Apr 2015

CatMan Do
Reach across aisles to boost

center store Page 62
s
i
2
Truth and Consequences

Exploring the ramifications of
deli failures Page 80
r
e
t
t
e
b
e-Shop Around
Choose the best online model

for your company Page 129
!
1
n
a
th
Page 30
Add Nutella & GO! Pretzel Sticks to

drive front-end profitability.
April 2015 Volume 94 Number 4
$10 www.progressivegrocer.com
Nutella & GO! is ranked 2nd

among top front-end SKUs*
12cnt front
end tray*
Nutella & GO! Pretzel is projected

to be a Top 10 front-end item*
Nutella & GO! Pretzel is the only snack
offering Nutella 's delicious hazelnut
spread with dip-able pretzel sticks
12cnt front
end tray*
*Also available in 24cnt front-end display
Order Nutella & GO! Pretzel Sticks today to continue

driving high revenue and profit on the front-end!
*Source: IRI Total US MULO, Latest 52 WE 4/20/14
2015 Ferrero. All rights reserved.
CatMan Do
Reach across aisles to boost

center store Page 62
Truth and Consequences

Exploring the ramifications of
deli failures Page 80
e-Shop Around
Choose the best online model

for your company Page 129
Page 30
April 2015 Volume 94 Number 4

$10 www.progressivegrocer.com
BREWED THE
HARD WAY,
TO WORK HARD FOR YOU.

The King of Beers is an asset on Grocery Store shelves.
In fact, Budweiser accounts for over $1.5 billion in
annual sales, meaning one case of Budweiser is sold
from large-format stores every second. Its a brand with
so much stopping power that 54% of shoppers can
recall seeing Budweiser on display.*
Contact your local distributor to get your Brewed The
Hard Way signage today.
* Sources: iri total convenience and drug, last 52 weeks

IRI MULO, last 52 weeks
2015 Anheuser-Busch, Budweiser Beer, St. Louis, MO
#1 Hard Discount
Grocery Designed for
Independent Retailers
Save-A-Lot has been developed with the
independent retailer in mind.
Contact us to learn why leading independent
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Minimum $200,000 fnancial incentive.
Comprehensive support including
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Dedicated distribution of fresh meat,
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To learn everything you need to know

about opening Save-A-Lot food stores
visit save-a-lot.com/own
or call 314.592.9446
CO
ACTUAL SIZE
NV
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T 12
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OZ MIRCROW
profit from
our innovation
As organic goes mainstream, Blount
enables you to expand your organic
offerings with an exciting variety of
our delicious innovative side dishes.
Hand crafted in small batches, our
products are available in convenient
12 or 16 oz retail bowls.
Elevate your customers dining experience
and your stores prots.
With Blount, you get more

because we do more.
To learn more about our artisan-crafted
organic sides, call 800.274.2526 or
visit blountfinefoods.com/buildsales
Visit us at the IDDBA
Georgia World Congress Center June 6-9 Atlanta
Booth# 1901
Arugula Salad with

Pear Nectar Vinaigrette
2015 Goya Foods, Inc.
Your shoppers nd this and

other great recipes at goya.com
The ChefsBest Excellence Award is awarded to brands that surpass

quality standards established by independent professional chefs.
April 2015
features
Volume 94, Issue 4
cover story
88
PrePared food PaCkaging
62
To Protect and Serve

Retailers collaborate
with suppliers on innovative
packaging for prepared foods.
Category ManageMent
Delivery Solutions
Reaching across aisles
to satisfy shopper
need states is the way
to boost center store.
92
ProduCe
Pack and Play

Todays packaged produce
delivers it all:
convenience, sustainability,
personality and fun.
grocery
70
CondiMents
Hot Stuff
Sauces with a spicy kick
enliven supermarket displays
and customers palates.
frozen &
refrigerated
30
98
Progressive groCer s 82 annual rePort

of the groCery industry
nd
Aisles of Opportunity
Grocers are bullish on 2015, but new specters are

bringing on sleepless nights for retailers.
fresh food
ProduCe Category
sPotlight
Masters of Melons
Flavor-packed varieties,
strategically merchandised,
are key to this categorys
success.
106
guest PersPeCtives
80
Progressive groCer s deli insights
Facing Deli Consequences

Training is key to reducing prepared food
product issues, out-of-stocks.
A Call for an Organic

Checkoff
Grocers can combat out-ofstocks by supporting a boost
in organic farming.
115
74
Baked goods
A Slice of the Action

Savvy promotions and a
keen eye on consumer needs
position frozen cakes and pies
as an attractive alternative
to home baking.
2015 annual
Meat ConferenCe
Lessons in Meat
Marketing
Annual conference looks at
branding, natural products,
foodservice and how to
enhance the shopper
experience.
April 2015 | progressivegrocer.com |
nonfoods
120
HealtH Beauty & Wellness
570 Lake Cook Rd, Suite 310, Deerfield, IL 60015

224 632-8200 www.progressivegrocer.com
Advances in Care
Retailers can tap new technology for personal disease
management to attract diabetes patients.
vP, Brand Director

201-855-7621
EDITorIAL
Editorial Director
Joan Driggs
224-632-8211
jdriggs@stagnitomail.com
Chief Content Editor
Meg Major
724-453-3545
mmajor@stagnitomail.com
Editor-in-Chief
James Dudlicek
224-632-8238
jdudlicek@stagnitomail.com
Managing Editor
Bridget Goldschmidt
201-855-7603
bgoldschmidt@stagnitomail.com
Technology Editor
John karolefski
440-582-1889
jkarolefski@stagnitomail.com
Senior Editor
katie Martin
224-632-8172
kmartin@stagnitomail.com
Senior Editor
Anna wolfe
207-773-1154
awolfe@stagnitomail.com
Digital Editor
kyle Shamorian
224-632-8252
kshamorian@stagnitomail.com
Art Director
Bill Antkowiak
bantkowiak@stagnitomail.com
Contributing Editors
Bob Ingram, Jenny McTaggart, Barbara Sax,
Jennifer Strailey and Christina Veiders
126
Batteries and FlasHligHts
Storm Cells
In times of emergency, consumers look to grocery retailers
for batteries and fashlights.
technology
129
e-CommerCe
Getting Started Now

Whats the best type of service for online grocery?
134
guest PersPeCtives
The Perception Gap

Heres how grocers can use data more efectively.
138
logistiCs
The Digital Link

Beyond serving consumers needs, up-and-coming
technology can help streamline the supply chain
for a new era of retailing.
equipment & design
142
sHoPPing Carts
Pushing Into Tomorrow

Te shopping cart of the future has attracted
a wide array of concepts.
| Progressive Grocer | April 2015
ADvErTISING SALES & BuSINESS

Midwest Marketing Manager
John huff
224-632-8174
jhuff@stagnitomail.com
western regional Sales Manager
Elizabeth Cherry
310-546-3815
echerry@stagnitomail.com
Eastern Marketing Manager
Maggie kaeppel
630-364-2150 Mobile: 708-565-5350 mkaeppel@stagnitomail.com
Northeast Marketing Manager
Mike Shaw
201-855-7631 Mobile: 201-281-9100 mshaw@stagnitomail.com
Marketing Manager
Janet Blaney
(AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY)
jblaney@stagnitomail.com
630-364-1601
Account Executive/
Classified Advertising
Terry kanganis
201-855-7615 Fax: 201-855-7373 tkanganis@stagnitomail.com
Advertising/Production Manager
Jackie Batson
224-632-8183 Fax: 888-316-7987 jbatson@stagnitomail.com
Classified Production Manager
Mary Beth Medley
856-809-0050
marybeth@marybethmedley.com
MArkETING & ProMoTIoN
Director of Market research
Debra Chanil
201-855-7605
dchanil@stagnitomail.com
Audience Development Manager
Shelly Patton
215-301-0593 spatton@stagnitomail.com
List rental
The Information refinery
800-529-9020
Brian Clotworthy
reprints and Licensing
wrights Media
877-652-5295
sales@wrightsmedia.com
Subscriber Services/Single-copy Purchases
978-671-0449 or email at Stagnito@e-circ.net
EvEnts MEdia REsEaRch infoRMation

uNITED STATES MArkETS
Convenience Grocery/Drug/Mass
Store Brands Specialty Gourmet
Multicultural Green
departments
10 EDITorS NoTE: BANNEr YEAr
14 PG PuLSE
16 IN-STorE EvENTS CALENDAr: JuNE 2015
20 NIELSENS ShELf SToPPErS/SPoTLIGhT:
frozEN AND rEfrIGErATED PrEPArED fooDS/
frozEN AND rEfrIGErATED GrAvIES AND SAuCES
22 MINTEL GLoBAL NEw ProDuCTS:
SALTY SNACkS, MEAT SNACkS AND PoPCorN
24 NEw horIzoNS: ITS TIME for A NEw workPLACE
28 ALLS wELLNESS: EArTh DAY EvErY DAY
146 whATS NExT: EDITorS PICkS for INNovATIvE ProDuCTS
150 ThE SuPPLIEr SIDE
154 ThE LAST worD: ANTICIPATIoN
Jeff friedman
jfriedman@stagnitomail.com
CANADIAN MArkETS
Convenience
Pharmacy
Foodservice
President & CEo

harry Stagnito
Chief Information officer
kollin Stagnito
SvP, Partner
Ned Bardic
Chief Brand officer
korry Stagnito
vP & Cfo
kyle Stagnito
vP/Custom Media Division
Pierce hollingsworth
224-632-8229 phollingsworth@stagnitomail.com
Production Manager
Anngail Norris
human resources Manager
Sandy Berndt
Corporate Marketing Director
Bruce hendrickson
224-632-8214
bhendrickson@stagnitomail.com
Promotion Director
robert kuwada
201-855-7616
rkuwada@stagnitomail.com
vP/Events
John failla
201-855-7634
jfailla@stagnitomail.com
Director of Digital Media
John Callanan
203-295-7058
jcallanan@stagnitomail.com
Audience Development Director
Cindy Cardinal
Drive trac and sales

with innovative and exciting
items from Pillsbury.
Shoppers know they can celebrate any occasion with Pillsbury.

With the bright colors and unique avors your shoppers look forward to each
season, were making the bake aisle a destination for inspiration all year long.
Innovation brought to you by The J.M. Smucker Company family of brands.

/ The J.M. Smucker Company. Pillsbury, the Barrelhead logo and the Doughboy character are trademarks of The Pillsbury Company, LLC, used under license.
editors note
by Jim Dudlicek
Banner Year
G
Marketing
meals, not
ingredients
solutions, not
products is
whats going
to keep the
traditional
grocer relevant
and thriving.
10
rocery retailers tell Progressive

Grocer theyre upbeat about their
prospects for a successful 2015,
and apparently the folks who supply the food they sell are happy
about the year ahead as well.
Despite an underwhelming performance in
2014, the near-term prospects for the U.S. food and
beverage industry are encouraging, according to a
new report from Chicago-based BMO Economics.
Although margins and proftability fell short
of lofty expectations in 2014, stronger demand
growth, falling livestock prices and still-low
crop costs should help producers make up lost
ground, says Aaron Goertzen, an economist for
BMO Capital Markets.
Te outlook for demand is relatively upbeat,
with real consumer spending expected to grow
3.3 percent in 2015 as employment continues to
expand and, eventually, as wage growth shifts into
higher gear. Te profle of consumer spending
growth is becoming more balanced, with less focus
on durable goods such as autos and faster growth
in nondurables such as food, Goertzen notes.
Lower pork and dairy prices should also create
some wiggle room in household food budgets later
this year, which should provide a lift to volume
demand across most segments.
He adds, Looking ahead, a more moderate pace of global growth should help to limit
upward pressure on commodity prices and help
keep costs better contained.
Tis analysis mirrors what grocery retailers told
us in responses to the exclusive survey underpinning our 82nd Annual Report of the Grocery
Industry, which begins on page 30.
On a 100-point scale, retailers score their confdence in 2015 at just above 72, six points higher
than their 20/20 hindsight rating for 2014, which
a year ago they gave a 71.8. Nearly half of our
respondents express signifcantly more optimism
for 2015, up from the 39 percent who said they felt
that way last year about 2014.
Among issues keeping you up at night, grocers
put data security in frst place, up from ffth after a
year of widely publicized breaches hitting Super-
| Progressive Grocer | Ahead of Whats Next | April 2015
valu, Target and

other retailers.
Meanwhile,
a perpetually
competitive
retail climate,
continued
channel blurring and the advancement of e-commerce have
made grocers more mindful of exclusive products,
customization and in-store services geared toward
a rewarding shopper experience that cant be had
by clicking and dragging.
To prove their relevance to younger demographics
that were raised on mobile technology but are foodsavvy and hungry for authentic experiences, traditional grocers are enhancing their historic competencies with digital components designed to bring speed,
convenience and uniqueness to a mature channel, as
if to say, Sure, you can buy diapers online, but do
you really want Amazon picking out your steak? A
mouse click can whisk ancient grains to your doorstep, but a grocery store wellness expert who knows
your name and face can explain why theyre good for
you, over kale smoothies at the markets cozy caf.
Meat remains the top sales driver for grocers,
while center store dropped to eighth, replaced at
No. 2 by private label, which has hopscotched
its way up our ranking.
Center stores ills might well be cured by better
cross-merchandising across multiple aisles, including the fresh perimeter, as our category management report suggests, starting on page 60.
Marketing meals, not ingredients solutions,
not products is whats going to keep the traditional grocer relevant and thriving as Millennials start bringing their kids along on shopping
trips. Grocers not already thinking this way may
already be in big trouble.
Have your own thoughts about this?
Dont wait until our 83rd annual report
reach out to us anytime. PG
Jim Dudlicek
Editor-in-Chief
jdudlicek@stagnitomail.com
Twitter @jimdudlicek
INNOVATION
IS
EVERY DAY.
Consumer-led innovation delivering the
INCREMENTAL CATEGORY GROWTH

youre looking for. Another way were committed
to creating shared success every day.
SUCCESS IS AN EVERYDAY THING.
hersheys.com
Join us at the
NCA Sweets & Snacks Expo,
Booth 1505.
General Mills
Driving Growth with

New Products that meet
Evolving Food Trends
DELIVERING INNOVATION ACROSS THE STORE
Whats trending on Progressivegrocer.com
Supermarkets Excel at
Experience Ratings
A tip of the cap to Publix, Aldi and H-E-B,

each of which earned top scores on the
2015 Temkin Experience Ratings, an
annual ranking of large organizations
based upon the quality of the customer
experience. Also lauded from the
grocery industry in the online consumer
poll were Trader Joes and Hannaford,
which cracked the lists top 12.
Customer experience
drives loyalty, so its a
growing area of focus for
most businesses, notes
Bruce Temkin, managing
partner of Temkin Group,
the Waban, Mass., research and
consulting firm that conducts the annual
ratings program based on the feedback
of 10,000 U.S. consumers, who this year
were asked to rate recent interactions
and overall experiences with 293
companies in 20 industries across three
dimensions: success, effort and emotion.
Millennials Driving Meal Prep
Meal preparation takes center stage among top evolving trends in U.S. consumers
eating habits, according to Jacksonville, Fla.-based Acosta Sales & Marketing, whose
recent survey finds that nine in 10 shoppers prefer eating at home, driven by a desire for
comfort (61 percent), cost (60 percent) and convenience (59 percent).
Rather than cooking from scratch, however, Americans are turning to readyto-eat and take-and-bake solutions, including hybrid homemade meals such as a
grocery store rotisserie chicken with a salad-in-a-bag and homemade potatoes.
Some 46 percent say they prepared meals at home over the past year 48 percent
when considering only the Millennial generation which also reports eating prepared
foods from grocery stores at home at a much higher rate than total U.S. diners
(27 percent versus 16 percent, respectively).
Acosta Sales & Marketings The Evolution of Eating Survey
Making Things Personal

American consumers want a more
personalized retail experience but are
divided on retailers tactics and the
types of personal information they
feel comfortable disclosing, according
to Accenture. Nearly 60 percent of
consumers want real-time promotions
and offers, yet only 20 percent want
retailers to know their current location
7.4%
The rise in the

Hispanic populations
spending power over
the past 10 years
Nielsen
14
and only 14 percent

want to share their
browsing history.
The Dublin, Irelandbased firms research also found that
while many consumers are willing
to share some personal details with
retailers, nearly all (90 percent) of
the respondents say that if the option
were available, they would

limit access to certain types
of personal data and would stop
retailers from selling their information
to third parties. In addition, 88 percent
would prefer to determine how the data
can be used, and 84 percent want to
review and correct information.
Accenture Personalization Survey
$12 Minimum Wage Yields Maximum Support

Based on results of PGs recent online poll asking readers to weigh in with thoughts on the minimum
wage following Walmarts move to increase its hourly wage rate to $10, it seems clear that more
front-line associates responded than industry executives. To wit: While 40 percent of the total votes
were tallied across an hourly rate range between $8 to $11, with
$8
6% 23 percent voting to keep the present hourly rate intact,
$9
9
the 37 percent favoring a $12 minimum wage doesnt
square with the industrys well-established
$10
19
position that a minimum wage increase
$11
6
would create significant challenges for
$12
37
many grocers. At left is how the votes
It doesnt need to
stacked up as we went to press.
be increased
23
FAMILIES IN NEED
ARE ASKING FOR MILK
Milk is one of the most requested items at Feeding America food banks nationwide. But donations
fall far short of the need. That means many of the 16 million children who struggle with hunger
every day miss out on milks high-quality protein and other essential nutrients. Its a big problem.
The Great American Milk Drive is the answer.
LIFT YOUR SALES BY DOING GOOD
2015 Americas Milk Companies.
Invigorate your
milk sales without
discounting
Drive foot traffic

and new customers
to your stores
Strengthen
your community
presence
MELISSA MALCOLM, MILKPEP

Lets discuss how to put The Great American
Milk Drive to work in your stores. Mention this ad
during our conversation and Ill donate a gallon
in your name for your time and interest.
1-800-945-MILK
mmalcolm@milkpep.org
June 2015 is...

National Dairy Month
National Candy Month
National Iced Tea Month
National Soul Food Month
National Country Cooking Month
Say Something Nice

Day. Let your staff
know you appreciate
their efforts.
10
11
12
13
17
18
19
20
National Rocky
Road Day. Sample
different brands of
rocky road ice cream.
National Egg Day
Hug Your Cat Day.

Put up a display
of cat food and
accessories.
National Doughnut
Day. Make sure
the bakery is ready
and offer doughnut
samples to shoppers.
National Yo-Yo Day.

Hold a contest for
the best Walk the
Dog or Around the
World.
World Milk Day
IDDBAs DairyDeli-Bake Expo

begins in Atlanta
and continues
through the 9th.
Make sure your

barbecue products
are well stocked
Fathers Day and the
first day of summer
are coming.
National Chocolate
Ice Cream Day
14
Flag Day. Decorate

the store in red,
white and blue.
21
Fathers Day
15
National
Lobster Day
22
National Chocolate
clair Day
National Onion
Ring Day
Its also the First Day

of Summer.
28
2
Summer Fancy Food

Show begins in New
York and continues
through the 30th.
Finalize a sale on
summer items in
honor of the nations
birthday next month.
16
29
National Waffle
Iron Day
National
StrawberryRhubarb Pie Day
National
Iced Tea Day
National German
Chocolate Cake Day
FMI Connect begins

in Chicago and
continues through
the 11th.
16
National Fudge Day

Fresh Veggies Day
23
Public Service Day.

Work with your team
to find a couple of
community projects.
National Apple
Strudel Day
Conversely, its
also Eat Your
Vegetables Day.
To celebrate
International
Picnic Day, build a
big display of picnic
baskets, recyclable
cutlery, plates and
glasses, napkins,
and food storage
containers.
24
25
National Cherry
Tart Day
National
Pralines Day
National Pink Day.

Use your Facebook
page to ask shoppers
to wear something
pink.
Global Beatles Day.

Play music in store by
the Fab Four.
National Peanut
Butter Cookie Day.
Schedule cooking
demos to show how
easy it is to make this
treat at home.
National
Flip-Flop
Day
Kitchen Klutzes
of America Day.
Display items to help
the clumsy like
sponges, cleaning
aids, adhesive
bandages, mops and
brooms.
National Vanilla
Milkshake Day
National
Martini Day.
Take an online
poll: shaken
or stirred?
26
National Chocolate
Pudding Day
27
To celebrate
National Sunglasses
Day, ask all staff to
wear their shades.
National
Catfish Day
30
Social Media Day.

Tweet your
shoppers to find
special deals on your
Facebook page and
fun ideas on your
Pinterest page.
National Almond
Buttercrunch Day
E-mail your calendar

submissions to
awolfe@stagnitomail.com
Trion Cooler Merchandising
AMT Adjustable
Merchandising Tray
Org
ga
aniz Chaos, Increase Sales
Organize
Designed for yogurts; dips; spreads; puddings, gelatins
and snacks; ice cream and sherbet; instant soup cups;
microwave single-serves; food-to-go offerings, tubs,
bottles and other difcult to organize products.
Small AMT adjusts from 2 11/16" to 3 5/16" wide for

4-6 ounce yogurt cups and similar small products.
Medium AMT adjusts from 3 5/16" to 3 15/16" wide for

5-6 ounce greek yogurt cups and mid-range offerings.
Large AMT adjusts from 4" to 4 5/8" wide for tub, pint,
11/2 pint, ice cream and large containers.
Width adjusts in 1/8" increments and locks in place.

Two breakaways allow easy adjustment in the eld
from standard 22" length to 20" and 18."
Built-in manual feed allows trouble-free forwarding

and facing of products for increased sales and prots.
Trays lift out for rear restocking and proper rotation.
Durable, easy-clean plastic construction for long-life,

even under heavy use and in harsh environments.
Optional plain-paper label, sign and ag holder

provides a protected home for product and price
information and improves promotional opportunities.
Proudly Made in the U.S.A.
Built-in Manual Feed

Optional Label/Flag Holder
Adjustable Width
Breakaway Lengths
Built-in Handles
Built-in Ventilation
Paddle Extenders
Sidewall Extenders
Part of the Trion Shelf Works System of Cooler and Storewide Merchandising Solutions.
2014 Trion Industries, Inc.

297 Laird Street, Wilkes-Barre, PA 18702-6997
Phone 570-824-1000 l Fax 570-823-4080
Toll-Free In U.S.A. 800-444-4665
www.TrionOnline.com
Patents and patents pending. Note: Product photography is a simulation of a retail environment
and is not meant to imply endorsement by or for any brand or manufacturer.
Trion WonderBar
Pouch Hook
Pouch Merchandising Simplied

T
Trust
the hook-makers at Trion to invent creative solutions
sspecifically for the new wave of pouch packaging and
merchandising. Field-tested and already in retail use,
m
Trions new Pouch Hook is ready to back your expansion
Tr
into this exciting new venue of product promotion.
in
Standard and Gravity-Feed congurations available

to keep items forwarded and automatically faced.
Proprietary gate keeps product from being jostled

off rear.
o
FFlip-front Label Holder swings up for easy access

and product removal.
a
LLoads from rear, or easily dismounts to insure fast

restocking, product rotation and reduced shrinkage.
re
Saddle mounts on a Universal Bar design allowing

Sa
tool-free installation on all thick- and thin-walled
to
gondola and cooler uprights.
go
Stocked in 4 lengths compatible with all standard

St
shelf sizes allowing mixed use in display.
sh
Custom sizes and short-run congurations possible.

Cu
Proudly Made in the U.S.A.
Proprietary Rear Gate
Insures Product Rotation
Easy Vending Front
Gravity-Feed Available
Part of the Trion WonderBar Family of Tray and Bar Merchandising Solutions.
2014 Trion Industries, Inc.

297 Laird Street, Wilkes-Barre, PA 18702-6997
Phone 570-824-1000 l Fax 570-823-4080
Toll-Free In U.S.A. 800-444-4665
www.TrionOnline.com
Note: Product photography is a simulation of a retail environment and
is not meant to imply endorsement by or for any brand or manufacturer.
Front End
Market Intelligence By The Numbers

GROCERYS TOP 10
Shelf Stoppers
Frozen/Refrigerated Prepared Foods

Largest Sales Increases in Supermarkets by The Nielsen Co. (52 Weeks Ending Jan. 17, 2015)
Sales
% Change Dollars
(Millions)
2015
2014
Entres-Mexican (One-food-Frozen)
$621.9
5.0%
1.9%
Entres-Meat (One-food-Frozen)
641.3
4.2
7.5
Sauces and Gravies-Frozen/Refrigerated 308.1
3.5
3.0
Entres-Remaining (Two-food-Frozen)
13.3
3.5
-14.5
Soup-Frozen/Refrigerated
224.1
3.1
5.5
Entres-Remaining (One-food-Frozen)
487.4
2.5
-0.2
Corn Dogs-Frozen/Refrigerated
200.0
0.7
-2.7
Pot Pies-Frozen
317.7
0.1
4.8
Entres-Poultry (One-food-Frozen)
1,898.9
0.0
1.9
Pasta-Plain-Frozen
192.6
-0.4
0.0
Total Category
$8,108.1
-1.5%
% Change
2015
3.6%
2.1
2.9
-7.8
2.0
-0.3
-0.4
-1.5
-1.7
-1.8
Units
2014
1.2%
6.8
0.8
-15.1
2.2
0.0
-1.6
0.5
0.0
-1.1
-3.3%
-2.1%
-1.2%
NielseNs Spotlight
Consumption Index: Frozen/Refrigerated Gravies and Sauces
LIFESTYLE
Behavior Stage
Cosmopolitan Affluent Comfortable Struggling

Centers
Suburban
Country
Urban
Spreads
Cores
Modest
Working
Towns
Plain Rural
Living
Total
indicative perhaps of higher

disposable incomes and a
greater interest in culinary
experimentation, residents of
affluent suburban spreads use
more frozen and refrigerated
sauces and gravies than
other lifestyles, across all
behavior stages. Particularly
enthusiastic consumers in
this category are younger and
older bustling families, who no
doubt appreciate the products
convenience, and empty nesters,
many of whom are using their
newly freed-up spare time to
whip up interesting meals.
CROSS-MERCh Candidates
wITh ChILDREN:
startup Families
105
169
77
67
81
103
103
small-scale Families
124
158
107
83
89
72
106
Younger Bustling Families
104
183
102
76
118
79
109
Older Bustling Families
159
177
161
65
129
89
136
Young Transitionals
57
130
66
89
90
37
77
independent singles
72
94
92
61
62
36
67
senior singles
48
81
60
92
46
49
59
established Couples
127
167
120
124
111
76
119
empty-nest Couples
133
194
125
96
112
84
126
senior Couples
125
134
129
63
99
72
105
Total
100
152
110
81
91
68
100
HHs with young children only <6

small HHs with older children 6+
large HHs with Children (6+), HOH <40
large HHs with children (6+), HOH 40+
NO ChILDREN:
Any size HHs, no children, <35
1-person HHs, no children, 35-64
1-person HHs, no children, 65+
2+-person HHs, no children, 35-54
2+-person HHs, no children, 55-64
2+-person HHs, no children, 65+
Very High Consumption (150+)
20
High Consumption (120-149)
Average Consumption=100
Wine
Photographic
Supplies
Baby Needs
Yogurt
Skin Care
Preparations
Disposable Diapers
and Training Pants
Baby Food
Fresh Produce
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e
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Mintel Global New Products Database Category Insights
Salty Snacks, Meat Snacks

and Popcorn
For more information,

visit www.mintel.com
or call 800-932-0400.
Market Overview
The United States is the standout market in the
North American salty snack, meat snack and
popcorn category, with a predicted average value
growth of 5.3 percent over the next five years.
Canada also offers promising average value
growth of 3.1 percent during the same period,
despite lower per capita consumption.
key iSSueS
Introducing protein to food
and drink has become a
major focus of innovation,
due to its links to increased
satiety and muscle retention.
Recent new product
development activity has
shown that the protein
trend has migrated into the
salty snack category, with
manufacturers fortifying
their innovations with protein
or by prominently marketing
natural protein content
on-pack. For instance, a
number of brands have
launched salty snacks based
on vegetables and grains to
achieve high-protein claims.
The past 12 months have also seen how brands
have been launching skinny snacks onto the
market. No/low/reduced fat has been one of
the main areas of innovation in North America,
accounting for 14 percent of the total new
product launches in the past year.
What Does it Mean?
22
High-protein snacks have huge

potential in North America if
brands can successfully convey
the health benefits of eating
protein throughout the day
rather than on specific occasions.
knowledgeable about nutrition.

Vegetable-based protein snacks
are currently enjoying a boom,
but innovations like egg-white
chips suggest that there will be
more variety in the future.
Protein source will become

a distinguishing feature as
consumers become even more
The growing interest in skinny

products suggests that more
brands should be looking to enter
the no-/low-/reduced-fat and no-/

low-/reduced-calorie segment.
Convenient on-the-go formats
that allow consumers to
experience guilt-free indulgence
should also emphasize
recommended portion sizes to
offer consumers control over
their calorie intake.
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2015 The Coca-Cola Company
Nonfoods
Category
Todays leadership model isnt

working for everyone, which means
its not working at all.
NEW
Horizons
By Joan Toth
Its Time for a New Workplace

Womens leadership has stalled weve launched a movement to change that.
corporate culture and workforce policies to create a better

workplace for everyone.
ourteen years ago, a handful of determined leaders launched the Network

of Executive Women at the FMI Midwinter Executive Conference. At this
years FMI Midwinter, we launched a
new network with a bold vision a workplace with
no limits and an urgent message: Its Time.
Its not that old NEW wasnt successful far
from it. Since 2001, NEW has grown into one of
the industrys largest and most infuential organizations. Weve put womens leadership on the agenda,
weve changed hearts and minds, and weve helped
thousands of women advance.
But we havent moved the needle. In recent
years, the share of women corporate ofcers has
barely budged. Women represent almost half of the
retail industrys total workforce but fewer than one
in fve corporate ofcers and one in 20 CEOs.
Te reason for this is simple: Weve been focusing on the wrong thing. We need to change our
24
Joining the Movement

This message was delivered loud and clear at FMI
Midwinter. More than 100
senior industry leaders gave
up part of a sunny Sunday
afternoon in Miami Beach
to hear me; Amy Hahn,
of Ahold USA; and Lisa
Walsh, of PepsiCo, present
a call to action on womens
leadership and
workplace change.
More than half of those
present committed to our Its
Time movement. Our industrys top executives know that
women leaders are critical to
their organizations, and theyre
committed to take action.
But this is no easy lift.
Tere are strong cultural and
business headwinds against womens leadership
and workplace change. But we must create a more
fexible, collaborative, inclusive and authentic
workplace if were to connect with our increasingly diverse consumers and workforce.
Todays leadership model isnt working for
everyone, which means its not working at all. Our
manifesto, presented by Walsh, NEWs marketing
chair, calls for a new leadership culture less
rigid and more fexible, less conformist and more
diverse, less impersonal and more authentic.
We need a workplace culture that values the
unique contributions of everyone male and
female, young and old, black and white, Latino
and Asian, native-born and immigrant, gay
and straight. Tis new workplace will make our
industry a destination for women and a model to
attract Millennials, who are the largest generation in our history 80 million strong and
43 percent nonwhite.
What Needs to be Done

NEW has developed a researchbased action agenda that zeroes
in on the top priorities needed to
advance women leaders and transform the workplace:
sustainable organizations
must have targets in place that
advance women.
Change the culture and the

way we look at women, who are
often viewed as either too nice
or too bossy.
Change the organization to eliminate the
countless subtle barriers to advancement,
including lack of role models, sponsors and access to senior leadership, and career paths and
policies that favor men.
Engage men and treat them as partners instead
of problems to be fxed.
Engage senior leadership. At PepsiCo, which has
taken a strong stand on women in the workplace,
31 percent of U.S.-based executives are women.
Achieve critical mass. To achieve the benefts
of womens leadership and make these gains
Hahn closed our movement

launch with a retailers perspective. At Ahold USA, we make
three promises every day, she
said. First, be a better place to
shop. Second, be a better place to
work. And third, be a better neighbor
everywhere we do business. Womens leadership provides the talent, new ideas and customer
connections we need to deliver on these promises.
To enlist in the Its Time movement, visit
newonline.org/itstime. PG
Joan Toth is president and CEO of the Network
of Executive Women, Retail and Consumer
Goods, a learning and leadership community
with 9,000 members, 750 companies, 100
corporate partners and 20 regional groups
in the United States and Canada. For more
information, visit newonline.org.
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25
Consuming a plant-based diet may cut ones

greenhouse gas emissions in half.
Alls Wellness
By Molly McBride
Earth Day Every Day

Alternative proteins, local products and waste reduction
can impact health of consumers and the planet.
pring is upon us, and with it comes

sunny weather, fowers in bloom and
more fresh produce. Earth Day is
April 22, and what better way to revisit
how we treat our planet than looking at
food, one of the greatest resources we use?
How many consumers equate the way they eat
to their carbon footprint? A recent study published in Climatic Change, encompassing 55,504
participants from the EPIC-Oxford cohort, addressed this concept. It found that the kilograms
of carbon dioxide equivalents per day (kgCO2e/
day) was 7.19 for high meat-eaters, 5.63 for
medium meat-eaters, 4.67 for low
meat-eaters, 3.81 for vegetarians (no meat, poultry or
fsh) and 2.89 for vegans (no
animal products).
Tese numbers suggest
that consumers could
decrease their
environmental impact as
fewer animal
products are consumed, and that consuming a plant-based diet
may cut ones greenhouse
gas emissions in half.
Plant-centric diets are
many times lower in total
calories, saturated fat, cholesterol
and sodium, while higher in fber
and antioxidants. Alternatives on the
shelf like soy and almond milks, legume-based
proteins, mock meats, and dairy-free desserts,
alongside plenty of fresh, canned and frozen
fruits and vegetables, can present opportunities
for supermarket customers to enjoy wholesome
as well as innovative products. As dietitians, we
realize that consumers have many diferent diets
and preferences; however, some simple swaps for
plant-based fare can be an environmental and
health-conscious advantage.
28
Discovering Local
At Kroger, our Discover Local campaign focuses on
locally grown products, with an emphasis on great
quality. Te less time food is on road, rail, water or
air equates not only to a greener approach, but also a
cost savings that can be passed on to the customer.
Current numbers from the Environmental
Protection Agency indicate that 13 percent of all
global greenhouse emissions are from transportation and 14 percent are from agriculture. Retailers
can be leaders in limiting the distance from farm
to table, to control the amount of energy expended in putting brands on the shelf.
Other ways to honor Mother Earth
this month include adhering to
the four Rs: reduce, reuse,
recycle and repurpose. Customers continue to strive
to use less and do more
with less, in eforts to
save money, decrease
clutter and contribute
to sustainability eforts.
Capitalize on this time
to talk to your packaging department,
category managers or
CPG manufacturers to
brainstorm ways that can
decrease packaging waste
and make your products even
more appealing.
Te sustainability movement involves much more than whats happening
outside the walls of your stores. Take a harder look
at plant-based oferings, waste, packaging, sourcing, geography and even seasonality to engage and
retain customer interest and support resources for
generations to come. PG
Molly McBride, RD, LD, is a corporate dietitian for
The Kroger Co., based in Cincinnati.
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30
82nd AnnuAl RepoRt
of the GRoceRy IndustRy
Aisles of
opportunity
Grocers are bullish on 2015, but new specters are

bringing on sleepless nights for retailers.
Analysis by Jim Dudlicek, Bridget Goldschmidt
and Meg Major / Research by Debra Chanil
rocery retailers confdence in ana rosy retail climate, up from 30 percent this year.
other year of success continues to
Its obvious that current economic conditions
inch upward from the valleys of the
are buoying retailers spirits. Te Kroger Co.
past decade, and their optimism for
recently celebrated its 45th consecutive quarter
the retailing climate has reached
of same-store sales growth. Describing 2014 as
new heights, exclusive research from
an outstanding year by all measures, Rodney
Progressive Grocer reveals.
McMullen, chairman and CEO of the CincinnatiMeanwhile, as the manner in
based grocery giant, said at Krogers March earnwhich business is transacted continues to evolve,
ings call that the company captured more share
new issues are keeping grocers up at night.
of the massive food market [and] delivered on
On a scale of 0 (awful) to 100
our commitments and invested to grow
(sensational), retailers surveyed by PG
our business. [O]ur core operating
Grocers Are
just topped 72, up nearly six points
performance without fuel shows that our
siGnificAntly
from their score for 2014. A year ago,
associates are improving our relationship
however, retailers forecast for the com- more optimistic with customers in ways that grow loyalty
About the
ing year was 71.8, indicating that 2014
and generate strong shareholder returns.
didnt pan out quite as expected.
However, Ken Odeluga, senior market
retAil climAte
Still, sentiments are most defnitely
compAred with analyst for London-based City Index,
trending up, and have come a long way
that future trends in the market
A yeAr AGo, with warns
from the score of 58.4 reported in 2009.
may prevent Kroger from delivering the
Overall, grocers are signifcantly more neArly hAlf of
staggering numbers that it did in Q4.
respondents
optimistic about the retail climate comWith the shares having gained
pared with a year ago, with nearly half of sAyinG theyre
more than 64 percent over the last 12
respondents saying theyre sweet on 2015; sweet on 2015.
months, and a 52 percent rise in 2013,
thats up from about 39 percent a year
the bar is getting higher for continued
ago. Just more than a ffth express less
strong sentiment, Odeluga said in Prooptimism (versus 28 percent a year ago) and just shy
gressivegrocer.coms report on Krogers last earnof 30 percent declare they envision no change.
ings call. Te point is, a number of forces are
As is typical, chain operators are the most confcoalescing that are expected to press on Krogers
dent, with nearly two-thirds expressing optimism for
batting average over the next few quarters,
retailing this year, up from about 52 percent a year
largely from fuel-related to headwinds.
Continued on page 34
ago. About 44 percent of independent operators see
31
82nd ANNUAL RePORT
of the GROceRy INDUSTRy
methodology
Progressive Grocers 82nd Annual Report of the Grocery Industry is based primarily on an exclusive survey
conducted among headquarters executives and store
managers at 135 supermarket chains, independents,
wholesalers and distributors across the United States.
Sixty percent of the respondents classify themselves
as independent retailers, and about 18 percent are selfdistributing chains; about 12 percent are wholesalers,
and 7 percent are distributors.
Of the total respondents, more than half represent organizations with one to 10 stores, and about a third have 100
or more stores, while about 15 percent are from operations
with between 11 and 99 units.
Regionally, about 31 percent of respondents are from
the Midwest, about a quarter are from the West, just
less than a quarter are from the Northeast, and about 21
percent are from the South.
Additional store count and sales data are provided
by Nielsen TDLinx, which maintains a national database
of supermarket and other retail format locations.
type of orgaNizatioN
Number of SupermarketS operated
perceNt of reSpoNdeNtS
perceNt of reSpoNdeNtS
Independent (Use a wholesaler)

Chain (Self-distributor)
Wholesaler/Wholesaler-owned Store
Distributor
Other type
1-10
11-99
100 or More
Average Number of Stores: 770
51.2%
34.1%
60.3%
17.6%
14.5%
14.7%
0.8%
primary reSpoNSibility/job area
President/C-level
Buyer/Merchandiser/Category Management
Retail/Store Operations
Sales/Advertising/Marketing
Store Manager
Distributor/Broker
Other
19.2%
6.9%
regioN
Midwest
West
Northeast
South
21.4%
31.3%
13.1%
3.8%
22.9%
17.7%
41.5%
1.5%
3.1%
Source: Progressive Grocer Market Research, 2015
32
24.4%
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82nd AnnuAl RepoRt
of the GRoceRy InduStRy

Continued from page 31
Kroger is likely mindful of the impact lower

crude oil prices, and consequently cheaper wholesale
fuel, will have on customer perception, Odeluga
added. I think essentially, Kroger is saying it will
soon need to reduce prices to closer to the average
forecourt rate for its biggest rivals.
Te recent drop in gasoline prices has left
more money in consumers pockets to spend
at retail, including grocery. Tat being said,
consumer optimism about the economy in early
March had fallen to its lowest level since August
2014, according to new survey results released by
NACS, the Association for Convenience & Fuel
Retailing. At the time of the report, gas prices
had increased 29 cents per gallon versus the previous month as refneries began the transition to
producing the more expensive summer-blend fuel
required in many U.S. markets.
Meanwhile, leaders of the newly combined
Albertsons Safeway have expressed high hopes
for an improved and invigorated shopping
experience as the merger partners become a
single entity in 2015. We
plan to be the favorite local supermarket in every
How was 2014? How are community we serve, said
Robert Edwards, president/
prospects for 2015?
CEO of the 2,230-store
Rated on a scale of 0-100, where
enterprise. We will do this
0=awful, 100=sensational
by knowing, listening to and
delighting our customers;
providing the right products
Total
at a compelling value; and
2015 (forecast)
72.2
delivering a superior shop2014
66.3
ping experience.
Market optimism also
2013
67.7
bodes well for the benef2012
63.6
ciaries of the 168 stores cast
2011
65.6
of as a condition of the
merger, most signifcantly
2010
59.4
Bellingham, Wash.-based
2009
58.4
Haggen, which, by exponential expansion of its banner
2008
67.1
throughout several states, has
2007
70.9
the potential of becoming
2006
66.9
the next great regional West
Coast grocery chain.
2005
65.2
Independents, too, have
Source: Progressive Grocer
reason to be excited as they
Market Research, 2015
vie for the loyalty of consumers looking for new, better and more personalized
shopping experiences. Companies like Minneapolis-based wholesale distributor Supervalu Inc. are
feeling bullish about the future of the independent
grocer. Says Brian Audette, SVP of Supervalus corporate independent business, Were really focused
on keeping our customers relevant.
RETAIL CLIMATE
Compared with a year ago, are you more

optimistic or less optimistic about the retailing
climate for supermarkets?
More optimistic
No change
TOTAL
49.6%
29.8%
20.6%
THE BOTTOM LINE
34
Less optimistic
CHAIN
63.6%
22.8%
13.6%
INDEPENDENT
30.4%
44.3%
25.3%
What are the big issues keeping you up at night?

Current
Data Protection/Security
64.3%
Rank
1
Tossing and
Price Increases
59.5
2
Turning
Tere was a notable
Benefits (Minimum Wage, Affordable Care Act, etc.)
56.3
3
change in priorities
Food Safety
37.3
4
among grocers who
Labor (Recruitment, Retention, Diversity, Training)
35.7
5
responded to our question, What are the
Keeping up With Advancements in Technology
33.3
6
big issues keeping you
Increasing
Overhead
Costs
(Energy,
Infrastructure,
Maintenance,
etc.)
28.6
7
up at night?
Topping the list:
Sustainability
20.6
8
data protection and
Genetically Modified Organisms (GMO)
12.7
9
security, noted by
Feeding the Hungry
11.1
10
more than 64 percent of respondents.
Competitive Threats
6.3
11
A year ago, data
Animal Welfare
2.4
12
security ranked ffth.
Since then, retailSource: Progressive Grocer Market Research, 2015
ers of all kinds have
been rocked by data
breaches of varying
severity, from the
double hit at Supervalu last summer to the lingering efects of the Target breach that resulted in an
executive housecleaning.
In 2014, we saw more attention paid to cyberScore: 100=increase; 50=no change; 0=decrease
risks, namely because of Targets late-2013 attack, observes Tracy Kitten, executive editor of the Princeton,
Current
Rank
N.J.-based Information Security Media Group. Media attention, coupled with the congressional hearings
Wage Costs
90.9
1
that occurred throughout the year to review merchant
Benefit Costs
85.5
2
security, undoubtedly are to thank for bumping cybersecurity concerns to the top of the list among grocers.
Competition
84.8
3
While we actually saw a furry of breaches throughout
Technology Spending
82.8
4
2013 targeting merchants across the board, including
Retail Prices
78.2
5
grocers like Schnucks, none of these breaches got a ton
of public attention until Target.
Capital Expenditures
66.4
6
Kitten asserts that retailers cybersecurity is
Percent Net Profit
65.1
7
subpar. I think more attention has been paid to
Percent
Gross
Margin
60.0
8
PCI compliance in the last year and a half, she
tells PG, but we are still a long way out from havEnergy/Fuel Costs
56.3
9
ing EMV [chips] fully implemented at the POS,
Employee Turnover
54.4
10
and most grocers are not particularly innovative,
relative to other merchants, when it comes to payments security. I doubt grocers will adopt EMV at
a rate that exceeds other retailers.
Further, most merchants
across the board have not historically made big investments in
behavioral analytics to monitor
transaction activity, Kitten notes.
Grocers and all retailers have an
obligation to protect their customers cardholder data and personal information, Kitten says. If consumers do not feel that their information
is safe, they will stop shopping with
that merchant, so data security has
Last Year
Rank
28.8%
25.8
59.5
16.0
47.9
28.2
45.4
12.9
3.7
10
1.8
11
53.4
1.8
11
expected 2015 change in coMpany

operational Factors
Last Year
Rank
83.3
84.3
79.6
75.8
74.8
57.5
51.9
46.9
10
77.4
51.6
35
82nd AnnuAL RePORT
of the GROCeRy InDusTRy
10 Ideas to support revenue Growth In 2015

By Tara Oberg
Tara Oberg, a senior associate at data-driven consultancy
Seurat Group, gives her top 10 list of strategies that supermarkets can use to drive revenue in the coming year:
foodservice sales as shoppers seek more quality, time-saving

options. Invest space and resources in both meeting shoppers need for a convenient dinner to take home and driving
impulse hot-meal purchases.
1.Build loyalty through trust. The continued rise of natural

and specialty grocers displays the value in creating a loyal
shopper base by offering products and brands that buyers
can be confident about, both in terms of safety and quality.
These retailers are creating proprietary rating systems that
consumers trust to guide them.
7. Cautiously approach shoppers deal only purchase

behavior. Given declining revenue and margins in CPG
retail since 2007, retailers have placed a huge emphasis
on managing pricing and promotion. More than one-third
of packaged food and household products are now sold
on discount, meaning that todays shoppers are trained to
purchase on deal only. Todays retailers should proceed
with care, but shift focus of CRM and merchandising toward
value instead of price.
2. Look to frame-breaking channels for inspiration. Retailers across channels have begun to look toward smaller, more
entrepreneurial channels to stay informed on the latest innovation, macro-trends and consumer preferences.
Within the pet industry, Petsmart and Petco continuously learn from mom-and-pop pet stores
and local/regional chains that are more in touch
with their pet owner communities, and more in
tune with requests and preferences.
3. Do more to understand your customers.
Shopper segmentations are a common way of
understanding the subsets of shoppers. However, this work becomes most actionable when
retailers can prioritize high-value segments and
understand the moment and message necessary
to trigger a purchase. This process drastically
improves efficiency and simplifies marketing,
ensuring its not just a game of trial and error.
4. Turn double-digit e-commerce growth
into triple digit. Despite slower adoption of
e-commerce for certain grocery categories, online purchase
remains an avenue for revenue growth for most retailers.
Success in this area comes from being consumer-led and
understanding how to connect the array of touchpoints, from
navigational behaviors and purchase drivers to delivery options (home delivery, curbside pickup).
5. Partner to most effectively use your data. Collaborative planning is invaluable, and there are often huge benefits
for retailers sharing granular purchase behavior data (at the
household level, beyond reports) with go-to partners that
have experience working with them. This kind of data has
been used to create new insights and actions that double the
rate of category growth in a market.
8. Offer shoppers price and value

instead of just the lowest price. In the
face of a challenging environment to raise
prices, retailers can increase revenue by
taking a more holistic approach to the
total price-value equation and refuting the
notion that pricing up or taking product
out are the only levers available. Understanding the relationship between the desired benefits of a product or service and
the price paid will allow retailers to better
assess which items to carry and how to
communicate a value message in-store.
9. Leverage private label to win. Another
way to appeal to value-seeking shoppers
is through a more strategic private label
offering. Many retailers have created both
value and premium private label lines to
differentiate themselves. Success comes from fully understanding shoppers price and product needs and developing
store-brand products to best meet them.
10. Appeal to growing customer cohorts by understanding
their perception of value. The staggering growth and buying power of Millennials have already made CPG retailers and
manufacturers take notice. Winning with this shopper group
depends on retailers ability to appeal to their value equation.
Millennials are less interested in specific brand names, but more
interested in what brands stand for, and are more likely to pay
more for natural or organic products. A retailer that can offer
the right mix of private label products and premium, branded
ones will appeal more to this cohort.
6. Be part of shoppers dinner consideration set. Dinner

tonight is a growing source of wallet that leading retailers
are capturing through prepared meals. In fact, the growth
of in-store and takeout dining options is outpacing that of
36
Tara Oberg, a senior associate at the Norwalk, Conn.-based

Seurat Group, has domestic and international experience that
includes category leadership, brand and channel strategy, and
organizational design work.
mcgladrey.com/retail
82nd AnnuAl RepoRt
Supermarket SaleS by Format

Number
of Stores

Percent
of Total
Sales
($ Millions)
Percent
of Total
$638,338
100.0%
Total Supermarkets ($2 million or more)
37,716
100.0%
Supermarket-Conventional
26,487
70.2
414,794
65.0
Supercenter (Grocery and Mass Merch.)*
4,150
11.0
159,824
25.0
Supermarket-Limited Assortment
3,242
8.6
16,106
2.5
Supermarket-Natural/Gourmet Foods
3,144
8.3
38,372
6.0
Warehouse Grocery
523
1.4
4,367
0.7
Military Commissary
170
0.5
4,876
0.8
152,120
n/a
$412,703
n/a
Gas Station/Kiosk
22,303
n/a
n/a
n/a
Superette
13,070
n/a
19,974
n/a
1,320
n/a
136,339
n/a
674
n/a
4,067
n/a
Other Food Retail Formats

Conventional Convenience**
Conventional Club
Military Convenience Store
a huge and direct impact on customer

satisfaction and sales.
Also higher on the list: price
increases, at second place, noted by
nearly 60 percent of survey respondents and up from seventh a year
ago. Benefts, such as minimum
wage and the Afordable Care Act,
ranked third this year after leading
the list in 2014. Competitive threats,
No. 2 last year, plunged to 11th
place an interesting development,
especially amid growing challenges
from alternative channels like drug,
dollar and digital.
*Supermarket-type items only

**Excluding gas
Source: Nielsen TDLinx; Progressive Grocer Market Research, 2015
Supermarket SaleS by SaleS range

Number
of Stores
Percent
of Total
Sales
($ millions)
Percent
of Total
Supermarkets ($2 million or more)
37,716
Chains (11 or more stores)
30,925
100.0%
$638,338
100.0%
82.0%
$602,708
94.4%
$2,000,000 to $4,000,000
2,980
7.9
9,265
1.5
$4,000,000 to $8,000,000
6,858
18.2
39,604
6.2
$8,000,000 to $12,000,000
3,442
9.1
35,998
5.6
$12,000,000 to $20,000,000
4,833
12.8
79,087
12.4
$20,000,000 to $30,000,000
6,118
16.2
151,379
23.7
$30,000,000 to $40,000,000
3,217
8.5
111,580
17.5
$40,000,000 to $50,000,000
2,077
5.5
92,048
14.4
$50,000,000+
1,400
3.7
83,747
13.1
Independents (10 or fewer stores)
6,791
18.0%
35,630
$2,000,000 to $4,000,000
2,222
5.9
6,756
$4,000,000 to $8,000,000
5.6%
1.1
4,015
10.6
21,751
3.4
$8,000,000 to $12,000,000
366
1.0
3,695
0.6
$12,000,000 to $20,000,000
148
0.4
2,252
0.4
$20,000,000 to $30,000,000
33
0.09
802
0.1
$30,000,000 to $40,000,000
0.01
105
0.0
$40,000,000 to $50,000,000
0.00
46
0.0
$50,000,000+
0.01
225
0.0
38
Supermarket Sales
by Store Format
Total supermarket sales topped
$638 billion in 2014, up from $620
billion a year ago. Tats an increase
of about 2.9 percent, the same as
PG reported last year, indicating a
fattening trend that follows the 3.1
percent growth in 2012.
Tat fatness bears out when
looking at store numbers by format.
No surprise that conventional supermarkets dominate the marketplace,
with 70 percent of all stores (down
1 percentage point from a year ago).
Supercenters increased their share
by just three-tenths of a percentage
point, while natural/gourmet format
stores account for more than 8 percent of stores, up about four-tenths
of a point, with that growth driven
in part by the rapid expansion of upand-coming chains such as Sprouts
and Fresh Tyme.
In share of sales, conventional supermarkets maintain a frm 65 percent
82nd AnnuAl RepoRt
AverAge Per-Store SuPermArket

PerformAnce meASureS
2014
2013
2012
Sales Volume ($ Millions)
$16.92
$16.56
$16.26
Selling Area (Square Feet)
33,300
33,250
33,100
10.5
10.2
9.9
$325,478
$318,462
$312,758
Number of Checkouts
Average Weekly Sales
Dollars per Store
Dollars per Square Feet
Dollars per Checkout
9.77
9.58
9.45
30,998
31,222
31,592
hold on total sales, supercenters take a quarter, and

natural/gourmet enjoy 6 percent, up almost a full
point since last year.
Supermarket Sales by Store Count

Dollar sales growth outpaced unit growth among
chains with 11 or more stores, as well as among
independents, with percentages

holding steady year over year.
Larger chains added just 147
new stores in the past year, an
increase of less than 0.5 percent on
a total approaching 31,000 units, or
82 percent of all stores. Tose stores
accounted for nearly $603 billion in
sales, or more than 94 percent of all
supermarket sales, consistent with
their share a year ago.
Independent operators added 110
stores in the past year, an increase of
1.6 percent from a year ago. Indies
sales contribution rose nearly 2.7
percent since last year, for a total of
$35.6 billion, or a 5.6 percent overall
share, unchanged from a year ago.
Store Performance Measures

Investments in people, space and service continue to
reap positive results. Sales volume is up more than 2
percent and selling area is up slightly over a year ago,
as is the number of checkouts. Likewise, dollars per
store are up about 2 percent overall in the past year.
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82nd AnnuAl RepoRt
Enhancing thE in-storE ExpEriEncE
Evolving store concepts, amenities, marketing strategies and modes

of communication shape how grocers keep shoppers coming back.
Perpetually challenged by a cutthroat competitive climate, notoriously thin proft margins, and
demanding and often dichotomous patrons,
the grocery business can be brutal, which speaks
directly to the need for grocers to concentrate
heavily on enhancing the in-store experience
to stand apart from both traditional and
upstart competitors.
To that end, signature products, private
label and store-within-a-store specialty
departments are deemed the top three most
productive tactics to augment the in-store
experience among retail executives respond-
Enhancing thE in-storE ExpEriEncE:

MErchandising/Brand EnhancEMEnt
Percent of respondents rating each strategy as extremely or very important

Signature Products
64.5
62.7
Private Label
61.5
Store-within-store Specialty Depts.

Cross-merchandising
57.8
Prepared Foods
57.4
Locally Sourced Products
55.8
BOGOs
34.5
In-store Pharmacies
28.8
Free WiFI
22.2
Cooking/Meal Prep Stations
22.1
iMportancE of stratEgiEs:
consuMEr MarkEting/advErtising

58.1
In-store Signage/Digital Media

45.2
Digital Marketing
42.1
Newspaper Inserts
37.1
Newspaper Ads (ROP)

Mobile Marketing
34.5
31.0
Direct Mail (Circulars, etc.)

Radio Advertising
TV Advertising
Custom Magazines
12.1
9.5
5.3
42
ing to PGs 2015 Annual Report of the Grocery Industry survey. While signature products and private
label are often considered one and the same in the
supermarket world, the latter, for purposes of this
study, refers to exclusive products housed primarily
in the fresh departments, such as gourmet desserts
from the in-store bakery, store-made entres from
the fresh meat department, specialty cheese products, bundled meal deals, everyday-value bouquets in
foral, and oven-ready regional seafood specialties.
Meanwhile, todays increasingly sophisticated
supermarket private label products are all about differentiation, quality and the overall value proposition, and only partially about price. Retailers have
invested countless internal resources and millions
of dollars annually into perfecting their vast and
diverse private brands across the entire store to
provide customers meaningful value while shining
a spotlight on items that can only be had here.
Consequently, private label prominence has forever
solidifed its place in the hearts of both retailers and
consumers alike, and will remain a critical and compelling component of building the in-store experience for years to come.
Conversely, as we glance back 30 years give or
take a few a retailers life was certainly far easier,
regardless of the channel. Food stores sold food,
drug stores sold medicines and sundries, and fastfeeders sold meals. Beginning in the late 1980s and
revving up in earnest by the mid-1990s, however,
retailers of all stripes began to realize that they
could successfully sell many products beyond the
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Entertainer
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Founder,
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Omnimedia
Walter Robb
Co-CEO,
Whole Foods Market
Phil Lempert
the Supermarket Guru
Harold Lloyd
Founder,
Harold Lloyd Presents
Youngme Moon
Author and Professor,
Harvard
Business School
Arianna Huffington
Co-founder &
Editor-in-Chief
The Huffington Post
Shaquille ONeal
NBA All-Star and Sports
Analyst for TNT and
NBATV
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82nd AnnuAl RepoRt
importancE of stratEgiEs:
consumEr EngagEmEnt

Customer Relationship Marketing
69.8
Social Media
49.1
Loyalty Incentive Programs
47.4
24.1
Online Surveys
Comment Cards
21.6
19.8
Blogs
Toll-free Hotlines
12.9

customEr intEraction

Community Involvement
71.2
65.8
Seasonal Special Events

Sampling, Demos
52.7
27.9
Wellness Events/Health Screenings

Healthy-eating Store Tours
18.0
Cooking Classes
18.0

in-storE sErvicEs

On-site Butchers
60.4
34.5
Seafood Specialists
26.1
Service-based Kiosks
23.4
Informational Kiosks
20.0
Childrens/Student Programs
17.1
Wellness Experts/Registered Dietitians

Event Planners
12.6
Certified Chefs
10.0
Cheesemongers
10.0
edges of their traditional boundaries. Grocery stores

began adding pharmacies with complete HBC sections and morphed quickly into compelling combo
food/drug formats. Drug stores followed suit by
making signifcant forays into food, a cause which
was vigorously furthered by spunky regional Bentonville, Ark.-based retailer Wal-Mart Stores Inc.,
46
which started selling a full line of groceries and

high-volume fresh commodities in some stores.
Te common denominator for migratory channelblurring can be explained by a simple answer: store
size. Over the period between 1960 and 2000, the
square footage of the average store grew relentlessly;
the latest years prototype foor plan always seemed
to be a few thousand feet larger than the prior year,
which provided retailers with an incrementally larger
platform to test and experiment with new departments housing more products in bigger cases, and
with it, bigger ROI needs and expectations.
But much has been learned from yesteryears bigger is best store confgurations, which brings us back
to the present day of retailing, when more compact
footprints are becoming the preferred choice for
many retailers new store confgurations. Regardless
of the size of the box, store-within-a-store departments have been among the most infuential tactics
for progressive grocers to amp up the in-store experience with full-on specialty departments, be it beauty
and wellness, kitchenware, pet food/pet care, or
free-from products. To that end, the key to the most
successful retailers store-within-a-store concepts is
to capitalize on categories that drive frequent visits
and concurrently surprise and delight their most
important shoppers, which in turn enables them to
capitalize on those visits with countless other items
found throughout the rest of the store.
Other elements cited as being highly infuential
in enhancing the in-store experience among this
years retailer panelists include cross-merchandising
(57.8 percent), which slid nearly 10 points from
last year; prepared foods (57.4 percent), which held
steady from the year-ago report; locally sourced
products (55.8 percent), which are expected to continue to gain prominence; time-tested BOGOs
(34.5 percent); in-store pharmacies (28.8 percent); free WiFi (22.2 percent); and cooking/
meal prep stations (22 percent).
In-store Services
In the current food retailing war, supermarkets are clearly in the crosshairs of many
formidable contenders. For that reason,
grocers are pulling out all the tools in the
shed to help them shine in a sea of sameness,
with strategies to help impart an experience, rather than just another place to pick
up products that can be sold anywhere. To
that end, many grocery leaders are accelerating ongoing eforts to enhance relevancy,
diferentiation and tailor-made community
appeal with specialty services and resident
expertise that are available for the asking.
In addition to personalized, professional advice and guidance from pharmacists, in-store nutritionists, dietitians,
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82nd AnnuAl RepoRt
of the GRoCeRy InDuStRy

wellness experts and even aestheticians available
to consult with shoppers on how to live with a new
diagnosis such as diabetes, high blood pressure or
celiac disease, many retailers are also seeing success
with kids cooking and nutrition classes, wellness and
nutrition sessions, oral care screenings, and smoking
cessation seminars all of which are usually free or
inexpensive.
However, the most critical in-store service
cited by this years Annual Report of the Grocery
Industry panelists is that of on-site butchers or
resident meat department experts, viewed by 60
percent as the most rewarding component of an
excellent in-store experience.
Pacing butchers in the second seed is having
seafood experts, which is also considered to yield a
rewarding ROI for building bonds with consumers
among 34 percent of respondents, followed next by
service-based and informational kiosks.
Benefits of MoBile
Devices/sMartphones
Total
Facebook
48.3%
e-Coupons
46.6
Digital Circulars
45.7
Interactive Websites
31.9
Price Comparison Apps
28.4
Personalized Discounts
27.6
Shopping List Apps
27.6
Personal Shopping Assistance
24.1
Delivery of Online Orders
23.3
Paper Circulars
22.4
POS Loyalty Cards
19.8
Order Online/In-store Pickup
18.1
Meal Planner Apps
15.5
Direct Mail
13.8
In-store Digitial Media
12.9
Shopping History
12.1
Twitter
11.2
QR Codes
9.5
YouTube
6.0
Pinterest
5.2
In-store Video Marketing
5.2
Geo-fencing
3.4
Other
1.7
48
GraDe of coMpanys
strateGy for connectinG
with consuMers
Total
A: We have a fully integrated strategy
using in-store, online and digital
channels (omnichannel).
12.9%
B: Weve got a strategy that

were executing.
32.8
C: Were just getting started.
37.1
D: Were barely there.
12.9
F: Whats omnichannel?
4.3
Other service-based programs scoring points

with experiential retailing tactics include childrens/
student programs, at 20 percent; wellness experts
and registered dietitians, cited by 30 percent of panelists; event planners (12.6 percent); certifed chefs
(10 percent); and cheesemongers (10 percent).
Benefits of Mobile Devices/Smartphones

Like most other aspects of our lives, technology is
playing an ever more important role throughout
the store to deliver a more rewarding shopping
experience. Innovations in digital, mobile and social
technologies have created new contemporary expectations in todays shopper. Indeed, as consumers
increasingly use smartphones and tablets in their everyday lives, mobile-based technology has emerged
as the top priority for retailers in 2015. Tat fnding is reafrmed separately by the 2015 State of
Retailing Online survey from Shop.org/Forrester
Research, in which nearly six in 10 (58 percent) of
those polled place mobile at the top of the list.
Moreover, smartphone sales as a percentage of online sales grew from 8 percent in 2013 to 12 percent in
2014 an increase of 50 percent according to the
2015 State of Retailing Online survey, which further
found that tablets share of online sales grew from
13 percent in 2013 to 16 percent in 2014. Additionally, many of those who list mobile as the top priority
say their digital marketing budgets remain modest,
knowing consumers are coming to their mobile sites
whether theyre ready for them or not.
Of those retailers surveyed, 32 percent report
spending less than $100,000 on their smartphone development eforts in 2014, while 68 percent report spending less than $1 million. As for
tablets, just 4 percent say they invested between
$100,000 and $250,000 last year. However, eight
in 10 surveyed plan to increase their mobile budgets by at least 20 percent in 2015.
Technology, Transparency
Top 2015 consumer Trends
By Kyle Shamorian
reTailers and
manufacTurers
have The
opporTuniTy
To Take full
advanTage
of shoppers
desire To
aggregaTe more
and more of
Their consumer
acTiviTy onTo a
single device.
Smart technology, blurred channel lines, brand

transparency and modernized gender roles took top
billing at Mintels recent Big Conversation as a panel
of industry experts discussed evolving consumer
trends for 2015 at the market research firms U.S.
headquarters in Chicago.
The continued growth of synced devices not only
smartphones and TVs, but also wearable technology
like watches and health software that monitors fitness
goals will continue their forward march into the
mainstream, and not just for consumers.
According to Mintels Director, Innovation & Insight Lynn Dornblaser, in
the coming year more products will feature QR codes that sync to consumers personal devices, to offer not only specials and promotions, but also
source-tracing information, recipes and even music downloads. Retailers
and manufacturers have the opportunity to take full advantage of shoppers desire to aggregate more and more of their consumer activity onto a
single device.
Another trend carving out a substantial impact on global retail is the
blurring of channels, in terms of brick-and-mortar, try-before-you-buy,
pure-play online and click-and-collect. The panel made particular note of
Seattle-based Amazon, which is expanding its Sunday delivery service to
15 additional cities, as well as Bentonville, Ark.-based Walmart, the worlds
largest traditional brick-and-mortar retailer, which is testing its own pickup option in certain markets, a service that answers in-transit purchases
being spurred by increased connectivity, Dornblaser said.
Brands also have been using the online realm to test new products
before expanding them to larger markets, Dornblaser added, including
Pepsi True, the brands stevia-sweetened answer to Coca-Cola Life, and
General Mills Veggie Blend-Ins.
As Millennials will command more buying power than any consumer
segment in just a few years, its important to consider that these younger
shoppers demand transparency, the panel noted. Customer rights and
corporate responsibility have taken center stage among consumers, and
not only are manufacturers and retailers following suit, but theyre also
actually enlisting consumer input and responding accordingly.
In addition to what ingredients companies put in their products, consumers are also making buying decisions based on company values like LGBT issues, minimum wage, environmental responsibility, animal rights and the support of political parties. Many engaged consumers get involved in protests,
social media campaigns and other such efforts, and offer up their money to
those companies that heed similar calls.
82nd AnnuAl RepoRt

Consumers are focking to retailers mobile sites

at a faster pace and with more interaction than ever
before, so naturally they expect retailers to ofer
fast, well-designed mobile services that meet their
needs, explains National Retail Federation SVP
and Shop.org Executive Director Vicki Cantrell.
With that in mind and with several years of mobile
commerce now under the industrys belt, retailers feel confdent in their mobile investments. For
retailers when it comes to mobile strategies
small but continuous incremental changes really do
go a long way to keep their savvy customers happy.
Omnichannel ranks second on retailers priority lists this year, according to the 2015 State of
Retailing Online survey, which found nearly half (45
percent) of participants hoping to improve or invest
in programs like buy-online, pickup-in-store, shipfrom-store and inventory visibility. Tis is up signifcantly from the 26 percent of respondents
who listed omnichannel eforts as a priority
last year. Nearly four in 10 (38 percent)
surveyed say their third priority is
marketing optimization, including initiatives related to customer
retention and acquisition.
Promotions Become
Social, Personal
Without question,
the smartphone will
be the end-all/beall source of deals,
personalized ofers and
customer engagement
going forward. Pushing a
grocery cart around with a paper
shopping list is becoming a thing of the past.
Along their path to purchase, modern aislebrowsers want convenience and value that makes
their lives better and easier.
Recognizing that social networks are the
ultimate hub for conversations and word-of-mouth
discoveries, 48 percent of retail execs responding to
this years Annual Report of the Grocery Industry survey rank Facebook as the leading outlet to
solidify connections with shoppers. According to a
recent study by Te Hartman Group, 54 percent of
online consumers use social media to discover new
foods and share food experiences.
For years, grocers have been reducing FSI
circulation, and many retailers have done so with
a scalpel rather than a hatchet testing which
markets will proftably respond to
transitioning some of their print circular distribution to digital. As more
grocers further enrich their wealth of
Next
customer data and as consumers
5 years
make digital an even bigger part of
28.4%
their lives the race to ofer the most
13.8
relevant promotions for each customer
will continue to intensify.
4.3
Bearing out that the days of coupon
17.2
clipping may be numbered, e-coupons
(46.6 percent) and digital circulars (45.7
11.2
percent) are rated as the second and
6.9
third top-rated benefts for an increas14.7
ingly mobile-using base of shoppers.
As grocers look to further increase
6.0
share of wallet, theyre also investing
4.3
more heavily in interactive websites
0.0
(32 percent) and price comparison
apps (28 percent), both of which
11.2
gained double-digit traction from last
1.7
year, as well as personalized discounts
2.6
(27.6 percent).
Other growing in-store tech1.7
nologies include indoor positioning
1.7
systems to push customized ofers in
real time. A handful of retailers are
0.0
already piloting beacon technologies
0.9
that enable them to blast promotions
0.9
to customers smartphones as they
stroll through the aisles.
Best Investments In the Past 5 years/next 5 years

Past
5 years
Remodeled/Invested in Existing Stores
27.4%
Built New Stores
12.0
Expanded Assortments, i.e., Free-from Section, Organic Section
10.3
Technology Upgrades/New Investments
8.5
Upgraded Infrastructure to be More Efficient
7.7
Geographic Expansion
7.7
Enhance Social Media Strategy
6.8
Invested in Private Label/Store Brands
6.8
Changed Format (Smaller, Bigger, Different)
6.0
Streamlined Assortments/Trimmed SKUs
4.3
Training and Retention Programs
3.4
Overhauled Loyalty Program
2.6
Closed Underperforming Stores
2.6
Developed Sustainability Program
1.7
New PR Campaign to Promote Store to Community
0.9
Enhance Sustainability Strategy
0.0
Transitioned to Employee-owned Company
0.0
Other
5.1
50
Advertor i Al
Q &A
Talking with
Kon Ostaficiuk
President
Camber Pharmaceuticals
Cambers Impressive Growth Is Tied to

Quality, Service and Teamwork
Tell us why Camber has grown so
dramatically over the past several years.
It begins with a commitment by each
individual in our company to never lose sight of the needs
of our customers. From sales, to pricing, to customer
service, everyone is pulling in the same direction. We know
we have to earn our customers business every day and in
every way. So if it means developing a customized program
for a particular partner, or staying late on a holiday
weekend to make sure all our orders are shipped, its really
just part of the culture here at Camber.
PG: Is this commitment refected in your results for 2014?
Yes, defnitely. Based on the latest IMS data, Camber
is number 14 overall among generic companies in
dispensed prescriptions and number 1 in % growth with
an 18.9% increase for 2014. We are very proud of these
accomplishments but were not the type of company to
rest on our laurels.
PG: Tell us about your parent company, Hetero Drugs
As the Chairman of Hetero, Dr. B.P.S Reddy likes
to say; We are in the life saving business. Heteros
business model is based on providing affordable, lifesaving
medications to as many people as possible. An example
of that is their dedication to improve the quality of

life for HIV patients worldwide. In addition to being a
member of PEPFAR (Presidents Emergency Plan for
AIDS Relief), Hetero and Camber currently provide
anti-retroviral medications to some 3.5 million patients
in 140 countries. Hetero is also one of the largest API
manufacturers in the world, which gives Camber a
distinct advantage when it comes to maintaining the
integrity of our supply chain.
PG: What plans does Camber have for 2015?
: For 2015 we are planning an aggressive new product
launch schedule. We have already launched 4 new products
since January, (Valsartan, Zolmitriptan, Pantoprazole and
Rizatriptan), and we have 20 or so more in the pipeline.
We have also launched a new OTC division of Camber
Pharmaceuticals called Camber Consumer Care, which will
focus on the Pain, Allergy, Sleep and Cough/Cold categories.
We believe our current success, great reputation and
strong existing customer relationships will give us a good
opportunity to break into and thrive in the competitive OTC
marketplace. At the end of the day it is our quality products,
commitment to teamwork and passion for the business that
will drive Cambers continued growth.
Making a world of difference in generics...
one dose at a time.
Helping todays pharmacists meet the

challenges of the future with quality generics.
CAMBER PHARMACEUTICALS, INC. Phone: 732.529.0430 camberpharma.com
82nd AnnuAl RepoRt
success across the store
Meat still reigns supreme, but other categories swap places

as they jockey for consumers dollars and ongoing loyalty.
When respondents to PGs survey were asked which
categories generate the most sales, meat once more
comes out on top, chosen by 50.9 percent. Te second
spot belongs jointly to private label, which rocketed
up from 12th place last year, and produce, which rose
slightly from its third-ranked position in 2014; both
were selected by 47.2 percent of respondents. Rounding out the top spots are beer/wine/liquor and frozen
food, each with 39.6 percent; general merchandise, at
38.7 percent; and dairy, at 36.8 percent.
Interestingly, center store, No. 2 last year, drops
to No. 8 this year; deli/prepared foods, which ranked
ffth in 2014, falls to ninth in 2015; and organics have gone from seventh to 11th. Such dramatic
downward shifts may indicate that these categories
are in need of fresh marketing and merchandising
strategies to boost customer purchases, particularly
center store, which faces stifer-than-ever competition from fresh categories, while organic may be
afected by the plethora of better-for-you, natural
and free-from items on the market, giving healthconscious shoppers more to choose from. On the
ascendant, meanwhile, are frozen foods, which last
year were in ninth place, and fresh bakery, up six
Most successful DepartMents:
GeneratinG sales

54
DrivinG traffic
Total
Meat
Private label
Produce
Beer/Wine/Liquor
Frozen Foods
General Merchandise
Dairy
Center Store
Deli/Prepared Foods
Fresh Bakery
Seafood
Organic
Health, Beauty & Wellness
Gourmet/Specialty
Floral
Ethnic
Pharmacy
Checklanes
rungs to ninth this year, buoyed perhaps by consumers increased interest in the perimeter.
When it comes to driving trafc, meat is again
the winner, at 41.7 percent, paced by produce (39.6
percent), deli/prepared foods (38.5 percent), and
dairy (37.5 percent), while the next-ranked category, beer/wine/liquor, most likely because theyre
not carried by all stores, lags somewhat behind, at
25 percent. Last years second-ranked trafc driver,
center store, plunges to seventh, while frozen
foods, 17th last year, surges to sixth place.
50.9%
47.2
47.2
39.6
39.6
38.7
36.8
34.0
28.3
28.3
27.4
25.5
24.5
20.8
18.9
17.0
16.0
11.3
coupon reDeMption
Total
Meat
Produce
Deli/Prepared Foods
Dairy
Beer/Wine/Liquor (if applicable)
Frozen Foods
Center Store
Fresh Bakery
Pharmacy
Private Label
Ethnic
Gourmet/Specialty
Organic
Floral
Seafood
Checklanes
General Merchandise
41.7%
39.6
38.5
37.5
25.0
24.0
21.9
21.9
18.8
18.8
15.6
15.6
15.6
12.5
12.5
11.5
10.4
7.3
Total
Center Store
Frozen Foods
General Merchandise
Dairy
Checklanes
Deli/Prepared Foods
Gourmet/Specialty
Seafood
Ethnic
Fresh Bakery
Meat
Private Label
Produce
Floral
Pharmacy
Organic
50.2%
21.1
21.1
17.5
14.0
10.5
5.3
5.3
5.3
3.5
1.8
1.8
1.8
1.8
1.8
0.0
0.0
0.0
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What Shoppers Want

Meats supremacy in sales and driving trafc is no doubt due to the industrys
heightened awareness of shoppers motivations and desires, as evidenced by the
in-depth Power of Meat study, published yearly by the Food Marketing Institute (FMI) and North American Meat Institute (NAMI). At the recent Annual
Meat Conference, in Nashville, Tenn., in February, various sessions discussed
such timely issues as the implications of the proposed 2015 Dietary Guidelines,
which dont recognize consumption of lean meat as part of a healthy lifestyle;
food safety; and sustainability through modern factory farming.
Tis awareness is coupled with an aggressive approach to getting consumers
to buy. Sherry Frey, SVP at Schaumburg, Ill.-based Nielsen, noted at the conference that grocers can increase basket rings by delivering solutions through crosspromoting meat across multiple store categories. She added that, to shore up
meat against incursions from the prepared foods department, grocers should strategically target two key categories: versatile quick-cuts (premium-priced smaller
packs) and planned occasions (larger family packs), and promote meat in circulars
as part of multicategory solutions, not as isolated ingredients. Other advice in this
vein provided at the conference included the need for retailers to market meals
rather than ingredients; promoting premium extensions of conventional brands,
clean labels and other trending concepts such as gourmet, artisan and craft; and
engaging meat consumers through social media.
Whats more, ample feed stocks and fat ethanol use are expected to help
boost herd development and ultimately moderate meat prices, which should
encourage more consumer purchases. A good economy and changing preferences have created a very positive demand situation for meat, said Steve
Meyer, president of Adel, Iowa-based Paragon Economics, at the conference.
Frozen foods substantial gains appear to stem from such trends as the
introduction of a greater number of natural and organic frozen oferings,
which in turn is spurring interest in consumers who are sufciently attracted by their convenience to opt for them over comparable fresh items.
Rockville, Md.-based Packaged Facts estimates that sales of frozen foods,
custoMer InteractIon
custoMer Buzz
Total
Total
Organic
Deli/Prepared Foods
Ethnic
Gourmet/Specialty
Meat
Floral
Fresh Bakery
Produce
Checklanes
Seafood
Private Label
General Merchandise
Center Store
Dairy
Pharmacy
Frozen Foods
source: Progressive Grocer
31.3%
28.8
28.8
27.5
18.8
17.5
17.5
16.3
13.8
12.5
12.5
10.0
10.0
6.3
5.0
5.0
5.0
1.3
Checklanes
Deli/Prepared Foods
Floral
Meat
Pharmacy
Fresh Bakery
Produce
Seafood
Organic
Ethnic
Center Store
Gourmet/Specialty
Dairy
Private Label
General Merchandise
Frozen Foods
source: Progressive Grocer
54.4%
32.4
26.5
19.1
19.1
17.6
16.2
16.2
13.2
11.8
10.3
8.8
8.8
7.4
2.9
2.9
1.5
0.0
82nd AnnuAl RepoRt

as it was last year, with 50.2 percent of respondents
including dinners/entres, pizzas, side dishes,
selecting it in 2015. Next are frozen food (up from
and appetizers/snacks, will grow from $22 billast years ffth place) and general merchandise, both
lion in 2014 to $23 billion in 2019.
with 21.1 percent; health, beauty and wellness, at
As for the deli/prepared foods section, while
17.5 percent; and dairy, at 14 percent.
Chicago-based Technomic fnds that sales are up
According to Marx, a solution from Minneap30 percent since 2008, compared with about 10
olis-based Kantar Media, retailer participation in
percent for the overall foodservice industry during
free-standing insert (FSI) coupon events and digital
this period, the categorys slipping sales among
coupons distributed on retailer websites benefted
PGs survey respondents point to the idea that
from double-digit increases from 2013 to 2014,
many grocers havent quite fgured out how to make
increasing by 11.8 percent and 16.5 percent, respecthe shift from the historical ingredient/component
tively. During this same period, retailer feature ad
approach we have seen for many years to what
pages grew 4.2 percent, while overall retailer adverMark Hayden, president of Acosta Foodservice for
tising among CPG retailers declined 2.8 percent.
Jacksonville, Fla.-based Acosta Sales & Marketing,
Tese trends indicate retailer and manufacturer
sees as the next logical step for the category, given
marketing dollars are increasingly being directed tothe explosive growth of the grocerant, or grocery
ward programs that communicate specifc and easystore-restaurant hybrid concept featuring a greater
to-understand value to the shopper, notes Marx Acnumber of convenient ready-to-eat meals.
count Solutions VP Dan Kitrell. Although retailer
Its important to create oferings that are
advertising provides continuity and builds equity
high-quality and executed consistently day to day,
with shoppers, retailer FSI couHayden notes. Tis is where
pon events efectively reach
bringing foodservice expertise
shoppers in the home when they
is important to consult on areas
are writing shopping lists and
such as equipment, packaging,
planning shopping trips, while
food preparation, menu design
digital coupons distributed on a
and marketing strategies, to creretailers website provide relevant
ate visibility for their programs.
incentives to shoppers who are
One major area of opportulikely planning a trip to that
nity for deli/prepared foods is to
retailer. Finally, retailer feature
court Millennials, who, accordads frequently make the value
ing to Mary Kay OConnor, VP
of the combined ofers easier for
education at the Madison, Wis.the shopper to understand by
based International Dairy-Delishowing the math, including
Bakery Association (IDDBA),
regular price, feature price, and
represent a crucial demographic
net price paid after the coupon
for the cheese industry, as they
savings are applied.
increasingly demand a wider
Marx noted considerable
spectrum of favors and varieties
shifts in advertising and promocompared with older generations.
tion activity among various
[Millennials are] also more
retailers. For example, Benlikely to visit the specialty cheese
tonville, Ark.-based Walmart
department than Baby Boommaintained the highest level of
ers and the Silent Generation,
actual advertising expenditures
notes OConnor, citing fndings
and the highest level of particifrom the associations 29th annual
pation in retailer FSI promotion
Whats in Store 2015 trends repages, and also increased its
port. Given the rise in snacking
consumer promotion activity,
as a prominent eating occasion
Total
with a 15.7 percent increase
and the interest in consuming
Meat
45.8%
in FSI promotion pages and
more protein, specialty cheese is
Produce
28.1
an 18.4 percent rise in digital
well aligned to position itself as a
Center Store/Grocery
9.4
coupon events on Walmart.com
unique snack category thats both
Deli/Prepared Foods
8.3
in 2014. Minneapolis-based
healthy and indulgent.
Fresh Bakery
7.3
Target, meanwhile, had the secOrganic
3.1
ond-highest levels of advertising
Coupon Redemption
Gourmet/Specialty
2.1
expenditures and retailer FSI
In the area of coupon redemppromotion pages after Walmart,
tion, PGs survey fnds center
but cut back on advertising by
store unsurprisingly in the lead,
Most InfluentIal
DepartMents In DrIvIng
stores overall
BranD/IMage/poInt
of DIfferentIatIon
58
6.1 percent, FSI promotion pages by 11.1 percent

and digital coupon events on Target.com by 36.6
percent in 2014. Tese advertising and promotion
shifts may ultimately lead to shifts in share of shoppers, trips and sales between the two retailers.
Several leading pure-play grocery retailers
Kroger, Albertsons and Supervalu lowered
their advertising expenditures in 2014. FSI coupon
pages and digital coupon events rose for most
of these retailers, while retailer feature ad page
changes were mixed in 2014.
Tese retailer trends may refect several factors, including retailers exiting select markets,
the sale of retail banners, or a response to retailerrelated news stories, observed Kitrell, adding
that manufacturers should time their programs to
the specifc periods in which a retailer has higher
advertising and promotion activity.
Customer Buzz and More

It may be down in generating sales, but organic tops
other categories in customer buzz, at 31.1 percent,
rising from No. 7 in 2014 to supplant last years
deli/prepared foods, which shares second place with
ethnic, at 28.8 percent. Other most talked-about
categories are gourmet/specialty, at 27.5 percent;

meat, at 18.8 percent; and foral and fresh bakery,
with 17.5 percent apiece.
In the realm of customer interaction, checklanes
and deli/prepared foods have switched places, with
checklanes now out in front by a wide margin,
54.4 percent to deli/prepared foods 32.4 percent.
Floral makes an impressive leap from 12th last year
to third this year, at 26.5 percent, pushing meat
down one spot, with 19.1 percent, where it ties with
pharmacy. Despite the opportunities opened up by
its showing on the customer buzz chart, organic
comes in ninth, three spots up from last year but
still fairly low down on the list.
Given the buzz it engenders, grocers should ensure
their associates know the benefts of organic and how
products receive organic certifcation, thereby enabling
consumers with questions to understand what theyre
purchasing, and increasing customer interaction that
will inspire more shoppers to buy organic.
Most infuential in driving stores overall brand,
image or point of diferentiation is once more the
meat section, with 45.8 percent, while produce,
which was No. 2 last year, is a distant second, at
28.1 percent. Center store/grocery is third, with 9.4
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percent, followed by fresh bakery and organic (which
didnt even chart last year), at 7.3 percent and 3.1
percent, respectively.
Finally, when asked to name the tools they use
to engage with consumers, a whopping 73.2 percent
of PGs survey respondents choose social media,
up from 69.8 percent last year. Next in popularity
are electronic communications/digital surveys, at
36.5 percent, down slightly from last year; customer

service hotlines, at 36.3 percent, an increase of
nearly eight percentage points; loyalty card data, at
33.3 percent, down from 37.2 percent in 2014; and
associate feedback, at 29.2 percent, a small uptick
from last year. As grocers continue to embrace digital
marketing, we can expect the use of social media and
e-communications to keep growing. PG
How MulticHannel SHopping iS cHanging tHe grocery induStry

By Julian Highley
cal contact will continue to be dominant in-store.
This will force retailers to think about how they rebalance
Theres no doubt that the online channel is increasing its
space in their physical stores and deliver on different customer
presence in the grocery sector. Theres also no question that
needs. Using the store as a depot allows retailers to manage
its taken a long time.
the transition of key categories, but it also introduces its own
While 83 percent of leisure flights were booked online
complications. Retailers will need to provide customers the
in 2014, Googles Consumer Barometer found, less than 1
ability to pick up quality produce and food to go, while rapidly
percent of grocery sales were, according to Planet Retail.
innovating the rest of the in-store experience.
And with Bloomberg Businessweek estimating that onlines
share of the grocery business could reach 11 percent by
2023, its understandable to think that theres still considerOnline Merchandising
able time before those in the grocery space need to turn
How shoppers navigate the store online is fundamentally
their focus toward online shopping.
different from in-store. Although devoid of tried-andHowever, recent Dunnhumby research has found
true in-store stimulus, online purchasing is
that the online channel is going to have a profound ef- tHe virtual
significantly healthier than in-store purchases.
fect on grocery brands and retailers, with 50 percent
Also, based on customer behavior, promotions
environMent
of sales in key categories being sold online well before
work very differently online versus in-store.
iS currently
2023. Planning for this shift needs to start now.
For instance, the end-of-aisle display is a staunderuSed
ple of trade promotions in the physical world,
by retailerS,
while the online equivalent contributes to only
Key Categories for Growth
and Moving
6 percent of online purchases. The in-aisle
Established markets total online sales account for
equivalents are far more important online.
less than 5 percent of total grocery, yet categories
forward we
While the online behavior of shoppers is
such as frozen meat, canned food, baby food and
anticipate MucH
profoundly different from in-store, the apcare, and breakfast cereals are seeing almost 20 pergreater uSe of proach of most retailers has been to translate
cent of their sales through online. With online annual
the physical store online (with some tweaks
growth rates in excess of 20 percent, one-third to half tHe freedoM
tHat tHe virtual such as a search function and favorites). The
of all sales could easily be online for these categories
virtual environment is underused by retailby 2019. For the most part, the shift from in-store to
environMent
ers, and moving forward we anticipate much
the online channel is a zero-sum game.
provideS.
greater use of the freedom that the virtual
Retailers will need to ensure that they have an
environment provides not to the futuristic
online presence to respond to this dynamic. Within
extent of virtual reality, but more thoughtful and simple
the categories that are already well established online, there
ways of improving the online experience.
are a significant number of brands that have close to 40
For example, providing dedicated entry points for spepercent of their sales from online today. In a few years, there
cific mission-based shopping (e.g., party planning versus
will be grocery brands that see the majority of their sales
full shop versus stocking up on staples), and the introduccoming from online grocery shopping.
tion of features like have you forgotten to remove the
frustration of an additional trip to pick up items that were
Think Multichannel, not Online
omitted from the original shopping trip.
While there are categories that will see sizable shifts to
online, for customers it will be about a balance between
the online and in-store environments. Even in the most
established online grocery markets, those shopping solely
Julian Highley, global capability director and head of global
online equate to less than 2 percent. Fresh produce, the deli
trends at London-based Dunnhumby, influences strategy at the
executive level across a number of retail and brand partners.
counter categories where its important for consumers to
gauge the quality and freshness of products through physi-
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Category Management
Center Store
Delivering
Solutions
Reaching across aisles to satisfy shopper need states
is the way to boost center store.
By Jim Dudlicek
rocery retailers and industry analysts

alike say the fresh perimeter exhibits
the strongest continuing growth, but
where does that leave center store?
Fewer and fewer consumers are
shopping both the perimeter and center
store currently only 43 percent, noted John Rand, SVP
of retail insights at Boston-based Kantar Retail, in his presentation at the recent 2015 Annual Meat Conference.
62
According to PGs own survey of grocery retailers, fully

explored in our 82nd Annual Report of the Grocery Industry in this issue, center store is the eighth-highest salesgenerating department in the store, down from second a
year ago, on a list led by meat, produce and frozen foods.
Both Rand and Sherry Frey, SVP at Te Nielsen Co.,
in Schaumburg, Ill., assert that fresh and center store
categories must be cross-merchandised to deliver meal solutions for shoppers. Competition and partnerships hinge
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Category Management
Skate to where
the customer
is going and
you will be
rewarded.
Center store
may not have
the same
glamour that
fresh has, but
there are great
opportunities
when properly
mined.
Richard Meyerkopf,
Hannaford
Center Store
on connections across aisles, said Frey, also speaking at the Meat Conference. Tat means thinking
diferently on how to merchandise the store, Frey
said. If youre not willing to think diferently and
get creative, youre vulnerable.
Tat vulnerability can be overcome by marketing
solutions, rather than isolated ingredients, to address
need states in demand by consumers. Meals that
deliver on convenience, great taste, ease of preparation and solid nutritional profles allow busy shoppers
to put dinner on the family table with as much ease
as going through the fast-food drive-through, but
without the guilt.
Moving center store out of the shadows and
demonstrating how its an essential partner to fresh
and other categories will boost excitement and
basket rings for key consumer age groups, and help
elevate the category from the chore status it holds
as part of the shopper experience.
Wants and Needs

Its important to have equal passion for center
store as fresh, says Richard Meyerkopf, VP of
merchandising at Scarborough, Maine-based supermarket chain Hannaford. Diferent consumers have a variety of needs and wants, and a lot of
those needs and wants have center store solutions
for them. My job is to ensure we are moving in
sync with our primary customers.
In center store, Meyerkopf tells PG, that means
knowing what categories matter most, and then ensuring the assortment, merchandising, price, promotion,
display and fxtures all deliver a strong impression and
experience. Skate to where the customer is going and
you will be rewarded, he says. Center store may not
have the same glamour that fresh has, but there are
great opportunities when properly mined.
Gordon Wade, SVP for best practices at the
Wimberley, Texas-based Category Management
Association, describes the reasons for center stores

malaise as numerous and complex, therefore no one
magic prescription will solve the sickness.
Wade looks to Te Kroger Co., based in Cincinnati, and its seemingly perpetual same-store sales
gains as a best-practice beacon. In my judgment,
they are leveraging their loyalty card data to identify
the categories and shopper cohorts where they
are underperforming, and designing programs to
capture the proft pools among shoppers in the store
but less loyal in category X, he says.
Wade points to a recent VideoMining shopper behavior study that tracked consumers actual
movements through a supermarket. Tis work
suggests that specifc category end cap choices will
enhance center store trafc, he says, urging that
retailers should jump on this learning because it is
something they can do immediately with little or no
additional expense or labor.
Further, Wade recommends leveraging categories with high household penetration and frequent
purchase, particularly dairy: Numerous studies
indicate that cross-merchandising with milk drives
shoppers into the middle of the store.
Ultimately, Wade asserts, retailers need to
truly understand the problem categories in
center store, those where
shoppers are satisfying a low
percentage of their need in
my store, and then design
programs with vendors to
recapture this volume.
Understanding Shoppers
Making center store more
shopper-friendly is a common
goal of retailers and CPG
companies.
Te linear aisle structure
of center store was originally
designed to optimize operational efciencies. For the
most part, this structure is
uninspiring, hard to navigate
and hard to shop, declares Ja-
64
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popular brands. On July 1st, well be known as Edgewell Personal Care Company
focused, agile, and ready to take flight as an even stronger challenger!
Xtreme3
2015 Energizer. INT 127609
Playtex and all other trademarks are licensed or owned by Energizer.
TM
MC
Category Management
The linear aisle

structure of
center store
was originally
designed
to optimize
operational
efficiencies. For
the most part,
this structure
is uninspiring,
hard to
navigate and
hard to shop.
Janine Shearer,
The Coca-Cola Co.
66
Center Store
nine Shearer, VP for category advisory services at the

Atlanta-based Coca-Cola Co. Much has changed in
the decades since this original center store design was
conceived. Not only has shopper behavior changed,
but our depth of understanding of shoppers and their
behavior has also grown tremendously.
According to Shearer, understanding behavioral,
emotional and functional insights helps retailers and
CPG companies focus on solutions that can drive
more trafc, transactions and conversion, while
improving shopability; connect with shoppers motivations, needs and occasions; help shoppers better
navigate the aisle to locate their preferred brands;
and optimize shelf sets by understanding how shoppers visually navigate the shelf.
Adding excitement to the center store often
means staying on trend and fexing merchandising
space to refect growing categories.
Brick-and-mortar retailers sometimes struggle
with getting ahead of these growing categories, and
as a result, merchandising space can often lag behind
the trends, says Nicole OConnor, director of
category and shopper solutions for Stamford, Conn.based Nestl Waters. We have seen successful
retailers add excitement to center store by identifying
trending categories whose growth is driven by macro-trends (i.e., health and wellness or demographics).
Tey watch these trends and have the confdence to
add space and assortment just ahead of demand.
Northfeld, Ill.-based Kraft Foods Group has
developed an action plan for center store focused
fve key areas: shopper insights, category basics,

space management, aisle/total store and more on
the foor, or leveraging modular shipper displays
to sell more products.
Further, retailers should modify their store layouts according to evolving shopper navigation principles to convert shoppers to buyers, according
to Art Sebastian, Kraft VP of category leadership
and shopper insights, in a recent presentation to the
Wisconsin Grocers Association. As envisioned by
Kraft, a reimagined center store creates new aisles
focusing on specifc need states such as meal solutions, a dinner aisle, protein snacking, a cofee aisle
or front end solutions.
Crossing Categories
Michael Ganey, VP of marketing at Four Oaks,
N.C.-based baking mix maker House-Autry Mills,
suggests promoting go-with items across categories for example, bacon and eggs, cooking oils
with fried foods, and fruit with cereals.
A compelling in-store signage program is
needed to connect center store with the fresh perimeter via healthy eating messages, Ganey says, and
direct suggestions to add fruits and veggies to all
meals using easy-to-prepare center store items.
House-Autry Mills is developing load-to-card and
IRC cross-couponing programs to tie its products to
related purchase items. It is important to provide the
consumer a look at a complete meal, and cross-promotions can accomplish that, Ganey asserts.
Revitalizing Center Store

With Natural and Organic
Coca-Cola has been working with some of its
retail partners on a beverage aisle reinvention project,
Shearer notes. Te principles of category management have been critical in understanding the right
assortment based on shopper demographics and key
beverage occasions, as well as the right merchandising
and in-aisle messaging to maximize shopper engagement, she says. Tis work has driven positive results
in terms of purchase incidence and basket size.
And, with more than a quarter of trips lasting
10 minutes or less, putting even more pressure on
center store, basket analysis helps retailers identify
logical product adjacencies to create more convenient solutions for shoppers.
Additionally, neuroscience research has shown
that purchase incidence is higher when complementary items are co-merchandised, for example, snacks
and beverages, Shearer says. In the future, if stores
are designed to meet the needs of the shopper,
then we will see less of a clear delineation between
perimeter and center store, and will see more of a
store-within-a-store concept where visual beacons
communicate logical clusters of products.
At Nestl Waters, opportunities abound in a
variety of consumer occasions and shopper crosspurchasing dynamics.
Our imported sparkling water brand, S. Pellegrino, has very high afnities with perimeter
categories, OConnor says. S. Pellegrino appeals to
the foodie who enjoys at-home entertaining. It most
frequently shares a basket with specialty cheeses,
specialty crackers, and organic fruits and vegetables.
Ofering a premium sparkling water alongside
perimeter categories, or suggesting the addition of
a sparkling water to a specialty cheese purchase, is
an example of how you can connect the perimeter to
center store in a shopper-relevant way.
Nestl Waters is partnering with retailers to reexamine total beverage space. By reallocating space
from declining beverage categories to higher-ring
or higher-margin categories like still and sparkling
bottled water, retailers are able to improve basket
ring and proftability, OConnor says.
Te brand also is collaborating with retailers
to promote sales of singles on premium items. For
example, S. Pellegrino Sparkling Fruit Beverage (SFB), sold in a 6-pack, typically retails for
about $4.99, a price that OConnor says may be a
barrier to putting it in the cart. We have worked
with retailers to authorize sales of the single cans
that retail for $1 each, efectively a 20 percent
premium to the 6-pack. Te results have been
tremendous, she says an eightfold increase on
total S. Pellegrino sales, with shoppers returning
to purchase 6-packs at a rate of three times more
than before the promo, at full price. Te 6-packs
become a value to the single-can purchase, and
adding $5 to a cart is substantial.
By Daniel Lohman
Consumers are continually looking for solutions to improve their health and vitality. You cant turn on the TV, listen to the
radio or read anything today without seeing a story
focused on improving health. Some of the stories discuss things
we should avoid, while the majority are about healthier trends, for
example, lowering sodium and sugar consumption.
Natural and organic solutions are fueling these conversations and are at the heart of the trends of growing sales of
natural/better-for-you products. Core natural consumers carefully read labels and are better educated about nutrition than
most shoppers. Theyre happy to pay a premium for products
that deliver exceptional value and fully meet their needs.
The natural channel is growing at more than twice the pace
of conventional. Natural product innovation comes from disruptive brands laser-focused on providing solutions that meet
and exceed consumers needs and wants. Natural products are
responsible for developing entirely new categories like glutenfree, vegan, clean label and organic. These shopper need states
fuel natural product innovation.
How does this strategy work and why does it matter?
Integrating natural and organic products side by side with
other items invites consumers to try new and different
things, products that meet specific needs. For example,
shoppers might consider a gluten-free pasta alternative like
quinoa, rice or chickpea noodles instead of processed pasta
made with wheat flour. This strategy matters because it
capitalizes on better-for-you trends that bring incremental
sales growth to the pasta category. The other benefit is that
the retailer now has a richer selection that caters to consumers with specific needs like food allergies, or those who
want clean-label products.
Quality natural and organic products can be found in almost
every category. They support every meal occasion (breakfast,
lunch, dinner and snacks). One key aspect of natural and organic
products thats frequently overlooked is their true value. While
theyre typically higher-priced, they provide better nutrition and
are often more satisfying, so consumers tend to eat less of them.
For example, a sandwich made of cheap white bread may sustain you for a couple of hours, while the same sandwich filling on
high-quality gluten-free bread will fill you up for a longer period
because it better meets your bodys nutritional needs. In addition,
the gluten-free product provides better overall nourishment to
those with gluten sensitivity. In this example, the better-quality
bread may prove to be less expensive in the long run.
Retailers looking to compete more effectively in any channel and in any economy need to remain dedicated to meeting
their shoppers needs. There are a lot of untapped opportunities to grow center store sales and make shopping there an
adventure. Natural products provide an excellent way to drive
shopper foot traffic and grow sustainable sales at retail.
Daniel Lohman is a strategic adviser in the CPG and organic industry.
His company, Category Management Solutions (CMS4CPG), based in
Littleton, Colo., assists companies in expanding their retail distribution
and improving their merchandising. Lohman can be reached at
dan@cms4cpg.com or 303-748-3273.
67
Category Management
We believe
retailers must
constantly
redefine
theircategories
in the same
ways shoppers
define
categories.
Michael Ganey,
House-Autry Mills
Center Store
Crafting a New Center Store

What does the future hold for category management in center store?
We believe retailers must constantly redefne their
categories in the same ways shoppers defne categories, says Ganey, of House-Autry Mills. Simply
because particular products have similar physical characteristics does not mean it matches up with consumer
perceptions. Dedicated gluten-free sections are a good
example. We are launching a line of gluten-free baking
mixes, and retailers are split on placing them either in
line or in a dedicated section. Sales would seem to indicate the latter creates the best opportunity for a sale.
Cokes Shearer says category management will
become ever more critical in understanding and
optimizing center store. Te key to the future will
be ensuring not only a complete understanding of
the four Ps product, place, price and promotion
but also the ffth P of people, or shoppers, which
underpins every insight and recommendation, she
says. Finally, being able to efectively segment stores
so that the ofering in each store exactly matches the
needs of the shoppers in that specifc store is critical.
Optimizing assortment, pricing, merchandising and
marketing in this way will enable our retail partners
to maximize their sales and profts.

Nestl Waters OConnor notes that health-andwellness trends, coupled with e-commerce growth,
will put more pressure on retailers to revolutionize the center store. We believe that shoppers will
come to expect the product selection and assortment in the center store to become as healthy and
natural as what they demand from items around
the perimeter, she says. How can we reinforce the
healthfulness and naturalness of center store items
to improve the perception of center store?
According to Hannafords Meyerkopf, adding
general merchandise to displays makes a lot of sense,
giving as an example another retailers display featuring vegetable steamers in the produce department.
Tats not driving them down the aisle, though, he
cautions. I dont think the answer is through fresh.
Its going to be through relevance and drawing power
of the category, by assortment, price, brands, favors,
merchandising, dcor and store design. PG
Read more about center store
category management at
Progressivegrocer.com/catmancenterstore.
AdvertOrIAL
Talking with
Jim Rogers
Vice President of Sales and Marketing,
Creekstone Farms
Progressive Grocer: After 20 years of success in the
Premium Black Angus Beef business, why was now the
right time to expand to pork?
Jim Rogers: We felt we could ofer customers a healthier and
higher-quality alternative to what is currently available. Our new
Premium All-Natural Duroc Pork line is from premium Duroc
genetics and contains absolutely no antibiotics, added hormones or
artifcial ingredients. Plus, you wont fnd any added water or solutions its all-natural. You can really taste the diference. Each bite
is juicer and more tender than the next.
PG: What is Creekstone Farms doing to promote sustainability in
local communities?
JR: Our all-natural Duroc pork is processed at one facility owned
by some of the same family farmers that raise our hogs. Our
ultimate goal is to make sustainability a way of life rather than
just a word. Weve even taken steps to ensure that our animals are
68
treated with the utmost dignity and respect. Tey live in a cratefree environment and are 100% vegetarian-fed. All of this leads
to Creekstone Farms delivering high-quality taste while leaving
behind the lowest environmental footprint possible.
PG: Your new case-ready program has been highly
anticipated by grocers. Tell us why.
JR: Trust me, were just as excited as they are! Our case-ready
program applies to Premium Black Angus Beef steaks and roasts,
as well as all-natural further processed pork items like franks,
sausages and bacon. It provides extra fexibility for grocers that
stock our products. Two of the major benefts are an extended shelf
life 28 days from production and smaller pack sizes, about 6 to
12 pieces per case. Te longer shelf life means less markdowns and
throwaways, which supports our overarching goal of sustainability. Were creating less waste in the community while increasing
profts for our partners. Our customers will see immediate benefts
by encountering fewer out-of-stock situations.
WEVE GOT SOME
Grocery
Condiments
Hot Stuff
Sauces with a spicy kick
enliven supermarket displays
and customers palates.
By Bridget Goldschmidt
o doubt about it hot sauces

are hot.
Tis month alone, the 2015
NYC Hot Sauce Expo (just one
of many such themed events for
spicy food lovers) is scheduled
to blast of at the Brooklyn Expo Center, with a
full slate of demos, eating contests and ceremonies
planned, and New Yorks resident hipster borough
will become home to a Kickstarter-funded hot sauce
emporium punningly dubbed the Heatonist and
already active as a mail-order business in the
citys oh-so-trendy Williamsburg section.
Just how hot are hot sauces? According to Te
NPD Group, a Port Washington, N.Y.-based
global information company, 56 percent of households have hot sauce on hand in their kitchens.
When broken down by demographics, females
age 18-44 and 55-64 and males age 18-54
and 65-plus, eat more than the average
amount of hot sauce over the course of a
year, according to NPDs ongoing food and
beverage market research, National Eating
Trends, which also found that dual-income,
no-kids households, or DINKS, eat more
hot sauce than any other type of household,
and that consumers in the South eat more
hot sauce than any other region of the country, while easterners eat the least.
Hot sauce is clearly part of the diet of
many U.S. consumers, and its a food that
crosses gender, age, ethnicity and income,
70
notes Annie Roberts, VP of NPD SupplyTrack, a

monthly service that tracks every product shipped
from major broadline distributors to their foodservice operators.
On the retail front, Minneapolis-based Target
stole a march on other retailers at the end of last year
with the rollout to select SuperTarget locations of
Tabasco Premium Sriracha Tai Chili Sauce, which,
as lovingly described by a representative of Te McIlhenny Co., on Louisianas Avery Island an iconic
147-year-old enterprise thats virtually synonymous
with hot sauce boasts hints of sweet garlic and just
the right amount of spice. Every batch is made with
a small amount of Tabasco pepper mash, which has
been aged in white-oak barrels for up to three years
for a hint of Tabasco signature favor.
Just Say Sriracha

Tat, of course, brings us to the current favor sensation, sriracha, made from a paste of chili peppers,
distilled vinegar, garlic, sugar and salt, and named
for a coastal city in eastern Tailand. Te sauce is
now present in 9 percent of total U.S. households
and 16 percent of households headed by someone
Watch a special Texas Pete TV

episode about The Pantry
youtube.com/texaspetefoodservice
Grocery
With the growth

in popularity
of hot and
spicy foods at
home and in
restaurants,
we knew that
[consumers]
would love a
new, bold take
on their favorite
condiment.
The sriracha
flavor brings
the excitement
and versatility
that [they] are
craving.
Joseph Giallanella,
Heinz
72
Condiments
under age 35, according to

NPDs recently released audit
of U.S. kitchens.
Sriracha frst came to public
prominence through the eforts
of Irwindale, Calif.-based Huy
Fong Foods, whose founder, David
Tran, remains committed to keeping his
companys most popular ofering super-spicy,
even in the face of complaints since dropped
from locals about the pungent odor of chilies emanating from its factory. Hot sauce must be hot, he
insists on Huy Fongs website. If you dont like it hot,
use less. We dont make mayonnaise here. Te companys sriracha sauce is made with California-grown
red jalapeo peppers and sold in bottles sporting the
now well-known rooster logo.
Consumer enthusiasm regarding sriracha has
prompted other sauce makers to try their hands at
similar products. Along with McIlhenny, Franks
RedHot, a brand of Chester, N.J.-based Frenchs Food
Co., which is owned by multinational consumer goods
company Reckitt Benckiser, has come out with Slammin Sriracha, which Miguel Gonzalez, Frenchs VP of
food, says is great for drizzling on pizza and scrambled
eggs, or as a marinade for grilled chicken or short
ribs, adding that the sauce combines the right heat
of sun-kissed chili peppers and jalapeos, with a hint
of smoke. Meanwhile, Winston-Salem, N.C.-based
T.W. Garner Food Co. has its own rendition, Cha! by
Texas Pete, an extension of the brands hot sauce line.
Te favor has also migrated to
other condiments, as in the case
of Lee Kum Kees Sriracha Chili
Ketchup and, amusingly enough,
given Trans comments above,
Sriracha Mayo (the Hong Kongbased company also makes a
Sriracha Chile Sauce). Heinz
Ketchup Blended with Sriracha
Flavor is another recent introduction, available at select retailers,
including Target and Walmart.
Consumers told us that they
have been in search of unique
and versatile favors to add to
their favorite foods, notes Joseph
Giallanella, brand manager of
Heinz Tomato Ketchup at the
Pittsburgh-based company.
With the growth in popularity
of hot and spicy foods at home and
in restaurants, we knew that they
would love a new, bold take on their
favorite condiment. Te sriracha favor
brings the excitement and versatility
that consumers are craving.
Hillsboro, Ore.-based Beaver-
ton Foods, meanwhile, has brought the

distinctive favor to extra-hot mustard
sold under its Inglehofer and Beaver
brands. We are getting great feedback from
our customers about the favor of the new
Sriracha Mustard, asserts Beaverton CEO
Domonic Biggi. Its a one-of-a-kind combination of our award-winning mustard
with sriracha they go together great,
and the customers are telling us that with
their comments and in sales.
In other pairings, Tessemaes All Natural, based in Annapolis, Md., has teamed with
self-confessed food nerd and cookbook author
Michelle Tams Nom Nom Paleo blog on a forthcoming clean-label sriracha ranch Bufalo sauce, in
deference to the favors status as the king of hot
sauce right now, according to VP of Production
and Youngest Brother Matt Vetter, who points
out that all of the family-owned companys Bufalo
sauces boast clean profles.
Beyond the now omnipresent sriracha, other
zesty favors predominate; for instance, Heinzs other
favored ketchups include blends with Real Jalapeo
and Tabasco Brand Pepper Sauce. Franks RedHot
is looking ahead to perhaps the next big condiment
trend with its Rajili Sweet Ginger Sauce, which,
according to Gonzalez, ofers an exotic spicy favor
[that] will add excitement to all favorite foods. Its
sweet, mildly hot and tangy profle has the right
balance of favor and heat that can be used as an
ingredient in recipes, or alone as a topping or dipping
sauce. Te item, due to hit store shelves next month,
will aim to capture the taste buds of the growing
number of consumers looking for variety and big,
bold favors, he notes, adding that sweet, savory
[and] bitter are particularly in demand.
Calling all Heat Seekers

When it comes to encouraging trial, the proof
of the sauce is in the eating, to paraphrase an old
saying. Getting consumers to try our products
is the best way to promote them, says Gonzalez.
Once they try it, they wont share it with anyone.
We are pleased to see that we enjoy above-average
repeat rates in most of our products. Te brand
likes to play up its ubiquity among fans with the
somewhat saucy slogan/hashtag I put that **** on
everything/#IPTSOE.
Weve found that our consumer is familiar with
hot sauce as a condiment but is looking for usage
ideas that utilize the product as an ingredient, notes
the McIlhenny rep. As a result, we pair promotions with recipes to inspire and motivate them to
create favorful meals. In a similar move, Beaverton
Foods ofers appropriate recipes online featuring its
spicy condiments. You need to pair them with the
appropriate foods so they complement each other,
observes Biggi. Its important to develop easy recipes

to use with the product. We like to show consumers
how to best use the product.
Asked about additional placement and promotional measures for the segment, Gonzalez responds: Displays are always a welcome asset in the
key summer season, and, of course, cross-promotions with compatible products [are] always a smart
move. Beavertons Biggi seconds
the use of displays, singling out
end caps as prime locations.
Te best promotional/merchandising tactics are those in which we
are closely aligned with our retail
partners to ensure strong execution
in-store, online and wherever the
stores shoppers are looking for
new and exciting ideas, explains
Heinzs Giallanella. For instance,
in the case of the companys new
sriracha-favored ketchup, we
have worked closely with our
retail team to ensure it is carried
nationally and can be located
easily in aisle and on display.
Sometimes, getting the
word out involves some truly
novel attention-grabbers. At
this point, very few people
know our Bufalo sauce,
admits Tessemaes Vetter, so
for us, the key has been to
create some unexpected moments and recipes. ... For instance, we have a Bufalo
sauce lemonade. Its something so rare that you almost have to try it and once you do, we then can
compete in the expected spaces (e.g., chicken wings)
of extreme brand loyalty.
Sauce of the Future

Whats in store for hot sauce? In common with
Franks RedHots Gonzalez, Vetter sees the rise of
more Asian-style products on the horizon, while
the McIlhenny rep expects greater consumer demand
for international favors in general, and both Vetter
and Biggi anticipate cleaner ingredient lists as people
continue to try to eat more healthfully. But tastes will
defnitely remain in the culinary torrid zone.
We defnitely dont see the heat trend going away, asserts Biggi. Its not a fad. Teres a
population of consumers out there who want hot
products, and were going to keep looking for hot
new products to ofer them. PG
For more information on hot sauces and
other condiments, please visit
Progressivegrocer.com/condiments.
Frozen & Refrigerated Foods
Baked Goods
A Slice
of the Action
Savvy promotions and a keen eye on consumer needs position frozen cakes
and pies as an attractive alternative to home baking.
By Bridget Goldschmidt
ustomers are looking for three

[main] things when it comes to
frozen baked foods: quality and
freshness, convenience, and
selection, along with unique
and new items that dont sacrifce that homemade quality, says Sean Maurer, portfolio
lead frozen at Carlisle, Pa.-based Ahold USA. Our
customers are busier than ever before and sometimes do not
have the time to make something homemade for their special
occasion. Its a convenience for them to know that they have
quality options that just need to be baked or thawed.
Te companys banners consequently carry a wide
variety of types and favors of baked goods available every
day, so customers can purchase for their special occa-
74
sions throughout the year, notes Maurer, adding that the

grocer has had success in working with our vendors on
bundling dessert options, i.e. cakes with ice cream in the
summer months. Promotions have also included bundling
frozen desserts with another category. For example, a
customer can purchase several selections and receive a
free dessert: Buy a dinner, get dessert.
Certain periods call for a stepped-up approach, however. Merchandising pie is critical in the big holidays, as
is ofering the traditional seasonal favors: pumpkin, pecan
and apple, Maurer points out. Sufcient display space is
dedicated to both fruit and crme pies in the weeks leading
up to Tanksgiving, Christmas and Easter. Crme pie is also
a favorite for barbecues and summer events, and should be
featured in the display case during those months as well.
NEW!
New Seasonal Items!
Heres why retailers

nationwide are sweet on
Leading brand for frozen

cream puffs and clairs
According to 2014 52-week

Nielsen data:
Largest U.S. producer of

premium European desserts
Aggressive coupon marketing
and trade promotions
Ranked among the top five

U.S. brands in Bakery/
Dessert cakes/Frozen sales
volume
New flavors and website

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For samples and sales information, please contact:

Delizza Patisserie 252-442-0270 6610 Corporation Parkway, Battleboro, NC 27809
Frozen & Refrigerated Foods
Its a
convenience
for consumers
to know that
they have
quality options
that just need
to be baked or
thawed.
Sean Maurer,
Ahold USA
Baked Goods
Pie With Wine

Te Chicago-based Sara Lee brand, part of Tyson
Foods Inc., knows a lot about capitalizing on the
seasonal appeal of frozen baked goods. Last holiday season, we partnered with Pacifc Rim Riesling wine for a Riesling to Feast cross-marketing
promotion, observes Angie Dobrofsky, assistant
brand manager at Sara Lee Desserts. Te promotion was ofered to select retailers across the country and provided consumers with valuable rebates
when they purchased both Pacifc Rim wine and
Sara Lee dessert products.
Continues Dobrofsky: Tis program worked well
because Sara Lee dessert products, especially pies,
are synonymous with holiday traditions and pair
wonderfully with the Pacifc Rim Riesling wine
portfolio. Retailers liked the natural connection
between the two products, and consumers benefted
from fun wine-and-dessert pairing ideas that were
delivered via POS materials as well as shared online
by popular food and lifestyle bloggers.
Te result was a win for both retailers and
consumers, she recounts.
Beyond the festive season, Dobrofsky notes that
smaller portions for individual snacking and enjoyment, as well as more convenient and timesaving
options, remain a trend in the frozen baked goods
category. In response to these trends, we added our
frozen Sara Lee Original and Double Chocolate
Pound Cake Slices to the iconic pound cake portfolio
to allow consumers especially those with children,
boomers, and one-person households to be able
to enjoy this classic treat whenever they choose. Te
individual packaging ensures every slice stays fresh.
New favor varieties from the brand include

Blueberry Pound Cake, introduced last October and
marketed as a whenever treat. We know consumers enjoy our pound cake for breakfast, afternoon
snacks and when creating unique dessert dishes; the
fresh blueberry favor is great any time of day, and
its perfect for spring and summer, says Dobrofsky.
76
The More the Merrier

How about when company drops by in time for
dessert? Multiserve frozen baked goods ofer
something that tastes homemade, but in frozen
format, so it can be enjoyed anytime for those
special times with family and friends, asserts Amy
Morgan, manager, public relations and social media
at Marie Callenders, a brand of Omaha, Neb.based ConAgra Foods, which also ofers perfectly
portioned single-serve items. Te convenience allows you to enjoy time with loved ones, rather than
spending time making your own [baked goods], and
without sacrifcing taste or quality.
Further, such ease for consumers comes with the
psychological satisfaction of preparing the closest
thing to homemade. Marie Callenders provides
consumers with the feeling that they are baking themselves, due to the quality and freshness of the fruits
that were picked at the height of the season and locked
in the frozen dessert, says Morgan. As the pie bakes,
consumers are still able to savor the delicious aromas
that come from an apple pie baking in the oven.
But to get shoppers to buy frozen dessert cakes and
pies, both of which, for the 52 weeks ended Jan. 15,
2015, saw sales dollar and unit declines at food stores
with sales higher than $2 million, according to Schaumburg, Ill.-based Nielsen, a little prompting is often
necessary. Given the infrequent purchase nature of
the frozen dessert category, its important to constantly
remind the consumer of the benefts of frozen baked
goods, notes Morgan. To keep it top of mind, you do
have to rely on things such as FSIs, ad features, consumer rewards mailings and in-store displays. More so
than many other types of products, this really requires
a tight partnership with all of our individual retailers.
For example, [thanks to] a partnership with a natural
complement like Reddi-wip, Marie Callenders is able
to ofer consumers more incentive to purchase.
Educating shoppers about the products unique
points of diference is a good idea as well. It is
important to insert the brand into trending conversation topics, afrms Morgan. For example, real,
fresh ingredients are important to consumers, and
many are unaware that real Key lime juice from

Florida is in our Key Lime Pie, or that our Apple
Pie is made with 100 percent Fuji apples.
Keeping it Real
For Chicago-based Elis Cheesecake Co., whose
products can be merchandised either refrigerated
or frozen, authenticity is of particular signifcance,
since the consumer is more educated about food
and has expectations of how the product should
look and taste, according to VP of Marketing Debbie Marchok. Elis commitment goes much deeper
than just sourcing the best ingredients, however.
For example, in the case of the companys Honey
Mediterranean Cheesecake, a honey-sweetened
item topped with honey-glazed pistachios and
almonds that was introduced last year, when honey
as a natural sweetener started to gain real traction
among consumers, the honey is harvested by
student beekeepers from the Chicago High School
for Agricultural sciences (CHSAS), one of the only
agricultural high schools in the country, notes
Marchok. Proceeds from honey sales go toward
college scholarships for deserving high school seniors. Tis product is made with an authentic ingredient, honey; made locally by a school, CHSAS;
[and] supported by a business, Elis Cheesecake Co.,
which not only purchases honey from the school,
but [also] supports the school with job shadowing,
mentor programs, scholarships and internships.
Additionally, the company is a member of Brooklyn, N.Y.-based Slow Food USA, which Marchok
describes as an organization devoted to preserving
traditional foodways and educating people about
food as a center of community. Elis prefers using
regional ingredients from local farms and producers
who share Elis commitment to quality.
As its Honey Mediterranean Cheesecake illustrates, Elis isnt afraid of product innovation. Among
its latest products are a new favor in its GMO-free,
1.5-ounce mini pie line, Dulce de Leche, described
by Marchok as a caramelized, sweetened condensedmilk confection baked in an all-butter shortbread pie
crust; a 7-inch mousse-topped Tres Leches Cake;
and, most novel of all, a Vegan Cheesecake.
Of this last item, Marchok admits: We know
its an oxymoron, but Elis Cheesecake has created
a vegan dessert so rich and creamy, we couldnt
resist calling it cheesecake, drawing a parallel to
the Chicago-style cheesecake for which Elis is
known. Certifed vegan by the Vegan Awareness
Foundation, Elis Vegan Cheesecake contains no
animal products or byproducts, has not been tested
on animals, and is dairy-, egg- and cholesterol-free.
Tofu and vegan dairy-free cream cheese replace
cream cheese and sour cream, making Elis Vegan
Cheesecake zero cholesterol and lower in fat than
traditional cheesecake. Introduced last May in
Belgian Chocolate and Carrot Cake varieties, the

product is slated to roll out nationally this June.
Why create a vegan option? Marchok cites the
countrys growing awareness of healthier eating,
the fact that the vegan market has doubled over the
past fve years, and over 100 million people, vegans
and non-vegans, are choosing more plant-based
foods. In keeping with its passion for the authentic,
the company carefully chose such ingredients as
tofu from Phoenix Bean, in the Edgewater neighborhood of Chicago; single-source Madagascar
Nielsen-Massey vanilla extract; Callebaut Belgian
semi-sweet chocolate, which contains no milk; fresh
carrots; pecans; ginger; and Saigon cinnamon.
When asked about how to get cold confections
selling like hotcakes, Marchok similarly spotlights
the seasonal opportunity: Integrated promotions
with the retailers promotional themes work well
in this category. Tis may be a seasonal feature or a
local theme executed in-store. For example, a heartshaped cheesecake rather than a traditional round
cheesecake for Valentines Day draws consumer
attention to the product in a seasonal display.
Elis also relies on in-store demos to initiate
product trial, with handout coupons to encourage
purchase. Te personal interaction enables the
consumer to ask questions and enables our demo
team to engage in conversation about the brand and
the product, explains Marchok. For example, we
have conducted demos for several of our new favors,
[which] invited a lot of discussion with the consumer because of their unique profles and attributes.
Perhaps due in part to the companys eforts,
cheesecake is one of the bright spots in the frozen
baked goods case, with Nielsen reporting, for the 52
weeks ended Jan. 15, 2015, sales dollars and units
up 1.8 percent and 6 percent, respectively, at food
stores with sales higher than $2 million.
As frozen baked goods continue to evolve in
step with shifting shopper demand, a blizzard
of ever more inventive products like Elis should
hit retail. As Marchok notes, We expect to see
continued growth in artisanal products and mashup
desserts as consumers continue to look for locally
sourced, handcrafted and unique desserts. PG
Its an
oxymoron,
but Elis
Cheesecake
has created a
vegan dessert
so rich and
creamy, we
couldnt resist
calling it
cheesecake.
Debbie Marchok,
Elis Cheesecake Co.
For frozen baked goods beyond cakes or pies,

visit Progressivegrocer.com/frozbakedgoods.
77
Q &A
Advertor i Al
Talking with
Bill Monroe
Director of Marketing
Pompeian
Whats happening in the olive oil

category?
Bill Monroe: Something very interesting has been
happening to the category over the last few years. Sales
of extra virgin olive oil have been expanding at a rapid
rate. The Extra virgin segment is now over 70% of the
total olive oil salesand its still growing! We see some
real opportunities in the EVOO segment.
PG: Hows Pompeians business doing?
BM: Our olive oil business is up as of December 31,
2014. In fact we were the fastest growing national olive
oil brand at the end of the year and plan on continued
growth. Our Extra Virgin is one of the leading brands with
almost a 20% share by volume.
Not only are we doing well in the olive oil category but we
are the leading brand of Gourmet Wine Vinegar and the
leading brand of Balsamic Vinegar.
PG: What makes Pompeian different from your
competitors?
BM: In a word, plenty. It all begins with our sourcing
model. We build strong relationships with quality farmers
from around the world which helps us keep our quality
high while maintaining competitive pricing. This also
gives us 100% traceability for total quality assurance.
We then ship our oil in bulk to our U.S. bottling facility
not overseas bottling that adds to shipping costs and
creates traceability questions. With our state-of-the-art
bottling operation based in the U.S., we can maintain
a high quality standard which is why Pompeian is the
only Extra Virgin to participate in the USDAs Quality
Monitored Program.
PG: Anything new on the horizon from Pompeian?
BM: Yes, we are launching our new Smooth Extra Virgin
Olive Oil. It has a more delicate taste than our original
Robust Extra Virgin Olive Oil. Our Smooth Extra Virgin is
perfect for sauting, sauces and stir frying while our Robust
Extra Virgin is for marinades, pastas, and salad dressings.
We did extensive national research that concluded that

93% of the respondents would purchase our new Smooth
while 91% said they would also purchase our Robust.
These incremental sales are the best way for the retailer
to beneft from the EVOO growth trend! And both of
these items will be the same price making it easy for the
retailer to feature both in promotions.
The launch of this new item was the perfect opportunity
to redesign our line of olive oil packaging to have strong
consumer appeal by featuring the distinctive taste
profles along with usage suggestions. These new designs
did extremely well in our market research.
PG: What do you see in Pompeians future?
BM: I see nothing but continued growth for Pompeian.
We have always grown our business on innovation and
will continue to do so in the future.
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Facing Deli
Consequences
Training is key to reducing prepared food product
issues, out-of-stocks. By Joan Driggs
rom long wait times to out-ofstocks, Tyson Foods research

reveals that many issues
common to grocery retail are
magnifed in the deli area.
In this, the fnal installment of Progressive Grocers
2015 Deli Insights series, data from two major
Tyson Foods research initiatives, Consequences of
Failure and In-store Observation, demonstrate
that general deli and product issues can undermine
shoppers trip missions, but that investing in associate training can solve long-standing problems.
More than 3,000 consumers who purchased
80
or considered making a prepared chicken

purchase at grocery retail during the past three
months were tapped in December 2014 for
Tysons Consequences of Failure research,
which delves into deli issues and the impact they
have both in the deli and store-wide. In-store
observational studies were carried out in November and December 2014 at more than 1,300
stores across 36 retail banners to shed light on
operational and product issues at in-store delis.
PG also felded a proprietary survey of retailers
that weighed in on their operations, fndings of
which are included in this article.
As reported in PGs March 2015 Shore Up
Costly Results
Cleanliness is table stakes, with consumers barely
registering sanitation as a problem. Retailers
indicate they have the processes in place to ensure
that its not an issue. Clean cases, no streaks, says
Tony Orlando, owner of Tony Os Supermarket &
Catering, in North Kingsville, Ohio. It has to be
fresh-looking. No dirty spoons, no dishes in the
sink. We have an open kitchen, so people see us.
We have to keep it clean.
Tony Os deli associates continually scrutinize
the area with a consumers eye for visual appeal and
cleanliness, he says. Tis is proof that investing in
procedures and training pays of.
But there are other issues in need of addressing,
including long wait times, product preparation and
availability, and product quality. General deli and
product issues have a tremendous impact on purchase
behavior, with approximately two-thirds of shoppers
who didnt make a purchase indicating that general
deli issues and product issues were the reasons.
When a Shopper Doesnt Make

a Purchase, its Because:
Percent of shoppers reporting
65.9%
68.3%
26.7%
Valuable Deli Area article (http://magazine.progressivegrocer.com/t/149254), executional failures

disrupt 21 percent of shoppers usual trips. Failures
in the deli area are defned by general deli issues
(long wait times, availability of product, cleanliness
and appearance), product issues (overcooked or dry
product, as well as appearance and taste of product), and stafng issues (staf knowledge, friendliness, helpful or rude), the latter of which was the
focus of the March article.
Some 41 percent of all shoppers surveyed say
they had a problem at the in-store deli, with signifcant issues identifed as general deli (42.9 percent of
respondents) and product issues (46.7 percent).
General
deli issues
product
issues
staffinG
issues
Source: Tyson Consequences of Failure Study, 2015;

base 712: Consumers who considered, but didnt make a purchase.
Time and Timing is Everything

Similar to checklane issues, retailers are plagued by
long wait times at the in-store deli. Nearly a quarter
of consumer respondents wont make a purchase
if they feel the lines are too long. Wait times are a
chronic problem, reported by shoppers and acknowledged by retailers. Pre-ordering capabilities via
store apps and kiosks are gaining traction, but most
81
Tyson Deli, Inc.
Boosting Staff
Performance
% of shoppers reporting
42.9%
46.7%
When prepared foods customers experience a problem

with a deli staf member, they take it personallyand they
take action.
Product
issues
Even though stafng issues arent the most common

problem reported by customers, these issues result in the
most severe repercussions for deli sales, suggests a new
study from Tyson Foods on purchasing prepared chicken
products from the supermarket deli. Shoppers who report
stafng problems also report more deli problems of any
type, and theyre much more likely to bypass the deli on
future shopping trips for prepared foods, either temporarily or permanently.
22.2%
Staffing
issues
General
deli issues
Among shoppers reporting problems, the most common staffing issues were:
Staff was
not friendly
Staff was
not helpful
Staff was not

knowledgeable
Staff was
rude
12%
11%
9%
8%
/ 2015 Tyson Foods, Inc.
Advertorial
Tyson Deli, Inc.
Investing more resources in staff training

will likely create significant increases in
customer satisfaction and repeat purchases.
Tyson In-Store Observation Study, November-December 2014
Te key to reducing stafng problems lies in better,
more efective training, however, rather than simply adding more team members behind the counter,
according to a Tyson In-Store Observation Study
completed in November-December 2014. Te study
found that the number of store associates working in
a deli department does not correlate with cleanliness,
organization or in-stock position in major product categories (although there is a correlation with customer
perceived freshness). But you can likely create significant increases in customer satisfaction and repeat
purchases by investing more resources in staf training,
especially in these areas:
Coaching about key customer service issues such as courtesy, friendly attitude and product
knowledge
Average number of total

problems reported by
shoppers who reported:
4.1
3.1
Operational training on cooking to temperature

and following holding procedures, to help alleviate the
most common deli product problemdryness
Upgrading staf training to improve performance on
key metrics, and stopping the churn that can result
when shoppers experience repeated problems, can
help the deli department achieve sales increases at full
marginand without increasing stafng.
Staffing
problems
Product
problems
2.9
General deli
problems
Customers who stopped shopping at their grocery deli due to problems

38%
25%
Staffing
problems
22%
9%
For a short period of time

Chart data
provided by
Tyson Foods
/ 2015 Tyson Foods, Inc.
7%
4%
For a long period of time
7%
3%
3%
Product
problems
General deli
problems
Permanently
Turn to Tyson
Tyson Deli can support you with products,
insights and tools to help grow your deli business.
Contact Eric LeBlanc at (800) 248-9766 for more information.
Advertorial
retailers continue to rely on staf efciency. Tony

Os Orlando has mapped out peak trafc times and
cross-trained managers to jump in as needed in the
deli. We always have backup, he says.
Randy Yochum, supervisor of perishables
departments at Newport Avenue Market, in Bend,
Ore., ofsets wait times with appropriate stafng.
When you walk into our deli, youll see eight or
nine people working, he notes. We visit large
chains and well see no more than two people working in a deli thats double the square footage.
Following closely behind in wait times in general
deli issues is the lack of availability of products,
either because theyre not ready or not
in-store. Orlando says his team
is in the deli at 5 a.m. to
ensure that by 8 a.m.,
everything all items
made in-house, from
scratch is ready
for business. Te
deli manager cant
arrive at 7 a.m. and
think it will all
come together, he
says. Tat means
the early-morning
customers will be
[disappointed].
Te right products at
the right time are crucial
for success in the deli area; you
cant sell what you dont have. Nearly
three-quarters 74 percent of retailer respondents to PGs deli survey agree that at all times,
the products that our shoppers want are available.
Tis indicates that 26 percent of the time, products
Key Shopping Measures

No
Problems
Any
Problems
shoppers want arent available.

Shoppers say product availability is a top-three
reason for where they shop, according to Solving
the Out-of-Stock Problem, a 2015 report produced by the Trading Partner Alliance of FMI and
GMA, yet out-of-stocks remain at 8 percent. Such
a problem encompasses lost revenue and, even more
relevant to grocery retailers, a damaging dent in
shopper experience. In-store research commissioned
by Tyson Foods indicates that out-of-stocks are
even higher in the deli area, where a run on prepared dinner items, such as rotisserie chicken, leads
to out-of-stock rates of 10 percent to 11 percent.
Compounding the problem of in-stocks/product
not ready, deli managers indicate theyre selling more
prepared foods compared with a year ago. More than
70 percent of respondents to PGs deli survey indicate
theyre selling more prepared foods such as rotisserie
chicken, fried chicken and salads, compared with just
2.4 percent who are seeing a volume decrease and
fewer than 5 percent who dont ofer prepared foods.
For many retailers, their point of diferentiation is
fresh prepared food, but if not executed properly, it
could be the reason that shoppers are going elsewhere.
Increasing the amount of prepared foods being sold
has the potential to solve part of the problem of
meeting shopper demand, but any solid execution will
include an exponential gain in training.
Solving the Out-ofStock Problem reports a
disturbing three-strikesand-youre-out pattern.
As a result of the frst
Product General Deli
strike, the shopper will
Problems
Problems
substitute another item 70
percent of the time; for the
second strike, the shopper
will make a substitution,
make no purchase or go
to another store; and on
the third occurrence, 70
percent of shoppers will go
to another store.
How satisfied are you with

overall shopping experience?
82% 65% 47% 49%
How satisfied are you with

the prepared food shopping
experience?
77
48
36
43
How likely are you to recommend

shopping for prepared foods?
77
51
40
47
How likely are you to shop for

prepared foods?
81
57
45
51
Source: Tyson Consequences of Failure research, 2015, based on top three satisfied and likely responses,
3,018 consumer respondents.
84
Facing Failure
Seen in the harsh light of
reality, not only do shoppers believe their deli
NEW! One-of-a-Kind
D
U
T
S
E
V
LI
T
S
A
C
D
A
O
R
B
O
I
Presented by
April 28, 2015 2:00 pm EST/ 1:00 pm CST/11:00 am PST
Join us for an unscripted and provocative exchange on consumers engagement

with the in-store deli and strategies to beat the competition. Panelists:
Joan Driggs, Editorial Director of Progressive Grocer
Eric Le Blanc, Vice President of Marketing, Deli, Tyson Foods
Christopher Brace, Founder and CEO of Shopper Intelligence
Michael Eardley, President and CEO of the International Dairy-Deli-Bakery Association
FREE!
shopping experience could be better, but also their

lack of satisfaction in shopping for prepared foods
is having a ripple efect on the total shopping
experience. Shoppers who report
any problem already have
diminished levels of satisfaction and demonstrate
a lower likelihood of
recommending or
purchasing products
than shoppers who
havent encountered
deli problems. Satisfaction levels sink
further when focusing on product and
general deli problems,
with just one-third (36
percent) of those who
reported product problems,
and 43 percent of those with
general deli issues, saying theyre
satisfed with their deli shopping experience.
Product Issues: Its Complicated

While a bad in-store experience carries consequences, theres an additional layer of complexity with
product issues, as many wont come to light until
after the shopping trip, when consumption occurs.
Te product should be formulated and prepared
to make it suitable for the way in which it is used,
says Eric Le Blanc, VP of marketing, deli at Tyson
Foods, in Springdale, Ark. If the product does not
meet the shoppers expectations when she reheats it,
retailers and suppliers need to partner to fnd ways to
deliver a product that does. While Le Blanc believes
that retailer and supplier share a joint responsibility
in ensuring the customer has a good experience with
the product, its up to the manufacturer to properly
formulate for cook and hold,
and its up to the retailer
to prepare the product
according to those
procedures.
Te frst evidence
for believing that
the quality issues
are present before
the consumer takes
the product is their
behavior at the shelf,
says Le Blanc. Rotisserie
chicken has the highest
shelf engagement in the
deli department. Nearly
every shopper will stop to look at
multiple chickens, rejecting those that
look old, burned or dried out.
86
Among respondents who considered but

didnt make a purchase, 68 percent attribute
their lack of purchase to product issues, including nearly 25 percent who didnt make a
purchase based on appearance; and nearly 60
percent of other issues wouldnt come to light
until the shopper and, in most instances,
their family and/or friends are eating.
Retailers admit theres room for improvement with
product issues: 80 percent of retailer respondents indicate that products always appear fresh to shoppers.
And just less than that amount 79 percent agree
that products are always prepared (cooked, stored,
packaged) in the same manner to ensure quality.
Retailers admit, and research supports, that
procedures for food prep need to be supported
with training. Consistency is probably the main
problem, says Kathy Holtzinger, store manager
of Hammer and Wikan, in Petersburg, Alaska.
Many times, I fnd an employee changing how
a product is baked or cooked of. Everyone needs
to be doing things the same way so that when the
customer comes back, theyll get the same item the
same way every time.
Product Issues
Product was too dry
Product didnt appear fresh
Product was overcooked
Breading wasnt crispy
Product taste was poor
Product quality was poor
17.6%
12.6
12.4
10.5
7.5
7.4
Source: Tyson Consequences of Failure Research, 2015
Responses to the open-ended question What

can your deli department do to improve the
efectiveness of delivering excellent products
and customer service to your shoppers? were
overwhelmingly tipped toward better training,
improved training and communications, and
continuous training.
Tysons fndings indicate its not even additional bodies that will make the diference in
terms of improved product quality, ensuring stock
during peak periods or customer engagement.
Rather, investing more resources in staf training,
including product preparation and hold times,
will create signifcant increases in customer satisfaction and repeat purchases. PG
REACH SHOPPERS
AND ACHIEVE GROWTH
WITH A NEW SET OF SOLUTIONS

HAS STRENGTHS IN THE
SEGMENTS THAT MATTER MOST
MORE TRIPS
PER BUYER
MINI MEALS / SNACKS
120
MEAL MAKERS
126
PACKAGED FRESH
120
VEGETABLE NUTRITION
105
WELLNESS
118
100
STRENGTHENING OUR CORE

EXPANDING INTO
FASTER GROWING SPACES
CREATING SOLUTIONS
THAT DRIVE GROWTH
LARGER MARKET
BASKET
MINI MEALS / SNACKS
127
MEAL MAKERS
133
PACKAGED FRESH
124
VEGETABLE NUTRITION
108
WELLNESS
118
100
Source: IRI US PANEL, 52 Weeks Ending 10/5/2014
SM
2015 CSC Brands LP
Fresh Food
Prepared Food Packaging
To
Protect
and
Serve
Retailers collaborate with suppliers on

innovative packaging for prepared foods.
By Jim Dudlicek
repared foods are the future of

grocery foodservice is the top
strategic initiative for many retailers,
and many analysts are saying those
not already playing in this arena are
sitting out at their own peril.
Grocery prepared foods accounted for $25 billion
in sales in 2014, up $10 billion since 2004, according
to data presented by Wade Hanson, principal with
Chicago-based Technomic Inc., at the recent Annual
Meat Conference, in Nashville, Tenn.
Of course, its not enough just to attract business
you also have to keep it, and a huge part of that
is delivering delicious, satisfying and fresh
selections. Packaging plays a crucial role in
the appeal of supermarket prepared foods.
Tat means packaging thats more
sustainable, and that can maximize
visibility of the food inside, says
Lewis Shaye, VP of culinary concepts
at Schenectady, N.Y.-based grocery
chain Price Chopper. People want
to see clearly what they are getting and
know that it is not cluttering up the waste
stream, whenever possible, he says. We are
conscious of not overpackaging food.
Demand for those attributes is supported
by fndings in the latest trends report released
in late 2014 by the Falls Church, Va.-based
Foodservice Packaging Institute (FPI). Current trends focus on both the environmental attributes and the look of containers, FPI reports.
Survey participants expressed a demand for
products that can be recycled and/or composted, with
88
perhaps a greater interest this year in compostable

products, which could be the result of a growing
number of food waste diversion initiatives throughout
the foodservice industry, FPI notes on its website.
Respondents also pointed to the use of unique colors,
shapes and sizes that help to incorporate branding in
a package. Interestingly, clear (transparent) packaging
was also mentioned, which focuses the visual cues on
the foods and beverages, instead of the container.
Freshness and Function

Beyond that, preservation of food quality is key.
Our guests want restaurant replacement food,
not home meal replacement, Shaye says. Tey
expect our products to be made fresh, customizable to their particular liking and want us to have
consistency in our food ofers. Tey want food packaged properly they want hot foods kept hot and
cold foods kept cold, and now, more than ever, want
packaging that works for dashboard dining. More
and more, carry-out occasions involve portability,
so just like in a typical fast-casual restaurant, our
guests want to be able to eat on the go.
Te supplier community is taking note as well.
Much of the growth opportunity were seeing
right now pertains to freshness and food safety,
says Sean Brady, marketing director for ready
meals at Elmwood Park, N.J.-based Sealed Air
Corp.s North America Food Care Division. As
supermarkets try to compete with restaurants for
those quick take-home meal options, consumers
are expecting the same freshness and food safety
that theyd experience at a restaurant. To help
meet that demand, retailers are ofering more full-
entre options on the ready meal side.

Indeed, food quality and freshness are the most
critical drivers for prepared foods, followed by
convenience, asserts Keri Olson, marketing director
at Lenexa, Kan.-based Robbie Fantastic Flexibles.
Olson points to Mintel research showing that
consumers place the highest importance on food
packagings ability to retain freshness.
As a packaging supplier, we continue to listen
to consumers and retailers to meet their needs, she
says. We created the Hot N Handy pouch for rotisserie chicken after conducting in-store intercepts
with shoppers at multiple large chains. According
to the study, the chicken stayed fresher and moister
in a pouch versus rigid packaging. Tis research has
led us to further listen to create additional packaging to hold crispy items as well.
Partnering with retailers also is par for the course
at Anchor Packaging, which has developed containers as a result of problems reported at retail. Understanding how food is prepared and handled, how it
will be packaged and displayed, and if the consumer
is expected to eat as-is or be able to reheat the food
all play a role in how a package is designed, explains
Marilyn Stapleton, marketing director at the St.
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Louis-based company, noting one example: Fried

chicken becomes soggy when packaged, even when
numerous vent holes are included in the package.
Store tests helped to develop our patented cross-fow
ventilation system that keeps fried foods crispy.
Partnering on Innovation
Retailers like Price Chopper are constantly reviewing their foodservice packaging for functionality as well as visual appeal.
Big opportunities lie in maintaining product freshness and shelf life without looking too
manufactured, Shaye says. Since we both prepare
on-site and selectively use manufacturers for our
menus, we try and get our food to the guests as soon
as it has been made, and we want it to perform well
for its shelf life, whether it is being consumed on
the spot or three days later. Convenience in cooking
or reheating is also very important, so microwaving or easy oven-prep bags or containers are being
reviewed and considered as good options.
Companies like Sealed Air aim to help grocers
deliver. Consumers have told grocery retailers they
wanted the variety and fexibility to bring home more
than one prepared meal to satisfy their family mem-
People want
to see clearly
what they are
getting and
know that it is
not cluttering
up the waste
stream,
whenever
possible.
Lewis Shaye,
Price Chopper
Fresh Food
Consumers
have told
grocery
retailers they
wanted the
variety and
flexibility to
bring home
more than
one prepared
meal to satisfy
their family
members
varied tastes.
Sean Brady,
Sealed Air Corp.
Prepared Food Packaging
bers varied tastes, Brady says. At the same time,

they want the fexibility to serve that meal [on the]
same day or to wait several days to serve it. Consumers want to be served on their own timelines.
Sealed Airs Cryovac Simple Steps packaging ofers consumers the favor and freshness of
a chef-prepared meal, served on a white plate
with vacuum-skin packaging a ready-to-serve
product that can be fnished and served in store or
at home. Te steam-assisted technology allows
consumers to heat the food more evenly, creating
the ideal eating experience, Brady explains. Its a
higher-quality product, thanks to the packaging,
than consumers previous choices. Additionally,
this package format can help boost food safety
that the consumer demands by reducing the risk of
cross-contamination from serving or handling.
For its part, Robbie is focusing on providing packaging that helps keep the prepared foods
tasting just as fresh from the time the consumer
purchases the [product] until they get home to sit
down at the table, Olson notes. Savvy retailers
have already fgured out that the package is an
ambassador for their brand and will ultimately
help a consumer decide if they are going to return
to that supermarket for their next meal to go.

Elk Grove Village, Ill.-based Clear Lam Packaging Inc. has successfully worked with retailers
to develop rigid and fexible packaging solutions
such as fresh fruit and vegetable containers, platters sealed with peelable lidding flm, and salad
and fruit trays sealed with the companys Peel and
ReSeal lidding system technology.
Te opportunity is to develop intuitive packaging solutions for a variety of meal options, says Jim
Foster, Clear Lams senior marketing manager. Te
challenge is creating packaging that conveys fresh
while delivering the protection and ease of use con-
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90
New Bowls Aim to Keep

Animal Byproducts,
Chemicals Out of Plastic
sumers need across multiple consumer segments.
Innovation also extends to seemingly small details
like packages that stay shut but are easy to reopen.
An innovative adhesive, developed by Columbus,
Ohio-based Battelle in cooperation with Deerfeld,
Ill.-based Mondelz International, combines high
self-adhesion with low tack for a product thats easy to
use, easy to apply, consistent and only sticks to itself.
Low-tack adhesive will be applicable to prepared
foods that come in fexible, reclosable packaging
after it gets FDA approval, expected early this year,
according to Battelle spokeswoman Katie Pearson.
Unlike traditional pressure-sensitive adhesives,
low-tack adhesive isnt messy, sticky or expensive. For
example, it wont pick up crumbs from crackers or
cookies, which makes traditional adhesives inefective, says Cindy Conner, a Battelle senior market
manager. All consumers need to do is press it together
to create an efective and consistent seal that stands the
test of repeated cycles of opening and reclosing.
Expanding the Market

Whats needed to take prepared food packaging
to the next level?
Consumers want transparency and visibility
of whats in their food, and they are bringing that
same expectation to prepared foods, says Joe
Ramirez, marketing director for fuids at Sealed
Air. Te consumer perception is that prepared
foods are not fresh because they are served in a
package or are not prepared on-site. To move this
segment to the next level, retailers need to address
this challenge, potentially through consumer education, and demonstrate that prepared foods can be
as fresh, if not fresher, than other options.
Meanwhile, the folks at Sealed Air see room for
growth in the areas of food safety and shrink loss.
Tose challenges present the greatest opportunity
for retailers, Brady says. By educating the consumer on what theyre really buying and the freshness
of the food in their prepared meals, retailers can
continue expanding this product line.
Clear Lams Foster says retailers will likely need a
variety of meal solutions and corresponding delivery
methods that appeal to multiple demographic segments with disparate levels of cooking knowledge.
Retailers also need packaging solutions that will
position the products as fresh, while still ofering food
protection and ease-of-use functionality, he says.
Consumer trends toward smaller portions, less
time for food preparation at home, increases in
snacking, and nontraditional eating times have all
created a demand for new package sizes to handle an
increase of food varieties, Anchors Stapleton asserts.
Retailers are fghting for market share with
convenience stores and fast-food chains, so custom
orders will help drive trafc to the store, she says.
Packages that allow the food to look fresh and
Fairfield, N.J.-based Premier Classic Products

has launched a Kickstarter campaign to help
finance a new line of food containers aimed at vegans, health
advocates and those following religious-based dietary laws.
Premier has developed a set of containers purported to be
pure to one part per billion that resists the leeching of harmful chemicals and animal byproducts into food that may occur
with other plastic packaging and storage containers. Premiers
parent company has invested more than $1 million in the project
and is now seeking funds to produce the containers in large
quantities for the key audiences noted above.
Beyond food, Premier plans to market its innovation to the
health care industry for items like blood bags, inspection devices, medicine containers, gelatin capsules and anything that
can come in contact with the human body.
Premiers goal is to raise $30,000 through pledges of $100
each, for which donors will each receive a set of nine containers
with lids, valued at $49.50. www.kosherplastic.com
appealing on display or made to order, with features

that include leak resistance and reusability, will help
to diferentiate the retailer from other segments.
Also something to consider: new regulations
aimed at reducing waste. Local legislation banning Styrofoam and polystyrene-based packages is
causing retailers to explore other options, Stapleton
cautions. Although foam packages are not being
used to a large degree in the deli, there are many
OPS [oriented polystyrene] lids and hinged packages on grab-and-go displays. Its time for the retailers
to get ahead of these pending changes so they can
transition on their time frame to curbside recyclable
products made with polypropylene or PETE [polyethylene terephthalate]. Packages made with these
materials not only ofer improved performance for
heat tolerance and merchandising, they also provide
the retailer with a positive environmental platform.
While its no secret that prepared foods will continue to be an integral part of supermarket operations, its also clear that the right kind of packaging
is essential for grocery foodservice.
Supermarkets need to fnd ways to cater to,
and expand on, the market, Robbies Olson says.
Prepared foods are just not for dinner anymore.
Convenience stores have already set the stage for
fast pickup of breakfast and lunch foods, but they
havent captured the desire for more-healthful options. Supermarkets have all the tools in the perimeter now; they just need to make it easily ready for
the consumer to get in, chose their meal and exit.
Consumers are already familiar with the perimeter of the store, but just dont have the time to put
their meals together. Retailers that set up a drink
bar, sandwich, salad and fruit center will capture
consumers very quickly. PG
Packages that
allow the food
to look fresh
and appealing
on display or
made to order,
with features
that include
leak resistance
and reusability,
will help to
differentiate
the retailer
from other
segments.
Marilyn Stapleton,
Anchor Packaging
91
Fresh Food
Produce
Pack and Play

Todays packaged produce delivers it all:
convenience, sustainability, personality and fun.
By Jennifer Strailey
tyle and substance have raised

the stakes in packaged produce
and are redefning the way consumers interact with supermarkets, suppliers, and fresh fruits
and vegetables.
Te trends in produce packaging are all-encompassing from a marketing and a technology
standpoint, observes Dr. Bob Whitaker, chief
science and technology ofcer at the Newark, Del.-based Produce Marketing Institute
(PMA), and a judge since 2008 of its Impact
Awards for excellence in produce packaging.
From convenient portability to sustainability to maximizing messaging, todays produce
packaging is not only delivering what consumers
desire, but also enticing them to buy new fresh
food products in formats they didnt know they
needed until now.
Fresh Convenience
Clearly, there has been a trend in recent years toward portability, ready to eat, ready to go and single
serve, and I think that portability trend will continue this year both in snack format and something
you can eat in your car, Whitaker predicts.
Fresh produce packaged for just such on-thego convenience is the idea behind Chelan Fresh
Marketings two newest products: Te Rockit
and Cup O Cherries. Next month, the Chelan,
Wash.-based company will re-release the Rockit,
an innovative, high-graphic sleeve similar to
tennis ball packaging, which contains four or fve
smaller New Zealand apples.
Its a great way to take whole fresh fruit
on the go, says Chelan Director of Marketing
Mac Riggan, who adds that the Rockit is so
revolutionary, it may be a little ahead of its time.
Its like bottled water. Initially, people thought,
Why would you need that?
But as consumers continue to demand
healthier options for on-the-go eating, Riggan
is certain the convenience of the Rockit will
92
resonate with more shoppers, and thus

anticipates increased sales momentum.
I think packaged produce is the
future, asserts Riggan. Tey say that
25 percent of our meals are eaten in a car,
so convenience is essential.
For cross-country or cross-town road
trips, Chelan created its Cup O Cherries, an
8-ounce cup of washed and de-stemmed cherries
that features a smart lid: One section of the lid
dispenses cherries, while a diferent compartment
provides a place for pits.
Supreme Green
Te other trend we see, and I suspect it will grow
this year, is more and more sustainable packaging both in terms of materials used and how
they are applied, including the use of compostables,
biodegradable fber and an overall efort to decrease
packaging, notes Whitaker.
Even seemingly small reductions, such as cutting
back on the lip of a bag that runs over the seal, can
have major impact. Tats miles of packaging over the
course of a year, says Whitaker, who adds that the industry can expect to see better use of packaging, more
consistently.
Te newest
packaging from
Wada Farms, in Idaho
Falls, Idaho, is designed to
help retailers meet their sustainability objectives and win the
attention of consumers in the produce
aisle. Tats because Wada Farms Tater Made
eco-friendly bags are made in part from potatoes
as much as 25 percent.
Packaging is one of my passions, afrms Chris
Wada. It gives us the ability, through packaging style,
artwork, messaging, etc., to bring consumers something they are going to touch, read and understand.
Te bags represent a substantial carbon-footprint reduction, explains Wada. Te most common response from consumers to the bags has been,
Tats cool. And thats what we want. You can talk
about sustainability, but until its something you can
touch, pick up and look at, the concept is less clear.
Smaller packs
that result
from more
frequent
[store] visits is
the No. 1 trend
right now.
Hillary Femal, IFCO
Fresh Food
You can
talk about
sustainability,
but until its
something
you can touch,
pick up and
look at, the
concept is less
clear.
Chris Wada,
Wada Farms
Produce
Wada notes that more

growers are using the Tater
Made logo, which launched
this past November, and several large retailers are
employing it in their private label programs.
In an area of the store where local and organic
matter most, it makes sense that sustainable
packaging is also on shoppers radar as they peruse the produce department.
One female shopper recently e-mailed Wada
Farms with a message that Wada believes underscores the potential of Tater Made. She said that
she only purchases organic fruits and vegetables, but
upon seeing the 5-pound bag of russet potatoes in
the eco-friendly packaging, she felt that was enough
for her to switch, and she bought them even though
they arent organic, he says.
Katharine Grove, of Wenachee, Wash.-based
Columbia Marketing International Inc. (CMI), one
of the states largest growers, packers and shippers
of premium apples, pears and cherries, also sees the
heightened importance of sustainable packaging.
Todays produce consumer is earth-friendly and
wants to know that we are doing everything we can
to protect their fruit, and that were putting it into a
package that can be recycled, she notes.
CMI is committed to seeking out more sustainable
solutions, while at the same time providing highimpact packaging. We will continue to be environmentally conscious and look to sustainable packaging
vehicles, while continuing to create packaging that
acts as a billboard to tell consumers what is special
about the fruit inside the package, says Grove.
Other suppliers leading the green packaging
trend include Naturipe, of Salinas, Calif., with its
organic blueberries in a compostable and recyclable
natural-fber tray, and Mastronardi Produce/Sunset,
of Kingsville, Ontario, which last year introduced
the 100 percent recyclable Eco Flavor Bowl, made
from recycled materials.
Packaging Connectivity
Increasingly, produce suppliers are using packaging
as a way to communicate with consumers. Whether
through recipes, nutritional information, or QR codes
to connect the consumer with the brand and the farm,
packaging is bringing consumers and the produce
industry together like never before.
94
We continue to see a better use of real estate

on produce packaging in a way that provides
consumers with a personal link to the product,
notes Whitaker.
Personal connection and consumer satisfaction
are the ideas behind a new initiative at Driscolls.
Te Watsonville, Calif.-based berry grower is inviting consumers, through a code on its packaging, to
provide feedback on the Driscolls berries they eat.
Were allowing our consumer to rate their
berry-eating experience with us, explains Frances
Dillard, the companys director of marketing. We
take great-tasting berries very seriously, and the
Consumer Advisory Panel is our report card from
berry consumers on whether we deliver on delight.
Te code on the packaging links to Driscolls
community page where consumers can register for
the Rewards Club and participate in the advisory
panel by taking a quick online satisfaction survey
about the Driscolls berries theyve eaten. Consumers
receive a savings coupon for every completed survey.
Te code on the packaging also allows Driscolls
to trace the berries back to their farm of origin.
Connecting to consumers through recipes is also
important, as market research confrms that many
consumers would buy a wider variety of fruits and
vegetables if they knew how to prepare them. Packaged produce provides an opportunity to communicate recipes and serving suggestions that can give
consumers the confdence they need to buy.
MountainKing is one potato supplier making the
most of its packaging real estate. Te Houstonbased company recently introduced fve attentiongrabbing Kwik Lok bag tags that recommend the
best uses for MountainKing potato varieties via
easy-to-prepare recipes.
Te 2-inch-by-2-inch tags are designed to help
shoppers diferentiate potato types and their key
cooking diferences. For example, the bag tag for
MountainKings Butter Reds touts the variety as
a boiling potato and includes a recipe for Butter
Red Dill Potatoes, while the tag for Butter Gold
potatoes suggests a recipe for Garlic Gold Mashed
Potatoes. Te tags also help retailers to avoid mixing varieties in the same display.
Safe Bets
Delivering fresh, delicious and, above all, safe foods
to consumers is a priority for everyone in the produce business. Packaged branded and local produce
thats traceable back to the farm may prove to play
an increasingly important role in building consumer
confdence in food safety.
Freshness, safety and convenience are the three
factors we keep hearing as most
important with produce packaging,
afrms Keri Olson, marketing director for Robbie, a fexible packaging
solutions provider in Lenexa, Kan.
Young consumers think brandname and organic fruit and vegetable products are safer than their
unbranded and nonorganic counterparts, she continues. Flexible
packaging ofers an easy way for this
to happen by printing valuable information right on the package.
Olson points to research that
shows consumers prefer locally grown
produce whenever possible, often
citing food safety as a factor in their
preference.
Robbies new Locally Grown produce pouch was designed with this in
mind. Te pouch has the words locally
grown printed in large letters right
on the handle of the pouch to quickly
connect with the consumer that their
produce is locally grown, she explains.
weeks. Today, consumers go to the store that day

to buy dinner for that evening.
Te result has been a decrease in demand for 5and 10-pound bags of potatoes, and a move toward
smaller bag sizes and specialty items. Wada Farms
has embraced the shift by focusing on value-added
products such as individually wrapped russet potatoes that microwave in eight minutes, and Small
Good Things in Smaller Packages

Smaller packs that result from more
frequent [store] visits is the No. 1 trend
right now, asserts Hillary Femal, VP
global marketing for IFCO, a global
provider of reusable packaging solutions
for fresh products in Tampa, Fla.
She also sees the rise in smallerfootprint stores infuencing this
trend. Urban and small store
formats are expanding quickly, so the
fresh supply chain has had to respond
with smaller and more frequent
shipments due to space constraints
at these locations, she explains. In
addition, the packaging sector is
providing smaller pack sizes to meet
the store conditions and more frequent shopping visits among urban
customers.
Chris Wada agrees. Teres a
trend toward less pantry stocking,
he says. In the past, consumers
bought groceries for a couple of
95
Fresh Food
Produce
Artisan potatoes in a microwave steamable bag.

Both products ofer dinner-tonight appeal,
while the latter has a decidedly specialty look.
We wanted to keep the packaging simple and
give it an almost nostalgic or retro feel, notes
Wada. We hope the look disrupts the consumers line of sight. Like they say, lead with
emotion and follow with logic.
Packaging that Cooks

Te demand for convenience is driving more than
portable, healthful snacks in packaged produce. Consumers are also looking for products that will help
them make nutritious and favorful meals in less time.
From salad kits with protein to seasoned
vegetables in microwaveable bags, suppliers are
responding with no-fuss oferings. Te recently
launched Ready.Chef.Go! line of
cook-in bags gives retailers and consumers a modern solution to traditional cooking in one neat package.
Its essentially quick and convenient
en papillote cooking, which is French
for in parchment, explains Kevin Gallahan, Elkay Plastics director of Sirane
Products. Commerce, Calif.-based
Elkay introduced Ready.Chef.Go!,
manufactured by U.K. company Sirane
Products, in the United States.
Retailers can choose from two
cooking bags a dual-ovenable bag
that pairs a combination of high-density paper and clear flm for microwave
or traditional oven cooking, and an
oven and grilling bag that combines
aluminum foil, parchment paper and
clear flm. Te bags are available with
a selection of 16 seasoned compound
butters and nine sauces.
Every retailer in the U.S. may have
certain favor profles that best ft their
region, notes Gallahan. Tis is why we
ofer a wide variety of recipes to choose
from. How about Brussels sprouts with
a bacon balsamic butter? he suggests.
Te bags allow supermarkets to
showcase seasonal produce and local
favorites as quick and easy meal options.
Produce merchandised and sold
in the Ready.Chef.Go! cooking bags,
with their low carbon footprint, natural artisan feel and incredible cooking
performance, brings retailers closer
to what the consumers, especially
Millennials, are looking for today,
asserts Gallahan.
Te Ready.Chef.Go! line is supported by a full program that includes
POS, social media marketing, advertising support and limited in-store
demo support.
Art and Science
Some of todays best produce packaging embraces both aesthetics and technology. Its this perfect marriage that
Whitaker and his fellow judges look
96
for at the annual PMA

Impact Awards.
Visibility of the
product, uniqueness,
convenience, sustainability of the packaging, food
safety and traceability
some way to trace the
product, should there be
an issue all of this factors into our selections,
explains Whitaker of the highly competitive event.
From breathable flms to packaging with
micro-perforations, the technology side has
evolved in the past seven or eight years, according
to Whitaker, who also sees companies distinguishing themselves with various shapes: oblong,
round, all kinds of permutations to create differentiation.
From a style standpoint, one of the most profound
changes in recent years has been the use of full-color,
more sophisticated designs in produce packaging.
Its a trend not lost on CMIs Grove. Over the last
two years, CMI and our customers have seen great
success with the use of the 2-pound high-graphic
prep in the bag

ready.Chef.go!
bags make the
preparation of
seasonal produce
a snap.
pouch bag, she notes. Tese pouch bags ofer us full

use of color, with a crystal-clear viewing window.
More dynamic produce packaging has also raised
the bar with regard to how supermarkets want their
produce departments to look and feel.
Retailers want to reap the benefts of retailready packaging in fresh produce, as they do in
center store, but not at the expense of their brands
look, says IFCOs Femal. Increasingly, we
are seeing demand for branding capabilities with
reusable plastic containers (RPCs) such as placards, sign holders and wraps. All of these trends
are driving continued increase in use of RPCs for
fresh produce. PG
ONLY WHOLESUM USES A
THERES A REASON
FARMTOFAMILY APPROACH TO
WERE ONE OF NORTH
PRODUCE, BUILT BY THREE
AMERICAS FASTEST
GENERATIONS WORKING TOGETHER.
GROWING ORGANIC PRODUCERS.
AS A FAIR TRADE CERTIFIED PARTNER, WHOLESUM
HEALTHY LIVING IS NOT JUST
WE RECOGNIZED THE IMPORTANCE OF SUSTAINABLE
ENSURES THE WORKERS WHO GROW OUR PRODUCE
WHAT WE DO; ITS WHO WE ARE.
FARMING PRACTICES DECADES AGO. THATS WHY
RECEIVE A PORTION OF OUR PROFITS. ALONG WITH
ITS A DIFFERENCE YOULL TASTE IN OUR
WE DO OUR OWN COMPOSTING TO REPLENISH THE
EDUCATION AND HEALTH CARE, THEY ALSO GET FREE
VEGETABLES: A COMMITMENT THAT STARTS AT THE
SOIL, USE SOLAR ENERGY TO HELP POWER OUR
DAYCARE AND TEACHERS FOR THEIR CHILDREN, AND
SOIL AND ENDS WHEN YOUR FAMILY LEAVES THE
WAREHOUSE AND RECYCLE UP TO 40% OF
WITH COMMUNITY SUPPORT.
TABLE HAPPY.
THE WATER AT OUR FARMS.
W H O L E S U M H A RV E S T F O R W H O L E S O M E FA M I L I E S V I S I T W H O L E S U M H A RV E S T.C O M
Fresh Food
Produce Category Spotlight
Masters of
Melons
Flavor-packed varieties, strategically merchandised,

are key to this categorys success.
By Jennifer Strailey
S
Consumers are
looking for a
more flavorful
cantaloupe.
Barry Zwillinger,
Legend Produce
98
upermarkets across the country

are teeming with untapped melon
customers. Some are former cantaloupe thumpers and honeydew dabblers, but many may be under the
mistaken impression that too many
melons just arent that favorful, so they dont bite.
Barry Zwillinger, sales manager at Legend
Produce, the largest supplier of cantaloupe in the
United States, hopes to change that. Te Dos Palos,
Calif.-based company sources melons from multiple
growing regions in California and Arizona, as well
as of-shore farms in Honduras and Guatemala, to
supply melons 12 months a year.
Consumers are looking for
a more favorful cantaloupe,
asserts Zwillinger, who says
that a pursuit of higher yields
and a longer shelf life in cantaloupe and honeydew cultivation
led to an era of less aromatic
and favorful fruit.
Its kind of like what happened with heirloom tomatoes,
continues Zwillinger. Consumer demand for

unblemished tomatoes led to a rise in more uniform
and waxy options that lacked the juicy and compelling favor of heirloom varieties.
But demand for full-favored fruit has returned,
he says, fueled in large part by the popularity of
local farmers markets and increasingly favorobsessed chefs who want what Zwillinger calls the
old-school taste of cantaloupe and other melons.
Two years ago, Legend Produce secured the
exclusive U.S. rights to the Origami cantaloupe.
It has a high Brix [level]. Its highly aromatic, very
favorful, and it has a small, dense seed cavity and
thin skin that ofers a lot of melon that you can eat,
notes Zwillinger. It also travels well
and cuts nicely, holding its shape and
favor, which makes it excellent for
processors and foodservice.
Origamis are bringing back the
old-school favor of cantaloupes,
but with a longer shelf life, he
continues. Its a combination thats
resonating with retailers, from club
stores to major supermarket chains,
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Fresh Food
Cantaloupe is a
fairly efficient
crop when
it comes to
water.
John Gilstrap,
California
Cantaloupe
Advisory Board
Taste and Traceability
as well as with processors.

In the processor business, 100 percent of our clients who cut Origami
melons have seen an increase in their
sales, says Zwillinger. And the retailers who cut that fruit in their back
room in a lot of cases, their sales
are upwards of 100 percent.
While consumer demand for the
convenience of cut fruit may be fueling
part of this demand, when it comes to honeydews,
there may be more to the story. Actually, the best
honeydews are often the rough ones with scarring
or sugar netting. Tose are typically your sweetest
melons, notes Zwillinger.
Sampling is one way to demonstrate the fact that
a honeydew with scarring is favorful and sweet, in
spite of its appearance. Try to focus more on favor
and the eating experience, and not so much on
visual presence, recommends Zwillinger.
Stepping Up Food Safety

A number of melon suppliers, including Legend
Produce, have ramped up food safety initiatives
in recent years. Teyre getting the word out on
Food safety and traceability are top of mind for

the entire produce industry. At Dos Palos, Calif.based Legend Produce, rigorous
third-party audits and certifications are employed. Food
safety is priority No. 1,
says Sales Manager Barry
Zwillinger. Legend Produces farming, harvesting,
packing, cooling and shipping are audited in accordance with
Global G.A.P. and GFSI standards.
This summer, if not before, the company will
launch a new website that will offer full traceability on all of its products back to the farm.
Its my job to make the consumer feel
comfortable, says Zwillinger, who adds that
the new website will also include consumer
education about how Legend Produce grows
and picks its melons, as well as how to identify
a flavorful melon in the store.
company websites, and perhaps one day soon,

on the product itself.
In 2011, news broke of cantaloupes linked to a
deadly listeria outbreak at Jensen Farms, in Colorado.
Te event afected the whole cantaloupe industry.
ADVER TORI AL
Del Caf Snack Packs and Salad Bowls:

Healthy Options for Snack-Seeking Shoppers
Consumers across North America are becoming
more aware of what it takes to have a
well-balanced diet that includes
healthy, wholesome, and satisfying
snacks. In line with this
consumer trend, we
set out to create
the perfect snack
and salad bowl lines
that combine fresh
cut fruit and vegetables
with other nutritious and
hearty components. Del
Cafe salad bowls and snacks offer
consumers healthy, convenient products
with fresh cut fruit and vegetables.
Del Caf Snack Packs are available in four selections
and are perfect for your on-the-go customers who need
easy-to-eat, nutritious healthy bites that fit into their busy
lifestyles. Selections available: Apples with Ham and
Cheddar, Apples with Turkey and Swiss, Apples with Turkey
100
Sausage Bites and Colby Jack Cheese, and Apples with

Turkey Sausage Links and Mini Pancakes.
The new Del Cafe line up of salad bowls comes
in four recipes and is the perfect solution
to your customers busy lifestyles. Del
Caf salad bowls are fresh, hearty,
and made with delicious, quality
ingredients. Each salad is an
all-in-one meal, contains dressing
and a fork, and is a great addition to
any and every channels fresh on-the-go
line. Selections available: Greek Style Salad with
Chicken, Caesar Salad with Chicken, Turkey and Bacon
Cobb, and Chef Salad.
The Del Caf salad bowls
and snacks are made
to order from our CFIA
certified facility in Toronto
as well as our USDA
certified facility in Dallas.
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People didnt just stop buying Colorado cantaloupes, they stopped buying all cantaloupes, recalls John Gilstrap, of the California Cantaloupe
Advisory Board, in Dinuba, Calif. Obviously,
things like this can impact a whole industry.
Gilstrap adds that although California has
thankfully never had a food safety issue with cantaloupe, theres no such thing as being too cautious
when it comes to food safety.
California mandates government
inspections of all growers of a certain
size any large enough to supply
supermarkets. Its comprehensive,
notes Gilstrap of the auditing program, now in its third season. Field
audits began in 2012, and 2013 was
the frst year handlers were certifed.
While certifed growers are
permitted to use a certifed mark on
letterhead, bills of lading, and cartons, the industry has yet to develop a
certifed sticker for use on individual cantaloupes.
Te board has applied for a grant
to study whether such an identifying label would make a diference to
consumers. In October, the board
will learn whether its grant has been
approved, and, if its greenlighted, this
is the question it will explore through
a formal survey.
In the meantime, Gilstrap says that
cantaloupe sales have recovered from
the 2011 incident. Any current dip in
sales has to do with somewhat lighter
crops due to Californias water shortage, he explains.
We had some reduction in
volume last year, but not as much as
we thought, notes Gilstrap, adding,
Cantaloupe is a fairly efcient crop
when it comes to water. Dry growing
regions are really great for it, [although] it sounds counterintuitive.
Fresh Food
health and versatility of our product, which also

happen to be some of the primary drivers for watermelon sales, she says.
And cross-merchandising is even better. Demos
and promotions that involve more than one commodity always have great success, notes Rosado.
Tey not only drive the sales of more than one
product, they also have the potential to showcase
Our bag leaves the

competition sweating
Watermelon Mania
While a well-planned and -executed merchandising strategy can
increase sales across all categories in
the produce department, Juliemar
Rosado, director of retail operations
and international marketing for the
National Watermelon Promotion
Board (NWPB), in Winter Springs,
Fla., believes its particularly critical
with watermelons.
Good merchandising is important because it confrms the value,
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Fresh Food
Hydration has
been a growing
area of focus
for us over
the past year.
You cant spell
watermelon
without the
word water.
Juliemar Rosado,
National Watermelon
Promotion Board
the products versatility if shown in a recipe.

When it comes to whats selling in watermelons,
NWPB reports an increase in fresh-cut sales in
general. Cut watermelon equals convenience, says
Rosado. Consumers can pick it up and take it to go.
For supermarkets that feature bins of watermelons in season and also ofer value-added thats
fresh-cut in-store, the board recommends merchandising whole watermelons near the fresh-cuts.
NWPB, which has run a retail display contest
in July for a number of years, says watermelon is
the biggest item in the produce section, so retailers should use it.
While promoting the health benefts of watermelons is one way to spur sales, Rosado further
notes, Hydration has been a growing area of focus
for us over the past year. You cant spell watermelon without the word water.
Enticingly Exotic
Te Eat One Fruit a Day Tat Scares You campaign, launched by the specialty produce experts
at Friedas Inc., in Los Alamitos, Calif., recently
gained national attention through a health blog for
U.S. News & World Report written by registered
dietitian, nutritionist and author Janet Helm.

Citing low U.S. fruit consumption fgures,
Helm issued a challenge to America, inspired by
the Friedas campaign: Get over your fear of fruit.
Taking a further cue from the company, Helm
suggested new, exotic fruits, especially for children.
Te kiwano, a member of the melon and cucumber
family, made Helms list of recommendations.
Te fruit, which is also known as a horned melon
or horned cucumber, is grown in the United States
and New Zealand; is high in vitamin C and A, iron
and potassium; and provides a good source of omega
fatty acid, notes Friedas website, which also urges
consumers not to refrigerate them and includes a
video on how to enjoy the exotic fruit. PG
american Grown
The California Avocado label
is a symbol of quality and a promise
of the most preferred avocado in
the U.S.A.
Call 1-800-344-4333 or visit CaliforniaAvocado.com/A-Look-Behind-The-Label to learn more.
Produce of U.S.A.
2015 California Avocado Commission. All rights reserved.
Nonfoods
Category
Retail stores face shortages of organic products

every year because domestic organic production just
cant keep up with the robust demand for organic.
Guest
Perspectives
By Sarah Bird
A Call for an Organic Checkoff

Grocers can combat out-of-stocks by supporting a boost in organic farming.
rganic is a big seller in todays

supermarkets, and this trend is here
to stay. No longer available only at
farmers markets or specialty stores,
organic labels and even organic
store brands are now available at local grocery
stores, and customers are digging a little deeper
into their wallets to purchase such items.
In 2014, U.S. sales of organic foods and nonfoods
are estimated to have hit nearly $40 billion, a new
record. More than 80 percent of U.S. families now
buy organic products. Conventional grocery stores are
seeing double-digit growth rates in their organic aisles.
Despite this growing appetite, however, consumers
continue to be confused not just about all of the benefts and guarantees of organic, but also by all of
the other labels and unregulated claims on
food throughout the supermarket.
Te organic sector is at a critical
juncture. We now have the incredible opportunity and, more
importantly, the need to better
explain what organic stands for
and, in so doing, take organic
sales and stores revenues to even
higher levels. Americas certifed-organic
stakeholders farmers, ranchers, distributors, food
makers and retailers are now considering whether
to adopt a national organic checkof program.
Consumer Confusion, Empty Shelves

An organic research and promotion checkof
program would be a game changer for the entire
organic sector. It would address the industrys two
major challenges: consumer confusion about what
it means to be organic, and the need to increase
organic supplies so retailers dont get caught short as
their customers clamor for more organic choices.
An organic checkof program would enable a
large, coordinated promotion plan to educate consumers. Attention-getting promotions on television,
on social media, in newspaper fiers, on billboards,
and via in-store ads, activities and customer education
days the options are endless! A checkof would
clear up the current consumer misunderstanding;
drive trust in organic; further fuel the growth of the
106
organic sector, as more consumers would seek out

organic products; and drive store revenue. It would
also fund research to encourage farmers to transition
to organic, ultimately increasing supplies.
Organic food companies and retail stores face
shortages of organic ingredients and products every
year because domestic organic production just cant
keep up with the robust demand for organic. To
prevent your stores organic egg shelves from standing empty, or your having to put a temporarily out
of supplies sign on the door of your organic milk
case, we need more organic farmers in America.
An organic checkof program could raise up to an
estimated $40 million annually through a collective
fund to which all organic stakeholders could contribute. Its proposed that organic certifcate holders in the
supply chain with gross annual sales above $250,000
be assessed for one-tenth of 1 percent of net organic
revenue, with a maximum $1,000 assessment for
every $1 million in net organic revenue.
Te Organic Trade Association (OTA), the
principal trade group for the organic sector, has
taken the lead in formulating the checkof proposal,
and will soon submit an application for an organic
checkof to the U.S. Department of Agriculture. Tis proposal will ultimately be voted on by
certifed-organic stakeholders.
The Vision is Still Clear

All of the organic chain must act collectively to ensure our future. If organic stakeholders want to take
the industry to a new level of success and sustainability, nows the time to act.
Te organic sector was founded by visionaries who
believed in a better, more healthy and sustainable way
to raise food and be the stewards of our precious land.
Putting in place an organic checkof program is the
most powerful way to make this vision a reality.
For more information on the proposed checkof,
visit UnitedForMoreOrganic.com. PG
Sarah Bird is chief commercial officer of Oakland,
Calif.-based Ecologic Brands Inc., a sustainable
packaging company, and VP on the Organic Trade
Associations U.S. board of directors. She can be
reached at mmcneil@ota.com.
SERVING UP MORE SALES

IN THE CEREAL AISLE
Five steps to grow profits and customer
loyalty in a fast-changing category
ereal remains a favorite on Americas breakfast tables. But for retailers, although cereal
is the No. 2 dry grocery category, its been
hard to fnd ways to increase category profitability and build customer loyalty in the
cereal aisle amid economic pressures, population shifts

and changing consumer preferences.
ADVERTORIAL
To succeed in the current retail
infation-adjusted 2012 income
environment, its important to
level but still nearly $4,500 below
understand the key factors that
what they earned before the start of
are impacting consumers buying
the recession in 2007. Middle-class
behavior. With this knowledge,
incomes have been either stagnant
retailers can then take steps to
or declining since peaking in 1999.
meet their customers evolving
As a result, median household
needs and wantswhile boosting
income in the United States is now
their bottom line.
actually less than it was in 1989

nearly a quarter of a century ago.1
Economic pressures:
recession afershocks
Particularly hard hit by recession
The recession may be over, but
aftershocks are lower-income con-
consumers are still feeling the
sumers, who now make up almost a
aftershocks.
third of the U.S. population. Nearly

104 million Americans fall into the
According to an analysis of U.S.
low-income category, defned as
Census Bureau data by Amer-
those earning between 100 and 199
icanProgress.org, the typical
percent of the federal poverty line.
middle-class household earned
Yet this large group of consumers
$51,939 in 2013, a statistically
presents an enormous opportunity
insignifcant $181 above their
for retailers, with nearly $833 billion

in spending power, most of which is
Lower-income consumers: an opportunity for retailers
spent on necessities.2
The Census Bureau esTimaTes ThaT 106,376,000 ameriCans

live on inComes aT 200% of The poverTy line and Below.
State of the plate: what

America eats for breakfast
Cereal remains Americans No. 1
choice for breakfast. According to a
2014 survey among 1,000 U.S. con-
34%
LOW-incOmE
cOnSumErS
sumers by Carbonview Research,

on any given weekday, 60 percent of
adults and 79 percent of kids start a
typical morning with their favorite
cereal before heading off to work
or school, making it the most commonly consumed breakfast food
in the country. When asked which
foods they feel defne breakfast,
cereal came in second out of 20
optionssurpassed only by eggs.3
Source: Census.gov
ADVERTORIAL
Top 5 items that defne breakfast for consumers
Eggs
54%
Cereal
48%
Breads/
toast
34%
Bacon
27%
Fruits/
berries
20%
Source: Carbonview Research, September 2014
Beyond traditional sit-down
Children under 13 consume 126
breakfast foods like cereal, eggs
servings of cereal per capita annu-
and toast, consumers today have
ally, more than any other age
an ever-growing array of new
group, and the under-13 population
breakfast options to consider,
is expected to grow 8 percent by
whether its for ease of prepa-
2020.4 Also a vital part of the mix
ration at home or eating on the
is the up-and-coming generation of
run. Over the years, new quickand-easy breakfast items such

as toasted goods, hot cereals,
frozen items, yogurt and granola
Top breakfast foods consumed on weekdays
bars have begun competing for

the breakfast dollar. In addition,
foodservice operators such as
quick-service restaurants and
60%
Cold cereals
54%
Prepared breakfast items

(eggs, pancakes, etc.)
54%
Toasted goods (toast, bagels,

frozen waffes)
49%
Fruits
43%
Breakfast meats (bacon, sausage, etc.)
43%
Hot cereals
38%
Yogurt
26%
Frozen breakfast items

that are heated up
26%
Breakfast bars
convenience stores have added

an array of breakfast options to
their menus. Despite these alternatives, cereal still remains a
$9 billion category.
Population shifs: whos

at the breakfast table?
There are a number of shifts in
Americas demographic landscape that bode well for the cereal
category.
Not surprisingly, children continue to be big cereal eaters.
ADVERTORIAL
Source: Carbonview Research, September 2014
population, likely due to their typ-
In addition to great taste and good
ically larger household size. Today,
value, other attributes impacting
one of four children is of Hispanic
food purchases include a products
origin. Furthermore, Census pro-
ability to satisfy hunger and how
jections suggest that between now
well it provides parents with foods
and 2050, the Hispanic population
my kids will eat.10
will grow by 49 million to nearly

106 million, or 26.5 percent of the
The number of American consum-
U.S. population.
ers who consider healthfulness

when purchasing their food and
For retailers, catering to specifc
beverages has shown a signifcant
consumer segments presents new
uptick in the past two years, accord-
opportunities to fulfll these shop-
ing to IFIC. As a factor in food and
pers unique needs and preferences
beverage purchases, healthfulness
while building store proftability.
rose from 61 percent of consumers
Having a better understanding of
in 2012 to 71 percent in 2014, a 10
what drives consumers to purchase
percentage point increase.11
cereal is part of the equation.

To address consumers interest in
Top purchase drivers: taste,

value, health, convenience
healthfulness, many cereal manu-
When it comes to factors infu-
range of better-for-you options
The growTh of
The hispanic
populaTion
remains a
dominanT
demographic
Trend. These
households
purchase cereal
aT a raTe of
23.1 pounds
per year vs.
22.7 pounds
among The
general
populaTion.
facturers are now offering a wider
encing consumer food purchases,

taste continues to reign supreme.
According to the International
Food Information Council (IFIC)
Foundations 2014 Food and Health
Top purchase drivers

in the cereal category:
cereal buyers driven by
taste and quality
Survey, taste and price consistently

have been the top two factors that
impact consumers food and beverage purchases, at 90 percent and
73 percent respectively.8
In fact, taste is so powerful with
consumers that it can trump even
brand name. Eighty percent of
cereal buyers value product quality
and taste over brand name, when
82%
80%
42%
Product
quality
Taste
Brand name
asked to rank each factor in terms

of how important it was in the
cereal aisle.9
adverTorial
Source: Custom Panel, GROCERY, 52 weeks ending

April 6, 2013; Path To Purchase study October 2013
focusing on healthful ingredients,

such as whole grains, protein and
fber, and more hot cereal options.
Manufacturers also are moving
toward cleaner labels, making it
easier for consumers to see the
product benefts.
Five steps to boost

profitability in the
cereal aisle
Offer more value through

everyday low pricing.
Consumers need and want value,

so offer it to them through everyday low pricing. Instead of relying
Given these considerations, here
on increasingly less effective
are fve steps retailers can take to
promotions to sell more volume,
serve up more sales, boost prof-
offer value brands that todays
itability and increase customer
cash-stretched consumers are
loyalty in the cereal aisle.
looking for.
80%
Of cEREAL buyERs VALuE pRODucT

quALITy AnD TAsTE OVER bRAnD nAmE
Evaluate the mix. Assess

product velocity and cate-
gory incrementality in the cereal

aisle to see how fast products
are selling, then make sure the
product mix correlates
to the turn. It may be
necessary to stock the
shelves with a better
mix of options to meet
the needs of people
near your location. Bulk
packaging for big, multifamily homes nearby.
Nutritious options to
help Boomers maintain
their health. Quick, convenient cereal choices
that make it easy for
on-the-go millennials to
eat breakfast on the fy.
Stay on top of food

trends. The cereal
category is constantly
evolving as consumer
needs and wants change.
For example, the health
ADVERTORIAL
trend has created the opportunity

for many new cereal options that
help people lead healthier lifestyles,
so make it simpler for them to fnd
solutions: offer cereals that bear the
Whole Grains Council Stamp or that
indicate added protein or fewer calories on the label. Also include more
hot cereals, as consumers perceive
them as a better-for-you option.
While cereal is already a convenient
product, consider adding single-serve
cereal options to your assortment to
appeal to consumers seeking more
convenience or an on-the-go snack.
Stock the shelves with true

innovations. Grocery stores
are flled with brand extensions

that manufacturers create to look
like something new. Offer cereal
products that meet a need or solve
By offering customers high-quality,
a problem in a specifc and mean-
great-tasting and affordable cereals to
ingful way. For example, another
feed their families, retailers can help
new favor in a brand lineup is one
customers save moneywhile increas-
thing, but a product that enables
ing their margins in the cereal aisle.
consumers to address health concerns or save money will help to

keep them in the category.
Dont underestimate the power

and sophistication of low-in-
come consumers. Low income

doesnt correlate with low interest
when it comes to customers wanting high-quality cereal that offers
great taste, value, health and convenience. While one product may
not offer all of these benefts simultaneously, include in your lineup
a mix of cereal brands that can
deliver on these value propositions.
ADVERTORIAL
Sources
1
Americanprogress.org, Sept. 16, 2014, https://www.americanprogress.org/issues/economy/news/2014/09/16/97203/
what-the-new-census-data-show-about-the-continuingstruggles-of-the-middle-class/
2
Census.gov
3
Carbonview Research survey,
September 2014
4
NPD, U.S. Census Bureau
5
6
7
Pew Research, http://www.pewresearch.org/
fact-tank/2014/02/26/the-u-s-hispanic-population-has-increased-sixfold-since-1970/
8
IFIC, 2014 Food and Health Survey, http://www.foodinsight.
org/press-releases/more-americans-choosing-foodsbeverages-based-healthfulness
9
Custom Panel, GROCERY, 52 weeks ending April 6, 2013;
Path To Purchase study October 2013
10
NMIs 2013 Health & Wellness Trends Database
11
IFIC, 2014 Food and Health Survey, http://www.foodinsight.
org/press-releases/more-americans-choosing-foodsbeverages-based-healthfulness
ThE hEALTh
TREnD hAs
cREATED ThE
OppORTunITy
fOR mAny
nEw cEREAL
OpTIOns ThAT
hELp pEOpLE
LEAD hEALThIER
LIfEsTyLEs.
DRIVING PROFITABILITY IN THE CEREAL AISLE

Founded in 1919, MOM Brands today
is among the largest cereal companies
in the United States. Today, one in
11 servings of breakfast cereal eaten
every day is a MOM Brands cereal.
Heres How MoM Brands Helps
retailers drive profitaBility
in tHe cereal aisle:
Ofers an extensive house of brands
featuring 103 varieties of familyfavorite ready-to-eat, natural,
organic and hot cereals that deliver

on consumer needs for taste, value,
health and convenience.
Everyday low-price strategy keeps
consumers in the cereal aisle and
creates higher margins for retailers.
Dedicated to finding better ways to
make a better breakfast at a better
price. MOM Brands has saved families
nearly $1.5 billion on cereal purchases
since 2007.
Put MOM Brands to work for you. For more information, visit www.MOMBrands.com.
ADVERTORIAL
2015 Annual Meat Conference
Fresh Food
Lessons in
Meat Marketing
Annual conference looks at branding, natural products, foodservice
and how to enhance the shopper experience.
By Jim Dudlicek
hese were among the messages

delivered to grocers attending the 2015 Annual Meat
Conference, hosted by the
North American Meat Institute
(NAMI) and the Food Marketing Institute (FMI), Feb. 22-24 at the Gaylord
Opryland Resort in Nashville, Tenn.
Meals should be a vehicle for great service, said
John Rand, SVP of retail insights at Boston-based Kantar Retail, in his presentation, Securing the Perimeter:
Te Red, White and Green of Retail Branding, the
colors representing meat, dairy and produce. Integrating fresh into these solutions creates cross-merchandising opportunities across the store and enables retailers
to move from item statements to meal concepts.
Rand noted that fewer and fewer consumers are
shopping both the perimeter and center store, and

only 43 percent shop both. Yet supermarket marketing has been almost entirely co-opted by center
store suppliers with large marketing budgets.
Grocers, he said, need to market meals, which
are the solutions sought by consumers looking for a
retail experience that solves their daily challenges.
Such is the essence of branding: delivering on a
meaningful, consistent, relevant promise.
In Navigating the Growing Demand for Natural and Organic Meat, Mary Ellen Lynch and Clay
Sayers, of Schaumburg, Ill.-based SPINS, urged
retailers to stay ahead by watching natural consumers because theyre driving the trends.
Tats defnitely the case, especially where meat
is concerned. While still a small part of the overall
meat category, natural is driving a lot of the growth
If youre not
willing to think
differently
and get
creative, youre
vulnerable.
Sherry Frey, Nielsen
Perishables Group
115
Fresh Food
CRaFteD with
CaRe
Kent harrison
displays tyson
Foods Crafted
Creations line.
at retail, most of it coming in what SPINS calls the

natural standard (brands that follow strict standards) and specialty natural (marketed as artisan,
premium and ethnic).
Of the overall $1.2 billion meat category, just
$200 million is natural, but the segment has grown
nearly 24 percent, compared with 4.7 percent for
conventional meats.
Showing the most growth are products claiming hormone-free and grass-fed, among other
sales-driving claims, including antibiotic-free and
humanely raised.
Meanwhile, the latest top 20 food trends identifed by the Washington, D.C.-based National
Restaurant Association (NRA) are dominated by
natural, free-from and better-for-you concepts.
Retailers can cash in by promoting premium extensions of conventional brands, clean labels and other
trending concepts like gourmet, artisan and craft.
Natural shoppers, the speakers said, prize honesty,
transparency and compelling farm-to-fork stories.
More Meat, Bigger Rings

Grocers need to leverage meats connection to
other categories to drive bigger baskets that was
the advice from the Nielsen Perishables Group to
retailers looking to deliver on evolving consumer
preferences amid high protein prices.
Sherry Frey, SVP at Schaumburg-based Nielsen,
asserted that grocers can grow basket rings by delivering solutions through cross-promoting meat across
multiple store categories. Competition and partnerships hinge on connections across aisles, Frey said.
Its a solution aimed at halting category attrition,
as price increases are driving people away from the
116
meat case, leading to a 1 percent average decline in household penetration

for historic protein mainstays of beef,
pork and chicken. Likewise down are
meat sales volume and the number of
meat-buying trips.
Further, meat case sales are leaking
to the in-store deli. Deli is changing
and really becoming a competitor to
foodservice, but it shouldnt erode sales
within the store, Frey said.
Grocers need to strategically target
two key meat categories: versatile
quick-cuts (premium-priced smaller
packs) and planned occasions (larger
family packs). Reduced trade-advertising activity has contributed to volume
loss, Frey said, recommending that
grocers promote meat, not isolated
ingredients, in circulars as part of
multicategory solutions.
Meat should be treated in-store as
such, too; that means thinking differently on how to merchandise the store, Frey
said. If youre not willing to think diferently
and get creative, youre vulnerable.
Marketing meat-based solutions should focus on
three things, she noted: creating excitement, simplifying lives and personalization.
Digisumers Calling the Shots

Neil Stern, senior partner with Chicago-based
Ebeltoft USA/McMillanDoolittle, ofered a Visual
Journal of Global Retail and Meat Trends, with an
international look at how retailers are exploring new
formats and new trends in visual merchandising, and
experimenting with new disruptive business models.
With consumers and their needs more diverse
than ever, retailers must understand and respond,
or disappear, Stern said. With the rapid adaptation
of technology, he continued, its digisumers who
are calling the shots in retail.
Among Sterns key points:
Local resonates with freshness, sustainability
and community support.
Foodservice mashups bring theater
to retail grocery.
Retailers must boldly deliver experiences
that cant be duplicated online.
Experiences must refect demographic
specialization; the Millennial population is
35 percent ethnic.
Grocers should experiment with new ways to
reach shoppers, such as food trucks, curbside
pickup, home meal delivery and vending.
Were really seeing profound changes happen-
ing in the marketplace, Stern declared.

In common with Stern, Wade Hanson, principal
with Chicago-based Technomic Inc., singled out
foodservice as a must-have in his presentation, Te
Changing Face of Supermarket Foodservice and the
Keys to Long-term Success.
Restaurants are looking at this as a threat to
their business, Hanson said of the evolution and
refnement of supermarket prepared foods. Te
growth potential is there, much more so than
other areas of the grocery industry. In fact, he
said, grocery foodservice can expect 7.5 percent
annual growth over the next 10 years.
And in Technomics latest consumer ranking of
the top 10 foodservice operators, four of them are
grocers, including the top-ranked Wegmans Food
Markets, along with Marianos and Standard Market
in the Chicago area, Market Bistro by Price Chopper
in New York, and Krogers Chef on the Run, which
Hanson named as standouts in this category.
So important is foodservice to grocery, Hanson
asserted, that without it, grocers risk losing the rest
of their overall basket. He cited data showing grocery
prepared foods with $25 billion in sales for 2014, up
$10 billion since 2004, with foodservice being the
No. 1 strategic initiative for many retailers.
Hanson pointed to the following emerging
trends in grocery foodservice:
Breakfast, beverages and dessert are
prime opportunities.
As fresh expands to other channels, grocers are
under pressure to more clearly defne and own it.
Brand loyalty will depend on relevance and
customization: Be on-trend and relevant, he
said, and adapt to your consumer.
The Power of Meat

Meat and poultry products remain among the top
choices for shoppers at retail, but the 10th annual
Power of Meat study published by FMI and
NAMI, and sponsored by the Cryovac Brand, a
part of Sealed Airs Food Care Division highlights several trends in the way consumers are
changing their purchasing behavior.
Anne-Marie Roerink, principal at San Antonio-based 210 Analytics, which felded the study,
laid out this in-depth look at the meat category
as seen through the shoppers eyes. Key points
include the following:
Price increases prompted shoppers to seek
alternatives: Price hikes for beef and pork
caused shifts in buying behavior among 40

percent of shoppers, with most looking for ways
to save. Others returned their focus to quality,
convenience and nutrition. Consumers most
often look at price per pound.
Shoppers are open to switching among proteins, cuts and brands: Many sought protein
outside the meat case, mostly eggs and beans.

Millennials are more likely to use meat alternatives for ease of preparation.
Megatrends affect the meat purchase: Shoppers are infuenced by local sourcing, sustainability, health and wellness, and organic, and are
looking at leaner cuts and portion control.
Alternative channels take some of the fresh
dollar: Supermarkets remain the dominant outlet
for fresh meat and poultry; farmers markets are

the greatest source of the occasional purchase.
Meat purchase decisions are increasingly
shifting to in-store: While meat and poultry
remained well-researched list items for many

shoppers, a greater share made the ultimate
buying decisions among species, cuts and brand
in-store putting additional emphasis on
operational excellence.
Value-added is a fast-growing but narrow
segment: One-quarter of shoppers say they
purchase value-added items sometimes or regularly, but for most, cost (21 percent) or preferring to prepare items themselves (46 percent)
are the greatest barriers to purchase. Despite all
of the value-added solutions provided by food
retailing, foodservice continues to win
the last-minute dinner decision.
sMarT ideas
Chef Chris Mayer
gets creative
with Perdue
Chickens simply
smart line.
Full-service counters are highly valued: 63 percent among shoppers with
access consider this a store advantage.

The natural/organic segment continues to grow: Te top reasons for pur-
chasing natural/organic are free-from

and better health and treatment of the
animal. For those not yet engaged in the
segment, price is the largest barrier.
Meat and poultry provide
nutrition and balance to the
diet: Meat is most highly
associated with being a

source of important nutrients. Millennials are
more likely to associate it with functional
benefts and de-emphasize enjoyment.
Winning while faced
with volume pressure:
Shoppers want better

everyday and promotional
pricing; and better quality; better in-stock perforApril 2015 | progressivegrocer.com |
117
Fresh Food
mance and variety in package sizes, cuts and

specialty items, along with customer service
excellence.
Exhibits and Tasting Expo

An Annual Meat Conference highlight was the
annual tasting reception, which this year combined
with the lunchtime tech expo to create a fve-hour
exhibition of meat purveyors and equipment supplibe on-trend ers, featuring more than 60 companies. Among the
and relevant, exhibitors:
and adapt
AHT Cooling Systems, launching a propaneto your
fueled cooler, extolled the benefts of its plugin multideck merchandisers and slim units
consumer.
designed for midaisle placement in alternative
Wade Hanson,
store departments.
Technomic
Bubba Burger sampled its new veggie burger
and beef-based bacon cheddar burger, and also
announced a grass-fed burger, to be sold in fourcount 1-pound boxes.
life. Also on display were examples of the

Elmwood Park, N.J.-based companys evolving
microwaveable plated entre packaging.
Smithfield Farmland sampled its new dry-rub
ribs and pork-based Italian meatballs, and also

showed its seasonal favored-glaze spiral hams.
Springer Mountain Farms sampled its glutenfree breaded chicken breast chunks.
Tyson Foods showed its Crafted Creations line,
which brings several pre-seasoned and premarinated beef and pork entres under a common
banner. Te 16-item line includes Beef Skirt Steak
with Smokey Chili Sauce and Pork Shoulder for
Carnitas; packaging includes callouts such as
Great for Grilling and Skillet Ready. PG
Follow trade show reports online at Progressivegrocer.com

and on Twitter (@pgrocer and @jimdudlicek).
Clemens Food Group sampled new thick-cut,
triple-smoked applewood and maple bacon under

its Hatfeld brand.
Hillphoenix displayed its Coolgenix 2.0 meat and
seafood case with a glycol-based refrigeration

system that purports to extend product shelf life.
Land OFrost sampled its new Pure and Simple
line of antibiotic-free, veg-fed luncheon meats,

consisting of two ham and two turkey varieties.
Miller Poultry is launching Katies Best, a full
line of Non-GMO Verifed chicken thats

vegetarian-fed, air-chilled and free of antibiotics.
After extensive development, John Morrell
Food Group has released a 50 percent reducedfat hot dog line under the Nathans Famous
brand, which doesnt sacrifce favor, with
half the fat, said Michael Paribello, senior
director of marketing. Cincinnati-based
Morrell has also expanded its LunchMakers
kid-centric line with breakfast and snack
items, and continues to grow its Eckrich
smoked sausage business.
National Beef is targeting Millennials with its
Food.eez recipe-ready beef cuts, which sport

on-pack labels featuring product useage tips and
recipes. Te line will be supported by a mobilefriendly website.
Perdue Foods ofered dishes prepared with its
Simply Smart chicken; the clean-label line,

which proclaims no antibiotics ever, includes
fresh, heat-and-eat and frozen products.
Sealed Air showed its Darfresh on Tray packaging
system that promises to speed plant packaging

times, yield no scrap and extend product shelf
118
HErEs THE bEEF

Andy stenson
shows off bubba
burgers new
grass-fed burger.
Nonfoods
Advances
in Care
Retailers can tap new technology for personal disease management

to attract diabetes patients.
By Christina Veiders
orecasters indicate that no end is in

sight to rising diabetes rates 29
million Americans and counting,
plus 89 million prediabetics who
are at risk of developing the disease.
Even more worrisome, an estimated
8.1 million people live with diabetes but dont know it.
Food and drug retailers have long recognized
the importance of targeting the diabetic population
from a public health standpoint as well as to tap
such consumers value and loyalty.
Canadian diagnostic company Miraculins Inc.,
120
which is in the process of testing its Scout DS

diabetes-screening kiosk in its home country, notes
independent research that puts the average spend
of diabetes patients at $6,000 per year for treating
the disease, of which $3,000 may be spent at the
pharmacy. Tat fgure doesnt include purchases in a
grocery/pharmacy setting.
While diabetes numbers keep rising, the health care
system remains in fux, and advances in therapy and
mobile technology stand to impact how retailers go to
market with services and oferings for diabetic shoppers.
Will Bevins, director of pharmacy operations
evaluate the patients overall medication profle

and identify any gaps in therapy and work with the
prescriber to close these gaps, he adds.
Te Afordable Care Act, which has ushered in
about 16.4 million insured, stipulates that diabetics cant be denied insurance coverage and requires
health insurers to cover some basic needs, including
free preventive care, diabetes screenings for adults
with high blood pressure and for pregnant women,
and medical nutrition therapy.
However, with more people insured, the supply
cant meet the demand, since there are, as mentioned earlier, around 29 million diabetics and only
about 5,000 endocrinologists in the country.
for Abingdon, Va.-based K-VA-T Food Stores, has

observed a trend toward personalized therapies
and notes the importance of the pharmacist in the
diabetes management equation.
Advances in therapy have provided patients
and prescribers many new and unique treatment
options. Tese new advances target diferent and
novel ways to treat the patient. With many of these
new medication classes, prescribers may be able to
individualize treatment plans based on the patients
needs and symptomology, Bevins says.
Te pharmacist is in a unique position to
Acute Care to Clinical

New venues and models for health care are in
development, and the retail landscape has become
a proving ground. Last year, retailers Walmart and
Target, for example, began moving from acute care
clinics to primary care services
Te Bentonville, Ark.-based mass merchandiser
opened a handful of Walmart Care Clinics, which
it owns and operates. Tis is in contrast to the 100
or so Clinics at Walmart that are leased and operated by third parties.
Broad-range services ofered at Walmart Care
Clinics include chronic condition management
for those with uncomplicated diabetes, notes
Walmarts Ben Wanamaker, senior manager
strategy and operations. Te cost of entry is low:
$40 per visit, with Walmart employees and their
dependents paying just $4.
Te mega-retailer also ofers an exclusive line of
afordable Reli-On diabetic products, including test
strips for just $9, regardless of whether customers
have health insurance. Further, shoppers can fnd
in-depth information on diabetes, treatment options
and healthy living tips at relion.com.
Te biggest challenge facing our diabetic customers is the rising cost of health care, notes a Walmart
representative. We will continue to remain committed to providing afordable products to help them
manage their disease and reach optimal health.
Meanwhile, Minneapolis-based Target, through
a partnership with Kaiser Permanente, opened four
California clinics ofering primary care services
delivered by Kaiser staf. Telemedicine is being used
to connect patients to Kaiser staf doctors.
And earlier this year, in a interview with Bloomberg Business News, John Mackey, co-founder and coCEO of Austin, Texas-based Whole Foods Market,
foated the idea of a Whole Foods medical clinic, frst
for employees, and then possibly for consumers.
Te big question is, how long will it be before
Whole Foods wants to cater to patients with
chronic conditions [like diabetes]?, asks Dave
With many
of these new
medication
classes,
prescribers
may be able to
individualize
treatment
plans based on
the patients
needs and
symptomology.
Will Bevins,
K-VA-T Food Stores
121
ADVE RTORIAL
Kyle Stenzel
Vice President Sales, Beiersdorf, Inc.
Established over 100 years ago,

Eucerin is one of the most respected
brands within the skincare category.
Even with the constantly evolving
landscape, Eucerin continues to
innovate and provide the effective
skincare solutions that consumers
have come to expect.
PG: Whats next for Eucerin?

KS: Eucerin will continue to deliver the innovations
that consumers in the therapeutic skincare space
are looking for. Our strong product pipeline, which is
developed in consultation with our network of dermatologists and pediatricians, helps Eucerin continue to
grow the brand and bring new consumers into the
category by delivering on the skincare issues most
impacting consumers. We look forward to continuing
to provide consumers with proven solutions that keep
them feeling condent in their skin.
Progressive Grocer: Recently, Eucerin launched a

new line of lotions and cremes, Eucerin Diabetics'
Dry Skin Relief. How did this innovation come
about?
www.EucerinUS.com
Kyle Stenzel: Eucerin works hand-in-hand with

dermatologists when developing new products.
Dermatologists have reported an increase in patients
with very dry, rough skin. Eucerin aims to provide
consumers with hardworking products that effectively
moisturize to soften even intensely dry skin.
PG: Eucerin products are used and trusted

by many with dry, itchy or sensitive skin. How
does the Eucerin Diabetics Dry Skin Relief line
of products meet the needs of those with
intensely dry skin?
KS: Through extensive research and testing, we
know that, the best way to address most dry skin
conditions is the routine use of effective, long-lasting
moisturizer. Eucerin Diabetics' Dry Skin Relief formulas gently exfoliate and intensely moisturize leaving
skin smoother and softer. People with diabetes saw
noticeably moisturized skin in just one use. Eucerins
Diabetics Dry Skin Relief line offers three complementary products specically designed for the body
in a creme or lotion formulationand the feet, which
are particularly prone to drying and cracking. These
products gentle, non-greasy and fast absorbing
formulas are gentle enough for everyday use and
help build multi-item baskets.
122
This product is intended to moisturize dry skin and not cure, treat,
or mitigate symptoms of diabetes.
SOFT, SMOOTH SKIN

IN JUST ONE USE.
INTRODUCING EUCERIN DIABETICS DRY SKIN RELIEF.
In just one use, its effective combination of ingredients noticeably
moisturizes the rough, dry skin of people with diabetes.
Soft, smooth skin. Now, how good does that feel?
PROUD SPONSOR
of the
AMERICAN DIABETES
ASSOCIATION
Skin Science That Shows.

Want to learn more on how to grow? email us: ShopperMarketing@Beiersdorf.com
Intended to moisturize dry skin and not cure, treat, or mitigate symptoms of diabetes.
Nonfoods
Wendland, VP at Waukesha, Wis.-based Hamacher Resource Group. If they collaborated with a

strong pharmaceutical partner, the [Whole Foods]
patient base that expects fresh may gravitate to
that kind of environment.
Wendland sees a growing demand for diferent
health care access points, and retail health clinics
make perfect sense.
Ive seen a stepped-up number of health clinics
being integrated into grocery, he says. If you look
at the DNA, it isnt just about acute care. [Grocers]
are beginning to focus on chronic care and management, and the biggest food retailer player in the
world isnt bashful about saying, We can replace
primary care physicians.
Jim Wisner, president of Libertyville, Ill.-based
Wisner Marketing Group, who has worked in the area
of retail wellness for more than a decade, says those
with a clinic/pharmacy model have an advantage when
it comes to managing chronic conditions like diabetes.
With a medical care model, consumers are
completely linked in, and, better yet, if you can impact
their lives, that is the best of everything, he observes.
Wisner believes many grocery chains are doing a
good job on the diabetes front and will continue to
hone their services and oferings.
Medication adherence and cost of medications

are two of the biggest challenges with tackling
diabetes moving forward, says Maria Brous, a
spokeswoman for Lakeland, Fla.-based Publix
Super Markets, which operates 925 pharmacies in a
chain of 1,000-plus stores.
Five years ago, the grocer began a multifaceted
diabetes management system. Te frst phase offered diabetic patients a free medication, Metformin; online resources; and the beneft of a knowledgeable pharmacist.
Customers could also sign up to receive a
monthly e-newsletter containing diabetes-related
articles, a featured recipe of the month, and special
ofers from Publix and Publix Pharmacy. Te
program additionally included a voucher for a free
Publix branded glucose meter.
Last year, Publix expanded a Sync Your Reflls program established to assist customers with
synchronization of their medications to be reflled
on the same day of the month. Te program is
designed to help with medication adherence.
Staff Training
With 93 Food City locations and 78 pharmacies in
Food City stores, K-VA-T has invested in training
programs for pharmacists to become diabetic coaches
Mobile Tools for Health Management

For the millions living with diabetes, the condition often
involves finger sticks and constant monitoring and recording of blood glucose levels.
New digital medical devices and mobile apps may
change the daily grind for diabetics and provide caregivers
and patients with valuable data to manage the disease.
Diabetes is a condition of high blood glucose levels
over a prolonged period due to insufficient insulin or
insulin resistance. Left untreated, it can wreak havoc on
the body, causing heart and kidney disease, nerve damage, and vision problems.
With such a large portion of the population
smartphone-enabled, the next wave of consumer
interaction will be mobile-driven, predicts Dave
Wendland, VP at Waukesha, Wis.-based Hamacher Resource Group.
124
The FDA recently issued final guidelines on its oversight of mobile health apps, indicating that generally
it would take a hands-off approach to regulating apps
that pose no threat to users if they fail.
Accordingly, expect more wearables that measure
important biometrics, such as a smart lens, currently
being developed by Google and Alcon, that can measure
glucose in tears, and the potential of the Apple Watch
to be used as a blood glucose monitor.
In a similar vein, product developers are using advanced technology to design tools that make it more
convenient and easier for diabetics to track their health.
The KiCoPen device (pictured at left), developed
by U.K.-based Cambridge Consultants, was designed
to capture when the exact dose of insulin is delivered and send the information to a smartphone app
for accurate tracking. The pen has no battery and is
powered through energy harvesting.
For retailers, such technology means understanding
how their consumers will use it and having more health
data to help patients and customers stay healthy.
Retailers will use the information to connect back
through their omnichannel experience, Wendland explains, to personalize communication with the patient
that says, Mrs. Jones, today Ive got green peppers on
sale, and they are great for someone living with diabetes.
and provide overall medication

therapy management.
For company associates
and their family members,
K-VA-T ofers through its
Healthy Initiatives department health coaching to those
enrolled in its Diabetes Management Program.
Te program provides the incentive of a reduced
co-pay on diabetic supplies and medications that
lower blood sugar for associates/family members
who comply with its requirements, one of which
is meeting with a pharmacist health coach, who
provides education, support and counseling.
Te Healthy Initiatives department also
partners with Kingsport, Tenn.-based Wellmont
Health Systems Diabetes Treatment Center to
ofer free in-store tours. Tese small group tours
focus on shopping and consuming foods that
will help those with diabetes better manage the
disease. Further, K-VA-T reaches out to other
organizations and businesses to ofer free diabetes
educational sessions and support groups.
We strongly feel that diabetes management must
begin with the patient as the central person caring for
their diabetes, but that a team

approach, including their family
members/support persons, is
critical to a better quality of life
and outcomes, Bevins says.
Besides new therapeutics,
technology is changing the way
retailers will deliver services and how patients manage their diabetes. Telemedicine, being used by Target and some large drug chains, is just one example.
Miraculins Scout DS, which was tested earlier
this year in several Lovell Drug stores in Ontario,
is able to determine whether the user has type 2
diabetes. Te kiosk reads, via a light source, AGEs
(advanced glyscosylated end-products), among other
biomarkers) in the skin and, based on age, provides
normal, borderline or elevated results on those tested.
Christopher Moreau, president and CEO of
Winnipeg, Manitoba-based Miraculin, says the kiosk
provides a 90-second no-blood, no-fasting screening
test for type 2 diabetes thats 80 percent sensitive.
It is ideal in a food-pharmacy environment to
identify those who may be prediabetic or diabetic,
Moreau says. Te company will seek FDA approval
to market the kiosk in the United States. PG
Medication
adherence
and cost of
medications
are two of
the biggest
challenges
with tackling
diabetes moving
forward.
Maria Brous,
Publix Super Markets
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125
Nonfoods
Batteries and Flashlights
atteries and fashlights are some of the

frst items consumers look for when they
prepare for weather-related power outages.
Even minor storms lead to a bump
in battery sales, and major storms can
quickly wipe retailers out of stock, says
Ann Rule, senior director of marketing at Rayovac, part of Middleton, Wis.-based Spectrum
Brands. Since weather and power outages occur
throughout the year, storm prep can be a yearround category at many chains.
Battery companies have stressed to consumers the importance of being prepared
during the power outages brought about
by extreme weather conditions, says Nick
Cunningham, an analyst with The Freedonia Group Inc., in Cleveland. Duracells
biggest push for emergency preparedness
has historically been in the spring and
summer, targeted to help consumers gear
up for the summer hurricane season. But
winter storms in the Northeast and Mid-
west can also create power disruptions, making winter

another key selling season.
To promote emergency preparedness last year,
Duracell significantly expanded its Power Forward
program. The program is designed to provide power
relief to those who are without power due to natural
disasters, explains Win Sakdinan, a spokesman
for Duracell, a brand of Cincinnati-based
Procter & Gamble. Our five Power Forward trucks are positioned throughout the
country, enabling them to get to any disaster
location with free batteries and charging
stations within 24 hours.
Since 2011, the brand has deployed the
trucks 18 times throughout North America.
Weve donated over 380,000 batteries and
provided thousands of people with mobile
device charging from our trucks, Sakdinan
says. With the help of our retail partners,
we also use the trucks to help spread a message of storm preparation, so families can be
prepared for the next big storm.
Storm Cells
In times of emergency, consumers look
to grocery retailers for batteries and flashlights.
By Barbara Sax
126
Selling Preparedness
According to Rule, Rayovacs internal forecasting
team communicates weather reports to account
managers, who then help retailers get needed supplies on the selling foor before a storm hits. We
had a 200 percent lift in sales during Hurricane
Sandy, she says. Its important for retailers to
have the product in the store not only from a sales
perspective, but as a public service.
Tis past winter was a rough one in
New England. At Springfeld, Mass.based Big Y Foods Inc., batteries are
merchandised regularly on foor stands
throughout the year, but when it comes
to storm prep merchandising, the chain
uses tables to maximize display.
We place them in high-trafc
locations near the front door or at the
checkout, says Scott Brackney, Big Ys
general merchandise sales manager.
Te stores get creative, merchandising
candles, can openers and other stormrelated SKUs all together. Its a onestop shop that flls a customers need.
Brackney continues: It really
comes down to opportunity merchandising, having the right product in
store, in the right place, at the right
time. Its something our customers
have really come to expect and appreciate from Big Y. In this situation,
its so much more than just selling
product. Tese items now become a
necessity, a public service.
Weather emergencies are a yearround threat in the Texas markets
in which Brookshire Grocery Co.
operates. Customers in our market
areas have to be prepared to deal with
extremes in weather, from thunderstorms and fash foods to tornadoes
and hurricanes, during the spring,
summer and fall, along with snow
and ice in the winter, points out
Steve Delello, category manager of
general merchandise/seasonal categories at the Tyler, Texas-based chain.
To help customers prepare for
inclement weather, the Brookshires
seasonal display plans always include
batteries and fashlights. We maintain a preloaded battery clip-strip
inventory in our warehouse that is
ready to ship at a moments notice,
says Delello. Te chain also developed lane closure displays on wheels
to bolster stores in-stock position
and capture last-minute buys at the
front of the store.

We have developed
storm-specifc displays
for all of our retailers that
feature one of our Duracell
Power Forward trucks, notes
Duracells Sakdinan. Tis display
encourages consumers to stock up prior
www.grimmway.com
127
Nonfoods
It really comes
down to
opportunity
merchandising,
having the
right product
in store, in the
right place, at
the right time.
Its so much
more than just
selling product.
These items
now become
a necessity, a
public service.
Scott Brackney,
Big Y Foods
128
Batteries and Flashlights
to the storm. We also are prepared from a supply chain perspective to ship product to our retail
partners ahead of signifcant storms or immediately following to help replenish their inventory as
quickly as possible.
Rayovac helps retailers prepare for storm seasons
with fexible and easy-to-assemble displays for its
Rayovac branded batteries. Te correct product
mix and secondary locations are key to the success of a retailers emergency operations center,
says Rule. AA, C, D and 6-volt batteries and
value-priced fashlights have the highest lift during
storms, so its important that retailers get enough
product on the foor to meet consumer needs.
While the basic battery and fashlight products
are a crucial part of the mix, manufacturers have
introduced new products that are good additions to
an emergency operations center. Long-lasting batteries are becoming a bigger part of the category, for
instance. With our Duracell with Duralock technology, our batteries last up to 10 years in storage, so
there is no downside on purchase if the storm doesnt
hit, says Sakdinan. While all battery sizes are important, we see a signifcant increase in demand for
C and D batteries during storms, as those are used in
many fashlights and lanterns.
For its part, St. Louis-based
Energizer recently launched Fusion,
a value-priced high-drain battery
positioned against Energizer Max
and Duracell with Duralock.
Portable power packs
that can recharge with
AA bat-
teries are another important part of the category;

Rayovacs 7 Hour Power is a strong seller in this
segment. In July, the brand will launch a StormPrep
line of lanterns and fashlights featuring NiteGlow
locator technology. All products feature a glowing
on/of button powered by a long-life lithium battery
that makes them easy to locate in the dark.
Energizer promotes its WeatherReady fashlights during storm season. Our WeatherReady
line of fashlights is perfect for emergency situations because of critical benefts of long runtimes,
area lighting and water resistance, notes Nguyen
Violette, Energizers director of marketing.
Beacon for Shoppers

Promotional activity for fashlights peaks in October
and November in tandem with hurricane season,
and then again in November through January, timed
to the winter storm season in many parts of the
country. Grand Rapids, Mich.-based Meijer promoted the category most heavily in the supermarket
channel for the year ending Feb. 21, 2015, according
to Solon, Ohio-based ECRM, which also found
that Energizer was the leading branded fashlight
promoter in the category, with 17 percent of promotional activity linked to the brand, while Rayovac
accounted for 5 percent of category promotions.
Manufacturers also advertise their battery
brands during storm seasons. Duracell was the most
frequently promoted brand, with 24 percent of all
battery ads promoting it, ECRM found. P&G also
marketed the Duracell Coppertop brand heavily, with nearly 12 percent of category promotion
devoted to it.
Energizer Holdings ran 18 percent of category
ads for its fagship Energizer brand. Ads for the
companys Energizer Max brand accounted for
nearly 12 percent of category advertising, and Advanced Lithium and Advanced Ultimate Lithium
brands accounted for a combined share of 2 percent
of category ad spending.
More than 75 percent of promotions in the battery category were price-point driven, according to
ECRM. Promotional support spikes from the end
of November to mid-January are targeted to the
holiday selling season. Kroger, Safeway and H-E-B
were the most frequent promoters of the battery
category in the supermarket channel. PG
Online Grocery Shopping
uying groceries online is becoming more popular as consumers

become comfortable with this
shopping option. To serve these
customers, some supermarket retailers have been ofering grocery
e-commerce for some time, while others are testing
various services or considering getting involved.
Its no wonder why. Online grocery shopping is
one of the fastest-growing retail channels. According
to Rockville, Md.-based Packaged Facts, the annual
growth rate will result in a market of nearly $100
billion in 2019. So grocers need to get their fair share
of this business. Tey need to determine the best way
to assemble online orders and deliver groceries while
ensuring prompt service at a reasonable price.
Online grocery shopping certainly can ofer a
competitive advantage for traditional food retailers,
according to Graeme McVie, VP of business development for Toronto-based Precima, a retail analytics solution owned by LoyaltyOne. Tis is especially
true if companies can successfully integrate a loyalty
program that rewards their best customers.
It is a highly engaged medium, he says. Since
shoppers are apt to share products, recipes and experiences socially, online grocery shopping can also play a
unique role in helping the retailer build its brand both
in brick-and-mortar as well as in digital forums.
Technology
But if grocery e-commerce ofers so many benefts

to grocers, whats preventing some from embracing it
and gearing up for a growing part of the business?
Its a pure cost play, and the logistics behind it,
says Lee Peterson, EVP of brand strategy and design at Columbus, Ohio-based WD Partners, citing
the costs of picking ordered groceries, trucks, gas
and delivery people. If youre a grocer with three
stores in Sacramento, thats a tough one. Tats why
you might use an outside resource.
And there are several outside resources from
which to choose. For example, San Francisco-based
Instacart, which operates in 15 cities across the
country, enables shoppers to browse through the
online catalogs of partnering supermarkets and then
deliver selected orders to users homes. Some of the
grocers using this service are Whole Foods Market,
Costco and Harris Teeter.
Ahold recently launched grocery ordering and
delivery in the Harrisburg and York, Pa., markets
through its Giant Carlisle and well-known and
successful Peapod divisions. Consumers can create
personal shopping lists, read nutrition information
online, and sort products rapidly by price or nutrition criteria. Giant Bonus Card users can quickly
get started with their frst order online, from a list
of items theyve bought at their local store, by entering their card number online.
If grocery
e-commerce
offers so
many benefits
to grocers,
whats
preventing
some from
embracing it
and gearing
up for a
growing
part of the
business?
Getting
Started
Now
Whats the best type of service

for online grocery?
By John Karolefski
129
Technology
Its all about making it easy for our customers to

shop for their groceries, says Giant President Tom
Lenkevich. With the launch of Peapod by Giant,
our customers now have a full range of shopping
options. Whether it is shopping in our stores, ordering online and picking up, or having their groceries
delivered to their home or ofce, Giant customers
truly can shop when, where and how they want.
Since
shoppers are
apt to share
products,
recipes and
experiences
socially,
online grocery
shopping can
also play a
unique role in
helping the
retailer build
its brand both
in brick-andmortar as well
as in digital
forums.
Graeme McVie,
Precima
Controlling the Threat

Meanwhile, experts believe online services from
Amazon and Walmart are the two biggest threats to
supermarkets. Seattle-based Amazon began expanding its grocery service, called AmazonFresh, in the
second half of last year to California, while Walmart,
based in Bentonville, Ark., is running tests of its
Walmart to Go service in San Francisco and Denver.
Both have the resources and national footprint to
become dominant players in grocery e-commerce.
Some larger grocery chains understand that threat
and therefore might want to have complete control of
the process rather than rely on a third party. Naturally, this requires considerable IT investment plus
supply chain, marketing and CRM integration on
the back end. Beyond that, grocers will need to put
time and efort into the user experience.
Shoppers want an easy-to-use service that can
be accessed by a mobile device, so they can shop
on the go, as well as [via] tablet or desktop, says
McVie. So out of the gate, its critical to make
sure you have platforms for all devices. Lets not
forget the delivery experience. Consumers will
have an expectation that you are paying attention
to this level of detail and that they can count on
you to not only get them what they need with the
push of a button, but that it will land at their door
packed as though they packed it themselves. Te
challenge on that front is on the ability to knit
online with delivery.
For chains that want their own e-commerce services, McVie lists critical operational decisions that must
be considered thoroughly and managed efectively:
How do you revamp management and
back-end systems that span a vast array of
business-critical logistics?
Do you have the same prices online as in-store?
How do you manage inventory and the supply
chain to minimize out-of-stocks?
How do you manage the picking/delivery
workforce?
Where do you do the picking in current stores
during slow hours, at dark stores or at warehouses?
How do you manage the delivery feet
and plan delivery routes?
How do you manage images and product
information?
130
Get the Onliners In-store

The increasing popularity of online grocery shopping makes this channel a priority for grocers.
Theres a problem, however: Many customers are
quick to abandon their carts before checkout.
Recent data indicate that almost seven in 10
consumers do so when shopping online.
This is an issue for online and brick-andmortar retailers alike. However, the latter have
an edge, according to new data from LoyaltyOne, which revealed a way not only to get
consumers to complete their online purchases,
but also to enter the brick-and-mortar store.
The survey of 1,000 American consumers nationwide points toward a simple answer: Offer
a discount to the online purchaser whos willing
to pick up his or her purchase in-store.
For instance:
73 percent of consumers say a discount for
picking up the online purchase at the closest
retail store would make them more likely to
complete the online purchase.
68 percent would visit the store to pick up
their online purchase for a discount of 15
percent or less.
Respondents reveal a strong desire to avoid
shipping costs. Nearly seven out of 10 (69 percent) say that simply avoiding shipping fees
alone would entice them inside a retailers
doors to pick up their online purchase.
Receiving additional loyalty program points
was also a driving factor, influencing more
than 40 percent of respondents to go in-store.
If used smartly, in-store pickup may just be
the edge retailers need to combat serial cart
abandoners, says Graham McVie, VP of business development for Toronto-based Precima, a
retail analytics solution owned by LoyaltyOne,
as well as providing an additional touchpoint
in the consumer experience by getting the
online shopper in the store.
Te accuracy and availability of this product

information is the frst step in giving shoppers the
confdence they need to buy groceries online, and a
pivotal frst step as grocers e-commerce strategies
evolve, notes Sue Sentell, president and CEO of
Lisle, Ill.-based Gladson. To get started on meeting shoppers online expectations, grocers need to
begin with a foundation of digital product content
to power their online strategies and e-commerce
engines. Tis includes a consolidated resource of
product images and comprehensive product details,
ranging from ingredients and marketing claims to
nutrition facts and package size, to give buyers a
true digital representation of each product.
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Technology
CoMinG ThreAT
AmazonFresh
presents a
challenge to
brick-and-mortar
grocers.
With same-day
delivery, the
question is
how to deliver
to many
people within
the narrow
windows they
are going to
require, and
still be on time
and efficient.
Victor Allis,
Quintiq
132
Same-day Challenges
According to a recent LoyaltyOne survey, 21 percent
of consumers say an additional fee is worth the convenience of same-day delivery for their online purchases.
Also, 27 percent say an additional fee is worth the
convenience of having the grocery products they need
ready for pickup upon their arrival at the store.
Same-day delivery is obviously an attractive
option. But its challenging, explains Victor Allis,
CEO and co-founder of Quintiq, a Netherlandsbased software company servicing the logistics
needs of such customers as Walmart and DHL. To
illustrate the difculty, he urges retailers not to become like a pizza delivery service, in which a courier
goes out, delivers to the house and comes back.
Tats very inefcient, because you can only make
one delivery by only one person, says Allis. With
same-day delivery, the question is how to deliver to
many people within the narrow windows they are
going to require, and still be on time and efcient.
On the other hand, the click-and-collect option
shoppers order groceries online and then pick
them up at the store solves logistical issues and
the delivery expense. Tere are other advantages to
this service that many experts say is the way to go.
WD Partners Peterson points out that getting
the shopper to enter the store prompts them to purchase fresh food, especially produce. Grocers need
to protect this business from niche online players
such as Relay Foods, Door-to-Door Organics and
others that are delivering produce to homes.
Te real beneft of in-store pickup is the opportunity for additional unplanned, high-margin
impulse purchases [in the store], says Professor
Emeritus Richard George, of the Haub School of
Business at St. Josephs University (SJU) in Phila-
delphia. Consumers use the amount of items in

their shopping cart as a heuristic of their spending.
Since the online items will be deposited directly
into their car, they can visit the store with an empty
basket. In addition, research has indicated that persons shopping both online and in-store spend more
than those shopping online only and in-store only.
By contrast, he adds, the number of Europeans
ordering groceries online has grown 60 percent in
the past fve years. Britain leads the way, with 22
percent of its population ordering groceries from
a desktop. In these markets, the preferred delivery
model is click-and-collect.
Millennial Movement
Te industry consensus is that online grocery
shopping will continue to grow because younger
consumers will accept this option more. Also, the
group starting families that will account for big
grocery bills will be Millennials, a demographic 80
million strong that checks smartphones on average
43 times per day, says Gladsons Sentell.
My recent national research on Millennials
those 18-34 years old underscores the sense of
urgency for traditional brick-and-mortar retailers to
enter the online space, says SJUs George, noting that:
Only 56 percent of Millennials have shopped for
groceries in the past 30 days in a regular or fullservice supermarket.
24 percent of Millennials have shopped for
online groceries in the past 30 days.
Millennials shop 4.5 times per month
online, versus 3.9 times per month at a regular
or full-service supermarket.
Millennials may eventually behave like their

parents and older consumers, says George.
However, at this stage of their life cycle, their
attitudes, lifestyles and behaviors are sufciently
unique to suggest the development of specifc
marketing strategies and tactics by food marketers that will capture a greater share of total food
needs. Traditional food retailers need to develop a
strategy that makes online shopping a capstone of
their organizations eforts and investment, rather
than simply an add-on form of distribution.
Precimas McVie acknowledges the importance of Millennials as the primary online grocery
shoppers of the future, but he points out that its
important to build a strategy to serve current customers while also looking forward.
At the same time, he advises grocers to tie
their online eforts to a loyalty program to reap
several benefts:
Tracking demographics
Seeing the products most popular by
demographic and psychographic
Tailoring ofers and specials
Hypertargeting marketing across age segments
Tis strategy builds

loyalty with current
customers and helps to
build loyalty with upand-coming
customer
segments,
stresses McVie.
As Millennials
become even more of the
overall revenue stream, youve cultivated them
into the fold and have shown them you can deliver
exceptionally customized experiences.
Whether they settle on an online grocery service
with or without a loyalty component, using a thirdparty partner, developing a home-grown service, or
click-and-pickup or click-and-deliver-home, WD
Partners Peterson urges grocers to get started now.
You have to try it, he afrms. You need to learn
as much as you can. Walmart and Amazon are so far
ahead of the curve in what they will be able to deliver.
Tey have the logistics to basically go nationwide
right now to at least deliver center store groceries. If
you dont understand the model, thats a problem. You
have to start testing. Ten you get the kinks out. PG
Retailers that understand and satisfy the needs of

shoppers better than the competition will be on a path to
sustainable competitive advantage and profitable growth.
Guest
Perspectives
By Graeme McVie
The Perception Gap

Heres how grocers can use data more effectively.
ustomer-centric strategies produce

results. When grocers make the investment to understand who their shoppers
are and use that knowledge to make
the shopping experience truly focused
on customer needs, they earn their loyalty and encourage them to consolidate their spend, resulting in
increased frequency of shopper visits and basket size.
When retailers use a customer-centric strategy,
they could see a net incremental sales increase of 1
percent to 4 percent, and an average increase of 4
percent to 7 percent in gross profts. For a $2 billion
retailer, this could potentially equate to an additional
$80 million in sales per year and an additional $30
million in gross profts per year.
Retailers and manufacturers understand that
building pricing, promotion, assortment and
marketing decisions around customer needs is an
essential approach to success. In fact, retailers and
manufacturers cite a customer-centric strategy as
the most important factor for success, according to
a 2014 survey of U.S. food and drug retailers and
CPG manufacturers conducted by LoyaltyOne.
Whats troubling is a perception gap between
how good a job retailers think theyre doing and
how customers really see their relationships with retailers. Top retailers may believe theyre embracing
shopper insights, but somethings not resonating.
Shoppers Arent Buying It

More than nine in 10 top U.S. retailers say they
consistently leverage customer insights to develop
strategies and plans across the organization. Tey
say they regularly track customer metrics; use customer insights for digital, social and mobile plans;
heavily invest in stafng and technical resources;
and educate store personnel on using customer
insights in their daily jobs. Tese retailers also say
they consistently draw from customer insights to
improve the in-store experience, to deliver personalized marketing communications and to collaborate
with manufacturers.
However, we also surveyed U.S. shoppers
who say they arent feeling personalization or
relevance in their shopping experiences overall.
Instead, theyre reporting lukewarm attention: 64
134
percent say the ofers (e.g., coupons) they get are

the same as everyone elses; 50 percent say companies dont consistently send personalized and
relevant marketing communications; 40 percent
say companies dont know how they prefer to
receive promotional ofers (e.g., coupons by mail);
and 35 percent say they dont receive promotional
ofers for products that they want. While retailers
say theyre delivering, shoppers arent buying it.
Interestingly, customers say they want the
experience to be more personalized. Ninetytwo percent say theyd like the retailer they
most recently shopped at to send them relevant
coupons. Ninety-four percent say theyd like a
loyalty card or app with the ability to earn and
redeem points or miles, and would like to receive special offers and discounts based on their
loyalty. Eighty percent say theyd like companies to use their data to decide which products
and services to offer or eliminate.
Te problem is that even as shoppers are essentially asking retailers to use their data, most
retailers arent acting on the material they have.
Teyre still struggling to share, analyze and
respond to customer data across the organization.
Only half (55 percent) report that theyre using
customer data in customer service, and fewer than
one in three use customer data in operations (28
percent), assortment management (28 percent) or
purchasing (32 percent).
Winning With Shoppers

Grocers can overcome these
challenges. Here are six
areas where companies
should focus on using data
better to close this perception gap:
Strategy: Shopper data
insights should be used

to assess current spend
and model
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Guest
Perspectives
potential spend for each individual shopper at the

category level. Tis allows the grocer to identify
the greatest growth opportunities by category,
customer and store, which enables them to allocate
stafng and fnancial resources against the shoppers, categories and stores in a way that will allow
them to most efectively pursue the best opportunities to proftably grow the business.
will align grocer and manufacturer trade investments

in the most productive areas, with grocers deploying
promotions that target specifc shopper segments and
needs. Selecting the right items to promote, determining the right discounts to ofer, and allocating ad
and display support to the right items to maximize
productivity of the space also leads to dramatic improvements in performance.
Pricing: Pricing insights can be developed at the

lowest levels of the store, product and even shopper
hierarchies. Grocers can then aggressively price the
items that are most important to their most valuable
shoppers, aligning price plans with the needs of
these shoppers. If they do this correctly, grocers
can expect to see sales and gross proft increases
while enhancing price perception and improving
market share.
Assortment: Maximizing the productivity of fnite

shelf space is key to retailer performance. Shopper
insights should be used to identify which low-productivity items can be safely removed from the assortment
to be replaced with higher-productivity items. Understanding item importance to most valuable shoppers
and the extent of demand transfer by individual item
ensures that only low-risk items are candidates for removal. Tis approach improves the sales performance
of the low-productivity items and gross profts.
Promotions: Shopper insights should be
used by grocers and CPG manufacturers to

identify which promotions are performing
well, which arent performing well but
can be improved and which should
be terminated. Tis collaboration
Marketing: Incremental sales from shopper marketing campaigns are usually less than 1 percent, but
with a personalized approach based on shopper data,
this improves to nearly 4 percent in incremental sales.
Retail and CPG marketers can tailor customer marketing communications along multiple dimensions to
consistently improve efectiveness in future campaigns.
With these insights, grocers can gradually shift the
marketing budget from mass, untargeted activities
to personalized cross-channel marketing that drives
enhanced response rates, meaningful incremental sales
and highly positive marketing ROI.
Manufacturer Collaboration: Manufacturer trading
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partners allocate a signifcant percentage of their revenues to the marketing mix. Manufacturers, retailers
and shoppers would all beneft signifcantly if these
marketing dollars could be deployed in the most effective way to deliver enhanced customer-driven media ads, consumer promotions and trade promotions.
Retailers that share customer insights with manufacturer trading partners maximize their chances of
aligning manufacturer marketing investments with
the needs of the specifc customers in their stores.
Retailers that understand and satisfy shoppers needs better than the competition does will
be on a path to sustainable competitive advantage
and proftable growth. Grocers would do well to
honestly evaluate where they are on the journey to
becoming more customer-centric and put a plan in
place to steal a march on their competitors to win
with shoppers. PG
Graeme McVie is VP of business development for
Toronto-based Precima, a leading retail analytics solution owned by LoyaltyOne. He leads customer analytics
and loyalty services sales efforts across North America.
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Technology
Logistics
The
Digital Link
Beyond serving consumers needs, up-and-coming technology can help

streamline the supply chain for a new era of retailing.
By Jenny McTaggart
ost of the talk about

digital technology at retail
these days is centered on
consumers. Who will buy
the new Apple Watch, and
how might shoppers use it?
Are online ordering and home delivery requirements
for 21st-century food retailing? How should supermarkets market to mobile users at the point of sale?
While retailers should certainly take a closer
look at these and other consumer trends, they
would also be wise to investigate how digital innovation can not only serve their wired customers,
but also help to streamline the new supply chain of
the digital era, retail analysts tell
Progressive Grocer.
Shoppers have
Shoppers have become digibecome digitally
tally connected with the supply
chain for the frst time, and the
connected with the
efects are already profound,
supply chain for the
notes James Naylor, senior knowlfirst time, and the
edge expert in McKinsey & Co.s
effects are already
European retail practice. It ofers
profound.
the potential for new operating
James Naylor,
models for marketing and distriMcKinsey & Co.
bution, as well as an explosion in
analytic possibility.
In a paper published last year
by New York-based McKinsey,
the authors surmised, To stay
competitive, companies must
stop experimenting with
digital and commit to transd
fforming themselves into full
digital businesses.
d
For food retailers, supply
cchain management is at the
heart of that business.
h
In its report, McKinsey
outlined seven traits that successful digital enterprises share,
138
and one trait speaks directly to the grocery industrys squeezed proft margins: Follow the money.
Te authors note that while many organizations are
focusing their digital investments on customer-facing
solutions, they can extract as much value, if not more,
from investing in back-ofce functions that drive
operational efciencies.
Indeed, the retail world appears to be on the
brink of a digital evolution in terms of operations,
and supply chain efciency is one of the critical
areas that will be afected. Of course, grocers will
and should be cautious about jumping on any killer
app that has yet to prove itself. But that shouldnt
stop them from putting on a set of digital lenses, so
to speak, as they plan their future strategies.
Several experts who spoke with PG had slightly
diferent takes on how exactly digital technology
will impact the future of the business, but all agreed
that while the need for transformation is evident,
there will likely be no sole magic bullet that the
industry can rally around at least for now.
Instead, they see a focus on multiple tools that can
advance supply chain efciencies for suppliers, distributors and retailers such as data visibility, consumer
analytics and 3D visualization, among others.
Beyond the UPC Code

In the past half-century of retailing, the evolution
of the UPC code was perhaps the most innovative
widespread technology to impact the grocery industrys supply chain, notes Peter Wietfeldt, a partner
in London-based PricewaterhouseCoopers retail
advisory practice.
UPC is probably the best example of the
industry rallying around a technology, he observes.
Everyone agreed to use it. But there really has to be
a vertical alignment across the supply chain to have
a new technology become universal.
While he isnt seeing any mass adoption of supply
chain technology right now, Wietfeldt is excited about
what may be coming down the pipeline. If we close
our eyes and picture what will be going on 20 years

from now, you certainly have to think that there will
be some type of digital technology at play, he says.
RFID technology defnitely showed a lot of
promise, especially back in 2003, when Bentonville,
Ark.-based Walmart committed to having all of its
suppliers apply RFID tags to pallets and cases of
goods sent to its distribution centers. But because
of the high cost of implementation, the technology
was perhaps a bit ahead of its time at least in the
grocery industry. Still, some observers say that the
technology is becoming more cost-efective and
could be more widely adopted in the near future,
especially considering its potential for tracking items
to better address food safety and security concerns.
High-value nonfood retailers have already found
RFID to meet their return on investment, notes
Wietfeldt, but thats because the products cost a lot
and require a higher level of security in stores.
Some people think that visual technology
visual readers is the next wave, since its easier
to print information, but the industry is still a long
way from having that as a standard, he says.
Impact of Industry Consolidation

Some supermarket chains have more recently
focused on gaining efciencies through supply
chain consolidation, either through M&A activity
or through outsourcing the supply chain, according
to Jean-Michel Fally, principal of New York-based
Deloitte Consulting. Tis helps remaining supply
chains gain volume and velocity, and better leverage
existing digital technologies, he says.
Some supermarket operators are cautiously
beginning to leverage digital technology to address
dot-com orders, pickup points and home deliveries,
observes Fally. Meanwhile, some of the larger chains
are focused on improving cross-functional execution
with merchandising and store/dot-com operations.
Fally also points to 3D visualization and analytical tools, which can help merchants communicate
their plans to operations and supply teams, and make
problem solving faster and more cost-efective.
Retailers are looking at better collaborating with
their suppliers and other partners to optimize the
end-to-end supply chain from factory to store shelf,
says Fally. Shared digital analytic platforms can help
retailers and suppliers get the metric and data visibility
to solve supply chain problems more efciently. Tese
technologies will allow a new level of transparency into
measurement, fow and execution fnally, the supply
chain visibility long awaited by professionals.
Augmented reality, a technology that provides a
live direct or indirect view of a physical, real-world
environment whose elements are supplemented by
computer-generated sensory input such as sound, video, graphics or DPS data, is a futuristic tool with ex-
citing possibilities, according to Fally.

Te solution will ... help merchants
see execution issues visually through
operators glasses and problem-solve
together, or help warehouse associates share quality control issues with
suppliers and retailers.
3D printing, meanwhile, could
have a profound impact on supply
chains, he notes. For example, for
general merchandise manufacturers, hard-to-source parts could be
printed on demand in metal,
ceramic or composite materials in the warehouse, using
blueprints at the touch of a
button, fnally allowing justin-time inventories.
Shared digital
analytic platforms
can help retailers
and suppliers get
the metric and
data visibility to
solve supply chain
problems more
efficiently.
Jean-Michel Fally,
Deloitte Consulting
Need for Speed

As McKinseys Naylor sees it,
most savvy food retailers are on
board with new technology that
can improve the supply chain, or any
area of the business for that matter. (In PGs
G
2015 Annual Report of the Grocery Industry, technology spending jumped to No. 4 on the Operational Factors index, indicating that more retailers
expect to boost their tech investment this year.)
Grocery retailers have had mission-critical IT
systems for decades to run their distribution and payment systems, notes Naylor. Te tougher question
is how rapidly they can bring digital capabilities to
bear upon the rest of their business customerfacing omni-channel, analytics-driven merchandising and loyalty, and new performance management
systems.
Consumers ongoing adaption of mobile applications ups the game, he adds. Te move to mobile is
pretty much inexorable. What makes this even more
challenging for retailers is that shoppers are not going to see mobile presence as a point of distinction.
Teyve gone straight to regarding omnichannel
fuency as a hygiene factor, he points out.
Tis is starting to put enormous pressure on
retailers, continues Naylor, not so much to develop
mobile sites and apps, but to overhaul their entire
ERP systems so they can show live data across
multiple online points of access, use common product
information databases to support them, and ofer
online ordering and fulfllment to all their customers.
Equally, it means the capacity for online growth is
extraordinarily quick. PG
For more information on supply chain technology, visit
Progressivegrocer.com/digitalsupplychain.
139
Advertor i Al
Q &A
Talking with
Sue Sentell
CEO and President, Gladson
Gladson provides consumer packaged goods product images and information along with high-impact
category management and Store Optimization Services to help its customers increase sales and
operational effciency. The Lisle, Ill.-based Gladson empowers retailers to plan and execute more
effectively so they can meet shopper expectations across the path to purchase, from in-store to online.
With people continuing to shop

for groceries at brick-and-mortar stores, why should
grocers be thinking about and acting on their digital
content now?
Sue Sentell: Although research shows that consumers
even those with the latest digital devices that they
use all day still like to shop at the grocery store and
will in the near future, developing a comprehensive
digital content strategy now is important for several
reasons, not the least of which is sales. Digital content
via virtual shelves can positively impact in-store traffc,
conversion, order size and loyalty when executed professionally,
accurately and consistently across multiple platforms. On the
fip side, retailers that ignore digital content risk missing sales
and growth opportunities not only today, but in the future. BI
Intelligence estimates that between 2013 and 2018, online
grocery sales will grow at a compound annual growth rate of
21.1 percent, reaching nearly $18 billion by the end of 2018.
PG: How do photos and product information come together
in digital content to enhance sales, and how is digital
content different from a traditional weekly circular?
SS: Quite simply, grocers wont get traction on their digital
efforts if they dont have appealing photos and product
information available on websites and mobile apps. Digital
content including photos and informative copy
infuences shoppers product research, shopping list creation
and, ultimately, in-store purchases. Reaching consumers
today is about being present where they are. That should
include both digital touch points and more traditional
methods, such as weekly circulars.
PG: What are some key things to keep in mind when

deciding on product images and information for
digital platforms?
SS: Remember that todays shoppers have high
expectations, especially when it comes to the availability
of and access to products that they research online.
Grocers need a strong foundation of digital product
content to ensure that consumers can fnd the
information they need quickly. That foundation should
include web-ready images; nutritional information, including
ingredients, allergens, calories/fat per serving; and other relevant
product or consumption information. Engaging copy that describes
a products attributes and benefts is pivotal. To build this content
foundation, retailers must obtain comprehensive, accurate and
up-to-date product images and information from product content
providers and/or their CPG suppliers, and ensure that content is
delivered in formats compatible with the retailers systems.
PG: What are some benefts to working with a digital
content provider?
SS: A content partner helps retailers create, maintain and
distribute digital product images and information. This allows
retailers internal teams to perform their jobs more effciently,
by having the right content in the right formats specifc to the
contents end use. At the same time, by ensuring the content
is available for the retailer to make accessible to the shopper, a
product content provider can help retailers build shoppers trust
and loyalty and support a retailers goal of increased sales and
operational effciency.
For more information, visit www.gladson.com.
Shoppers search
for products
in-store.
The same is
true online.
Empower shoppers and drive sales with accurate,
consistent and compelling product information
for websites, mobile apps, in-store and more.
www.gladson.com
Equipment
Shopping Carts
Pushing Into
Tomorrow
The shopping cart of the future has attracted a wide array of concepts.
By Bob Ingram
he humble, ubiquitous shopping cart is

something most shoppers and many
retailers take for granted, yet while
these wheeled enablers scoot through
supermarket aisles, there are creative
forces at work on the next generation,
the so-called shopping cart of the future.
In addition to already established shopping cart manufacturers, sources as disparate as an eighth-grade student and the
U.S. Department of Agriculture are diligently conceptualizing their own versions of these supermarket mainstays.
Last July, the USDA released an 80-page report aimed at
the 42 million Americans receiving SNAP benefts (formerly food stamps) in an efort to nudge them into healthier
eating. Among the reports suggestions were talking shopping carts, called MyCarts, which would be color-coded,
physically divided by diferent food groups, and outftted
with a system that detects when the cart reaches its healthy
threshold, congratulates the customer and notifes them
142
that they qualify for rewards like movie tickets or discounts.

Te USDA estimates that the cost would be $30,000
per store for MyCarts. If that holds true, a retailer like
Cincinnati-based Kroger, with 2,625 locations at most
recent count, would need to spend nearly $79 million to
outft its stores with MyCarts.
Shopping or Stalking?
Te most futuristic, Jetsons-like shopping cart of the
future is the Z-Cart, designed by Mete Mordag at his
Mordag Design studio, in Istanbul, Turkey.
Te Z-Cart can carry both the shopper and groceries.
It has storage space and a rechargeable scooter that can be
optionally integrated into the main body. Te scooter features stopping lights, brakes, a small digital display to show
battery level, and an accelerator ftted into the handlebars.
Te user is carried in a standing position, and the carts main
body can hold removable baskets and bags in diferent sizes,
and can be expanded as needed.
Equipment
Shopping Carts
Image courtesy of SK Telecom
CartlEss Cart
sK telecoms
smart shopper
platform
uses a virtual
shopping cart.
thinking of
the future of
shopping carts,
when it comes
to technology,
its really
more about
the grocery
store of the
future, which
is completely
connected
24/7 to the
customer.
Bill Gillespie,
IBM Global
Business services
144
At the Technion-Israel Institute of Technologys

Control Robotics and Machine Learning Laboratory, cousins Ohad Rusnak and Omri Elmalech have
come up with what theyve termed an autonomous
shopping cart, which others have deemed creepy
because its 3D camera and controls actually let the
cart follow the shopper around the store.
In St. Petersburg, Russia, CartPay Co. has
developed a cart that allows customers to pay for
the goods as they go into the basket. Te buyer
scans the barcodes and puts the products in the cart.
Payment can be made at either the cashier or at selfcheckout without shifting and rescanning.
According to CartPay CEO Evgeny Evnukov,
the mobile application, now being tested, allows
users to maintain shopping lists and check on
expiration dates and the calories in products, and
it doesnt require additional labeling.
In the U.S., Rogers, Ark.-based Mart Cart
has gone electric with its entry in the cart derby.
Repeated requests from our customers for a larger,
more robust electric shopping cart led us to design
the Ultima to better serve their need for a more
comfortable and stable electric cart, explains Gavan
Dufy, Mart Carts SVP of sales and marketing, of
the wider 24-inch seat and high capacity cart.
Dufy expects that the electric shopping cart of the
future will be able to communicate more efectively
with its passenger and the store about its condition
and state of readiness, while also conveying useful information for an enhanced shopping experience. We
will continue to evaluate new and existing technologies to assess their viability in the Mart Cart, he says.
Beyond the Cart

South Korean tech giant SK Telecom has gone its
competitors one better by producing an advanced

shopping system called Smart Shopper, a
platform that allows customers to shop without a
shopping cart, according to Public Relations Manager Cindy Hyungsung Kang.
Te Smart Shopper platform is one of SK Telecoms most recent innovations, introduced earlier
this year at Mobile World Congress 2015, she says.
We plan to commercialize the platform later this
year, starting with large retail chains in Korea.
According to Kang, a customer picks up a designated portable scanning device to read barcodes on items,
adding them to a virtual shopping cart. Ten, at the
order viewer terminal (a touchscreen device installed in
several spots within the store), the customer can check
and edit items in the shopping carts by placing the
scanning device on a dongle (a piece of hardware that
attaches to a computer and allows a piece of secured
software to run). Finally, the customer walks up to
the self-checkout counter and touches the device to
confrm the selected items, get the total amount owed
and make a payment. Te purchased products are then
home-delivered at a convenient time.
Te platform employs near-feld communication
(NFC) technology to access customer purchasing
data such as product information and special ofers
on devices located within the store and through
customers smartphone applications, according to
Kang. In addition, a variety of in-store promotions
are made possible through BLE (Bluetooth lowenergy) technology and beacons.
For the retailer, notes Kang, Smart Shopper will
not only enable them to reduce the size of their stores,
but also relieve them from holding large stocks in
stores, which equates to improved efciency and bottom lines. In the future, for low-involvement consum-
The Youngest Innovator
able products, we expect virtual stores only showcasing

sample products to replace physical retail stores.
Back in 2004, IBM introduced what it called a
personal shopping assistant, the Shopping Buddy,
which has a web-style screen with a variety of display
options such as sales items or a list of products bought
most frequently. A location-tracking system monitored
through ceiling-monitored beacons enables the retailer
to pinpoint shoppers locations and deliver relevant
real-time information as they move through the store.
While the Shopping Buddy doesnt exist as it did
when we originally announced it, says Bill Gillespie,
grocery lead for IBM Global Business Services, in
Armonk, NY, it has evolved into solutions with
a focus on helping our clients create personalized,
individual shopping experiences for customers using
cloud, analytics, mobile and social technologies.
Continues Gillespie, Tinking of the future of
shopping carts, when it comes to technology, its
really more about the grocery store of the future,
which is completely connected 24/7 to the customer
via technology that simplifes and personalizes the
shopping trip for each individual customer.
He asserts that, for a physical store, its not
necessarily about the store itself, but how a retailer
Melissa Feingold, an eighth-grader at the

Academy of the Lakes, in Land OLakes, Fla.,
took top honors at the University of South
Florida Young Innovator Competition in
February 2014 for her invention, Shopping
Cart with Tech Functions.
The idea came to me as I was shopping
with my family at Thanksgiving, she recalls.
The checkout lines were so long, and everybody was holding
long paper lists of what they needed for their holiday dinner.
My Fast Lane Shopping Cart has a software application
that you can log into to manage all your shopping, she continues. The application also records what items you place in
the cart and totals your bill so you can check out right on the
application. You can upload lists and recipes, and the application can tell you if youre missing anything. It can also review
the items in your cart and make recipe suggestions, and even
notify you of any items that cause allergies.
Now a high school freshman, Melissa also loves singing and
sports, and has a second-degree black belt to go with her
first-degree conveyor belt in shopping carts.
brings together the entire shopping experience for a

consumer through mobile technologies, with a main
focus on creating personalization.
Tat seems to be the thrust of most shopping
carts of the future, but only time will tell. PG
Protein
Protein is
is why
why
people
people need
need it.
it.
Flavor
Flavor is
is why
why
they
they love
love it.
it.
trimino. The best-tasting protein water on the market.
Boosts metabolism
Curbs appetite
Increases energy
From soccer moms to serious athletes, everyone is

reaching for trimino because unlike most functional
beverages, its smooth, with rich fruit flavors that are
downright delicious. And with the perfect amount of
whey protein and B-vitamins for muscle recovery
and energy, trimino enables everyone to look, feel,
and perform their best.
drinktrimino.com
145
Food, Beverage & Nonfood Products
Protein Power
With 36 percent of consumers using meat

alternatives, were excited to offer more delicious,
healthy plant-based options packed with flavor and
protein, Brad Lahrman, director of marketing at
Lightlife, says of the companys latest offerings.
Lightlifes new Smart Patties in Original with Quinoa and Black Bean varieties, along
with Harvest Apple Smart Sausage,
are designed for anyone reducing
or eliminating meat from their diets.
Kosher-certified, cholesterol-free
and grill-ready, Smart Patties
and Smart Sausage each
come in 4-packs for an SRP
of $4.99. www.Lightlife.com
Reaping the Harvest
Following its successful launch in

spring 2013, Harvest Snaps has unveiled a new Black Bean variety to
provide consumers with additional
better-for-you snack options. Emphasizing wholesome ingredients,
great taste and simplicity, Black
Bean Harvest Snaps, available in
Habanero and Mango Chile Lime
flavors, are made from whole
natural black beans and designed
to deliver a satisfying crunch full of
protein and fiber. Suggested retail
price varies by market.
Innovation with an Exclamation
Stonyfield has launched its latest yogurt innovation, Oh My Yog!, made with
organic whole milk and fruit. Delivered in a three-layer format fruit on
the bottom, honey-infused yogurt in the middle and a layer of cream on top
the offering comes in Madagascar Vanilla Bean, Wild Quebec Blueberry,
Pacific Coast Strawberry, Gingered Pear, Apple Cinnamon and Orange Cranberry flavors. Oh My Yog! 6-ounce containers appear in grocers refrigerated
sections in bold, colorfully striped packaging that reflects the products
unique format. SRP is $1.59. www.stonyfield.com
www.harvestsnaps.com
seasonal spotlight
A Spirited Collection for Moms
Moonstruck Chocolate Co. is helping consumers celebrate the exceptional

women in their lives with the launch of its 2015 Mothers Day collections.
This years offerings, which infuse wine and spirits into signature ivory, dark and milk chocolate, include the Oregon Pinot
Noir Collection, Cocktail Collection, Honey Bee Truffles, Nesting
Doll Eclipse Truffles, Hiwa-Kai Hawaiian Black Sea Salt Caramels,
and Wrapped Collections. Moonstrucks Mothers Day line has
an SRP range of $6-$35. www.moonstruckchocolate.com
146
Compostable Coffee
The launch of OneCoffees 99 percent compostable coffee

pods pairs consumersdesire for more single-serve beverage
options with a greater focus on environmental sustainability. Made with 100 percent
certified-organic and Fair Trade Arabica
coffee beans, the pods come in Breakfast
Blend, Colombian Blend, French
Roast, Sumatran Blend and Decaf
varieties. OneCoffees new offerings are compatible with
K-Cup coffee makers and retail
for $9.99-$10.99 for a box of 12
cups. www.canterburycoffee.com
Almost Like Homemade
Clif Bar & Co. is beefing up the sports nutrition category with its
new Clif Organic Energy Food, a line of pouches made from real
food ingredients in sweet or savory flavors. Designed to capture
the look and taste of homemade foods, each recipe contains
USDA-certified and gluten-free ingredients, without added
artificial flavors or synthetic preservatives. Clif Organic Energy
Food is available in 90-gram pouches (sweet, SRP $2.29) and
120-gram pouches (savory, SRP $2.99) in Banana Beet with Ginger, Banana Mango with Coconut, Pizza Margherita, and Sweet
Potato with Sea Salt varieties. www.clifbar.com
Skin Soothing
From the makers of Aquaphor Healing Ointment comes a new diaper rash
cream formulated with zinc oxide to prevent, soothe and treat diaper rash
flare-ups. Clinically proved to relieve irritation within six hours, the preservative- and fragrance-free cream is easy to apply and remove. Aquaphor Diaper
Rash Cream retails for $6.99 for a 3.5-ounce tube. www.discoveraquaphor.com
Shelf Score February 2015

New Product
1
2
3
4
5
6
7
8
9
10
Butterfinger Peanut Butter Cups Minis

Wheat Thins Toasted Pita
Prego Italian Sauce: Merlot Marinara
Quaker Quinoa Granola Bars: Yogurt Fruit & Nut
Kraft Macaroni & Cheese Dinner: Garlic & Herb Alfredo
Vans Gluten Free Pasta: Ultimate Cheddar Penne
BelVita Bites: Chocolate
Atkins Beef Fiesta Taco Bowl
Harmless Harvest 100% Raw Coconut Water: Dark Cacao
Mountain Dew Kickstart
source: Instantly Shelf Score
148
Purchase
INteNt score
77%
72
67
65
64
63
55
50
47
45
Sealed Air Honored for Flexible Packaging Innovations
Green Giant Fresh

Completes Network
of Herb Facilities
Salinas, Calif.-based Green
Giant Fresh has completed
its national network of fresh
herb-packing facilities,
extending the suppliers ability to deliver premium herbs
around the country from certifed local and regional farms.
Tese strategic locations
mean better efciencies and
shorter lead times, adding
to the products shelf life,
retailer profts and consumer
satisfaction, says CEO
Jamie Strachan. Our local
and regional certifed farms
supply local herbs when
possible, and draw from
common regional farms to
deliver year-round supplies.
In addition to its original
herb farm near Chicago,
Green Giant Fresh packs
and ships its line of 15
farm-fresh herbs from Saco,
Maine; Miami; Dallas; Los
Angeles; and Salinas, Calif.
greengiantfresh.com
Elmwood Park, N.J.-based Sealed Airs Food Care Division received Flexible Packaging Achievement Awards for two packaging innovations on March 3 at the Flexible
Packaging Associations 59th annual Achievement Awards and Innovation Showcase,
during FPAs annual meeting, in Naples, Fla.
In the retail category, Cryovac Darfresh on Tray received the Highest Achievement award. In the Technical Innovation and Sustainability categories, Cryovac Freshness Plus won Gold awards. Te Cryovac
technology behind both Darfresh on Tray and Freshness Plus is
an excellent example of packaging designed with the latest consumer-driven food
trends in mind, says Sean Brady, Sealed Air Food Cares director of marketing.
Combining a pre-made tray system with vacuum skin, Darfresh on Tray extends
product shelf-life, reducing food waste. Tis packaging solution eliminates flm
scrap to ofer a more environmentally friendly alternative, using 40 percent less
material than other available tray skin oferings. Te Freshness Plus odor-eliminating materials help extend shelf life and reduce shrink by protecting foods aroma
profles. Te unique active packaging technologies pull odors away from the food
to maximize product favor, color and quality, while eliminating and reducing the
need for additives or preservatives. www.sealedair.com/foodcare
Cooking Oil Management Goes Mobile with RTI

Foodservice operations in supermarkets, hotels, casinos, airports, hospitals,
educational institutions and malls can take advantage of a new mini portable oil
solution from Minneapolis-based Restaurant Technologies Inc. (RTI). Te mobile oil-management system conveniently fts the needs of commercial kitchens
that are hauling fryer oil long distances from one kitchen to the next, or from the
kitchen to a loading dock, to dispose of used cooking oil.
Te RTI Mini-Portable Oil Solution holds up to 300 pounds of fresh and
300 pounds of used cooking oil. At 52 inches long, 25 inches wide and 53
inches high, the compact container can move easily across kitchen foors and
ft comfortably in small spaces. Te closed-loop system takes care of oil storage, distribution to the fryers, handling and disposal.
Te complete system comes with all of the hardware, software, installation,
training and support services needed to easily automate oil management, at
no upfront cost. It allows for automatic fltration of fryer oil, improving food
quality while reducing oil waste. Te system eliminates oil spills in kitchens
or the need to manually lift and haul oil from one area to the next reducing
strains, slips, falls, burns and associated workers compensation claims. From
an aesthetic standpoint, kitchens look cleaner and more professional without
open, unsightly containers of used cooking oil. www.rti-inc.com
Clear Springs Eyes Sales Force Realignment, Expansion

Buhl, Idaho-based Clear Springs Foods will create a separate retail sales
division to accommodate increased rainbow trout production. Te companys
domestic production has risen by 30 percent within the past three years, due
to farm acquisition and production efciencies, further augmented by Chilean
rainbow trout sourcing, with which Clear Springs has enjoyed a 14-year
strategic partnership. Te realignment will enable Clear Springs to service
foodservice and retail customers separately. clearsprings.com
150
Columbus Foods Appoints Two New Executives

Hayward, Calif.-based premium deli
meat purveyor Columbus Foods has
made two leadership appointments
aimed at strengthening the companys
brand-building capabilities as it approaches its 100th anniversary.
Joe Ennen, formerly SVP in charge
of Safeways exclusive brand portfolio,
was named president of leading sales,
Ennen
Fox
marketing and human resources.
Hell assume the companys leadership position when current CEO Timothy Fallon retires at the end of 2015. Ennen brings more than 20 years of food and CPG
industry experience to his new role; he was group VP at PepsiCos Frito-Lay division, managed the Healthy Choice business as VP and GM for ConAgra Foods,
and spent nearly a decade with the Kellogg Co. in the states and abroad.
Michael Fox takes on the newly created position of SVP of marketing and innovation. Fox spent close to a decade at PepsiCo, working on the Stacys, Doritos
and Cheetos snack brands; and was a VP at Safeway, where he advanced the O
Organics, Open Nature and Eating Right brands. www.columbussalame.com
CandyRific Promotes Clark Taylor to VP of Sales

Louisville, Ky.-based CandyRifc has promoted Clark
Taylor to VP of sales. Taylor, who has been with CandyRifc for the past three years, has been instrumental
in bringing a new perspective to sales operations and
in the implementation of a new long-range planning
direction for the company.
Clarks new role will help CandyRifc accelerate
our focus on customer-centric products, and a more
tailored approach to the licensed sales of our existing
and future new partners, says Rob Auerbach, the companys
president. Prior to his promotion, Taylor worked with CandyRifcs western
region and several of its national accounts in a sales and marketing role. He
has worked for more than 30 years on such brands as Pez, Del Monte Foods,
Shikai Natural Products and Dow Consumer Brands. www.candyrific.com
Black Gold Farms Expands Potato Production,

Packing Capabilities
Grand Forks, N.D.-based Black Gold
Farms recently acquired the legacy
potato production operation George
Wood Farms, located near Camden,
N.C. Production will consist primarily
of chip stock potatoes, and will also include fresh red, yellow and white potatoes.
Te on-site packing facility has the capability to pack poly and paper as well as
tote and bulk capacity.
Tese changes will allow stronger service to our customers by reducing risk through
greater geographic diversity, says Matt Wood, partner at George Wood Farms. Te
result is a more sustainable organization for all of our team members and customers.
Longtime George Wood Partner and Manager Jimmy Harrell will remain the
leader of this operation, assisted by Black Gold Group Manager Chris Hopkins.
www.blackgoldfarms.com
152
Earth Renewable
Technologies
Debuts EarthBottle
Brevard, N.C.-based Earth
Renewable Technologies
launched EarthBottle, a
plant-based packaging solution touted as a responsible
and sustainable alternative
to petroleum-based plastics,
on March 6 at Ingredea, in
Anaheim, Calif. Suitable for
natural products, personal
care products, pharmaceuticals and household goods,
EarthBottles claim to be
comparable or superior to
HDPE and PET in most
key parameters.
Our product is a versatile
plant- and mineral-based
solution for brands looking
to meet the demands of end
users with packaging options
that respect our resources
and protect our earth, at a
cost that may be comparable
to what they are using now,
says Owen Schultz, VP
of new business development. Boasting a sustainable
cradle-to-cradle footprint,
EarthBottles are made using plant-based materials
without toxic plasticizers or
fossil fuels and are recyclable
at facilities that accept #7
plastics. In addition, during
the decomposition process of
the biopolymer, no chemicals or hazardous materials
are leached into the water
or land, but instead vital
minerals and antioxidants
are returned to the earth.
www.earthrenewable.com
advertiser index
Agro America
Anchor Packaging
Anheuser-Busch Inc.
Beiersdorf, Inc
Blount Fine Foods
Butler Home Products
California Avocado Commission
Camber Pharmaceuticals
Campbell Soup Company
Candle Lite
Carrs Foods International
CH Robinson
Charles & Alice
Coca Cola NA
Conagra Foods
Creekstone Farms
Del Monte Fresh Produce
Delizza Inc.
Domino Foods
ECR Software Corporation
Elkay Plastics
Energizer Personal Care
95
44, 45
Inside Front Cover
122-123
4, 5
149
104
52-53
87
151
56
135
26, 27
23
57
68-69
100-101
75
21
131
39
65
Ferrero USA Inc.

Cover Tip
Forte Product Solutions
25
Fresno Food Expo
125
General Mills Inc
12, 13
Gladson Interactive Services
140, 141
Goya Foods Inc
6
House-Autry Mills, Inc.
49, 61
IT Retail
137
International Dairy Deli BAK / IDDBA
43
Jelly Belly
63
Kelloggs Company
33
Limoneira
96
Louisiana Seafood Promotion and Marketing Board
47
Loving Pets Products
147
Mars Chocolate NA
51, 155
Mason Ways Indestructible
136
McGladrey
37
Milk Pep
15
MOM Brands
51, 107-114
Musco Family Olive Co.
119
Nature Sweet
102
Nepa Carton & Carrier Company
133
Nestle Nutrition
17, Insert
Pfizer Consumer Health
29
Placon
93
Pompeian Olive Oil
78, 79
Robbies Flexibles
103
Sandridge Food Corporation
89
Save-A-Lot
3
Sticky Fingers Bakeries
59
Tabletops Unlimited
Back Cover
The Fremont Company
73
The Hershey Company
11
The J.M. Smucker Company
9
The Wine Group
105
Trimino
145
Trion Industries Inc.
18, 19
Turkey Hill Dairy
41
TW Garner Food Co
71
Tyson Foods
82-83, 85
Well-Pict, Inc.
99
Wholesum Family Farms
97
www.onebananas.com
www.anchorpac.com
www.anheuser-busch.com
www.eucerinus.com
www.blountfinefoods.com/buildsales
www.thebutler.com
www.avocado.org
www.camberpharma.com
www.campbellsoup.com
www.candle-lite.com
www.stpierrebakery.com
www.accelerateyouradvantage.com
www.fruitfriends.com
www.coke.com
www.conagrafoods.com
www.creekstonefarms.com
www.freshdelmonte.com
www.delizza.us
www.dominosugar.com
www.ecrs.com
www.readychefgobags.com
www.energizerholdings.com/en/brands/
Pages/default.aspx
www.ferrerousa.com
www.forteproductsolutions.com
www.fresnofoodexpo.com
www.generalmills.com
www.gladson.com
www.goya.com
www.OurHouseGF.com
www.itretail.com
www.iddba.org
www.jellybelly.com
www.kellogg.com
www.limoneira.com
www.buy.louisianaseafood.com
www.lovingpetsproducts.com
www.effem.com
www.masonways.com
www.mcgladrey.com
www.milkpep.org
www.mombrands.com
www.olives.com
www.naturesweet.com
www.nepacartons.com
www.nestlenutritionstore.com
www.Nexium24hr.com/routine
www.placon.com
www.pompeian.com
www.robbieflexibles.com
www.sandridge.com
www.save-a-lot.com
www.stickyfingersbakeries.com
www.ttucorp.com
www.fremontcompany.com
www.hershey.com
www.pillsburybaking.com
www.flipflopwines.com
www.drinktrimino.com
www.triononline.com
www.turkeyhill.com
www.texaspetefoodservice.com
www.tysondeli.com
www.wellpict.com
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153
the last word
Anticipation
s the frst three

months of 2015
unfolded in the midst
of a prevailingly
fertile climate for food
industry mergers and
acquisitions, it was
logical to presume at
least a few key deals were in the works in
the CPG supplier community in the aftermath of a sharp uptick in retail deal fow
over the past two years.
But few saw the blockbuster $46 billion
union of H.J. Heinz and Kraft Foods Group brewing, the
consummation of which is expected to close in the second
half of the year, and which will most assuredly go down in
the books as one of the most widely watched and carefully
chronicled mergers for years to come.
Spearheaded by the $72 billion Oracle of Omaha, Warren
Bufett, chairman and CEO of Berkshire Hathaway, the
resulting Kraft Heinz Co. assuming all goes of without
a hitch promises to further dilute the U.S. food industrys
fundamental complexion, alongside whats largely anticipated
will bring about a dramatic reshufing of the center store
deck, whose shelves have housed the two companies ubiquitous brands for decades.
For retailers such as Delhaize America which is
radically transforming its center store strategy to cull irrelevant products across 80 percent of the overall category, with the goal of impacting 10,000 SKUs in its Food
Lion banner in tandem with a major divisional overhaul
the advent of the merged entity would seem to be right
on time.
While history hasnt always been kind to mergers of this
magnitude, the preliminary prognosis for the head-turning
Heinz-Kraft pact which was reportedly inked in a record
four-week timeframe from start to fnish is a bit better
than the average mega-merger introductory forecast. Even so,
past history also looms large as profound uncertainty swirls
around anticipated dramatic cost-cutting measures likely to
transpire on the watch of majority equity partner-owners
Berkshire Hathaway and 3G Capital, which are expected to
hit the ground running to achieve meaningful short-term
proftability.
Te majority of industry execs Ive spoken
with are betting on more upbeat prospects
for product innovation, greater global synergies, increased scale and relevance both in the
United States and abroad, and more efcient
operations that will lower expenses and up
the new conglomerates clout with commodity
costs.
Consumers, meanwhile, will largely be unafected by the transaction, for which antitrust
concerns are muted in view of little overlap
in the product lineups of the iconic brands
parents. Out of the gate, Heinz CEO Bernardo Hees will take
the reins of the combined global company, whose new executive team will be revealed during the transition period.
Indeed, while 2014 may have been the year of retail
food mergers with still more likely on the way 2015
could well wind up being the year of signifcant supplier
mergers. Many traditional brick-and-mortar retailers
have fewer opportunities for growth, and are turning to
M&A to gain market share through consolidation or enter
new markets to extend their brand and reach, notes Ted
Vaughan, partner in BDOs consumer business practice,
in regard to the recently released results of his frms ninth
annual Retail Compass Survey of retail CFOs, 59 percent
of whom expect M&A activity in the retail industry to
further surge this year.
Indeed, as we look ahead to whats widely viewed as
open season for more acquisitions from the ranks of other
center store stalwarts, the industry is clearly headed for a
new phase of irrefutable evolution where further upheaval
is all but guaranteed.
It thus seems appropriate to invoke the lyrics of Carly
Simons timeless ballad that Heinz ketchup used for years in
its memorable TV ad campaign: We can never know about
the days to come, but we think about them anyway. For now,
anticipation will surely make us wait to see how the thick
and emphatically rich arrangement of two legendary CPG
leaders will ultimately play out. PG
Meg Major
mmajor@stagnitomail.com
Twitter @Meg_Major/@pgrocer
Looking ahead to whats widely viewed as open season for more acquisitions from
the ranks of other center store stalwarts, the industry is clearly headed for a new phase
of irrefutable evolution where further upheaval is all but guaranteed.
154
OPPOSITES ATTRACT.
NEW SWEET BAKED
& SALTY
COMBOS
SNACKS.
% Lift
by Any Promo
% Lift
by Any Display
COMBOS
BAKED SNACKS
184%
266%
1,754%
SALTY
SNACKS
59%
54%
137%
Food
% Lift by Any
Feature & Display
72 ct.
Shipper
any promo units % lift and any feature & display % lift
Quarter
First Delivery Date
Last Delivery Date
Last Order Date
Q4 2014
12/1/2014
3/20/2015
3/13/2015
Q1 2015
12/29/2014
3/20/2015
3/13/2015
Q3 2015
6/15/2014
9/4/2015
8/28/2015
Women in
A S U P PL E ME N T T O P R OG RESSI VE GR OC ER & RETAIL LEADER
Leadership
A
reinvigorated
Network of
Executive
Women
is launching a
new movement
for workplace
change
Its Time for a

New Retail Workplace
Women need it. Millennials want it. The times demand it.
ts time to recognize an important truth: Women
are the key to your success. The retail, consumer
goods and services industry will rise or fall
with its women customers and employees.
Women drive our business. Women make 63
percent of trips to grocery stores and make or
influence 93 percent of food purchases. They
are the sole or primary breadwinners in 40 percent of U.S. households with children and wield
growing influence over consumer spending in
the United States (and around the world).
But 59 percent of women polled by Nielsen
said food marketers do not understand them.
Thats a problem and an opportunity.
Consider the competitive advantage thats possible when companies decision-makers reflect their customer base. And, research
shows, organizations with more women leaders perform better. A 2011
Quotes appearing in this supplement have
previously appeared in special reports published
by the Network of Executive Women.
Womens Leadership Quiz
Q:
study by Catalyst reported that companies with three

or more female board members outperformed those
with no women directors. These companies saw an
84 percent higher return on sales, a 60 percent higher
return on investment capital and a 46 percent return
on equity in at least four of the five years analyzed.
1. Which of these statements is not true?

A. Women are more likely to have high school diplomas
B. Women are more likely to have college degrees
C. Men are more likely to have post-graduate degrees
2. The U.S. public perceives men to be stronger
than women in which of these leadership traits?
A. Intelligence
B. Compassion
C. Decisiveness
D. Creativity
3. Organizations with mostly male leaders__________________
A. Have a greater affinity with female consumers
B. Are more focused on transactions
C. Have a stronger financial performance
D. Have more innovative and motivated teams
4. Since 2008, the share of women corporate
officers in the retail industry has:
A. Increased 5 percent
B. Decreased 5 percent
C. Stayed about the same
How did you do? The answers are 1, C; 2, C; 3, B; 4, C. Surprised?

Women are more likely than men to be high school graduates and to
have undergraduate and postgraduate degrees. And, according to a 2008
study by Pew Research, theyre more likely to be perceived as intelligent,
compassionate and creative leaders. As a group, women leaders are more
likely to prioritize relationships over transactions, according to research
by The Centre for Women in Business. But the result is not fewer
transactions. According to Catalyst, companies with the most women
leaders had higher returns on sales, equity and invested capital than
organizations with fewer female leaders.
Wired for leadership

Other research shows talented women bring unique
perspectives and leadership qualities to once-maledominated teams. In a 2007 study of 100 work
teams across 21 organizations in 17 countries, the
Centre for Women in Business at the London Business School found teams with at least 50 percent
women were more motivated and innovative than
those where women were in the minority, while
teams with a clear majority of women 60 percent
expressed greater self-confidence.
Beyond the benefits of gender diverse teams, women
are especially well suited to lead in todays changing
marketplace and evolving workplace. The Pew Research Center asked 2,250 people to name the most important leadership traits. The survey results, reported
in Men or Women: Whos the Better Leader?, found
that women were rated as better than or equal to men
in seven of eight top leadership characteristics, including honesty, outgoingness, compassion and creativity.
(They tied men on being ambitious and hardworking.)
Dr. Daniel Amen, author of Unleash the Power
of the Female Brain (Harmony 2013) and conductor
of the biggest brain-scan study ever (46,000 scans),
found that female brains were dramatically more
active. Women are really wired for leadership
they really make great CEOs.
But despite the strong case for womens leadership, women are vastly under-represented in key
decision-making and leadership roles. Although
theres a general impression that women are moving
up the ranks as never before, the numbers dont bear
that out. The percentage of women in officer roles in
How much do you know about

the power of women and their
leadership traits?
the retail industry has remained virtually unchanged

in the past five years, moving from 18.5 percent in
2008 to 18.6 percent in 2013, according to Catalyst.
What Millennials Want
53% aspire
to become
the leader or
most senior
executive within
their current
organization.
59% of
men would
like to secure
the top
job in their
organization.
47% of
women would
like to advance
to the top.
28
% feel
their current
organization
is making full
use of their
skills.
34% of
women said
theyd emphasize
employee growth
and development
as leaders.
30% of
men said
theyd
emphasize
employee
growth and
development
Millennials are just as interested in how a business develops its people and how it contributes to society as they are in
its products and profits, said Barry Salzberg, CEO of Deloitte Global. The business community, particularly in developed
markets, need to change the way they engage Millennial talent or risk being left behind.
Source: Millennial Survey, Deloitte Touche Tohmatsu Ltd., 2015.
Women in Leadership: Its Time
Women and Millennials

The typical workplace with a traditional hierarchy
and corporate culture, and lack of diversity among
its leaders, is not only holding women back its
holding business back. When organizations look
to diversity, inclusion and womens advancement
as major components of their strategic plans, they
significantly enhance their competitive position for
today and for the future.
Why? Workplace changes that have long been
championed by women appeal to tomorrows leaders, Millennials born between 1980 and 2000, too.
Women want a more flexible, more collaborative,
more authentic, less authoritative corporate culture;
a focus on work/life balance; more opportunity for
advancement; and the chance to make an impact.
Millennials, 80 million strong, want the same.
In a 2011 survey of more than 4,000 graduates
across 75 countries by PricewaterhouseCoopers
(PwC), more than half of respondents said they
About the Network of Executive Women

Founded in 2001, the Network of Executive Women, Retail
and Consumer Goods and Services, is a not-for-profit educational association representing nearly 9,000 members,
100 corporate partners and 20 regional groups in the United
States and Canada. Network members come from more than
750 industry organizations, including grocery, chain drug,
mass retailers, wholesalers, manufacturers, service providers, associations and universities.
The mission of NEW is to advance women, grow business
and transform our industrys workplace through the power of our
community. To support this mission, the organization provides
best practices on gender diversity, career development opportunities, research, learning events and networking programs
designed to advance womens leadership in the retail, consumer
goods and services industries. NEW is open to women and men,
emerging leaders and senior-level executives. NEW hosts more
than 100 regional learning and networking events each year and
two national conferences, the NEW Leadership Summit and the
NEW Executive Leaders Forum. For more information on NEWs
programs and events, visit newonline.org.
To help executives transform their organizations,
NEW is rolling out four new programs:
The NEW Executive Institute, an intensive 12-month learning course for emerging executives which creates a safe
environment for leadership exploration and deep learning
at three off-site immersion sessions, a series of webinars
and conference calls, one-to-one sessions with an executive coach, ongoing education and networking over a 12month period, and access to the NEW Executive Institute
Alumni Support Network.
preferred employers who offered opportunities

for advancement, while 35 percent cited excellent training/development programs. Virtually
every Millennial surveyed 95 percent said
work/life balance was important to them when
choosing where to work.
Female Millennials, in particular, seek out
employers with a strong record on equality and
diversity and employers that do more than
talk the talk, according to the 2014 PwC report
Developing Tomorrows Female Leaders. l
Founded: April 1, 2001

Members: 9,000
Organizations: 750
Corporate partners: 105
Regions: 20
NEW Career Accelerator workshops, designed specifically

for leaders in the retail, consumer goods and services
industry using cutting-edge research developed in partnership with the Center for Creative Leadership. Using
the NEW Career Accelerator Model, team members are
rated by superiors, peers and direct reports on critical
career competencies and derailers.
Innovation You, a webinar series led by thought leaders in
career advancement. In eight one-hour webinars, industry
professionals will learn dynamic ways to control their
career path, build a personal brand, navigate pitfalls and
better manage work-life balance. The webinars may be
viewed live or recorded, and are offered free for NEW
members. Nonmembers may view webinars at $99 each.
Multigenerational Leadership, a series of six webinars designed to help every leader or aspiring leader from Millennials to Boomers manage todays multigenerational
workforce. The course led by Sarah Sladek, founder of
management consulting firm XYZ University deep dives
into the unique buying habits of Millennial consumers and
the 2020 work environment. These webinars also may
be viewed live or recorded, and are offered free for NEW
members. Nonmembers may view webinars at $99 each.
ADVERTORIAL
Talking with
Lisa Walsh,
Senior Vice President, Sales and Marketing,

Frito-Lay North America, a Division of PepsiCo
Q:
A:
How would you characterize the

gender achievement gap in the
retail/consumer goods industry?
Today, women control 70 percent

of household spending and they
make or influence 93 percent of all food
purchases, while taking 63 percent of all
trips to the grocery store. Yet the majority of decision-makers in our industry
continue to be men.
Although more women have entered
the workforce, women continue to be
underrepresented in top leadership roles.
According to research done by Catalyst in
2012, women accounted for less than 15
percent of executive officers and less than
17 percent held board seats for Fortune
500 companies. The numbers are striking
and unfortunately they highlight the fact
that we are not seeing a material shift
toward equality in the executive ranks,
even though research shows companies
with more women in leadership roles outperform less diverse companies.
I believe that the challenges surrounding female retention and advancement
in our industry need to be addressed if
companies are going to be poised for
long-term, sustainable growth. We need
to change corporate culture, we need to
break organizational barriers and we need
to involve males as partners in the journey.
We need to have leaders set the example
and we need to transform the workplace
for the future. Only then will the gender
achievement gap start to shrink.
Q:
The Network of Executive Women

found that workplace initiatives
long championed by women (flexibility,
career development, the opportunity to
make a difference) are also desired by
Millennials. How might this intersection
change our workplaces?
A:
Millennials, now in their 20s and

30s, are 80 million strong and will
become the majority of our workforce
this year. They are confident, independent, connected and diverse.
Moreover, Millennials share the
same workplace priorities as women.
Namely, they want balance between
work and life. They want a flexible
work environment. And they want to
make a difference. When you create

a workplace that attracts and retains
women, you create a workplace that attracts and retains Millennials, too.
Given the impact that Millennials are
having, it is clear that we need to address
diversity and inclusion challenges head-on,
or risk that they migrate to other companies, leaving our industry with a massive
talent void. Just look at the tech industries
that are successfully recruiting out of the
top schools they empower their workforce to work when, where and how they
want. They create a workplace that is fluid,
dynamic and unstructured. And they take
risks in charting new ways of doing things
while challenging the status quo. We are
competing for the same talent so evolution
is a must do, not a nice to do.
Q:
Last fall, NEW published

a report on the status of
multicultural women in the retail and
consumer goods industry and the
career challenges they face as women
and as people of color. Why should this
double bind be addressed?
A:
Weve been speaking about solutions that affect women as a whole

but women come from all backgrounds 36 percent of U.S. women are
multicultural and they comprise nearly
12 percent of our managerial workforce.
These numbers are growing fast.
Still, the wage gap between white
women and nonwhite women is as big or
bigger than the wage gap between women and men. Multicultural women have
different workplace experiences and
career challenges related to both gender
and race/ethnicity. But companies often
do not recognize that there are differences that need to be acknowledged and
addressed between non-white and white
women. The same is true for young
and old, black and white, Hispanic and
Asian, native born and immigrant, gay
and straight. The tapestry of women in

our industry is vast and we need to be
mindful of that so we develop programs
and solutions that benefit everyone.
Q:
How has being a mother

impacted your career and the
work/life choices youve made?
A:
One of the reasons I am so passionate about diversity is because I am a

mom. I have a son and daughter and my
hope is that when they enter the workforce they dont see a difference in gender.
My daughter sees me as an example
of a successful working mom who is
thoughtful of the choices she makes
for both her family and her career. My
son sees a strong, independent woman
who isnt afraid to have a voice and
provide for the family. My kids also
have a strong father figure who stays
home to do the homework, coach the
teams and manage the household. One
isnt more important than the other,
both roles need to work successfully
and gender isnt a factor in who assumes which role.
As a working mom I make choices
every day about work/life.I know
that I will not make every school event,
but I also know which ones are critical.
Declaring what is important and then
being visible and transparent about it is
critical as a leader.
I also realize, however, that others
have not been as fortunate as I have
been. Research shows that working
mothers are often penalized on a host
of measures, regardless of hours worked
or commitment to their careers. They
are offered lower starting salaries, are
less likely to be offered training opportunities and often are not supported
for leadership roles. Eliminating bias
against mothers and instituting familyfriendly benefits and work arrangements is a win-win. At PepsiCo, our
CEO Indra Nyooi talks about bringing
your whole self to work. Parents
female and male should be able
to embrace that role both inside and
outside of the office. There are lots of
things you can outsource, but you cant
outsource being a parent.
Behind
the Gender Gap

Everyone says they
support women leaders.
So why arent there
more of them?
omen leaders have the

insights and skills that
retail and consumer
goods companies need
and their priorities and
career goals align with
those of tomorrows
leaders male and female. Why, then, have women
fallen behind their male counterparts in pay and
career advancement? The reasons are many and complex, and they start with conscious and unconscious
bias embedded in todays workplace.
A 2011 survey by McKinsey & Company revealed
that deeply entrenched beliefs within corporate culture are causing the biggest resistance to
advancing women to leadership roles. Women candidates are frequently judged differently from their
male counterparts when opportunities for promotion arise, the study found. A woman may be seen as
too passive or too aggressive, or even more vaguely,
not right for that position based on long-held gender stereotypes. Male executives have even admitted
to overlooking a woman simply because they didnt
know how to talk to or mentor her.
The old boys club continues to halt women in
their tracks. Participants in Network of Executive
Women (NEW) focus groups for the NEW 2020
research initiative said male leaders in the retail
and consumer goods industry often devalue their
contributions in meetings, disregard their requests
for mentoring opportunities and are quick to take
credit for womens ideas in high-visibility arenas.
Moreover, women said they are habitually excluded
from informal networking opportunities, where
influential decision-making takes place.
Im the only [female] V.P. in my company, recounted one female industry leader. When the men
went on a retreat, they accidentally emailed photos while
they were away, and I thought, Oh, so this is what you
do without me. It can be lonely to be the only woman.
One problem: Too few women are advancing to
roles that lead to the most senior positions.

A 2011 Catalyst study found that while
advancement within organizations is dependent on the receipt of projects that are
highly visible, mission-critical and international in scope, significantly more men
than women are chosen for these roles.
A 2013 report by the International
Consortium for Executive Development
Research backs up Catalysts findings.
Women are not typically given the risk or
stretch assignments required to broaden
their experience to the levels expected for
entry into the c-suite, according to Taking Charge: A
roadmap for a successful career and a meaningful life
for high potential corporate women leaders.
There is a stubborn assumption among many
decision makers that women especially mothers wont be interested in the
line positions, special projects or
The Network of
traveling opportunities that would
Executive Women
help propel their careers forward.
Manifesto
[To] assume that I cannot
Its time for a new take on a senior role and work
beyond 5 p.m., well, I have a
workplace. One
nanny, and, I can, said one
thats less rigid and female executive in the report.
I will decide where I can and
more flexible. Less
cannot be and how to prioritize.
authoritative and
I were a man, nobody would
more collaborative. Ifassume
that I need to get home to
Less conformist and feed my children.
more diverse. More

authentic and less
impersonal. NEW
is creating a new
model for workplace
transformation. To
advance women and
create a workplace
with no limits
for everyone.
Signs of progress
Some organizations are making a
determined effort to break down
traditional hierarchies, change
the way leaders are developed
and promoted and create a new
corporate culture thats more
inclusive, flexible and authentic.
Colgate-Palmolive Co., for
example, has worked to put
women into stretch positions.
The company offers executives
who cannot relocate permanently
opportunities to take on shortand long-term assignments in
the U.S. and abroad, allowing
them to raise their profiles and
broaden their skills.
And at Schwans Consumer
Brands, leaders have made a
concerted effort to move women
out of support functions and into
line roles. Women tend to do more staff roles,
says Diane Cooke, vice president of strategy and
compensation at Schwans. The challenge is getting
women to move into those line positions, getting

them onto the track that would lead them to the
CEO role. Whether its by choice that women are
not taking risks, or that its corporate perception
that women dont want to take risks, Im not sure.
Change will not happen overnight, and not
without a corporate-wide commitment to change.
At Hallmark Cards, a three-pronged approach to
diversity is taken: developing products that are
relevant to a broad range of consumers, recruiting talent from many backgrounds and creating a
work environment that makes the best use of each
individuals talents. Hallmarks Diversity and Inclusion Council has developed initiatives that appeal to
all employees, including several specifically focused
on women. Its employee resource groups (ERGs)
provide opportunities for employees to learn about
different ethnicities, cultures, religions, generations
and sexual orientations, while offering personal and
professional mentoring and networking opportunities. The ERGs are a resource for Hallmarks research, marketing and product development teams,
providing cultural insights and understandings.
And, mindful that employees have multiple
stressors at home and at work, Hallmark supports
work-life balance and makes it a central part of
the companys recruitment, retention and employee satisfaction programs. The company offers
flextime, job-sharing, part-time, telecommuting,
remote working and other flexible work options
where possible. It also provides up to six months
of parental leave to new parents and financial support for adoption.
To support working mothers who are nursing,
Hallmark provides private lactation rooms, electric breast pumps and refrigerators. To further
help employees juggle work and home responsibilities, the company has established relationships with a number of local agencies to connect
employees to childcare, eldercare, pet-sitting
and other services and organizations.
As a working mother of two boys, I know how
critical it is to have flexibility in the workplace,
says Hallmark National Sales Director Sharon Belto.
Continuing a career would have been virtually
impossible without it. l
ADVERTORIAL
Talking with
Deborah Rosado Shaw,
Senior Vice President, Chief Global Diversity and Engagement, PepsiCo
Q:
A:
Why is developing and advancing

women a good business?
The need to support and advance

women in the work force goes
beyond good business strategy. If we
dont make this a priority, I believe the
stability of the global economy and the
future of our family households are
at great risk. Today women represent
nearly half of our industrys workforce
and control roughly $20 trillion of consumer spending. In addition, a 2014 report from the White House Council of
Economic Advisors shows that women
are completing college and graduate
school at higher rates than men. When
combined with longer life expectancy
rates than men, we have a confluence of
events that represent a perfect storm
for our industry.
Yet women continue to be underrepresented in management and executive levels. Fewer than 5% of CEOs
are female and women only represent
19% of those serving on corporate
board of the S&P 500. The disparity is
even greater for women of color. This
is particularly concerning, as women
of color will represent the majority of
the U.S. female population by 2050.
Not addressing these disparities will
ultimately hurt the industrys ability to
attract and retain the best talent.
Without representation and active
engagement at senior levels in the consumer industry, we lack understanding
of womens needs along their life cycle
and we miss opportunities to innovate
and design products and services that
appropriately and respectfully address
this growing market.
Q:
A:
How would you characterize your

own companys efforts to advance
more women to senior roles?
As a company doing business

in more than 200 countries and
territories, diversity and engagement
(D&E) is integral to everything we do.
Performance with Purpose is our commitment to deliver sustained value,
which cant be done without engaging
the collective intelligence of our talent.
Our commitment to D&E has made
our company a strong and attractive

place to work by building a diverse,
inclusive and engaged culture with a
workforce reflective of the consumer
base in our local markets.
PepsiCos goals and initiatives reflect
a desire not only to include, but also to
support and engage women at all levels
of our operations. This is accomplished
through a three-pronged approach that
includes promoting gender diversity
in the workplace, advancing female
leadership through corporate sponsorships and empowering and educating
women and girls through the work of
the PepsiCo Foundation.
As the percentage of women in the
workforce increases, PepsiCo prepares
to meet the challenges of hiring new
talent, assisting women with re-entry
into the workforce and building skills
capacity of female associates through
local customized programs. Regional
Diversity & Engagement Councils assist
in identifying local challenges and work
with those teams to build solutions.
Female associates at PepsiCo can
take advantage of a number of mentoring programs to help advance their
careers. From the front-line to executive positions, we provide functional
and leadership development opportunities. We also offer functional development through our online courses
on PEP University that offer greater
flexibility for women to customize
their training programs.
Leadership Investment For Tomorrow (LIFT) is an 18-month leadership/
talent-development program that
provides women of color with access
to direct executive mentoring. Participants focus on development, network
acceleration, career advancement, executive awareness, and career strategy.
The Womens Inclusion Network
(WIN), one of PepsiCos most powerful
and active Employee Resource Groups,

elevates women internally and in the
community by encouraging members
to share their personal and professional
experiences and network to support
business initiatives.
The learnings from this spectrum
of programs and initiatives allows the
company to lift and shift best practices to better address womens issues
worldwide. And we are seeing results.
In the United States, 31 percent of
PepsiCos executives are women.
While the company is proud of this
progress, PepsiCo remains focused on
supporting the advancement of women
to achieve even greater gains.
Q:
In what ways must todays

corporate policies and culture
change for companies to leverage the
best talent, regardless of gender?
A:
We all want gender equality

in opportunities and pay, and
this can be achieved if we deploy a
holistic approach to analyzing and
developing solutions. I believe it
begins with developing a mindset to
reduce unconscious bias so we can
truly harness the collective intelligence and passions of everyone.
Working together we can identify
new challenges and solutions in our
ever-complex multicultural markets. For example, can we leverage
technology across the enterprise to
provide f lexible work arrangements
to women of all levels?
At PepsiCo, the men on our leadership teams are aligned on policies and
processes that help create a workforce
that mirrors the markets in which we
operate. They demonstrate this through
leadership in community and leveraging the many programs we offer.
Although new in my role as Chief
Diversity Officer, I have been affiliated with PepsiCo for more than 14
years as a former Ethnic Advisory
Board Member. I am excited to work
with our leaders to help usher in this
new era of engagement and emphasis
on women as part of our on-going
legacy of diversity.
Its Time to Leverage

Multicultural Women
Commit to, and embrace,
cultural diversity.
ot so long ago,
diversity was seen
as black and white,
male and female.
Little attention was
paid to the extraordinary experiences,
contributions and
career challenges
of multicultural
women. This has created an achievement gap that
persists. Not only are multicultural women underrepresented in the retail and consumer goods
industrys leadership, their unique challenges are
not being addressed something we have to do if
were to achieve a workplace with no limits.
Multicultural women face two career challenges, as women and as persons of color. Company
policies and corporate cultures that ignore
those challenges and the unique contributions of multicultural women are doing
the women and the company a disservice.
We are seeing a big difference in performance between companies that are more
diverse and those that are more insular, says Valerie Lewis, assistant vice
president, assistant secretary and senior
corporate counsel for Safeway Inc.
Indeed, while industry leaders
have been talking about the importance of the multicultural consumer
for the last decade, no real progress
has been made advancing multicultural women to senior roles. As
a result, most retail and consumer
products companies are not fully
benefitting from the rich diversity of
thought these employees offer.
Last year, NEW released the
Tapestry report, based on research;
interviews with industry leaders; and
an online survey exploring multicultural
womens advancement opportunities, the
workplace experiences of women and men
10
ITS TIME.
Its time for womens leadership.
Its time for a movement.
Its time for a new workplace.

NEW is creating a new model for workplace
transformation to advance women and create a more
fexible and inclusive workplace for everyone.
Unifed Grocers has proudly served as a regional

sponsor of NEW since 2008.
323.264.5200 | unifiedgrocers.com
corporatemarketing@unifiedgrocers.com
ADVERTORIAL
Talking with
Sarah Chartrand
SVP Talent and Human Resources,
Ahold USA
Ahold USA is a $26 billion business and the leading food retailer in the Northeast United
States, with approximately 770 stores and four operating divisions: Giant/Martins; Giant Food of
Maryland; Stop & Shop New York Metro; and Stop & Shop New England. Its Peapod business is the
countrys leading online grocery retailer, which operates across the market areas of the companys
retail divisions and is a purely online business in Chicago and surrounding areas.
Diversity & Inclusion is important to Ahold USA, which is why the company has invested in the
launch of business resource groups in order to further facilitate the connection and collaboration
between people with a common affinity. Sarah Chartrand, the SVP Talent and Human Resources,
spoke to Progressive Grocer about the importance of D&I to Ahold USA, along with its womens
resource groups and Ahold USAs strong partnership with the Network of Executive Women (NEW).
Progressive Grocer: What is the history and legacy of Ahold USAs approach to and success
with diversity in its mentorship and development approaches and programs?
Sarah Chartrand: We have a long and rich commitment to diversity within Ahold USA and our
Divisions. In the 15 years I have been with the company, all of the senior leaders I have worked
with have taken a genuine interest in embedding diversity and inclusion within our business,
in everything from our management development and recruiting practices to engagement
strategies, to our community partnerships. At the same time, there is a constant desire to get
even better in this space, which is very exciting to me.
PG: What are some examples of Aholds innovative ways of mentoring and developing
associates to reflect the organizations diversity of team members? How is this executed
in both different and customized ways across your brands and stores?
SC: About two years ago, the very active and energetic Women Adding Value
(WAV) Business Resource Group (BRG) in our Giant Landover Division
implemented a Mentoring Circles concept, where small groups of associates
gather on a monthly basis to discuss career progression, give advice, and
learn from one another. We have seen great success with this program and
it was later launched in our Ahold USA Support Offices and other divisions. Additionally, we are just
beginning to replicate this type of model within our ALANA/Mosaic multicultural BRG.
PG: In particular, how has your relationship with the Network of Executive Women
impacted or influenced programs that directly involve and benefit Aholds employees,
and ensure strong and diverse future leadership? Can you share some examples of
your collaboration/participation with NEW?
SC: Our partnership with NEW is very fulfilling, both organizationally and personally. We connect
the regional groups directly with our Divisional WAV BRGs, providing robust leadership development
and networking opportunities for our associates. We send numerous leaders to the national
conferences each year, connected to our management development program. We create opportunities
for our female leaders to speak at national and regional conferences, giving them much deserved
recognition and visibility within the industry. And for me personally, I have spent the past four years
on the NEW Board of Directors, which has been an amazing developmental experience. As a board
member, I have been able to help shape the future educational strategy and offerings of NEW,
which will contribute to the growth and advancement of women throughout our industry!
How to Close the Multicultural

Achievement Gap
of all backgrounds, corporate practices and the
role of white women and men in closing the career
achievement gap. As white women make slow but
steady progress into executive levels, the report
revealed, multicultural women can find their upward advancement stalling out in hidden places of
the organizational chart while the circumstances
that hinder their movement go unnoticed.
There are folks [of color] who were superstars
[at their jobs], but who are no longer with their
companies because they werent considered for
advancement, Lewis said. Sometimes a person of
color will get feedback that sounds a lot like, Gee,
you are doing so well, why arent you happy? Look
at what you have now. Senior management may
promote one or two minorities who they are comfortable with and think we should be happy with
that diversity. However, for there to be meaningful change, there has to be a top-down commitment to diversity in all areas of the enterprise.
At PepsiCo Inc. that commitment exists and the
bottom line has benefited from it. Multicultural
women have helped grow businesses that may not
have been developed by other employees, according
to Tom Greco, CEO of Frito-Lay North America.
For example, a Latina employee helped PepsiCo see
the opportunity in securing the sponsorship of the
Mexican national soccer team in advance of the 2014
World Cup. We embraced the multicultural consumer and we advanced multicultural leaders who
have a visceral understanding of our consumer,
Greco said. As a result, were growing faster.
To create an inclusive environment, companies
must recognize the differences in how women
perceive the workplace and nurture a culture that
will leverage the talents and traits of multicultural
women leaders, rather than continue the encouragement of covering which finds multicultural women feeling pressure to hide certain aspects
of their lives, and feeling uncomfortable being
their authentic selves at work.
An African-American woman
responding to the NEW survey noted
the majority of high-level executives
white males are more comfortable working with white women
than multicultural women,
because [white women]
were the first to break
through the
ceiling, and
theyre what
white men
executives
are used to
[as] wives,
mothers,
sisters.
Here are strategies for women of all races and ethnicities

for building bridges and connecting to each other:
Increase your awareness of your group and your own
privileges and disadvantages.
Acknowledge and challenge your own biases and stereotypes.
Be honest; explore the critiques and concepts you
most wish to reject.
Take responsibility for your own lack of knowledge
about other groups of women.
Read, watch documentaries and begin to educate
yourself about others.
Be willing to honestly and thoughtfully engage in courageous
conversations, where you will hear others truths about you.
Recognize that each group of women has something
to learn and to share.
Become comfortable in the roles of teacher and student.
Ask for help. Give help when asked. Offer help when possible.
Embrace your own power and influence.
Be open to new relationships.
Seek a mentor or sponsor outside the company.
Source: Tapestry: Leveraging the rich diversity of women in retail and consumer goods
[Among men of all races and ethniciWe embraced

ties], theres a comfort level of talkthe multicultural
ing sports, etc. Women of color just
consumer and
dont have that one thing that brings
comfort to the executives, so it can
we advanced
sometimes provide a barrier.
multicultural
Respondents to the NEW survey
leaders who
ranked corporate culture is not diverse as the No. 1 reason there are not have a visceral
more multicultural women in leaderunderstanding
ship roles in the retail and consumer
of our consumer.
goods industry, proof that to leverage
the diversity of thought and leadership As a result, were
skills that multicultural women bring
growing faster.
to corporate America, companies must
Tom Greco, CEO,
champion cultural fluency through
role modeling, policies and procedures. Frito-Lay North America
People are making progress in
advancing the presence of
multicultural women,
but not enough, says
Rodney McMullen, CEO
of The Kroger Co. We
must not be satisfied
until the diversity of
our workforce represents the diversity of
our customer base.
We have to find a way
to do more and do it
faster. l
in Leadership: Its Time
13
Launching a Movement
Inside NEWs bold new campaign for womens leadership
in retail and consumer goods.
t this years FMI Midwinter Executive Conference in Miami Beach, Fla.,

the Network of Executive Women
(NEW) launched its new Its Time
movement for womens leadership and workplace change. A summary of this presentation,
given by NEW CEO Joan Toth and NEW Board
members Amy Hahn of Ahold USA and Lisa
Walsh of PepsiCo Inc., is excerpted below. Video
highlights can be found on NEWs Its Time
website at newonline.org/itstime.
Since its founding in 2001, NEW has been highly successful in putting womens leadership on the industrys agenda.
We have built a powerful organization and grown to more
than 9,000 members. We have helped
tens of thousands of leaders.
But weve sent these leaders
back to companies that havent
changed. The share of women
in leadership roles in our
industry has barely budged in
the past five years.
So NEW set a new course.
We asked ourselves, what would
it take to create a workplace where
women had the same leaderJoan Toth, CEO,
Network of Executive Women ship opportunities as men and
everyone could be their best?
We interviewed our stakeholders and industry leaders, both
women and men. We conducted focus groups and surveys.
We engaged more than 1,500 people in all. NEW members
told us they wanted better career strategies, greater opportunity, authenticity in the workplace and work/life flexibility.
Women told us they needed to develop better leadership
skills, reconcile their careers and lives, and be accepted as
they are at work. Senior leaders told us they were under enormous competitive pressures, that they needed to prove ROI,
do more with less, and find and keep talent.
These overlapping needs are the foundation of our
movement to transform the workplace, win the war for
talent and create a better workplace for women, men and
the Millennial generation. The name of the movement is
simple, direct and accurate: Its Time. Its time to adapt to
the changing nation and our changing workforce, one that
is half female and one-third non-white.
What you can do

Changing an industry is not an easy ask. But emerging
leaders, mid-level leaders and senior executives can all
14
play a part in creating a workplace with no limits for

every man and woman.
Companies that want to increase the number of women
in senior roles and reap the rewards of womens leadership must make gender diversity a company priority and
drive home the business case for womens leadership.
Changing corporate culture means thoroughly challenging existing norms and stereotypes.
Organizations will need to:
1. Redefine leadership. Transformational leaders engage,
2.
3.
4.
5.
6.
collaborate and value employee contributions. Organizations must incorporate these feminine leadership
characteristics into a new leadership model.
Engage men. Too many existing diversity and inclusion efforts treat white men as problems that need to be
fixed instead of partners who need to be engaged.
Engage senior leaders. Companies making progress on
womens leadership share one trait: Committed executives driving change.
Nurture female talent. Fair hiring practices and work-life
policies are not enough. Organizations must implement
robust, corporate-wide programs that move the needle on
womens leadership.
Achieve critical mass. Advancing womens leadership
requires a critical mass of women in top roles a
minimum of 30 percent, according to a report published
by The White House Project, a nonprofit committed to
getting more women in the talent pipeline.
Enforce accountability. Organizations must have targets
in place that are frequently audited and revised with the
goal of increasing women in senior leadership positions.
Changes such as these will not come about on their own.

Women must champion womens leadership and enroll
those who have the authority to help their cause. They
should take risks and advocate the work-life changes that
will help create a better workplace for everyone.
While women are not expected to bring about this
change alone, they are far from powerless. Women can
speak up and speak out; they can mentor other women
and act as role models; they can demand challenging assignments, equal pay and promotions, and they can seek
employment elsewhere if they do not get them.
Bringing about change requires a joining together of forces,
not just of women, but of all who support womens leadership.
To get started on this transformative journey, visit the NEW
Its Time website and sign the wall of leaders supporting a
workplace with no limits at www.newonline.org/itstime. l
Delhaize believes in a workplace where

everyone can achieve their best.
Linda Johnson
Corporate Director of Human Resources

Delhaize Group
NEW leader and member since 2009
Women leaders are the key to your success

They drive collaboration, spur innovation and connect you to consumers. NEW is the authority on womens
leadership. Our learning and leadership community inspires thousands of women and men each year.
Now NEW has a bold new vision a workplace with no limits and robust new learning programs to
advance your women leaders, build your business and create a better workplace for all. Find out more.
Join the Movement now at newonline.org/itstime.
The distinctive Network of Executive Women and NEW Logos are service marks of the Network of Executive Women, Inc.
Mary Ellen Adcock

VP, Merchandising,
Columbus
Christine M. Albi
VP, Operations,
Michigan
Philecia C. Avery
VP, Pharmacy,
Corporate
Katy Barclay
Sr. VP, Human Resources,
Corporate
Lisa M. Chenny
VP, Operations,
QFC
Annette Franke
VP, Technology,
Corporate
Monica Jean Garnes

VP, Merchandising,
Frys
Donna F. Giordano
Division President,
Ralphs
Penny U. Goddin
VP, Merchandising,
Louisville
Lisa E. Holsclaw
VP, Promotional Planning,
Corporate
Jayne Homco
Division President,
Michigan
Valerie L. Jabbar
VP, Merchandising,
Ralphs
Colleen Juergensen
VP, Operations,
Smiths
Kathy Kelly
President,
Kroger Personal Finance
Laurie A. King
VP, Operations,
Nashville
Christina C. Lindgren
VP, Accounting,
Corporate
Sukanya Madlinger
Division President,
Cincinnati
Molly J. Malone
VP, Merchandising,
Corporate
Lynn Marmer
Group VP,
Corporate Affairs
Pamela J. Matthews
VP, Merchandising,
Delta
Margaret M. McClure
VP, Merchandising,
Corporate
Jill V. McIntosh
VP, Merchandising,
Corporate
Theresa M. Monti
VP, Corporate Benets,
Corporate
Marnette Perry
Sr. VP,
Corporate
Cindy L. Rantanen
VP, Customer Experience,
Corporate
Natalie M. Ream
VP, Marketing,
Corporate
Sharon M. Sever
VP, Merchandising,
Mid-Atlantic
Erin Sharp
Group VP, Manufacturing,
Corporate
Marlene A. Stewart
VP, Merchandising,
QFC
Cynthia A. Thornton
VP, Labor Relations,
Corporate
Katherine K. Wolfram
VP, Merchandising,
Central
Dana M. Zurcher
VP, Operations,
Southwest
Ann M. Reed
Martha C. Sarra
VP, Customer 1st Promise, VP, Chief Ethics and Compliance
Corporate
Ofcer, Corporate
Beth Van Oen

VP, Finance,
Corporate
Christine Wheatley
Group VP, Secretary and
General Council
Corporate
Women Executives
Leading the Way
The Kroger Co. is proud of our women leaders, working tirelessly
every day to fulll our Customer Promise. The individual talents and
collective dedication of this remarkable group of professionals
are setting new standards for excellence in the food retail industry.

Apr 2015

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