A CONVENIENT ARRANGEMENT

LISA SAXTON

STILLWATER, Minn. -- Candy takes center stage in a new test program at Cub Foods Stores here that places a convenience store within a supermarket.

To pick up a candy bar, a pack of gum, a magazine or cigarettes, customers need only swing to their left upon entering the chain's landmark Stillwater store. They don't even have to move past the front checkouts.

About 75 stockkeeping units in 140 facings of the most popular candy and gum count goods are prominently displayed in the compact service center.

"The concept was to create a convenience-store-type arena," explained Karen London, vice president of account management at Gage In-Store Marketing, the Minneapolis-based firm that developed the concept for Cub. Officials at Cub did not return SN's calls about project.

Prior to the new format -- which made its debut in January -- the Cub store featured a typical customer service center, located near the registers, separating the perishable and dry grocery areas. "It had just been a counter where people would come if they had service issues.

"We wanted to create a merchandising arena where items could be on display and easily accessed by the staff to build impulse sales," said London.

Gage designed a large kiosk area that not only houses merchandise requiring a higher level of service, such as cigarettes and film processing, but also customer services, such as check-cashing and returns. It's positioned in behind the registers, but in front of the video department, which is against the front of the building.

The idea, she said, was to attract the convenience shopper. For instance, incremental sales can be built "if customers wanting to rent a video know they can penetrate only the front end of the store, and pick up quick, high-impulse items like candy, gum or cigarettes."

Immediately after Cub installed the first of what it calls the "Extra! Extra!" service centers in its Stillwater store, London said, "we expanded this test to four additional stores -- there's one in Ohio and Indiana, and they'll be one going to into Denver and an additional site here in the Twin Cities.

"Part of the concept was to form a collaborative marketing effort between several key vendors, who would then become the category leaders -- as far as Cub was concerned -- in each of the key categories: candy, gum, tobacco, film, batteries, and magazines.

"So we partnered with M&M/Mars, Wrigley, Philip Morris, Eveready, Kodak and Time Distribution Services," said London. "And they all co-oped the development and the installation of the first concept."

M&M/Mars and Wrigley planogrammed the confection section for Cub with an eye toward enhancing candy sales on a whole, rather than their own brands.

"What was interesting in the candy and gum segments was [those vendors] put in a representation of all brands. They really planogrammed that section by category management principles and market share," she said, noting the presence of Hershey, Nestle and other manufacturers. Pegged candy also is displayed on the side of the service center that faces the video department.

"They felt they wanted to do what was right for the retailer, and, obviously, the consumer would be looking for those brands. "I think that's really noteworthy, because there's a major change in how these manufacturers view building their business. They know if they build the category, their business is going to grow; their market share has to be earned in other ways.

"Oftentimes these companies try to go in and do it solo, but Cub asked us to coordinate all of this for them," said London. "In fact, we even negotiated all the vendor agreements on behalf of Cub.

"That's something retailers themselves really don't have the time to do. And they also didn't want this to infringe on their day-to-day business," she added. "So the role we played was in developing the concept, designing and also helping them create all the partnerships and executing those partnerships."

Gage will help evaluate the success of the new format as well.

"We are tracking the [center's] sales for 90 days. Because, in our initial assessment, it will take a while for customers to not only get accustomed to the totally new store format, but to begin to create additional [store] visits."

Nonetheless, London said Cub is "already planning on expanding the concept to their corporate stores, just based on the fact that it creates the kind of visual impact and service perception they're interested in."

The convenience store concept also will help Cub monitor cigarettes, a self-select category prone to pilfering and sales to minors.

More importantly, it will help Cub stand out from its competitors. And that, according to London, is the name of the game these days.

"In my opinion, supermarkets have done a great job differentiating themselves as far as price and quality," she said.

"But I think they're realizing that price and quality has become a common standard now and the atmosphere with the consumer is becoming a critical issue. So they're looking for additional ways to differentiate themselves from their competition."

London asserted that shoppers want the store to meet their needs. "And they have varying needs. Sometimes they're popping in for a few fresh things; other times they're doing major grocery shopping.

"And with the time pressures people have today for shopping, to be able to move in and out quickly is really a critical issue. I think Cub is taking big steps in that direction."