Coffee Aisle Revamp Lifts Sales

CAROL ANGRISANI

NORTHFIELD, Ill. — Kraft Foods here is involved in a “coffee aisle reinvention” designed to build sales not only of Kraft's brands, but the entire category.

The concept, which was tested at multiple stores this year, involves creating a hot beverage experience by remerchandising about 24 feet of the coffee aisle in order to position Kraft's Tassimo single-cup brewing systems directly beneath the Starbucks single-cup capsules that are designed to be brewed in it. Other brands of coffee are positioned near beverage systems from other manufacturers. The brewing machines were previously sold from the general merchandise areas of the stores.

Initial test results show an increase in premium-coffee unit sales of more than 6%.

Kraft hopes to bring the concept to additional retailers in 2009.

The test was made possible via a partnership with Applied Predictive Technologies, Arlington, Va., and its Test & Learn software. Test & Learn enables companies to test new initiatives and learn from the results.

Kraft has used Test & Learn to determine the efficacy of other in-store projects, including transforming the cookie and cracker aisle into a near-replica of a kitchen, complete with tables, shelving and cookware. The “Mom's Kitchen” test involved products merchandised in cabinets surrounded by items typically seen in a home kitchen, including hanging pots and pans, utensils and cookie jars.

The goal was to remind consumers of the Nabisco heritage, and the role that brands like Chips Ahoy!, Oreo and Ritz have played in their lives.

The most valuable outcome of Test & Learn was the development of Wall-to-Wall, an overhaul of how Kraft sales reps work with retailers.

Introduced in 2006, Wall-to-Wall organizes sales reps by store rather than category. This means a rep is responsible for almost the entire portfolio of Kraft products, rather than handling one specific business area, such as cookies/crackers or pizza.

Prior to Wall-to-Wall, several different reps from Kraft's three sales force organizations — direct-store-delivery cookies/crackers; warehouse dairy and dry grocery; and DSD pizza — were sent to the same stores.

“It didn't seem logical to have four or five people calling on the same store, but not working together,” Denny Belcastro, Kraft's vice president, customer development and industry relations, told SN. “It was inefficient.”

The problem was that Kraft didn't have a way of quantifying whether or not sales force consolidation would work.

Then came Test & Learn. Kraft used the system to analyze weekly store-level data and determine if sales force optimization would be worth the effort.

“It gave us the opportunity to prove that it would have a positive revenue impact on our business at the retail level,” Belcastro said.

APT managing director Scott Setrakian said Test & Learn helps APT clients test an idea and measure what changes occur as a result, including sales by product or store level.

“We're able to read the impact of the activity, and understand the true returns that are created, before rollout,” Setrakian said. “This helps clients like Kraft to roll out the good ideas faster. They can also understand and fix new ideas that don't perform according to plan before they go network-wide.”