The fruits of a well-executed cross-merchandising program with a hit video can be sweet, most grocery executives agree.
The problem, however, is often in a coordinated execution given space availability, department autonomies and the initiative and creativeness of store managers.
"Cross merchandising is one of our corporate goals this year,"said Rod Boni, the grocery and general merchandise merchandiser, Pay Less Supermarkets, Anderson, Ind.
"Taking advantage of the name recognition and advertising and marketing support that manufacturers and studios use to support their products fits in with our strategy," he added.
Developing a program that combines cross merchandising licensed entertainment items with groceries is a shared responsibility between the nonfood and grocery departments and others at the chain.
Bill Metzinger, general merchandise and health and beauty care buyer for Pay Less, works with the directors of merchandising, grocery and general merchandise to formulate cross promotions.
According to Metzinger, merchandising sell-through videos at high-traffic locations, and close to the displays of tie-in licensed or promotional products effectively boosts sales.
The responsibility for creating the display falls to the store managers. "We've found having individual store managers responsible for executing these displays works the best. Some stores have enough space to display all the related products together, while others have to be creative," Metzinger said.
Pay Less builds these displays at the front end "where customers can't miss them," he said.
Wayne Gresl, director of nonfood, Copps Corp., Stevens Point, Wis., attempts to make the independent retailers it supplies aware that "this kind of cross-merchandising activity moves a lot more merchandise. We promote it that way, and at some stores it happens and in others it doesn't."
Copps buyers sit in on the same weekly ad meetings that grocery buyers do when grocery products are part of the promotional mix. Although cross merchandising within the parameters of nonfood may be a given, doing the same in other sections of the store becomes very difficult because nonfood executives "don't always have control over what other departments do," added Gresl.
"It's a constant challenge," he said of most cross-merchandising projects. E
ven though the video coordinator buys video products, and the back-to-school buyer buys licensed items in school supplies, Gresl said they try to coordinate with their retailers by suggesting store-display ideas.
Yet finding adequate selling space at store level for licensed entertainment merchandise is the biggest hurdle buyers must face in planning cross promotions, Gresl pointed out.
Some store managers, he added, are also still in a learning process about the opportunities that cross merchandising food with highly visible nonfood products offer.
"But once somebody [at store level] finds out it's a good way to merchandise and sell through quickly, they'll usually get on the bandwagon and do it," he said.
Mike Schultz, senior vice president of sales and merchandising, Hughes Family Markets, Irwindale, Calif., believes the chain does have a coordinated effort in cross merchandising licensed products, including video, back-to-school and groceries. "Generally it's fairly simple and smooth," said Schultz.
"It's really just a matter of merchandising and working all this into planograms and promotional plans in advance," said Schultz, adding that the nonfood department arranges all this with the video and grocery sections.
Schultz said finding space for cross merchandising isn't a problem either. "Generally we have enough notice to make the space available."
Many of these efforts depend on how it fits in the store, he added. "In most cases it's not a problem. But where there isn't enough room for a product to fit into the main-themed display area it would go into the video area, or grocery department near the related grocery tie-in items," Schultz said.
Creativity in displaying licensed items often shows up at store level, and "some stores are a little more creative than others," said Schultz. He said the displays are first planned at headquarters, and then forwarded down to store-level managers.
Fiesta Mart, Houston, sends suggested display ideas for cross merchandising licensed merchandise to its 34 stores, which store managers and merchandisers implement, provided the space is there to cross merchandise several different products, said Duane Robelia, general merchandise and HBC buyer.
"Each store, however, has a different configuration and may not have the space to do it," he said. Licensed items also do better in more affluent sections than at some of the chain's stores that cater more to lower-income customers, Robelia added.
"We review each licensed character for our different store areas. Certainly Mickey Mouse licenses are very strong in inner-city stores, while there isn't much interest in items too mainstream," he said.
Robelia works with others like the grocery buyers in a team effort in devising the chain's licensed cross-merchandising projects. He described the process as "pretty easy and not brain surgery. If General Mills comes out with a cereal promotion tie-in then the cereal buyer will contact me, and we'll work together in coordinating store displays," he added.