P-O-P for HMR

Is "HMR" just another acronym-fad for the alphabet-crazy supermarket business (ACV, ECR, SKU, etc.), or is there serious business that consumer product marketers can take out of the "home meal replacement" segment?In recent years, supermarket chains (particularly those on the coasts) have been setting up specialized areas within their stores to provide ready-to-eat meals. They are responding to a dramatic shift in the average American's eating patterns, according to industry experts. More and more consumers want to enjoy takeout food in their own home -- hence the use of the term home meal replacement.Stay at HomeAccording to a 1995 NPD Group survey, consumers opted for a takeout dinner at home 61 percent more often than they did 10 years earlier. A Better Homes and Gardens magazine survey of readers showed that 76 percent of "traditional" families take home prepared food once a month. The experts say Americans are in more of a rush than ever, but are tired of the offerings of the fast-food burger and pizza chains.The competition for the HMR dollar has developed between supermarkets and a handful of specialized restaurants such as Boston Market. Supermarkets have the benefit of neighborhood locations and the appeal of offering access to both a meal and various staples in one trip. "A huge hurdle for most supermarkets is layout and design," writes Paul Moomaw in Restaurants USA magazine. "Customers generally don't feel they can get in and out of a grocery store with prepared food half as fast as they can from a restaurant. Moving delis to the front of the store and employing separate checkouts have helped in some instances, but bolder moves may be afoot in supermarkets of the future."Supermarket operators say they are ready for such bold moves. In Progressive Grocer's April 1998 Annual Report on the Grocery Industry, chain supermarket and independent grocery store executives stated that their number one priority in the coming year would be to "stress ready-to-eat meals" in their stores. Progressive Grocer also notes that 60 percent of supermarket companies say they now have "some type" of HMR program in place.Opportunities In-StoreConsumer product marketers are watching the category for an obvious reason: they sense there's great potential for cross-merchandising. A new survey conducted by New York-based Meyers Research Center backs up their intuition. More than eight out of ten HMR shoppers buy something other than a main entree. Lily Lev-Glick, vice president, sales and marketing with Meyers, says the survey was conducted through 1,026 customer intercepts in retail outlets with HMR departments in seven major markets.Is there an opportunity for consumer product marketers in all of this, and can P-O-P play a role? The answer is yes and yes:More than half of store shoppers say that "signs/displays in the store" influenced their decision to buy a ready-to-eat meal, In fact, P-O-P was the sixth-most-important purchase factor listed by HMR consumers.Packaged goods marketers have a stake in the HMR department: nearly 40 percent of shoppers surveyed said the use of "brand-name ingredients" spurred a purchase.While retailers often "bundle" different items with the ready-to-eat meal (the package is price-scanned as one item), the vast majority of consumers opt to buy "non-bundled" items. And two-thirds of the consumers making these non-bundled purchases will wander to aisles in other parts of the store to make purchases.If easy cross-merchandising locations don't already exist in the HMR department, savvy marketers should try to find them. Technologies are already being developed that will bring branded "fresh food" items to other areas in-store such as endcaps and checkout aisles. See, for example, Octagon Industries' "FrigoPub" on the cover of this issue.P-0-P TacticsDigging deep into Meyers' data produced a variety of demographic insights that should help marketers guide their P-O-P efforts within this segment:More than half of all shoppers (51 percent) state that point-of-purchase elements such as signage or displays influenced their decision.When purchasing HMR items, young shoppers (under 35 years) were more likely to claim that they were influenced by P-O-P instead of by a store circular.Single-person households are more likely to be influenced by P-O-P and store circulars than two-adult households and households with kids.Lower-income households (with annual incomes under $35,000) claim more influence by P-O-P and/or circulars than households with higher incomes.Impulse purchasers claim far greater P-O-P influence on their purchase decisions than planned purchasers (62 percent versus 46 percent).Supermarket shoppers who claimed that their store visit was not their main shopping destination were far more likely to be influenced by P-O-P.Nearly one out of five shoppers choose to eat the meal in-store. Interestingly, they were slightly less likely to have been influenced by P-O-P in their purchase.Weekend shoppers were slightly more likely to claim influence by P-O-P.

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