THE MISSING LINK 1997

DAN ALAIMO

Cross merchandising sell-through event titles with related products in the supermarket is a vital tool for building sales for all involved. However, executing these programs at store level remains problematical, said retailers participating in SN's video roundtable.

On some titles -- "Toy Story" was an oft-cited example -- the communication needed to pull these programs together is very good, while on others -- such as "101 Dalmatians" -- the support is lacking, said the retailers.

The studios "communicate with the vendors, but we are really not seeing that information," said Sharon DeSordi, video buyer and merchandiser for Grand Union Co., Wayne, N.J.

According to Jamie Molitor, director of video operations for Dierbergs Markets, Chesterfield, Mo., on a recent cross promotion involving "Goosebumps," Pepsi and Frito-Lay, "they brought it to us. They made the appointment with all of us to work together on that one, [but on] '101 Dalmatians,' I didn't hear from the Nestle people at all," she said.

"If they are going to promote and advertise those cross promotions, they need to bring them to us that way, and present them to us that way," she said.

Meanwhile, space continues to be a major issue. "Our cross promotions probably haven't been as good as they should have been lately mainly because of space," said Bob Gettner, video buyer and coordinator for B&R Stores, Lincoln, Neb.

"It is hard to tie in a General Mills or a Nestle product or whatever and have a display that is shoppable," said Matt Dillon, director of video for the Concordia, Kan.-based Boogaart Retail division of Fleming Cos. Echoing the sentiments of others at the roundtable, he said the buy-ins on the related products are often very high.

Here is what the roundtable participants said about cross merchandising:

SN: On sell-through titles, what is the key to getting stores to actively cross merchandise the videos with the related products?

DESORDI: Try to get the two departments to talk to each other.

MOLITOR: You have to pick what you tie in with carefully. With "Toy Story," there were a lot of products, like action figures and others that were really easy to tie into. But with "101 Dalmatians," I don't know that you would want to build an endcap with dog food and Nestle products. I don't think it would be appealing to the customer.

MAXWELL: Plus the position in the store may not work either.

MOLITOR: And I think the Alpo you had to buy was in pallets, and I don't know how you would merchandise shippers and pallets.

MAXWELL: You've got a timing issue, too. The grocery guy will want to get in this half a truckload of Alpo that he bought on special deal, which may not be the same time your "101 Dalmatians" is coming in, and those things rotate really quick.

MOLITOR: Then their [freestanding insert] doesn't drop until next Sunday, and we got it in on Tuesday, and yeah, we had a little bit of an Alpo problem trying to track down that coupon. But partially that was my fault, because we did not communicate with the other department to find out that they did not buy in on that Alpo. But when the movie came out and the sticker was on there, I still needed to have those coupons in my store available for my customers.

DARNELL: You have to dedicate a lot of time and effort to cross promoting to make it work.

DESORDI: In supermarkets, I don't know that people who are doing our jobs can take on that responsibility. We need to have a person who works with us to be that liaison.

MOLITOR: We need better support there. When "Goosebumps" tied in with Frito-Lay this year, we had a lot of support from Pepsi and Frito-Lay. They brought it to us. They made the appointment with all of us to work together on that one. Where on "101 Dalmatians," I didn't hear from the Nestle people at all. They didn't try to coordinate that. So I think a lot of that rests on their shoulders. If they are going to promote and advertise those cross promotions, they need to bring them to us that way, and present them to us that way.

DESORDI: If I'm not mistaken, there has been some press on the studios providing more support on those kinds of issues. Frankly, they do it. They communicate with the vendors, but we really are not seeing that information. There are no major presentations being made. Or if it is being done, the presentations are not being made to both departments. That is something that we need the help from the studios on, and they promised to do that -- but I don't think that we've seen much of it.

MOLITOR: Because it is their deal.

DESORDI: Absolutely. They are bartering that money and we are not being given the opportunity to pass something on to the customer.

MOLITOR: And I've seen both sides of it. With Frito-Lay and "Goosebumps," it all worked really well, but with Nestle and "101 Dalmatians" it didn't go so well.

CARTON: I suggest that the small margin has something to do with it. It's a lot of attention, a lot of labor and a lot of effort for a pretty small margin, which is the ultimate benefit. In that respect, it differs from the rental side.

MAXWELL: Some of those cross promotions are pretty watered down, too. You buy this product, you buy this movie, you put the two tags together, and mail it in with your own stamp, and you get a $3 coupon on five selected titles.

DESORDI: That's too much work.

CARTON: Do people do that?

MAXWELL: But on the box it says $3 off and that looks good. The customer brings it up and they want their $3 off.

MOLITOR: I think the customers have every intention of doing all that when they purchase those items and they really think they are going to do it.

CARTON: But how many ever follow through?

MAXWELL: I've asked about the redemption rates and the studio couldn't come up with a number.

CARTON: They probably know. I would suggest that they don't want to come out with it.

SN: More sell-through titles are coming out with cross promotions using instantly redeemable coupons. How do those work for you?

DESORDI: You can get in trouble with that if you experience the same kind of problem we had with Alpo.

MOLITOR: I thought a coupon on a recent Disney movie was misleading for our customers. You had to open it up and read it to realize that it wasn't $2 off this movie, but $2 off something else.

MAXWELL: It was $2 off "selected movies."

FEINSTEIN: Probably "The Three Caballeros" or something.

MOLITOR: There was some concern there. We did have a few complaints on that.

MAXWELL: People got to the checkstand with that movie thinking they were going to get $2 off, but it was an instant coupon for $2 off a movie you never heard of.

FEINSTEIN: With experience after experience of this, customers are becoming more aware that it is confusing and that they have to read exactly what the offer is. More customers are noticing that they have to do other things and they are becoming unhappy about it.

MOLITOR: It is an irritation to them because they don't want to feel stupid, and this makes them feel stupid.

FEINSTEIN: Once they have done that once or twice, they learn.

SN: "Twister" had an interesting tie-in with the Tropicana Twister drink products using the Catalina Checkout Coupon system. How did that work for you?

MOLITOR: It didn't work as well as I would have liked because the buy-in on the Twister drink was not the same as the movie. We still merchandised it together, but it wasn't as good as it could have been.

DILLON: We have some push areas close to the front end of our stores and we will tie in some of those titles. But like everyone else said, it is hard to tie in a General Mills or a Nestle product or whatever, and have a display that is shoppable. Also, the buy-ins are so high.