- After a failed remodel of its checkout lanes, Midwestern supermarket chain Jewel-Osco turned to candy supplier Mars Inc., who helped the retailer incorporate a design that included more space for impulse buys like candy, as well as single-serve cereal and oatmeal, granola bars, and beef jerky, according to the Path to Purchase Institute.
- The new lanes boosted conversion rates from 15% to 55%. In February, Jewel-Osco rolled out the new lanes across its entire chain.
- Some of the ideas Mars brought to the table didn’t work out, however, such as LED lights that illuminated displays in the confectionery aisle. "We'll test stuff at Jewel-Osco," Jeff Hancock, Jewel-Osco's assistant sales manager of confection and beverage, said during a May 24 panel discussion at the Sweets & Snacks Expo in Chicago. "If the idea isn't working, we'll walk away. You have to keep evolving and stay on trend."
With center store sales down, manufacturers are searching for ways to stay relevant in today's increasingly fresh-focused grocery environment. As Mars showed, a solutions-focused approach can score a win for manufacturers and benefit retailers as well.
Albertsons-owned Jewel-Osco has spent the past few years remodeling its stores to focus more on prepared foods, natural and organic products, and fresh produce. These changes are helping the retailer keep pace with consumer preferences and fresh-focused competitors. But, like the scores of other store updates happening across the country, they come at the expense of center store brands.
Despite this, Mars increased its footprint in a key area by identifying an opportunity and offering a targeted solution. Jewel previously put theater roping in place to guide customers through the checkout lines — a setup that had worked well for retailers like Best Buy, but didn’t work so well in a grocery setting. So Mars proposed a lane design that focused on traditional impulse buys along with trendy meat snacks, single-serve cereals and granola bars.
Retailers and manufacturers have a long history of working together to develop store solutions. Indeed, grocers often look to suppliers as experts in their categories. Companies like Hershey, Coca-Cola, Campbell and others have invested in category and consumer research, and right now these efforts are taking on added significance. Still, as Jewel-Osco’s Jeff Hancock noted, the solutions have to benefit the entire category, not just one brand. Manufacturers may need to think more like retailers and less like food sellers.
This approach may not land the knockout punch that manufacturers want. But it does build trust with retailers, which can prove invaluable in the long run.