets that Fresh Picks has had open for a year, "we are experiencing strong double-digit growth," Rigby said. This is at a time when sales for traditional music retailers have been flat. "There's no question that we have unequivocally demonstrated how powerful and effective the supermarket is as a channel for retailing music products," he said.
Demographics support this contention, he said. For example, in the past it had been believed that the main purchaser of music is the 18- to 24-year-old male. "But the reality is that 60% of all music is now purchased by adults over the age of 25," he said, citing statistics from the Recording Industry Association of America, Washington. "For the first time last year, more women than men purchased music, which makes the supermarket channel perfect," Rigby said.
Eventually, Rigby sees Fresh Picks moving into other entertainment software products, like video, which he termed "a very natural expansion line for us." Also, video is an easier catalog to purchase because of the track record established in theaters, he said. But for now, "our belief is that it is important for us to retain a sharp focus, and demonstrate the expertise in optimizing music products before we broaden our scope," he said.
