Retailers are realizing the benefits of a trend toward specialty and premium condiments, enjoying higher dollar rings while furnishing the Center Store with some gourmet panache.
According to Robert Lavigne, a category manager for Randall's/Tom Thumb, Houston, numbers for ketchup and other traditional condiments have been fairly flat at his stores.
"I'm seeing minimal growth in that segment with the growth of our stores, but true growth is coming from the new, innovative items," he said.
Lavigne noted the rising popularity of the upscale lines, such as Ken's salad dressings, as well as the strong performance of the new marinades and grilling sauces. He stressed the adaptable quality of this segment, as dressings double as dips, and marinades may be sauces.
Statistics from Information Resources Inc., Chicago, bear witness to the success of the more glamorous garnish. For the 52-week period ended Jan. 28, 2001, ketchup showed a 0.4% increase in unit sales, while the marinade/meat sauce/glaze segment boasted a 15.7% increase.
Although the introduction of Heinz green ketchup and EZ squirt packaging has added some pizzazz to the segment, the role of the household staple leaves little room for a significant increase in sales. Lavigne maintains that consumers are simply "swapping" with these types of products.
At Lavigne's stores, while standard barbecue sauces are down, he has been able to pull up in the category as a whole because of the tremendous growth in marinades and grilling sauces.
"I've just redone my whole barbecue section to accommodate all the new things out there, and to increase what I've already got," he said.
"Lawry's [marinade] is very strong in our market. It just moved from direct-store-delivery to warehouse because of the product's strength," he said.
While the general consensus among retailers SN spoke with bodes well for this burgeoning segment, some feel these products have yet to prove their mettle, particularly some of the more exotic varieties.
Many of the unusual flavors -- for instance, the current popularity of chipotle and raspberry combinations -- tend to come and go, said Lavigne.
Jay Diebold, a category manager for Supervalu's Cub Foods division, Minneapolis, sees real potential in the marinade and grilling sauce segment, noting the increased sales volume of premium products in his stores.
"The premium barbecues and marinades coming out now are very appealing to retailers because of the $2.99 or $3.99 rings," Diebold explained. "You're not dealing with 99-cent ketchup and 79-cent barbecue sauce."
However, Diebold believes this segment has yet to cross the line from fad to trend, and advised retailers to be aware of the pitfalls for these types of products.
"The key is educating the consumer as to what is a marinade versus a steak sauce," he said. "I don't necessarily see the manufacturers developing that extra need."
The temptation is to go low on price, according to Diebold, at which point the segment loses much of its vigor.
"As soon as they take these marinades from a $2.99 ring to a 99-cent ring, it's not worth it to me to carry it," he said. "Then it's just a ketchup."
Retailers can play an active role in the cultivation of this market, cross-merchandising in the meat department and providing recipe cards.
Diebold finds that tie-ins work very well. For example, building a display in the chicken department and offering $1 off a chicken with purchase.
Scott Silverman, the vice president of specialty food and wine for Rice Epicurean Market, Houston, focuses on the educational aspect.
Silverman contends that although the price may cause some initial hesitation, people are willing to spend the money if they realize what they are buying has the potential to transform the average cut of meat into something exceptional.
Silverman highlights specific ingredients with recipe cards to facilitate the learning process.
At Rice, specialty condiments serve as a point of difference in the Center Store. By offering a unique array of products, Silverman hopes to establish customer loyalty while giving the aisles a definitive gourmet flair.
"If you look at grocery stores today, they're very homogenized. Once you're out of the perimeters, the aisles tend to be the same. This is a category that enables you to differentiate yourself."
Silverman uses an unusual and varied assortment of condiments in an attempt to establish his stores as destination stops. He takes advantage of the chain's small size, accepting special orders for hard-to- find items.
"There is an advantage to being a little guy," he said. "When you're a larger chain, it ruins your planograms to run these extra items off your shelf."
Many distinctive products at Rice have a strong seasonal component, such as pumpkin-based sauces in the fall or Hogwash -- dubbed by Silverman a "true condiment" -- a pork garnish for Easter.
Indeed, seasonal considerations are critical to the condiment category.
"Timing is probably as important as anything," said Silverman. "You have to watch the season."
The most lucrative time of year for the condiment category is the three month stretch between Memorial Day and Labor Day -- prime grilling season. Yet enterprising retailers are stretching the season, and some were already preparing in the final winter months.
Randall's Lavigne said that although 50% of his business in the barbecue department is done during those three months, he already had promotions running on barbecue sauces in March.
At Cub Foods, Diebold aims for an eight month grilling season by drawing out his trade dollars.
"Everybody wants the Fourth of July and Labor Day, but I can't do five ketchups in one week.
"Maybe I'll do Heinz for a full four weeks, effectively spreading out the dollars that the trade brings to me," he said.
In addition to seasonal spikes, many of the more popular grilling products are regionally bound, providing the Center Store with some local color.
Ken Manly, a specialty food buyer for Draeger's Markets of San Mateo, Calif., told SN that branded items from popular area restaurants are often top sellers.
Mac Arthur Park Restaurant, just outside of Menlo Park, has an outstanding barbecue sauce entry, he said.
But while this sauce does exceptionally well at Draeger's Menlo Park location, sales drop significantly at the other two locations.
"We don't carry the same products in all of our stores," Manly said. "We're finding we have to fine tune the selection to each location, to a degree."
Many of these small, local projects remain well kept, neighborhood secrets, yet some expand to gain placement on a national level. Stubb's barbecue sauce originated at a small restaurant in Austin, Texas, yet is today one of the leading specialty barbecue sauces nationwide, according to Rice Epicurean's Silverman.
Silverman looks to get in on the ground floor with many of these smaller companies, reaping generous rewards if the line expands beyond limited local distribution channels.