ST. CLAIRSVILLE, Ohio — Riesbeck's Food Markets' in-store bakeries have launched “bonus” packages with good results. Giving customers additional items in a package is definitely working, officials said.
“By bonus pack, I mean we put four extra cookies in what is normally a 12-count package and keep the price the same,” John Chickery, the 10-unit independent's bakery director told SN. “Our regular retail for our scratch-made cookies is $3.99 a dozen, so the 16-count “bonus” pack for the same price contains four free cookies, reflecting a huge savings.”
Seeing cookie sales begin to lag about 10 months ago, Chickery said he introduced the bonus packs to spark sales of its five different flavors of cookies: chocolate chip, M&M, oatmeal, peanut butter, and sugar. One flavor a week is bonus-packed.
“We decided to start with cookies because everybody seems to buy cookies. As people began downgrading, we still saw them buying cookies in the commercial aisle.”
Chickery said his cookie promos are geared toward younger families with two or three children. “These bonus packs help to maintain business. I'd rather give up some gross profit and keep sales going.”
For quite a while, the company has put bonus packs of various in-store bakery items on ad once a month — usually the last week of the month — but for the past 10 months, they've put a bonus pack on ad every week.
In addition to underscoring the bargain in its ad circular, Riesbeck's also uses 3×1.5 inch yellow and black labels on the bonus packs, and often builds a secondary display as near the front of the store. The concept was recently extended to some bread products as well.
“We have a three-count pack of pepperoni rolls, a regional favorite, for $4.39. Now, we've made it a four-count pack at the same price,” Chickery said. “That took off right away. The first week of the bonus pack, pepperoni roll sales climbed 15% to 18%. Those rolls are so popular anyway that they're always in the top five bakery items sold. When we ran the bonus ad, they moved up to number one.”
Par-baked pizza crust was next to get its trial as a bonus pack. “We had a two pack for $3.79. Now, with three in the pack, customers get a $1.90 savings, and we take the least cut in gross profit on that deal.”
Other value deals at Riesbeck's involve cakes which cut into the margin by double-digit percentages. Take the “half-cake, half-price” promotion, for instance, which has run six times in a year.
“While our single-layer, 8-inch cakes normally retail for $7.99 to $9.99, when we do this promotion, we make up an interesting-looking half double-layer, 8-inch cake, and retail it for $4.49. The customer is saving up to $5.
“We take the biggest hit on margin with that one, but it's worth it,” Chickery said. “It drives sales to maintain market share, and when the economy lightens up, they'll come in for a whole cake. From 2010 to 2011, our bakery sales were down 1%. Now, we're getting back up.”