The potential for higher rings in the front end has retailers considering a broader mix of cross-over items like new portable breath fresheners and beverage coolers, but candy still spells sweet success for most.
"The front end is a huge real estate location. It has to be one of the most phenomenal areas to merchandise in order to get high turns or high profit areas out of your store," said Michael Ortiz, corporate candy buyer for Unified Western Grocers, Commerce, Calif. The checkout aisles are the only spot in the store that every customer has to pass through, he pointed out, offering the opportunity to collect dollars from customers looking for a meal solution as well as those shopping for the month. Cross-over items like Listerine Pocket Paks, manufactured by Pfizer, New York, which made a splash a year ago, and the new lines of "extreme" mints with price points of close to $2, merchandised to the captive front-end audience, have given retailers a taste of higher profits, he added.
"You have unlimited merchandising opportunities to attract somebody's eye, to make a purchase that they might not have been looking for."
The maximization of front-end real estate vs. maintaining the status quo seems to be the strategy du jour, Ortiz pointed out. Category management principles being what they are, that approach isn't new, but applied to the front end it opens the door to a whole new makeup.
As part of the shift toward a higher ring product, Ortiz said his retailers have started adding novelty candy that was, until recently, relegated to the shelves of department stores or the supermarket candy aisle. He's seeing candies connected to entertainment properties, themes, holidays and, in some cases, toys appear more frequently at the front end through the markets he serves in Southern and Northern California, as well as Portland, Ore. The key, he stressed, is being able to capitalize on the hot items while still maintaining the tried-and-true high-turn velocity winners.
"More and more of the items we've traditionally seen in toy stores are making their way into supermarkets and being merchandised there."
Ring-shaped lollipops, push-up lollipops, edible bubbles and action figures with a spinning sucker attached are prime examples of these channel-crossing treats, he said. Jelly Pops, suckers that are molded and shaped into the likeness of a character or theme-oriented object, have been huge over the last year, Ortiz said. Products connected to everything from Harry Potter and Spider-Man to an upcoming line of SpongeBob SquarePants candies this fall have hit the front-end shelves, in addition to more traditional novelty candy spots.
And, what Ortiz dubs "old school" merchandising has punctuated the front, as the instant consumables geared toward children find their way onto rear-facing endcaps as well as back onto the traditional front-end displays. Kids' candy in whatever the hot new flavor is -- this year it's sour -- has been reappearing on lower shelves while the new mix of adult offerings has resumed authority over the higher shelves. The merchandising approach looks very familiar, but product trends are diversifying the offerings.
Indeed, candy and grocery items are in no immediate danger from other categories up front, according to statistics from Information Resources Inc., Chicago, as well as industry observers.
"Other grocery categories like salty snacks and sweet snacks have tried to become involved in front-end merchandising, but candy still certainly controls the lion's share of that space. When retailers look at turns and dollar sales per linear inch of space, candy still wins every time," said Jim Corcoran, vice president of trade relations for the National Confectioners Association, McLean, Va., and the Chocolate Manufacturers Association, Vienna, Va.
He pointed to an increasing number of grocery items that are packaged and, therefore, merchandised much like candy diversifying the front-end mix. Cereal bars and energy bars currently top this list, Corcoran said.
"If you look at some of the cereal bars or other things, they have packaged those very similarly to confections. Rice Krispies Treats, for example, which you see in a lot of front-end sections. A lot of consumers look at those products as a candy item. Energy bars are also packaged to perform just like a confection in that respect; the size of the package and item merchandise very well in the front end of the supermarket. Sales for those products have grown but they are still a very small percentage of what the overall candy category is."
According to IRI statistics, the candy category, chocolate and non-chocolate throughout the store, accounted for approximately $3.7 billion in sales for the food channel for the 52-week period ended Aug. 11 of this year. Chocolate candy bars in the less-than-3.5-ounce size (the products found most often at the front end) experienced a 4.1% sales increase over the same period the previous year. And pellet pack sugarless gums have experienced double-digit growth in sales, Corcoran pointed out.
In addition to an increase in grocery items, retailers across the board have seen more general merchandise items moving forward in a bid to improve one-stop shopping for the customer. Jeff Lowrance, spokesman for Food Lion, Salisbury, N.C., said an increasing number of items such as analgesics and cold remedies have been moved up to the fore in Food Lion stores so that customers can quickly find them. Food Lion merchandises an increasingly diversified product mix, which now includes more snacks like single-serve chips and cookies, peanuts and meat snacks; HBC items ranging from razors and lip balm to cold medicine during flu season; and beverage cases stocked with choices ranging from single-serve milk to sports drinks. All of these products have been added to the traditional mix of gum, candy and magazines found at the front end.
Some of the newer items seem to defy categorization, further complicating the front-end mix. Pfizer's Listerine Pocket Paks, for example, were pitched to both candy and general merchandise buyers when they were introduced, UWG's Ortiz said.
In his opinion, the number of general merchandise items found at the front end needs to increase on the basis of a profitability model. The traditional products, like razors, are being joined increasingly by items like flavored lip glosses as well as value-added mints, gum and other portable breath fresheners with dental hygiene benefits that seem to have achieved a cultish status with teens and preteens, Ortiz pointed out.
Even the front ends in natural food stores may soon be in for a barometric change.
"Our front-end merchandising has been pretty consistent for several years. Now we have been taking a look at whether we would want to bring some more convenience items in. We haven't actually done anything yet, but it's something that we have considered," said Sonja Tuitele, spokeswoman for Wild Oats Market, Boulder, Colo.
Traditionally, Wild Oats merchandises natural and organic chocolate, gum and mints at the front with the usual mix of magazines. However, the potential for additional profitability at the registers has the retailer considering adding other products, Tuitele said. The change would be a long time coming, as consumer feedback would be sought, but come it most likely will, she added.