While club-style packs have earned their rightful place in supermarkets, many retailers are rethinking marketing strategies for family and jumbo sizes.
"We are not a warehouse, but a retail store," said Terry Stapleton, vice president of Minyard Food Stores' Sack & Save division. "We offer lots of variety, a little bit of everything. That is the difference between us and a club store."
The Coppell, Texas-based operator has had "Big Buy" packs for more than a decade, to provide convenience to a certain segment of shoppers.
"The club packs are space robbers, but there is a need for them," said Stapleton. "We carry about 30 items and keep products in the mix based on turns and movement."
Save Mart Supermarkets, Modesto, Calif., introduced its Value Pack items to keep customers from defecting to discount merchandisers or membership clubs, according to Sally Sanborn, director of marketing for the chain. "There are certain customers that like to get their supplies in bulk," she said.
Another experienced marketer of club packs is Hy-Vee, West Des Moines, Iowa.
"Ever since the items became available to the supermarket class of trade, we have added to the assortment and we are carrying more," said Ruth Mitchell, director of communications. "More people have more room to store the larger sizes. When these club-style packaged items became available, they became a hot trend. Consumers wanted them, and still do. But we had to seek out items, because they were not offered to us [as readily] as they were to other classes of trade."
One West Coast operator is finding that large sizes create a value-oriented image for supermarkets in the face of membership club competition. Moreover, he noted that the limited assortment of the clubs frustrates those who are not shopping for a business. "They may offer price, but the variety is just not there," said the West Coast operator, who did not wish to be identified. He too commented that larger sizes have been less available to the supermarket class of trade, although this problem has eased over the years, as supermarkets seek their own style of merchandising big packs.
Supermarket retailers are also at a disadvantage with manufacturers in the area of trade promotions.
"Clubs don't carry the stockkeeping units that we do, and the promotions are in a few sizes, where we will have 10, 12 or 20," said Stapleton. "A retailer with variety is put at a disadvantage by having the promotional money spread around the store."
In an attempt to level the playing field, Sack & Save spends promotional dollars on what customers want, whether that be club-size or traditional-size packs. As a result, sometimes the club-style package is offered at a higher price. Still, the convenience alone offered by the larger pack is enough for some customers.
Most retailers SN spoke with prefer to integrate family, jumbo and club-style items within their respective categories, so that consumers have the opportunity to compare sizes.
In the Chicago area, Dominick's Finer Foods, Northlake, Ill., is changing its merchandising strategy for club packs. Once concentrated together, the club-style packs are now being integrated to provide instant awareness and present the larger-size option to consumers, said Shana Pritchett, public relations associate for Dominick's.
"We are looking to increase the amount of club-size packs and food-service sizes," she said. "For best space utilization we are integrating the items into their various categories and we are putting our efficient assortment procedures to use to present products based on market performance."
While merchandising decisions at Hy-Vee are usually made at store level, this chain is moving toward integration, and Sack & Save is already using this strategy.
"It is not favorable when items are in a section by itself," said Stapleton. "Customers have a tough time turning $6, $8 or $16 loose when there is no reference. It is best to work these items into their categories. Then the customer can see the value when regularly sized items are not on ad."
Save Mart still prefers separate sections, offering Value Pack items either on one gondola, occupying one side of an aisle, or in a 10- to 20-foot section, depending on the size of the store.
Retailers continue to find that traditional pantry-stocking categories are the most popular with consumers. Toilet tissue, paper towels and facial tissues have been most successful when they represent value and convenience, retailers said. Cereals and soaps round out the must-haves in the club-size lineup, retailers noted.
Bulk tissues and paper towels sell best, according to Stapleton. "Large bags of cereal do exceptionally well, while box cereals are average movers," he said. "The packaging in the case of cereal makes a big difference. [Bagged cereals] offer a distinct value."
Large families and stock-up shoppers are the main consumers of big packs, Hy-Vee's Mitchell said. "These customers shop occasionally for staples and do fill-in shops. This often reduces their regular shopping trips to perishables."
Promotions of large sizes are often not part of the regular promotional program, and retailers continue to explore how these items can be made a part of chainwide promotional efforts.
Save Mart, for example, advertises club-style items in the weekly circular and uses in-store signage to attract consumers' attention to a designated area where products are merchandised.
Hy-Vee also promotes the items in its circular and with in-store signage. Lately, the club-size packages have made their way into every weekly ad, Mitchell noted. Sack & Save focuses on pallet drops and endcap displays to renew consumer awareness of the availability of these products.