Thinking Inside the Big Box

For marketers of consumer packaged goods, mass merchants are the ultimate retail arena. How many other channels in this country are visited by 100 million shoppers in one week? Mass merchants have become more important than ever. And it's not hard to understand why Wal-Mart, Kmart, Target and other discount retailers draw shoppers in droves. Consumers today are starved for time and hungry for bargains, and these one-stop-shopping discount locales are designed to fill the bill for both. What's not so easy to grasp is how a marketer's P-O-P campaign fits into the fluid dynamics of the mass merchant retail scene. We asked several retail marketing experts and consumer goods marketers to shed some light.Under PressureIf you're feeling like there just aren't enough hours in the day, join the crowd. Last year, 60% of Americans said they had less leisure time than they used to, according to the 1999 Consumer OutlookSM Survey conducted by Kurt Salmon Associates of Atlanta. What's more, they indicated that they didn't want to spend their precious free time in the checkout line. Most consumers say they find shopping today overwhelming (57% of women, 53% of men) and, not surprisingly, they planned to spend less time shopping in 1999 -- just three hours per month, down from 4.3 hours a month in 1995.It's a phenomenon that Judith Langer, president of Langer Associates, a market research and trend consulting company in New York, calls the 25-Hour Day Syndrome. "That's the term one of our focus group participants used to describe the intense time pressures many people feel today," says Langer. She says consumers use time -- or the lack thereof -- as the reason for their choices about products and activities, including shopping. "And this time crunch has intensified over the past few years."Mass merchants, it would seem, are designed to help relieve our time woes. By gathering just about every product necessary for human existence -- everything from cereal to cosmetics to clothes for the kids -- under one roof, big-box stores streamline the whole general-merchandise shopping process.But theory doesn't always translate into reality. "Mass merchants are a double-edged sword," says Langer. "Theoretically, they save time because they're one-stop shopping, but if a shopper goes in and gets lost and it takes forever to find what he wants, then where's your time-savings?" She says consumers are especially annoyed by services that don't deliver on their promise to make life easier. Among the list she has compiled of most-annoying time-wasters: retail displays that are difficult to figure out. While her qualitative research shows that superstores have a lot of fans, they're seen as huge and overwhelming by some. "The irritability factor is very high today. People are rushed and extremely impatient. They don't want to take the time to figure out what's going on. With so many products on the shelves, in-store displays have to be a quick read," she says.It appears that some marketers have heard the message loud and clear. "We know that we really only capture the consumer's attention for a few split seconds," says Chris Monroe, director of merchandising and advertising for Ames-True Temper, a manufacturer of non-powered lawn and garden tools based in Parkersburg, W.Va. He says the selection of these tools -- indeed of all types of merchandise -- at mass merchants is greater than it's ever been. "You walk into Wal-Mart and there's anything from 8 to 24 feet dedicated to our category. And that's great, but the challenge is helping the consumer sort through this huge selection. Until recently, our category had been grossly under-merchandised. So we've changed to a new strategy that is much more visual and more colorful."Monroe says consumer research helped shape his company's new in-store campaign for long-handled tools. "We know that the first thing people see is color, the second is shape, the third is symbols and the fourth is words." So the company's new labeling program, to be followed up soon with a complementary in-store merchandising program, uses a color-coding system to differentiate each line, and a large illustration with key product features on a fold-out label. "People understand in a split second what a tool does," he says. The label also lists products' quality levels so shoppers can compare the benefits of different-priced versions of the same tool. "When consumers don't understand the differences between a lower-priced and a higher-priced tool, they default to price, buying the less expensive one. We've done tests that show a significant increase in step-up sales with placement of good in-store merchandising programs." Finally, the label lists information on the balance of the line, encouraging multiple sales. So someone picking up a shovel can read the fold-out brochure and walk up to the register with a shovel, a rake and a hoe."I think the tendency for manufacturers who don't understand the way people buy is to include too much information," says Monroe. "But the truth is, such a small percentage of people will read through all that. You're wasting their time and maybe even turning them off."Kate Sollecito, creative services manager for Union, N.J.-based Red Devil, a maker of caulks and sealants, echoes Monroe's sentiments. "People are very much graphics-oriented, especially the 'MTV generation.' People don't have a lot of time to spend looking at displays to figure out, 'Do I need this product? Do I want this product?'" Like Monroe, though, she promotes products that often require more than a cursory explanation. "For our products, most people need more information than we can include on a display. 'How does it work? Where can I use it, indoors or out? Is it paintable or not?' Shoppers need that information."Sollecito says brochures are sometimes used to fill the information gap. Most recently, the company attached mini brochures to an award-winning sidekick that houses the company's new House & Home Restore line of products. The display comprises eight caulks and sealants in five-ounce tubes, each with a patented roller device that squeezes the tubes neatly and efficiently from the bottom.If shoppers want easy-to-read displays that speed them on their way, mass merchant retailers are also looking for ease and speed in supplied displays. "We try to make our displays as easy as possible for in-store people so set-up is simple and fast," says Robert Werner, director, creative services for Revlon Consumer Products Corp., New York. "That's been a real focus in the past few years with our mass merchant accounts, and it seems to come up earlier in the development process." That means shipping components in one box when possible and clearly marking the outside of the box.For Larry Bauer, merchandising and packaging development director for Rayovac Corp., Madison, Wis., logistical issues are a key consideration when developing merchandising materials for mass merchants. "A display has to have the option of sitting on a counter, hanging on a pegboard or sidekick, or being able to mount to drywall. That's something we normally don't do for other accounts, but mass merchants are telling us we have to take into account the size and different layouts of their stores.""Logistics are always a consideration for us," says Red Devil's Sollecito. For instance, the company replaced cut-case boxes with sesame-tape boxes, not only because the tear strip creates a neater displayed edge, but because they didn't want store stockers spending time cutting up boxes. "And for our House & Home Restore sidekick, we packed everything so that basically, the retailer just gets it, opens it up and hangs it on the shelf. We even supply reorder tags so that's already in place." More than a mere courtesy, logistically well-planned displays can help differentiate a supplier in the eyes of the account, says Sollecito. "Obviously, our goal is to make products that are superior to our competitors' products. But when we create and pack displays so that they require minimum effort from the store, that's another area where we can really shine and sell ourselves to the retailer."In other words, a well-packed, simple-to-set-up display is a means of ensuring placement. Says Stephen Ulik, manager, planning and promotions for Sunbeam, Boca Raton, Fla., "If there is assembly required, we make sure that whatever needs to be done is as intuitive as possible. We make it so simple that you just pull it out of the box and set it up in a matter of minutes. That's a selling feature, quite frankly. When our salespeople go into an account presentation, if they're struggling with the display, that makes the buyers think, 'Hmm, will these be easy to implement at the store level?' If the answer's no, the stores won't implement them."If it seems like marketers are bending over backwards to please their mass merchant accounts, they are. "With so much retail consolidation," says Red Devil Sales Promotion Manager Larry Alexander, "the Wal-Marts of the world are getting bigger and smaller chains are disappearing. That means the big chains have more and more clout, and they dictate more and more how the P-O-P should look." Revlon's Werner says he's seen mass merchants shift from mere distribution points to marketing partners. "In the past, we would create displays that we'd present to the mass merchant retailers and they would just take them. Now, they are more proactive in coming to Revlon with a specific agenda that they wish to accomplish with our displays."Scanner technology is helping retailers plan more strategically. The use of scanners and UPC codes gives mass merchants a clearer understanding of their customer base, which products are selling and which aren't. They can then use that knowledge to hone marketers' in-store programs so they are most effective and profitable for that particular chain.Bill Sinnott, group president of Ryan Partnership, a sales promotion agency headquartered in Westport, Conn., sheds more light on the evolving manufacturer/mass merchant relationship. "Manufacturers used to see retailers as a place where you paid your toll -- an allowance, for example -- and sold your products. It was pretty cut-and-dry. Retailers have now decided they're going to become branded entities in their own right, no longer just toll roads. They're now the destination for consumers to go to and get their problems solved. Lots of retailers changed the way they see themselves, and manufacturers have had to respond to that."This "stores-as-brands"mentality means mass merchants are requesting more temporary displays from marketers as they create more permanent displays themselves. Pallet packs are particularly useful to some mass merchants. "With the Wal-Marts of the world, we do mostly pallet wraps and other temporary displays," says Sunbeam's Ulik. "Mass merchants have very tight control of their environments. They're very good at knowing what their stores should look like and what works best. I think they're all looking to manufacturers for an in-and-out opportunity."Rayovac's Bauer says displays with casters are supplying the mobility and versatility mass merchants are requesting. "The stores have the capability to move these things around, use them as lane blockers, create a nice island display. Mass merchants have all gotten on the 'temporary' bandwagon."At the same time, stores are focusing on creating their own permanent merchandising. "In the past, we [Revlon and our competitors] would have our own displays," says Werner. "The trend, at least for now, is for stores to come out with their own permanent merchandising." He cites the example of Wal-Mart, which is testing its Millennium Wall, where all cosmetics are displayed together, differentiated, of course, with graphics. "That creates efficiencies for the stores, as far as stocking and reordering, and it creates a unified store look."Some marketers believe that the idea of point-of-purchase is an outdated concept; instead, P-O-P is evolving into point-of-experience, creating an experience for the consumer that informs, involves and entertains. It's a concept that's relatively simple but at the same time contrary to traditional in-store marketing. However, some marketers are embracing this new way of thinking.For example, Nabisco, in celebration of Oreo's 85th birthday in 1997, held the "Only Oreo" cookie stacking contests for children at mass merchants across the nation. The contests culminated with a championship at Universal Studios Florida. "That was an in-store experience that really involved the consumer and built brand equity," says Douglas Haase, Nabisco's director of customer marketing.More recently, the company collaborated with two other brand marketers and Wal-Mart on a s'mores display that Haase calls one of his company's most successful. In the promotion, chocolate, marshmallows and Nabisco's graham crackers were loaded onto Wal-Mart's four-way floorstands, or "pdq's." Graphic panels featured plenty of color and the recipe for the campfire cookie sandwich. The result for Nabisco: a 118% increase in graham cracker sales over the previous year, says Haase. "In the past, we had put the products up on an endcap but didn't specify the idea. It was, 'Here are some crackers, some marshmallows, and some chocolate; you figure it out.' But this time, we got behind the whole excitement of what s'mores are. The idea was to merchandise them in a creative and consumer-friendly way and to create a sense of value, information and fun."Both campaigns were aimed at total category growth, an often-used but misunderstood concept in the industry today. Says Haase, "I think category management is more of a buzzword than people really embracing it and going after it." Indeed, it seems everyone has a different definition of the concept. But most agree that it centers around the analysis of demographic, psychographic and shopping pattern information in order to pinpoint who a retailer's or marketer's customers are -- what, how and why they buy -- and then offering the product assortments, price points and shelving arrangements that speak to the way they shop. Most also agree that Wal-Mart is a master at it."As a marketer, you don't make a move anymore without thinking, 'How does this affect the category?' " says Haase. "Marketers need to change the way they think and let retailers have more say in how they position their product and how those products are merchandised and priced. It's no longer a focus on your own little universe. In our case, it's about creating an environment that builds traffic in snacking, as opposed to just growing Nabisco sales. That's a whole different thought process. You need to build plans that win for you and for your customer."What sometimes gets lost in the fray of household panel results and scanner data is, oddly enough, the most important prize: the consumer. ACNielsen, in its Ninth Annual Survey of Trade Promotion Practices (1999), reports that although both manufacturers and retailers are availing themselves of category management tools like space management technology and third-party information, few are honing in on how consumers respond at the shelf. "The next phase of category management will be much more targeted, much more personal," says Robert Tomei, senior vice president of marketing for ACNielsen in the United States.Marketers at Ames-True Temper seem to have a firm grip on the hows and whys of mass merchant shoppers. Monroe says that by merchandising products with the project in mind, they've seen a tremendous increase in impulse purchases. He offers this example. "A mortar hoe is a tool designed specifically to mix concrete. Typically, they're merchandised with lawn and garden products. We started displaying mortar hoes next to bags of concrete mix. Now, I bet that 99% of the people who come in to buy concrete mix for a home project don't even know what a mortar hoe is. If the consumer walks into the lawn and garden area and sees it, he thinks it's a garden hoe with holes. But if you put the hoe next to the concrete mix with a poster on the front that describes what the tool does, they'll reach in and grab a product that I guarantee they never would have thought about buying."When you tailor merchandising to how people shop, not necessarily to what's most easily restocked, then you make it easier for the shopper to make an informed buying decision," says Monroe. "We benefit, our customers benefit, and the consumer benefits -- everybody wins."

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