Beyond Basic Product Merchandising

Until recently, most displays for Aquafresh, Contac, Sucrets, Tums, Vivarin and many other products from SmithKline Beecham Consumer Healthcare were pretty basic -- self-contained corrugated shippers. Were the retail marketplace unchanging, SB may have been able to survive on this most basic form of P-O-P display.But the world isn't simple and Pittsburgh-based SmithKline Beecham Consumer Healthcare has found itself in a very competitive business: marketing formerly prescription (Rx) medicines in new non-prescription, over-the-counter (OTC) versions. That has not only necessitated major changes in the way SB promotes its products at the point-of-sale, but the company is rethinking how it sells this new kind of merchandising to its retail customers.Setting the Standard"We are the only company that has had three [Rx to OTC] switches in less than a year," notes Stephanie Ausefski, SB purchasing category manager. "Not only was the company, in some cases, creating brand new categories, but we also had to create a home for them in the stores."The company's first switch came in late 1995, when SB introduced Tagamet HB into the field of OTC stomach acid reducers. "Tagamet was actually a lot easier," says Ausefski, "because it could go in stores in the antacid area."Finding a home in stores for the new category of smoking-cessation products proved more difficult. SB was first into the market in April 1996 with Nicorette, a chewing gum product containing nicotine designed to help smokers give up cigarettes. The company followed in August with NicoDerm CQ, a nicotine patch.By getting to the market first, SB was able to play a leadership role in how smoking-cessation products would be merchandised. Notes Ausefski, "Our salespeople were going to retailers and saying 'This is where we think these products belong.'"But initially, SB itself was not sure where the products should be placed. Did they belong with cough/cold remedies? Next to vitamins? It was even suggested that they should be placed near condoms, due to their high price. "None of those categories seemed right," adds Ausefski."Initially, there was a fair amount of resistance from retailers about where we would place this category," says Don Dumoulin, director of sales training and development. "And the minute we said these would be $30 to $50 products, the retailers said they didn't want them in their stores."With the advantage of being first to the market, however, SB was able to create a category management system and garner up to 70 percent of the space for its own products. SB has focused its efforts on getting the displays into stores with pharmacies. It has followed this path not only because of security issues, but because the company thinks first-time buyers will be more likely to consult the pharmacist on how to use the gum or patch.At the heart of the category management program are displays created by Advertising Display Co. (ADC), Englewood Cliffs, N.J."Don and the promotion team gave us a list of 26 requirements of what they wanted the display to do," says Ausefski. "They were asking for the world and I thought we would be lucky if we could give them half of what they asked for."But Ausefski and Greg Wengryn, packaging engineer, the people typically responsible for SB's P-O-P programs, put Dumoulin and other salespeople together with ADC's designers to hammer out the details of the displays."Normally, when we create a display, the salespeople come to us and we take their ideas to the vendor," notes Wengryn. "Early in this project, however, we saw that the information was coming in so quickly that Don needed to talk to the designers directly. It worked really well, especially in how quickly we could process the information."Wengryn says he and Ausefski "didn't take a backseat" and still played the important role of tending to the details of design and manufacturing. "But ADC's designers got a kick out of working with our salespeople," explains Ausefski. "And our salespeople were impressed with how easily ADC's designers could interpret what they suggested and get it to work."Security IssuesThe smoking-cessation products displays forced SB to consider the very serious issues involved with product security. "Our typical retailer is used to selling $2, $3 and $5 items," says Dumoulin, "and we are asking them to put something on their shelf that can cost $30 to $50. They were dumbstruck. That put a unique spin on what we had to deliver from a P-O-P standpoint.""One of our biggest challenges was that the more secure we made the displays, the less user-friendly it became for the retailer," notes Wengryn. "That makes it harder to restock and harder for the customer to get the product. We had to try to find a happy medium."Sound and light devices, to announce the removal of a product from a display, were also rejected as being too annoying to the retailer."The displays feature clear, lockable roll down covers. Casters are placed on the two-, three- or four-sided floorstands, allowing them to be rolled to a secured area during hours that a pharmacist is not available. Shelf displays also include the lockable feature. The displays allow only one package to be removed at a time, which is designed to stop "sweeping" of a shelf of high-end products by a quick-moving shoplifter.Other ChallengesAlthough the Nicorette/NicoDerm CQ project was exciting and time-consuming, SB's ongoing merchandising still required its normal level of attention. The company works on a rolling 12-month calendar, with P-O-P, coupons and other efforts planned more than a year in advance of execution.The company typically uses displays to promote a new SKU, or to help drive a price promotion or bonus-count package. Displays are also tied to coupons or annual events -- such as cold and flu season. SB's other primary vendors are Henschel-Steinau Inc., Englewood, N.J., and a local corrugated company, Packaging Specialist.According to Ausefski and Wengryn, many chains are more clearly defining their P-O-P requirements, meaning that many "one-size-fits-all" programs no longer work as well."The retailers are telling us exactly what works best for them," says Wengryn. "By meeting their needs, we are more successful. It makes more work for us, but it's worth it.""The future is going to bring more super stores," adds Ausefski, "and larger stores mean more opportunities for us to have multiple pieces in the same stores. But it will also mean a lot more account-specific P-O-P."

Beyond Basic Product Merchandising

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