Summit Preview: 'Solution Sharing' Benefits PepsiCo, Bi-Lo/Winn-Dixie

When partners like PepsiCo and Bi-Lo/Winn-Dixie plan, develop and implement a major beverage merchandising program in three months, it’s safe to assume that a fair amount of collaboration existed – enough to make it worthy of a general session presentation during the Shopper Marketing Summit in March.The program launched in early 2014 in the ready-to-drink tea category, whose proliferation has presented some vexing challenges for the manufacturers and grocery retailers. Chief among them has been the inconsistency of shelf-placement. Some of the teas are located among the carbonated soft drinks, while others are placed closer to sports drinks or even among bagged tea. Additionally, many of the newer hybrid tea drinks are flavored with lemonade and other ingredients, casting doubt about the real “tea-ness” of the products and creating confusion as to when to use them.Previous research from PepsiCo – which markets SoBe and, through a partnership with Unilever, Lipton ready-to-drink teas – revealed that fewer than half of all shoppers were able to locate the products in stores. “With new consumers entering the category, we knew we had to solve for navigation in grocery to capture the growth of RTD tea,” says PepsiCo’s Lisa Farrell, director, sales finance and strategy. “We also found significant opportunities to improve the flow of products on-shelf. Our testing demonstrated that new users responded well to occasion-based organization, while current buyers responded to brand-based organization.”In late August 2013, PepsiCo initiated a strategy session with the sales and merchandising teams at Bi-Lo/Winn Dixie, as well as Dallas-based agency Shoptology (part of Project Worldwide). Shoptology then coordinated what it calls a “co-lab” brainstorming session – working in small groups with category managers, brand mangers and retail designers to flesh out the program. “The exercise is designed to get participants to engage with each other differently and to reward bigger, more innovative approaches,” says Julie Quick, vice president of insights and strategy at Shoptology.Charlie Anderson, Shoptology ceo, believes that retailers and manufacturers should galvanize around a shared set of goals during a collaborative process that he refers to as “solution sharing.” Says Anderson: “Solution sharing is about coming to an agreement on how to unlock category growth and create a forum to build better ideas.”Testing for the merchandising program included shopper labs to determine a more effective shelf organization as well as endcap design/location. Feedback from shoppers also provided ideas for promotion around new usage occasions and pack sizes.For example, shoppers in the South usually think of tea as sweat tea and consume the beverages during family get-togethers. Thus, one concept for in-aisle signage featured an image of a family sitting on a front porch sipping tea, an idea that could potentially be leveraged through additional brand marketing elements of the program, notes Anderson.Early in-store results for the program were ahead of expectations, according to Farrell. Navigation cues alone drove 7% category dollar growth, while the combination of improved set merchandising and navigation drove category dollar growth of 16% and increased household penetration for the category by 1.3 points, she says.“As co-creators, the category buyer and [Rich Romano, director of sales and marketing at Bi-Lo/Winn Dixie] were both passionate and became internal advocates of the recommendations,” says Farrell. “With their engagement, we were able to iterate the design solution and quickly gain final alignment with the customer.”Farrell, Romano, Anderson and Quick will provide further details during the March 26 discussion moderated by Anderson.

Summit Preview: 'Solution Sharing' Benefits PepsiCo, Bi-Lo/Winn-Dixie

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