ConAgra Aims for Center Store Leadership
With Ultra Convenient Meals Aisle
By Dale Buss
CPG companies that play heavily in the center store of supermarkets long have understood and dealt with consumer suspicions about shelf-stable products – perceptual obstacles that generally have grown with shoppers’ increasing desire for fresher and better-for-you fare.
But ConAgra Foods apparently believes it can offer retailers a new scheme that will attract American grocery shoppers to the center aisles again and provide a highly flexible new arena for many kinds of in-store merchandising and marketing efforts. For a few months now, CPGmatters has learned from industry sources, ConAgra has been testing its Ultra Convenient Meals aisle at some supermarkets and combing retailer and shopper feedback for clues about whether it can succeed on a broad basis.
The idea behind the Ultra Convenient Meals aisle is to present the increasing number and type of ConAgra’s healthy, shelf-stable products to consumers in a convenient new way that will keep them coming back and to create synergies among the various product lines included through in-store marketing and merchandising.
The test assortment consists of microwaveable foods that can be prepared in five minutes or less, including soups, chili, macaroni and cheese, and boxed dinners such as ConAgra’s new Healthy Choice Fresh Mixers, as well as related items from other suppliers.
ConAgra is working with retailers to locate the Ultra Convenient Meals aisle at the front end of the center store, next to the soup. In fact, four shelf-feet of microwaveable soups would be part of the 16-foot Ultra Convenient Meal section, as it was initially configured.
In fact, virtual-store testing showed that creating an Ultra Convenient Meals environment in the aisle next to soups would significantly increase convenient-meal category sales. Also, shoppers in the panel rated the Ultra Convenient Meals aisle as easy to shop, well organized, and well showcased. And retailer and syndicated data have identified cross-purchase affinity among microwaveable products, a further possible growth factor.
ConAgra executives declined to respond to questions from CPGmatters about the test, with a spokeswoman for the Omaha-based processed-food giant saying that the company would “have more to share in a couple months.” But it’s clear that the Ultra Convenient Meals concept could yield significant benefits to a company that has been trying to move its primary shopping constituent upscale and that is looking for ways to optimize the wellness halo that surrounds some of its brands, including Healthy Choice.
The company is also launching a new, overall brand identity as a supplier and employer, “Food You Love.” The idea is to help customers succeed as they define success, and the effort will include several new vehicles including an e-newsletter targeted at retailers.
The Ultra Convenient Meals concept is expected to be a cornerstone of how ConAgra applies its new branding campaign to the center store. Consumer research told ConAgra that shoppers are interested in microwaveable products that are healthy as well as convenient to find and understand in the store. As microwaveable meals have grown within their respective categories, these sub-segments have attracted microwave consumers from adjacent categories.
Microwaveable meals already make up about $550 million of the annual $3.5-billion shelf-stable meal category, the rest of which is about evenly divided between “value meals” such as canned pastas, and ready-to-serve soup and premium chili.
ConAgra has been successful in adding to that growth with the introductions of new product lines such as Marie Callender’s Home Style Creations in recipes including Classic Beef Stroganoff, and Healthy Choice Fresh Mixers. The latter include everything in one compact container: sauce, pasta or rice, and even a strainer. Among other things, these lines have boosted the typical income level and health consciousness of shoppers in the category.
Nevertheless, many shoppers – especially more affluent consumers – retain an inherent distrust of shelf-stable products in the center store. They’re especially disdainful of shelf-stable meat products that may be unfamiliar to them outside the grocery aisle, and present meat varieties they’re accustomed to in temperature settings that don’t seem right. The more familiar they are with products, the more sauce and broth they contain, and the smaller the meat pieces, typically, the less concern these shoppers have about shelf-stable meal-type products.
But ConAgra believes that more innovation in the microwaveable meals category is beginning to give it an aura of innovation even with upscale and health-conscious shoppers, who more often are equating the category positively with frozen microwaveable meals. This gives the company and its retailer customers broadened in-store marketing opportunities – starting with the Ultra Convenient Meals aisle.
So far in its test, ConAgra has concluded that the best flow for the aisle is to start with premium microwave meals – such as its Fresh Mixers and Home Style Creations – adjacent to microwaveable soup. All-family microwave meals would be next, and the section would end with mainstream microwaveable meals including chili and stews.
Shoppers were led “virtually” through three sorts of shelving scenarios as part of the test. One, the ConAgra-recommended arrangement, was shopper-segment shelving in which the products were arranged by premium-healthy, all-family, and mainstream groups. The second scheme was a horizontal packaging-segment arrangement in which products were layered horizontally by package types, such as cups, bowls and trays. In the third plan, in control stores, microwaveable products were arranged in their parent categories.
In fact, virtual-store results indicated that ConAgra’s shopper-segment design drove more dollars and improved the shopping experience than the other two – and also improved consumer perception of the store.
And the results underscored the importance of the relationship in the shopper’s mind between soup and microwaveable meals. Dollars spent per shopper were slightly higher than in the control store, and much higher than a boxed-dinner adjacency, when the Ultra Convenient Meals aisle was set adjacent to soup.
When ConAgra finally reveals the results of its tests in the form of a program to roll out an Ultra Convenient Meals aisle scheme to retailers on a large scale, expect these key insights to drive the format innovation. And at that point, the company and its retailer partners can begin to take advantage of the in-store marketing opportunities in earnest.
JUNE 2010
Kraft Leverages Shopper Insights
To Develop Occasion-Based Marketing
By Dale Buss
For a generation, Americans have been pushing their food-shopping trips closer to when they actually consume their purchases rather than going like clockwork simply to re-stock their shelves. But CPG companies and supermarkets have been slow to figure out how to address this cultural shift in their marketing and merchandising practices.
Until now, that is. Leveraging shopper insights gained from a massive new research study,
Kraft has begun emphasizing “occasion-based marketing” aimed at tapping into the real-time interests and passions that consumers demonstrate during trips with different purposes to various food retailers. And they’re beginning to work with retailer customers to put occasion-based marketing to work for both parties, utilizing customized programs and promotions.
“The key is to trigger the passion for the eating experience during the shopping trip,”
Diane Tielbur, senior director of shopper engagement for Kraft Foods told CPGmatters.
“Today, most stores are designed to help shoppers fill their pantry, not to elicit the joy of the eating experience.”
So the “magic” of occasion-based marketing “is to create a tighter link between a shopper’s anticipated eating experience and the actual in-store shopping experience.” Tapping into the “passion shoppers have for eating,” Tielbur said, can be accomplished through in-store displays, sampling, retail design, messaging, visuals and meaningful product offerings.
“The power of occasion-based marketing is that it can unlock the potential of the everyday eating occasions we all experience.”
Tielbur said that the CPG industry still tends to think of shopping trips in the traditional fashion. Kraft has recently broken out of that funk in large part due to two developments: its recent combination of its shopper-insights group and its consumer-insights group, and its new research with 15,000 consumers. As a result, Kraft has formed a “call to action” to include retailers in exploiting what the company has learned.
As part of the research, Kraft examined the variety of occasions that motivate consumers to shop beyond the axiomatic weekly trek to the supermarket where they spend $150 or $200
to re-stock. That doesn’t happen nearly as much as it used to. Contributing factors include
not only the increasingly frenetic pace of life, especially in households that depend on two incomes, as well as economic strains that prompt shoppers to focus on value as well
as convenience.
As a result, consumers more often are spreading out the shopping occasions as they browse for that evening’s dinner, for a family birthday party the upcoming weekend, for a lunchtime snack, or perhaps fulfilling the grocery list of an elderly parent. They also are frequenting the growing number and type of grocery retailers as they address these occasions, Kraft’s research found.
“Not all of these occasions are created equal,” Tielbur said. “The afternoon snacking occasion is very different from the after-dinner snack occasion, and both occasions vary based on who was present and the in-going expectations or needs for that occasion.”
Shoppers also may vary in what they’re seeking for weekday breakfast goods when they’re shopping on Sundays through Wednesdays, for instance, compared with what Tielbur called “more savoring family- and couple-oriented breakfast solutions that consumers try to supply with shopping trips from Thursdays through Saturdays.
Kraft set out to define these occasions in more meaningful ways, to quantify them, and to understand the occasions that are most important to its various retail partners. That is
making it much easier to design marketing programs, retail-layout recommendations, and
new products.”
For example, Kraft has been working with a retailer that Tielbur declined to identify, on snacking occasions that are important to their particular shoppers, helping differentiate them from other retailers in their trading area. Stand-alone displays are one tool because they can prove very effective with a focused occasion as their central theme.
“But even something as simple as rolling fresh bread out to the registers between 4 p.m.
and 6 p.m. is occasion-based marketing that good retailers already do with great success,” Tielbur said.
As effectively as some retailers already tap into the occasion-based motives brought by consumers into their stores – even if they don’t use the terminology – Tielbur said that “there is certainly an upside” to be gained by Kraft and its customers in using the occasion-based lens even more.
That includes the idea of finding ways to get shoppers to focus on upcoming occasions as well as the primary one that has motivated a particular trip.
“While consumers are shopping for dinner,” Tielbur said, “we’d love to get them thinking about tomorrow’s breakfast or lunch – and capture another occasion.”
That's where partnerships with retailers -- based on in-store marketing, promotion and merchandising -- can really optimize the occasion-based marketing philosophy. Kraft is counting on them to take to heart the truism of retailing that one good return deserves another.
