WAYNE, N.J. -- Grand Union here and Albertson's, Boise, Idaho, are testing software sections that feature medium- to higher-priced products, through an arrangement with Major Connections, a Dallas-based company that distributes and racks software for supermarkets.
The chains began testing the program last month in 70 stores, according to Margaret Pacheco, vice president of marketing for Major Connections. The company distributes software brands from The Learning Co., Hasbro, 7th Level, Cambrix Publishing and Graphix Zone.
Albertson's is still in the process of rolling out the program. So far 13 of its stores in Texas are slated to sell the software. Grand Union has placed software racks in 57 of its 226 stores, Pacheco said.
"We have seen it taking off where it's been put in," said Gary Mistarka, general merchandise category manager for Grand Union. Officials at Albertson's could not be reached for comment.
A number of the nation's top supermarket chains -- including Kroger Co., Cincinnati; Vons Cos., Arcadia, Calif., and Randalls Food Markets, Houston -- have partnered with Major Connections to create software sections in some of their stores. There are 12 grocery chains with a total of about 600 stores currently selling the program, said Pacheco.
Supermarkets take the software on consignment. When the product sells, chains typically get 30% of the sale price. From the balance, Major pays the publisher and takes its profits.
According to Pacheco, the 16-month-old company offers supermarkets what it calls "complete outsourcing" services. The services include helping chains determine which stores are good locations for software departments, along with selecting, delivering and racking titles.
Though no one was willing to comment on specific sales figures, and most programs have been up and running for only a few months, Pacheco said that "a lot of our customers have doubled average sales from one month to the next during their involvement with the program."
Not surprisingly, best-selling titles in Major Connection's program include low-priced "edutainment," such as Hasbro's "Tonka Construction," which retails for $19.99. Pacheco said that in addition to low-cost family titles, the company has had success with business and productivity software as well. She cited SelectPhone, a software directory that retails for $39.99, as a top-selling title.
"What we're seeing is that higher price points don't have a significant impact on sales," she said. As consumers become more accustomed to the convenience of purchasing software in supermarkets, software packages such as Novell's WordPerfect, which retails for well above $100, could be best-sellers as well, Pacheco added.
Carrying software requires minimal commitments of space and money, according to Pacheco. A 6-foot spinner rack averages 40 facings and can carry more than 100 units. Major also offers supermarkets center racks, which take up 4 square feet, and 4-foot spinner racks.
Separate displays that carry only jewel cases are available as well, for specialized tie-ins throughout the store. Jewel-case racks with health-specific software titles are presently in more than 250 supermarket pharmacies, Pacheco said.
"By introducing the software category to our stores, we are creating added value for our customers, and giving them another reason to regard us as a one-stop shopping venue," Mistarka says.