GM MARKETING CONFERENCE 2000

CHRISTINA VEIDERS

ORLANDO, Fla. -- The General Merchandise Distributors Council, Colorado Springs, Colo., began its 30th-anniversary year with a birthday party here during the GM Marketing Conference, which ends tomorrow evening, June 6, with a tribute concert from the classic Beach Boys.

Appropriately, the GMDC's birthday was an occasion to release the results of the first phase of this year's Educational Foundation study -- "Birthday/Celebration Best Practices Consumer Research Report," co-sponsored by American Greetings and Hallmark Cards. Research consisting of focus groups and an Internet consumer survey of 1,800 households was conducted by the Allen Levis Organization, Northfield, Ill.

Not surprisingly, the study showed that birthday celebrations are a multibillion-dollar business. Household expenditures range from $75 to $125 for children's celebrations and $300 to $400 per occasion for milestone events. The potential for mass-market retailers is from $100 to $800 per capita spending annually per household, according to the study. "That's no small figure," said Roy White, GMDC's vice president of education. Add to this the fact that many parties are attended by a sizable number of people. The study found nearly 15% hosted large parties of 26 or more.

The report also revealed birthday shoppers, mostly women, want to get all their party needs from one location. Supermarkets, therefore, with their one-stop shopping format and multi-category food and nonfood selection, have the best chance of capturing birthday spending.

"The big surprise," said White, "is the opportunity-gap numbers embedded in this study -- high levels of spending, in-home parties, a wish list to do as much shopping as possible within a single outlet. It becomes an opportunity for those outlets that can brand themselves the destination for all of these elements."

However, according to a market-share chart (source: NFO Panel Diary, 1999) on dollars spent on cards, gift wrap and party supplies, discounters have the lead at the moment with a 24% share of cards, compared with 18% for supermarkets. In gift wraps, discounters take 38% of dollars, compared with food's 8%, and, for party supplies, discounters have 36%, followed closely by food stores' 34% of dollars spent.

Another chart from the research showed that supermarkets are way ahead of the competition when it comes to capturing food and beverage purchases for parties. Of survey respondents, 67.8% said they buy these items at supermarkets. Obviously, the opportunity is there for supermarkets, especially, to improve their share of the nonfood birthday business, said White.

To do this, supermarkets need to concentrate on expanded selection, an enhanced destination-merchandising format and competitive pricing, the report stated.

"The fact that consumers have this tremendous need to buy for birthdays that can be encapsulated into one location represents a huge opportunity for supermarkets," said White.

The GMDC plans to return to next year's conference with another birthday report on the results of store tests conducted on some of the promotional ideas suggested in this year's study.