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HITCHING PITCHES TO A STAR

Although supermarkets aren't "Toy 'R' Us," licensed toys and other merchandise will play prominently in the grocery aisles this fourth quarter as retailers gear up for a competitive season.Among the licensed merchandise that buyers mentioned they bought nearly six months ago to feature this holiday are Disney's "Toy Story," Mattel's "Barbie," Warner Bros.' "Looney Tones," Coca-Cola -- and a slew of

Although supermarkets aren't "Toy 'R' Us," licensed toys and other merchandise will play prominently in the grocery aisles this fourth quarter as retailers gear up for a competitive season.

Among the licensed merchandise that buyers mentioned they bought nearly six months ago to feature this holiday are Disney's "Toy Story," Mattel's "Barbie," Warner Bros.' "Looney Tones," Coca-Cola -- and a slew of products related to Disney characters and movies, from "The Hunchback of Notre Dame" to "Winnie the Pooh."

"Licensed products are very popular and an important part of our fourth-quarter general merchandise," said Bill West, director, nonfood, Seaway Foodtown, Maumee, Ohio.

Disney's "Toy Story" is expected to be the leading licensed item, as it was in many channels last year. Said George Volanakis, chairman of the Toy Manufacturers of American, New York: "The effects of 'Toy Story' were significant."

The introduction of the $180 million family hit to home video next month, October 30, will spur further interest and excitement during the fourth quarter.

Grocery is prepared to jump on the media hype of "Toy Story" -- as well as other highly visibly properties -- with plans to cross merchandise and build large displays of licensed goods, said retailers.

Retailers are pegging their licensed selections to fall in a $10-to-$20 price-point range.

At Seaway Foodtown, the licensed mix will feature Hot Wheels, spinner racks of Disney items merchandised near greeting cards, and Coca Cola playing-cards and bottle-openers merchandised in the pop aisle.

Some retailers like Harps Food Stores, Springdale, Ark., has sought close-outs to compete in this arena.

The chain will feature a large selection of name-brand, close-out merchandise, including Mattel, and plush items. The retailers expect to make as much as 37% to 38% margins on sales of this merchandise, said Art Bundy, Harps director, nonfood.

With TV often influencing children's choices in toys, retailers must closely follow the brands touted on the tube throughout the year.

"Kids know the toys they want from watching TV, which is important to know about if you want to attract customers. Without these name brands, you don't stand a chance in the fourth quarter," said Bundy.

Harps will merchandise its holiday toy mix at the front end of high-traffic aisles on three-by-four-feet, four-sided island fixtures. Other displays will be placed at the video rental department and at seasonal aisles, with other Christmas products.

Carr-Gottstein Foods, Anchorage, Alaska, will play up "Toy Story," other Disney products and Warner Bros. items for the fourth quarter.

Licensed items create excitement for holiday sales, said Gary Schloss, vice president, general merchandise. Carr's licensed products are merchandised in a toy aisle, on endcaps and at video rentals. The products carry 30% to 40% margins for the chain.

Licensed goods, especially "Barbie," are extremely important for fourth-quarter sales at Homeland Stores, Oklahoma City. In the fourth quarter, the chain expects to "sell a lot of Barbie dolls," said Steve Mason, vice president, marketing, Homeland Stores.

Homeland has had success with many styles of Barbie dolls supplied exclusively to the supermarket trade several times throughout the year, starting in the spring.

This keeps shopper interest in Barbie building to a higher level as the holiday shopping season nears, Mason noted. He said Homeland will promote four Barbie selections during the holiday period at $10. "The assortment will be wider than last year, since Barbie just keeps growing," added Mason.

Homeland has found anything with the Coca-Cola name also moves well. Mason said stores will cross-promote drinking glasses with the Coke logo at beverage displays, and cross-merchandise "Toy Story" sell-through videos with cake decorating products.

Camellia Food Stores, Norfolk, Va., plans to focus some of its licensed program around four to five "Toy Story"-themed products. Sell-through copies of "Toy Story" videos will be placed up front, while "Toy Story" coloring books and crayons will be cross-promoted in grocery aisles.

Camellia's licensed holiday displays will also incorporate well-known classic Disney characters. "Our grocery people get behind licensing with some of general merchandise products," said Judy Lane, nonfood buyer.

In holiday general merchandise, the chain is "very selective due to our smaller stores and the lack of large seasonal display areas," said Lane. "We look for the hottest characters out there, and cherry pick the best that's available," said Lane.