There's a chill in the Center Store air. That's because some chains are adding 4-foot coolers to grocery aisles so that refrigerated items like pasta, pickles and salad dressings can be near their shelf-stable counterparts.
The goal of this new trend is to provide solution shopping, enabling consumers to browse a specific category in one section of the store, rather than several different departments. The program not only boosts sales of refrigerated items, but also benefits shelf-stable products.
Kroger Co., Cincinnati; Hy-Vee Food Stores, West Des Moines, Iowa; Grand Union Co, Wayne, N.J.; the Central Islip, N.Y.-based Waldbaum's division of A&P, Montvale, N.J.; and Dahl's Food Stores, Des Moines, Iowa, are among the chains whose Center Store aisles have this "cooler" look. All feature grocery-section coolers that carry products from either one manufacturer, such as Claussen pickles or DiGiorno pasta and sauces -- or several different companies. Dahl's, for instance, is having success with a 4-foot refrigerated Claussen pickle unit in its pickle section and refrigerated DiGiorno pastas and sauces in its pasta aisle, said Ross Nixon, vice president of merchandising.
"This was an opportunity to grow the category," explained Nixon.
According to Nixon, Claussen pickle sales went up "three-fold," but not at the expense of shelf-stable counterparts.
Moreover, cross merchandising fresh items with dry groceries can only have a positive impact on the latter, Nixon said. "There are many shelf-stable items you can tie in that enhance the movement of products," he speculated.
Dahl's previously merchandised the DiGiorno cooler in its dairy section. Moving it to Center Store has not only helped boost sales of the DiGiorno products, but also gave the chain more space in the dairy section.
While fresh departments still get the ring for cross-merchandised items, and this may foster some competitiveness at store level, Nixon was more concerned with the big picture "of driving the business."
The cross-merchandised items haven't impacted the number of stockkeeping units in Dahl's grocery aisles, said Nixon. "You just tighten the set in anticipation of what will sell," he explained.
Claussen Pickle Co. has been partnering with retailers since 1995 to install pickle-aisle refrigerated cases, according to Vicky Evans-Stencel, brand manager for Claussen, which is part of Kraft's Oscar Mayer division and headquartered in Woodstock, Ill.
"We've worked with Kroger, primarily in the Cincinnati, Indianapolis and Dallas areas; with Hy-Vee in Minnesota; with Kash n' Karry in Tampa; and with a lot of independents," Evans-Stencel said.
A Kroger unit in Columbus, Ohio, has several Center Store-based refrigerated units. Unlike some chains that focus on a specific brand, the store features coolers with generic signs, such as "pickles," "pasta," and "lunch favorites," which offers refrigerated snacks merchandised directly next to beverage mixes.
According to Evans-Stencel, data from ACNielsen, Schaumburg, Ill., show double-digit gains in the stores where these refrigerated cases have been installed.
Kraft's DiGiorno Foods Co., headquartered in Glenview, Ill., also began working with stores in 1995. In some cases, the partnership was initiated by DiGiorno, and sometimes stores opened discussions, said Betsy Kalmar, brand manager for DiGiorno fresh pastas and sauces.
"It's really a matter of bringing all the consumers' choices together in one place," explained Kalmar. DiGiorno pays for the coolers from either corporate or sales funds, or a combination of the two, and the retailer pays for rewiring the store and maintaining the refrigeration units, which then become their property.
Like most coolers in Center Store, the DiGiorno units are 4 feet wide. They hold 24 DiGiorno SKUs, with 60% typically being pasta and 40% sauces.
Although she did not have specific sales figures that proved the success of DiGiorno's cross-merchandising efforts, she did say that "We've increased our facings and doubled the velocity."
A Hy-Vee unit in West Des Moines, Iowa, put DiGiorno's refrigerated pasta products in-line recently, and has had Claussen pickles in-line for almost three years, according to Joel Flug, assistant manager.
"Claussen pickles went up 25% to 30%," said Flug. "It made sense to put the pickles with the pickles." The refrigerated case is right next to the shelf-stable pickles and olives.
Flug said that other Hy-Vee stores have also been cross merchandising these two categories. In fact, a store-level source at an Urbandale, Iowa, store told SN that DiGiorno just recently went in-line, and that the Claussen pickles had been moved about a year and a half ago.
At Tidyman's in Greenacres, Wash., Craig Babbitt, director of non-perishables, now merchandises certain fresh items in two locations. "We have refrigerated salad dressings in-line, the DiGiorno's pasta and sauces in-line, and refrigerated juices in-line," he said. Babbitt has been testing these items in various stores over the last six months. Currently, three stores are merchandising refrigerated juices, pastas and sauces and salad dressings in Center Store.
"[To do this] makes sense. If customers are looking for juice, it makes it easier for them to shop, and since our margins are more substantial on refrigerated, to put them in with the stable juices should generate even more sales."
Babbitt said that he hasn't had the new program in place long enough to know if sales have actually increased.
Babbitt expects to get hard data in a few weeks. Meanwhile, his "visual verification" tells him that refrigerated juices are doing very well, while the salad dressings do not seem to be moving.
Who gets the ring is not all that relevant in Babbitt's stores, since the dairy department is a subset of grocery at Tidyman's. According to Babbitt, it was not necessary to decrease SKUs in the grocery aisle, since he, like Dahl's Nixon, simply tightened the set.
Some chains are building units with refrigerated coolers in the Center Store aisle. For example, a Ukrop's store that is slated to open in Fredericksburg, Va., in August is being built with cooler units in the aisle. "More stores will be doing solutions shopping," said Carroll Obaugh, director of procurement.
Similarly, a Walbaum's store in Lindenhurst, N.Y., features a 4-foot cooler in one of the grocery aisles, according to a store-level source.
This unit has tried various fresh items in the cooler, but fresh Italian products like ricotta, mozzarella and shredded and grated cheeses have been the most successful next to shelf-stable pasta and sauces, according to a store-level source.
"With the Italian, we've seen increased sales. It's more convenient. They see it there and think they might as well pick up an extra package," the source commented.
Along with refrigerated units, some chains are adding other types of fresh items, such as bulk Voortman cookie displays, to their Center Store departments.
The Urbandale Hy-Vee put Voortman's bulk cookies in the cookie aisle about two years ago. "That's where they belong," the store-level source said. "Our bakery is for fresh-made daily."