PERFECT PARTNERS

KAREN RAUGUST

Licensed snack food brands made into children's learning books that are merchandised in the cereal or candy aisle sounds like the perfect synergy between food and nonfood merchandising. However, publishers have found it easier said than done in supermarkets.

Marc Jampole, a company spokesperson for Syracuse, N.Y.-based Penn Traffic, with 220 stores in Ohio, West Virginia, Pennsylvania, upstate New York, Vermont and New Hampshire under the Big Bear, Big Bear Plus, BiLo, P&C and Quality trade names, described part of the merchandising challenge: "The demand for shelf space in supermarkets is incredible. We want to make sure we carry what the customers want."

According to Jampole, Penn Traffic stores in the past has carried children's titles related to foods, but "consumers weren't that enthusiastic about them."

More than 25 children's titles based upon a snack food -- from Cheerios and M&M's to Pepperidge Farm Goldfish and Reese's Pieces -- are available that teach concepts such as counting, fractions and the ABCs.

While such titles did not take off in Penn Traffic stores, many food-branded titles have built a strong sales track record in the world of children's books. The sales leader is Simon & Schuster's Cheerios line, published under license from General Mills. The first Cheerios title, The Cheerios Play Book by Lee Wade, was published in 1998; Simon & Schuster has printed 1.2 million copies of the book since then. Charlesbridge's M&M's books, produced under license from M&M/Mars, have exceeded 1 million units in sales, cumulatively, since the first title was published in 1994. Many of the food-branded children's books on the market have exceeded 100,000 copies in print within a year of their publication date. (As a comparison, last year's two top-selling new hardcover children's books, both in the record-setting Harry Potter series, sold 3.6 million and 3.4 million copies, respectively, in 1999, while the third best seller, Disney's Tarzan Read-Aloud Storybook, sold 429,000 copies, according to the trade magazine Publishers Weekly.)

The fact that the food channel is not a primary distribution channel exasperates the merchandising opportunity these books offer for food retailers. Supermarkets are considered a nontraditional channel in the eyes of publishers, who often are not set up to distribute to supermarkets. Publishers' primary sales channels include the major bookstore chains, such as Barnes & Noble and Borders; the mass merchants such as Target, Kmart and Wal-Mart; independent book and toy sellers; and the educational market.

In addition to the publishers' lack of infrastructure for distributing to supermarkets, other conditions can make selling into grocery chains a challenge. Factors such as a high price point or an odd shape can reduce potential sales, for example. Simon & Schuster's Barnum's Animals books have an $8.99 price point and are packaged as a cracker box-shaped container with four small board books inside. The shape makes the title hard to shelve, while the price reduces impulse sales and makes it more difficult to promote the books in-store. "It's harder to do things with a book that's $8.99 than one that's $5.99 in the mass market," said Kristi DeLano, marketing manager for Simon & Schuster Children's Books, New York.

Some publishers are looking for ways to encourage supermarkets to cross merchandise these titles with the foods on which they are based, in the hopes of increasing impulse purchases. Simon & Schuster offers shelf-extender racks, clip strips and other mass market-targeted displays that allow Cheerios books to be merchandised in the cereal aisle, Oreos books in the cookie aisle and Sun-Maid Raisins books in the raisin aisle. The company's Cheerios wire shelf-extender contains 24 books, as well as two dozen promotional height charts from General Mills (which retailers can request separately as well).

Other publishers are working on providing similar point-of-purchase assistance. Yet some houses have opted not to make the supermarket channel a priority in terms of marketing expenditures such as point-of-purchase support. One publisher offered grocery and drug chains clip strips of their food-branded books; the effort was successful enough that supermarkets wanted to reorder. Because of the expense and logistical difficulties, however, the publisher chose not to continue the effort. "It's a bigger challenge than the return warrants," noted a company executive.

Several publishers of food-related children's books are in talks with their food company partners about creating promotional tie-ins to increase exposure for the books in the supermarket channel and boost sales of both companies' products.

General Mills and Simon & Schuster have seen success with several such tie-ins in 1999 and this year. Last September, 4 million boxes of Cheerios featured a mail-in offer for the The Cheerios Play Book. The alliance was expanded in April and May of this year, when almost 20 million Cheerios boxes featured an ad -- covering most of the package -- for The Cheerios Animal Play Book. This summer, from June through September, 8 million boxes promoted a new area of General Mills' Cheerios.com site, the Cheerios Playroom, which incorporates several interior spreads from the books; some of these illustrations were highlighted on the promoted boxes. (Simon & Schuster's Cheerios books are also sold through the Cheerios on-line store.)

Publishers agreed that these promotions help sell more books, either directly, through purchase-with-purchase offers, or indirectly, by spurring impulse sales in the supermarket. The indirect results can be difficult to quantify.

The world of food brand-licensed books continues to expand. Most of the publishers who currently have snack-based titles are looking to add more examples to their rosters, while owners of brands such as Tootsie Roll and Junior Mints are actively seeking out publisher partners. All of this interest -- along with continued popularity among consumers -- should lead to more opportunities for supermarket sales, as well as additional cross-promotional and cross-merchandising activity in grocery stores.