Store Brands

APR 2016

Store Brands delivers unprecedented strategic and tactical information needed by retail executives to develop and support compelling, differentiated store brand programs to build customer loyalty.

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Category Intelligence: Condiments and Dressings 6 0 Store Brands / April 2016 / www.storebrands.info Retailers that offer store brands with easy-to- identify ingredients and without artificial flavors and colors will attract more of the growing sector of health-conscious shoppers, agrees Ron Ratz, director of development for Wixon Inc., St. Francis, Wis. "Gluten-free, vegan, and non-GMO products also continue to be important to customers," he states. "Cleaner, simplified labels are a major trend in salad dressings as in other consumer packaged goods." Stand apart Offering such wellness-oriented products, as well as unique selections, should be a key strategy of private label product developers, notes Mike Hackbarth, vice president of private label and customer demand for The Fremont Co., Fremont, Ohio. "Successful retailers in the condiment category lead with noticeably different products versus strictly the same private brand offering from the same supplier that all their competitors offer," he says. Yet value should also be a prominent store brand differentiator, says Jamie Smith, Wixon flavor scientist. "Set a price point that is below the national brands as consumers still shop with their pocketbooks," she states. Lower-cost store brands are already helping to spur sales of organic condiments — a typically higher-price category — by giving shoppers a more affordable alternative to the national offerings, Hackbarth states. "Shoppers like the concept of organic or gluten- free, but they often don't want to pay a higher price," Fabing adds. Retailers, however, should not rely strictly on low pricing to attract customers to store brands. Most mainstream stores, Hackbarth notes, cannot compete long-term with the volume- based pricing of discount chains. "The challenge is to not take a myopic view of the category or commoditize it," says Dan Kelly, vice president of sales for Tracy, Calif.-based Musco Family Olive Co. "Consumers have the opportunity to buy condiments in different retail channels, so it is important to have the right price and to engage shoppers through proper shelf management and promotions." Such promotions could include posting meal ideas that include condiments and dressings on websites, distributing product coupons and cross-merchandising selections in stores, he says. Retailers also could generate greater interest in private brand condiments and dressings by Do merchandise store brand condiments in the deli and meat departments. Don't go it alone: Collaborate with suppliers to create unique, on-trend condiments and dressings. Ketchup Mustard Marinated vegetables/ fruit Olives Peppers/ pimentos Pickles Relish Mayonnaise/ sandwich spread Note: Does not include all condiment subcategories. Source: IRI, a Chicago-based market research firm. Total U.S. supermarkets, drugstores, mass market retailers, military commissaries and select club and dollar retail chains for the 52 weeks ending Jan. 24, 2016. Condiment category performance Dollar Sales (in millions) Change vs. Year Ago Dollar Share Unit Sales (in millions) Change vs. Year Ago Avg. Price Per Unit Private Label All Brands Private Label All Brands Private Label All Brands Private Label All Brands Private Label All Brands Private Label All Brands Private Label All Brands Private Label All Brands $141.2 +0.4% 18.5% 87.3 -2.9% $1.62 $764.1 +3.3% 100% 337.0 -2.3% $2.27 $104.5 -3.5% 24.0% 84.3 -5.3% $1.24 $436.3 +2.1% 100% 242.1 +0.5% $1.80 $23.6 +1.7% 14.6% 9.4 -1.4% $2.51 $162.3 +3.0% 100% 60.5 +3.3% $2.68 $279.7 +0.2% 41.6% 166.9 -2.7% $1.68 $672.1 +3.6% 100% 316.7 -0.5% $2.12 $65.0 -6.1% 13.5% 49.8 -5.7% $1.31 $483.5 +1.8% 100% 274.8 +1.2% $1.76 $178.9 -0.2% 22.3% 82.2 +1.1% $2.18 $803.2 +2.3% 100% 306.5 +1.9% $2.62 $41.5 -5.0% 27.5% 25.7 -5.7% $1.61 $150.9 -2.1% 100% 85.8 -2.4% $1.76 $172.7 -3.7% 9.6% 64.7 -5.7% $2.67 $1,808.4 -0.9% 100% 520.0 -2.4% $3.48 Note: Does not include all salad dressing subcategories. Source: IRI, a Chicago-based market research firm. Total U.S. supermarkets, drugstores, mass market retailers, military commissaries and select club and dollar retail chains for the 52 weeks ending Jan. 24, 2016. Salad dressing category performance Dollar Sales (in millions) Change vs. Year Ago Dollar Share Unit Sales (in millions) Change vs. Year Ago Avg. Price Per Unit Salad dressing mixes Shelf-stable pourable salad dressings Private Label All Brands Private Label All Brands $6.1 -5.7% 4.0% 5.2 -3.6% $1.16 $151.0 +2.5% 100% 67.8 +2.4% $2.23 $289.4 -3.6% 15.2% 155.3 -5.8% $1.86 $1,908.8 -0.4% 100% 760.6 -1.3% $2.51

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