DOG FOOD HOWLS, COFFEE PERKS, PLMA SHOW HEARS

CHICAGO --- Coffee and dog food are among the Center Store categories that are flourishing in the private-label arena, said Ted File, senior vice -president of retail relations at Information Resources Inc. here.

"These seem to be the categories that are driving the bulk of private-label sales," File said at the Private Label Manufacturers Association annual trade show, held here Nov. 16 to 19.

Vitamins, household lubircants (which include 3-in 1 and WWD 40), candles, refrigerated entrees, salad kits, refrigerated juice and beverages and disposable cameras are also strong performers.

Private-label played a strong role in the Top 20 dollar growth categories in the food, drug and mass channels, File said.

Private-label dog food food/drug/mass dollar sales soared 40% in the third quarter of 1997 vs. the third quarter of 1996, while coffee jumped 25%.

There's also opportunity in salty snacks, which had one of the largest dollar growth rates (13%) of the Top 20 supermarket privatel-label categories for the 52 weeks ended Oct. 12, 1997, compared with the same period a year earlier: The IRI data excludes generics.

Shelf-stable juice/drink concentrate unit sales grew 48.8% for the 13 weeks through June 29, 1997, compared with the same period a year earlier.

On the other hand, three beverage categories: carbonated beverages, beer and ale, and wine, all had zero sales growth.

According to IRI, 187 private-label categories grew a total of $1.9 billion for the 52 weeks ended Oct. 12, 1997, compared with the same period the previous year. Similarly, 151 grew in units.

At the same time, 65 categories declined $223 million in sales, while 101 declined in units. Two of these were frozen juice and carbonated juices, whose dollar sales slipped 7% and 8%, respectively, compared with last year.

"We suggest that the reason for this is that we had a long spring, short summer," said File.

There are opportunities for private label at supermarkets, he said. IRI examined the sales of some of the Top 25 supermarket retailers, based on data from SN. It then looked at the three retailers who have a total private-label dollar share greater than 20% in the categories that IRI tracks. File declined to identify the chains.

Two of the three chains lacked private-label shelf-stable egg substitutes, refrigerated cheesecake, frozen coffee creamer, frozen cookies and frozen dough.

"Is there an opportunity for private label? Perhaps there is, so maybe we all should look and see what we can find," he encouraged members of the audience.

In the third quarter of 1997, 59% of supermarket consumers, up from 53.6% in the third quarter of 1996, bought at least one private-label product, while 10.3% -- up from 9.4% -- of the total food-store dollars were spent on private label. The average dollar amount spent on private-label items per trip was $6.35, up from $6.09.

File said private label has shown strength over the last few years. In the third quarter of 1996, for instance, sales of private-label products grew 10%, while total sales -- national brand and private label -- increased 3.3%.

"Private label really drove that 3.3% increase, at least in our findings," he said. While the third quarter of 1997 showed strong unit share -- 20.8%, up from 20.3% for the same period in 1996 -- the dollar share could be better. Dollar share for the third quarter of 1997 was 16.0%, the same as the period a year prior.

"[Unit share] may sound pretty good, but we don't take units to the bank," File said.

Along with certain categories, different regions could have stronger private-label sales. California had a 14.8% private-label dollar share for the 13 weeks ended Sept. 28, 1997, while the rest of the West Coast had a 16.9% share; Southeast, 15.7%; South Central, 14.3%; and the Northeast, 14.8%. But other regions could be doing better. The Plains, for instance, had 10.9%, while the Great Lakes had 12.9%, and the Mid-South, 5.7%.

File said the industry should work on ways to boost private-label sales. Promotions are one way to do this.

"The private-label dollar [share growth] will depend on depth of manufacturer promotional activities. I see very few across the board. I don't see the amount of advertising and promotional activity that I think it deserves," he said.

Among File's other recommendations:

Don't allow private label and national brands to get out of balance.

Establish a "no questions asked" return policy.

Place private label to the right of national brands.

Maintain a presence of private-label coupon shelf talkers.

Use customer testimonials.

Create a private-label merchandising philosophy."Retailers should get away from cookie-cutter shelf planograms and listen to the consumers about what they're telling us about private label," he said.

There also should be greater emphasis on private-label couponing, including electronic coupons and freestanding inserts, he said.