Progressive Grocer - January 2016 by ensembleiq

What’s Inside Counts

GMA’s SmartLabel platform takes on transparency Page 36

Power of Produce

Fresh Summit Produce Power Session offers insights Page 76

All Inclusive

Start preparing now for omnichannel retailing Page 91

Sweet Success Strack & Van Til sharpens its focus on customer service Page 40 Chris Bengtson, VP; Randy Gootee, Schererville store director; Ken Bair, director of operations, Strack & Van Til

January 2016 • Volume 95 Number 1 $10 • www.progressivegrocer.com

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January 2016

features

Volume 95, Issue 1

cover story

fresh food 66 producE

New and Improved Te produce industry reinvents snacking, with healthy and favorful results.

20 Industry EvEnts

Top Women in Grocery Shine in Orlando PG shares images from the recent gala/networking opportunity.

producE cAtEGory spotLIGht

Move Over, Meat Consumers are making room for more mushrooms.

GMAâ&#x20AC;&#x2122;s sMArtLAbEL

Playing it Smart Leading the industry into the information spotlight.

grocery

producE roundtAbLE

storE of thE Month

Now Theyâ&#x20AC;&#x2122;re Cooking Strack & Van Til ups its grocerant game with a northwest Indiana remodel focused on customer service.

Produce Power Session An executive roundtable focused on category challenges and growth.

nonfoods frozen & refrigerated 62 pIzzA

56 shELf-stAbLE soup

Taking Stock New delivery systems, healthier profles, fun shapes and an emphasis on versatility.

Upper Crust Retailers and manufacturers raise the ante.

84 hEALth bEAuty & WELLnEss

Smooth Operators Moisturizers lead the pack in the skin care category derby.

86 housEhoLd cLEAnErs

Nice and Neat Convenient, afordable green products can allow grocers to clean up.

January 2016 | progressivegrocer.com |

operations

570 Lake Cook Rd, Suite 310, Deerfield, IL 60015 224 632-8200 • www.progressivegrocer.com vP, brand director 201-855-7621

Editorial Editorial director Joan driggs 224-632-8211 jdriggs@stagnitomail.com chief content Editor meg major 724-453-3545 mmajor@stagnitomail.com Editor-in-chief James dudlicek 224-632-8238 jdudlicek@stagnitomail.com managing Editor bridget Goldschmidt 201-855-7603 bgoldschmidt@stagnitomail.com technology Editor John karolefski 440-582-1889 jkarolefski@stagnitomail.com senior Editor katie martin 224-632-8172 kmartin@stagnitomail.com senior Editor anna wolfe 207-773-1154 awolfe@stagnitomail.com digital Editor kyle shamorian 224-632-8252 kshamorian@stagnitomail.com art director bill antkowiak bantkowiak@stagnitomail.com contributing Editors Bob Ingram, Jenny McTaggart, Barbara Sax and Jennifer Strailey

Workforce ManageMent

the labor force awakens Cutting-edge technology can help manage challenges.

technology 91 consuMer engageMent

omnichannel retailing: a work in Progress Getting ready now is critical.

96 In-store MarketIng

Engage shoppers with digital devices Mobile is the linchpin for connections.

100 MobIle apps

applied marketing Mobile apps are adding a new dimension to food retailing.

equipment & design

104 foodservIce

becoming a Grocerant Equipment is key in developing destinations.

| Progressive Grocer | January 2016

advErtisiNG salEs & busiNEss midwest marketing manager John huff 224-632-8174 jhuff@stagnitomail.com western regional sales manager Elizabeth cherry 310-546-3815 echerry@stagnitomail.com Eastern marketing manager maggie kaeppel 630-364-2150 • Mobile: 708-565-5350 mkaeppel@stagnitomail.com Northeast marketing manager mike shaw 201-855-7631 • Mobile: 201-281-9100 mshaw@stagnitomail.com marketing manager Janet blaney (AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY) jblaney@stagnitomail.com 630-364-1601 account Executive/ classified advertising terry kanganis 201-855-7615 • Fax: 201-855-7373 tkanganis@stagnitomail.com advertising/Production manager Jackie batson 224-632-8183 • Fax: 888-316-7987 jbatson@stagnitomail.com classified Production manager mary beth medley 856-809-0050 marybeth@marybethmedley.com markEtiNG & PromotioN director of market research debra chanil 201-855-7605 dchanil@stagnitomail.com audience development manager shelly Patton 215-301-0593 spatton@stagnitomail.com list rental the information refinery 800-529-9020 Brian Clotworthy reprints and licensing wright’s media 877-652-5295 sales@wrightsmedia.com subscriber services/single-copy Purchases 978-671-0449 or email at stagnito@e-circ.net

EvEnts • MEdia • REsEaRch • infoRMation uNitEd statEs markEts Convenience • Grocery/Drug/Mass Store Brands • Specialty Gourmet Multicultural • Green

departments 8 Editor’s NotE: iN Pursuit of simPlicity 12 PG PulsE 14 iN-storE EvENts calENdar: march 2016 16 NiElsEN’s shElf stoPPErs/sPotliGht: mEdicatioNs aNd rEmEdiEs/adult iNcoNtiNENcE 18 miNtEl Global NEw Products: chocolatE coNfEctioNEry 32 NEw horizoNs: thE coNfidENcE GaP 34 all’s wEllNEss: harNEss thE PowEr of ProtEiN 108 what’s NExt: Editors’ Picks for iNNovativE Products 111 thE suPPliEr sidE 113 thE last word: thE dawNiNG of coNtENt aNd commErcE

Jeff friedman jfriedman@stagnitomail.com

caNadiaN markEts • Convenience • Pharmacy • Foodservice

President & cEo harry stagnito chief information officer kollin stagnito svP, Partner Ned bardic chief brand officer korry stagnito vP & cfo kyle stagnito vP/custom media division Pierce hollingsworth 224-632-8229 phollingsworth@stagnitomail.com Production manager anngail Norris human resources manager sandy berndt corporate marketing director bruce hendrickson 224-632-8214 bhendrickson@stagnitomail.com Promotion director robert kuwada 201-855-7616 rkuwada@stagnitomail.com director of Events ken romeo 224-632-8181 kromeo@stagnitomail.com director of digital strategy matt mcGuire 224-632-8180 mmcguire@stagnitomail.com audience development director cindy cardinal

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editor’s note by Jim Dudlicek

In Pursuit of Simplicity

rom product formulations to product merchandising, from meal ingredients to meal solutions, from dining in to dining out — shoppers want it simple. In fact, the Hartman Group has declared it the trend of the year in a recent report. “As consumers have clamored for cleaner product ingredient lists, driven by their desires for fresher, less processed foods and beverages, companies have heard these demands and have begun to respond,” the Bellevue, Wash.-based brand strategist says in “Strategizing Simple in the Food and Beverage Marketplace.” With “natural” lacking an ofcial standard of identity (the FDA recently announced its intention to solicit comments on a “natural” standard), which leaves the term open to interpretation as well as confusion, “the ‘simple’ labeling trend is overtaking ‘natural’ as large companies wish to avoid lawsuits provoked within a non-regulated sector,” Hartman reports. “We call it the new premium marketplace because we know that the brands commanding the highest-priced premiums generally are younger, entrepreneurial brands whose default assumption is a target consumer who wants minimally processed foods and beverages, which the natural and organic sector has relentlessly pushed through the market in the past two decades.” Among the Hartman report’s insights: Removing symbols of “bad” or “low-quality” food processing is critical to keeping a brand contemporary in modern food culture. Beyond reformulation, enhanced scrutiny and threat of regulation have forced food marketers to adopt a greater degree of transparency. To that end, the Grocery Manufacturers Association (GMA) is rolling out SmartLabel, a web-based application that makes it simple for consumers to access information about a host of grocery products. “SmartLabel holds the potential to demonstrate to consumers the degree to which the retail food industry is committed to meeting demand for transparency in an organized, responsible manner,” PG Editorial Director Joan Driggs writes in her article on the program, starting on page 36. “Te initiative essentially pulls back the curtain on nutrition, ingredients, allergens, thirdparty certifcation and company information.” Grocery retailers would be wise to join this initiative, not only with their private-brand products, but also by calling attention to SmartLabel through signage, in-store programs and other shopper education. Meanwhile, more retailers are making meal planning simpler for their shoppers in a variety of ways.

| Progressive Grocer | Ahead of What’s Next | January 2016

Strive to do business using a variation on the “KISS” method: Keep it simple for the shopper. Ahold’s Carlisle, Pa.-based Giant Food banner has rolled out meal kits, launched at two of its stores. Available in the deli or prepared food departments, each kit features pre-measured fresh ingredients to make two servings of the selected meal, as well as step-by-step instructions to have the meal on the table in 35 minutes or less. “Our customers are busy, and these new fresh meal kits are another innovative way we are helping them to save time and eat well by getting a delicious and convenient home-cooked meal on the table,” said Erik Keptner, Giant’s SVP of sales, merchandising and marketing. Te meal kits were expected to debut at 10 more stores in the greater Philadelphia area late this month. Among the latest grocers to boost its commitment to the grocerant concept is northwest Indiana’s Strack & Van Til. One of its recently remodeled supermarkets showcases a host of prepared food options ranging from grab-and-go sandwiches to the creation of full holiday meals for enjoyment at home. Read more about my visit to this store and its chef-led grocerant initiatives, starting on page 40. Strive to do business using a variation on the “KISS” method: Keep it simple for the shopper. Simplicity is indeed the watchword for 2016, at least as far as shoppers are concerned. Elsewhere, the jury is still out: mergers and acquisitions, the tattered remains of A&P and Haggen, pending regulations, and other industry twists and turns. PG Chief Content Editor Meg Major explores some of what’s expected in the coming months, in her column on page 113. And the simplest way to stay abreast of it all is in PG and on Progressivegrocer.com — every day, every week, all year. PG Jim Dudlicek Editor-in-Chief jdudlicek@stagnitomail.com Twitter @jimdudlicek

T H E

A R T

O F

M E R C H A N D I S I N G

T M

A NEW

Innovation, and

ÂŠ General Mills

GENERATION OF

Renovation Wellness • On-trend New Product Innovation • Renovating Brand Favorites • Consumer-centric Wellness News

What’s trending on Progressivegrocer.com …

A mixed bag of industry news – the vast majority of which pertained to retail newsmakers from around the nation – sparked the Progressivegrocer.com popularity meter during the busy Q4 period spanning Nov. 15-Dec. 15.

The Fresh Market Terminates Th COO Sean Crane bit.ly/1IJ1933

Wegmans Wonderplace Opens at Smithsonian n bit.ly/1QqLYDV DV

Kroger Heralds Dozen Years of Growth

‘Healthy’ Supermarkets, Food Waste Reduction Rank ank As Top Trends nds for 2016 6 bit.ly/1IUUEQa

bit.ly/1OwwKHn

Weis Markets Enhances Marketing Strategy

bit.ly/21rTtxC

H-E-B, Publix, Trader Joe’ss Have Most Loyal Customers: Studyy Rick Anicetti A bit.ly/1l6jIsA Aiming to ‘Reinvent’ The Supervalu Aiming S Fresh Market bit.ly/1MhphtR

tto Sell Save-A-Lot?

| Progressive Grocer | Ahead of What’s Next | January 2016

bit.ly/1SfQxhJ

Now is the time to make a difference in your community and grow your dairy category by helping put milk back into the hands of children who miss it. With your help, The Great American Milk Drive has accumulated over 620,000 gallons in donations to date. In 2016, we’re looking to make an even bigger impact.

March 2016 is... National Noodle Month National Nutrition Month National Peanut Month National Fresh Celery Month National Frozen Food Month National Flour Month

National Peanut Butter Lovers’ Day. Promote outside-thesandwich ideas on your Pinterest page.

National Banana Cream Pie Day

National Cold Cuts Day

National Employee Appreciation Day. Use #Employee AppreciationDay to post on social media.

National Cheez Doodle Day

National Pound Cake Day

International Boston Seafood Show begins and continues through March 8.

National Cake Pop Day. Schedule a class on making and decorating these fun treats.

National Hot Cross Bun Day

National Cereal Day

National Peanut Cluster Day

National Oreo Day National Frozen Food Day

Daylight Saving Time begins. Time to change the clocks. National Chicken Noodle Soup Day

Palm Sunday

Pile the end caps high for National Potato Chip Day. Decorate your store for spring.

National Crunchy Taco Day

National Peanut Lovers’ Day

Offer fun foods that require no preparation for International Goof Off Day.

Natural Products Expo West educational sessions, workshops and events begin. The trade show runs March 10-13 in Anaheim, Calif.

Celebrate your customers on Everything You Do Is Right Day.

National Chips and Dip Day. Make a big display of chip-and-dip combinations.

National Ranch Dressing Day

St. Patrick’s Day Not coincidentally, it’s also National Green Beer Day.

Purim begins.

National Eat Your Noodles Day

National Sloppy Joe Day. Set up cooking demos and sample this kid-friendly favorite.

Good Friday

International Waffle Day

It’s Girl Scouts Day. Let a local troop sell their cookies in your store.

Chocolate Caramel Day. Sample these tasty treats throughout the store.

Encourage employees to make suggestions for Make Up Your Own Holiday Day. National Spinach Day

National Ravioli Day

Easter

It’s Something on a Stick Day, so sample skewered appetizers, main courses and desserts.

National Lemon Chiffon Cake Day

Whole Grains Sampling Day

National Oysters on the Half-shell Day Email your calendar submissions to

Take a Walk in the Park Day

Spanish Paella Day

| Progressive Grocer | Ahead of What’s Next | January 2016

awolfe@stagnitomail.com

National Oranges and Lemons Day

Front End

Market Intelligence By The Numbers

Shelf Stoppers

GRoCERY’S ToP 10

Medications and Remedies

Largest Sales Increases in Supermarkets by The Nielsen Co. (52 Weeks Ending Oct. 24, 2015)

Psoriasis and Eczema Treatments Adult Incontinence Medical Wraps and Braces Motion Sickness Preventatives Medical Accessories-Remaining Eye Care-Remaining Eye Drops and Lotions Lip Remedies-Remaining Antacids Analgesics and Chest Rubs

Sales % Change Dollars (Millions) 2015 2014 $13.5 22.7% 32.8% 315.6 10.6 5.3 45.9 9.0 7.0 11.8 8.9 6.1 39.6 8.9 6.0 29.6 7.1 6.0 143.5 6.4 7.2 55.2 6.2 11.0 460.0 6.2 4.5 97.5 6.1 2.4

Total Category

$2,375.6

4.8%

% Change 2015 22.2% 10.0 8.4 6.0 4.6 4.6 4.3 7.2 2.8 4.3

3.5%

2.0%

Units 2014 26.9% 5.4 3.5 5.5 4.1 4.6 3.7 10.8 3.3 0.3 2.0%

NielseN’s Spotlight

As expected, seniors — both singles and couples — indexed the highest on adult incontinence products, although empty nesters in some areas showed higher-than-average usage. Retailers might try crossmerchandising certain items to lift sales further among these demographics, such as vitamins geared toward older adults displayed near the shelves offering incontinence pads.

CRoSS-MERCh Candidates

Consumption Index: Adult Incontinence LIFESTYLE Behavior Stage

Cosmopolitan Affluent Comfortable Struggling Centers Suburban Country Urban Spreads Cores

Modest Working Towns

Plain Rural Living

Total

WITh ChILDREN: startup Families

small-scale Families

Younger Bustling Families

Older Bustling Families

104

100

Young Transitionals

independent singles

senior singles

186

129

196

143

184

207

180

established Couples

108

120

empty-nest Couples

121

105

143

148

117

senior Couples

217

206

252

273

243

218

231

Total

106

105

121

100

HHs with young children only <6 small HHs with older children 6+ large HHs with Children (6+), HOH <40 large HHs with children (6+), HOH 40+

No ChILDREN: Any size HHs, no children, <35 1-person HHs, no children, 35-64 1-person HHs, no children, 65+ 2+-person HHs, no children, 35-54 2+-person HHs, no children, 55-64 2+-person HHs, no children, 65+

Very High Consumption (150+)

High Consumption (120-149)

Average Consumption=100

| Progressive Grocer | Ahead of What’s Next | January 2016

• Vitamins • Batteries and Flashlights • Butter and Margarine • Ice Cream and Frozen Novelties • Nuts • Coffee • Sugar and Sweeteners • Pickles, Olives and Relish

More oNLINE Dig up actionable e research and additional al intelligence at Progressivegrocer.com

GOOD FOR CUSTOMERS.

GREAT FOR BUSINESS. Pharmavite Customer Value Proposition “A trusted, strategic partner who provides innovative shopper-based insights and solutions that create loyalty among shoppers to our customers’ categories and Pharmavite’s products.”

Nature Made® delivers the largest buying households and drives larger transactions than any other brand in its category.*

PROFITABLE VOLUME GROWTH

SUPPLY CHAIN EXCELLENCE

INNOVATION

SHOPPER ENGAGEMENT/ ACTIVATION

VMS/PHARMACY HEALTH & WELLNESS AFFINITY COMMITMENT TO HIGH QUALITY **

Mintel Global New Products Database Category Insights

Chocolate Confectionery

For more information, visit www.mintel.com or call 800-932-0400.

Market Overview The U.S. chocolate confectionery market has performed well in the past and is expected to grow to a total of $25 billion in 2019 as recent innovations aim to boost the perception of health and quality.

unflavored/plain chocolate still dominates the market, new product development activity shows a raft of interesting flavor developments taking place as brands look to refresh the overall category.

key issues Flavor trends have widely been explored by North American brands looking to cater to adventurous palates. Although

Alcohol-flavored/-filled chocolate confectionery has gained more ground of late, with brands starting to explore more nontraditional alcohol varieties.

Sea salt-flavored varieties are increasingly appearing in North America, with brands aiming to target lovers of salty and sweet tastes. Innovation around savory flavor notes can also be noted in new product development activity, with brands looking to develop unique flavors that stand out in a crowded market. Strong demand for clean labels and products with authentic ingredients that haven’t been altered has pushed brands to place purity at the forefront of their development strategies. New product development activity shows that only 4 percent of total chocolate confectionery innovations in the past year were positioned with a “no additives/ preservatives” claim, however, indicating that brands could do more to meet the growing demand for natural products.

What Does it Mean? Product innovation is likely to shift toward more unique and unusual flavors such as spiced, salty and savory. Producers need to be mindful of the ethical and regulatory challenges of alcohol-

flavored/-filled chocolates. There are lucrative opportunities for chocolate confectionery brands to innovate around more simple ingredients and communicate clean, artificial ingredient-free labels, considering the high

| Progressive Grocer | Ahead of What’s Next | January 2016

proportion of consumers willing to eat natural products more regularly. Products free from artificial colors and flavorings have the potential not only to improve the health image of the category, but also to increase the purchasing frequency of chocolates.

| Progressive Grocer | Ahead of Whatâ&#x20AC;&#x2122;s Next | January 2016

Top Women in Grocery Shine In Orlando M ore than 200 of Progressive Grocer’s 2015 Top Women in Grocery honorees focked to Orlando, Fla., to relish their accomplishments at a world-class resort before a contingent of more than 450 industry luminaries, special guests and family members. Te Hyatt Regency Grand Cypress served as the ideal setting to celebrate the ninth year of the leading industry awards program. Event hosts Jef Friedman and Meg Major presided at the daylong gathering, highlights of which were a dedicated daytime learning platform and gala evening dinner program for Top Women in Grocery attendees. Meg Ham, president of Food Lion, accepted the 2015 Top Women in Grocery Trailblazer Award, which recognizes a single executive whose leadership, vision and infuence have helped break new ground for women in the retail food industry. Another event highlight was the frst-ever Top Women in Grocery Torchbearer Tribute, presented to P&G’s Always brand for its powerful #LikeAGirl multimedia campaign. For the third year, Top Women in Grocery’s confab featured a daytime leadership development program, which began with a welcome breakfast. An energizing keynote by Deanie Elsner, president of U.S. snacks at Kellogg Co., set the tone for the daytime program, which continued with a Tips from the Top panel discussion featuring a brain trust of some of the retail food industry’s most ac-

complished and respected women leaders. After lunch, Nancy Krawczyk and Eileen Tarjan, both of the Network of Executive Women (NEW), led a strategic networking primer session, which was followed by concurrent peer circle breakout discussion groups led by a contingent of women leaders from across the food industry, including Becky Estby, VP, Coborn’s Inc.; Lois M. Fruhwirth, Procter & Gamble NA Grocery Channel; Jewel Hunt, Albertsons/Safeway; NEW’s Krawczyk and Tarjan; Michele Murphy, Supervalu; and Rachel Rogers, Te Hershey Co. Te celebration concluded with an after-dinner dessert and dance party, courtesy of Te Hershey Co. Other key sponsors of the event were as follows: KraftHeinz, Platinum PepsiCo, Gold Procter & Gamble, Gold Te Hershey Co., After-Party Sponsor E&J Gallo, Exclusive, Wine Post Consumer Brands, Breakfast Sponsor Te Coca-Cola Co., Break Sponsor Belles Organic, Bronze Sponsor Domino Sugar, Bronze Sponsor Unata, WiFi Sponsor Kellogg Co., Table Sponsor Catalina, Table Sponsor Ferrero USA, Table Sponsor Anheuser-Busch, Table Sponsor American Greetings, Table Sponsor Te Clorox Co., Table Sponsor

January 2016 | progressivegrocer.com |

Leadership deveLopment program

ABOVE NEW’ ABOVE: NEW’s Eil Eileen Tarjan inspires attendees to make the most out of their experience. ABOVE: Deanie Elsner, president of U.S. snacks at Kellogg Co., delivers an inspiring keynote message to attendees.

ABOVE: PG’s ABOVE ’ Meg M Major M j (second ( d left), l ft) moderates d t a Tips from the Top panel discussion featuring, from left, Deanie Elsner, Kellogg Co.; Meg Ham, Food Lion; and Janel Haugarth, Supervalu.

ABOVE: NEW’s Nancy Krawczyk (far left) joins with Food Lion’s Top Women in Grocery, including, from left, Debbie Bowers, Carol Miller, Patricia Bednarz and Diane Medlin.

For the third year, Top Women in Grocery’s annual confab featured a daytime leadership development program designed to foster and enhance the success and professional development of its honored guests.

ABOVE: From left, Food Lion President Meg Ham; Janel Haugarth, EVP, Supervalu; PG’s Meg Major; and Deanie Elsner, president of U.S. snacks, Kellogg Co.

ABOVE PG’’s JJanett Bl ABOVE: Blaney and dM Meg M Major j jjoin i Mark Arrington, of Post Consumer Brands, which sponsored the welcome breakfast. RiGHT: Supervalu’s Michelle Murphy leads a peer circle discussion during the leadership development program.

| Progressive Grocer | Ahead of What’s Next | January 2016

Continued on page 26

A Taste of Sweet Excitement comes to Store Shelves!

— Introducing —

Zing Zero Calorie Stevia Sweetener TM

- packets & easy-spoon jar -

and

ZingTM Baking Blend Stevia & Cane Sugar - easy-pour canister -

Real ingredients. Perfect sweetness.

The Zing™ sweetener brand was created with the discriminating Millennial demographic in mind – the younger shopper searching for products with authentic ingredients and a pure sweet taste they can believe in. For this target of youthful, well-informed consumers seeking a delicious sugar substitute made with real ingredients, Zing™ is a victory, a true reason to get excited.

ZingTM Zero Calorie Stevia Sweetener

Made with only real ingredients of stevia leaf extract and dextrose. Zero Calories per serving. Delicious sweetness. 1 packet or 1/4 tsp. Zing™ Stevia Sweetener = sweetness in 2 tsp. of sugar. 40-count box of single-serve packets & 9.5 oz. easy-spoon jar.

Learn more at zingstevia.com.

ZingTM Baking Blend

Stevia leaf extract & pure cane sugar blend. 5 Calories per serving. Bakes and browns like sugar for delicious, golden-brown cakes and cookies. 1 canister sweetens like 2.5 lbs. of sugar. 20 oz. canister with an easy pour spout for quick measuring and a snap-closed lid.

P&G InnovatIon studIo & daytIme breaks Continued from page 22

P&Gâ&#x20AC;&#x2122;s Innovation Studio enabled attendees to enjoy complimentary beauty treatments, while honored guests networked at refreshment breaks during the daytime leadership development program.

| Progressive Grocer | Ahead of Whatâ&#x20AC;&#x2122;s Next | January 2016

ORGANIC

MILK TO GO! (Finally)

Organic milk is now 10% of all single-serve milk sales â&#x20AC;&#x201C; and growing!

Find out more at www.OrganicValley.coop Contact your Organic Valley salesperson or email salessupport@organicvalley.com to place your order.

Check out the rest of our adult-sized grab-and-go portfolio. ÂŠ Organic Valley 2015-10049

Source: SPINSscan, 52 weeks ending 11/1/15

NNetworkiNg receptioN LEFT: Celebrating in style are honored guests Dawn Soltis, Winn-Dixie/ Southeastern Grocers and Deanna Stephens, Southeastern Grocers.

LEFT: Crossmark’s Top Women in Grocery include, from left, Katherine Fuller, Debbie Buckner and Michelle Sutter. BELOW: Sheila G. Mains (left), CEO/founder of Brownie Brittle, Jessica Flores, founder of Belles Organics, and Cathy Cunningham, founder, Bodacious Foods, raise a toast to this year’s Top Women in Grocery.

ABOVE: This trio, all from The Kroger Co., consists of Merritt Henderson, Scott Thurman and Sara Parker.

Evening festivities kicked off with a cocktail reception, where guests networked and mingled prior to the gala dinner awards presentation. Plans are already underway for 2016’s Top Women in Grocery event, which will commemorate the 10th anniversary of the industry’s leading women’s recognition platform.

ABOVE LEFT: Topco’s Eric Smith celebrates with colleague Michelle Stengel, a Top Women in Grocery honoree. ABOVE RIGHT: Kim McGregor, Weis Markets (left), poses with Lori Brown, Post Consumer Brands.

ABOVE: PG’s Jeff Friedman congratulates KraftHeinz’s Top Women in Grocery honoree Colleen Flaherty. RIGHT: Enjoying the festivities from Food Lion are, from left, Melissa Saul and Diane Medlin.

ABOVE: Supervalu’s Janel Haugarth (left) visits with PG’s Bridget Goldschmidt, Meg Major and Jim Dudlicek. RIGHT: Top Women from Supervalu include, from left, Jennifer Foster, Melissa Sax, Carrie Jensen and Patty Fishman.

| Progressive Grocer | Ahead of What’s Next | January 2016

ABOVE: Giant Eagle execs Joe Lucot (center) and John Lucot (right) celebrate with the Pittsburgh retailer’s 2015 Top Women in Grocery, from right, Katie Scholl, Jan Hawkins and Ann-Marie Daugherty.

So profitable, it’s nutty. When you put our pistachios on the floor, wonderful things happen. One of the most profitable items you can display, W ∑ nderful Pistachios offer more profit per square foot than popular moneymakers bananas and peanuts. Maybe it’s our multimillion-dollar national TV campaign that gets people through your door. Or maybe it’s our eye-catching displays that make sure they have a handful of pistachios when they walk away. Either way, W∑ nderful Pistachios always shell out. Scientific evidence suggests but does not prove that eating 1.5 ounces per day of most nuts, such as pistachios, as part of a diet low in saturated fat and cholesterol may reduce the risk of heart disease. See nutrition information for fat content. ©2015 Wonderful Pistachios & Almonds LLC. All Rights Reserved. WONDERFUL, GET CRACKIN’, the Package Design and accompanying logos are registered trademarks of Wonderful Pistachios & Almonds LLC or its affiliates. WP13974

GALA AwArds ceremony

A highlight of the gala was the presentation of the 2015 Top Women in Grocery Trailblazer Award to Food Lion President Meg Ham. Below, from left, are NEW’s Nancy Krawczyk, PG’s Meg Major, Ham and PepsiCo’s Deanna Jurgens.

| Progressive Grocer | Ahead of What’s Next | January 2016

Celebrating a Decade of Top Women in Grocery 10 years of Leaders 10 years of Excellence 10 years of Celebration!

In 2016, Top Women in Grocery will proudly commemorate the 10th anniversary of saluting outstanding women across all sectors of the grocery industry for above-and-beyond contributions to their companies and communities and the industry at large. Plans are now underway for a very special 10th-anniversary celebration, additional details for which will be forthcoming. We look forward to continuing a rewarding tradition of honoring the grocery industryâ&#x20AC;&#x2122;s leading women.

Mark Your Calendar

Nominations for the 2016 Top Women in Grocery awards program begins on Jan. 4, 2016. Entry deadline is March 18, 2016. Help us make our 10th-anniversary program shine by nominating yourself and/or your colleagues for this important recognition.

topwomeningrocery.progressivegrocer.com

Nonfoods

Category

NEW

Horizons

By Joan Toth

The Confidence Gap Our industry’s most successful women push aside fear and step up.

omen in grocery need two things to achieve a leadership position: confdence in themselves and, more importantly, confdence that they have a path to leadership in their respective organizations. While women graduate from college feeling as qualifed for success as their male peers, their aspiration level drops by more than 60 percent over time, according to “Everyday Moments of Truth,” a report from New York-based Bain & Co. Why do female college graduates quickly lose confdence in their career potential? Bain attributed the confdence gap to three main factors: little supervisory support, too few role models in senior-level positons, and the widespread perception among men and women that “ideal workers” put in long hours and are adept at self-promotion, networking and maintaining a high profle. Organizations that address these workplace challenges are able to leverage the power of women’s leadership and the talents, skills and leadership potential of every employee. Tat’s a huge competitive advantage.

Making the Leap To succeed in today’s environment, women need to believe in themselves, fnd their own role models and create their own paths to success. At the NEW Leadership Summit last fall, more than 1,200 Network members were inspired by women executives who overcame such doubts to become powerful and efective leaders. Tese high-powered women worked through their fears, sought the help of mentors and sponsors, and took on stretch assignments that

| Progressive Grocer | Ahead of What’s Next | January 2016

broadened their skills and built their profles. During a Summit panel discussion, Ahold USA EVP of Human Resources Kathy Russello shared that early in her career, she was hesitant to take on a new role outside her area of expertise: responsibility for labor relations strategy, which included negotiating with mostly male union ofcials. “I went into that role with a great deal of concern. I wasn’t sure I could do it,” she recounted. “But it’s the role I learned the most from.”

Failure Is an Option For Ellen Junger, Hallmark’s SVP for corporate brand development, “stretch” has meant “jumping in without fully knowing what you’re doing.” But, like Russello, she learned the most and gained the most confdence when she accepted a role thinking, “I really don’t know if I can do this.” With stretching comes risk, and some risks fail. Successful women and men don’t let a failure — or two — permanently change their career trajectories, however. Summit keynoter Denice Torres, co-chair of Johnson & Johnson Consumer Cos., has faced multiple challenges as a gay multicultural woman and the mother of a special-needs child. During the low times, she said, it’s important to remember the situation won’t last forever: “It’s just for today,” Torres counseled. “Tomorrow can be diferent. Every career has highs and lows — and the more highs and lows you go through, the stronger you become.” Te NEW Summit’s closing speaker — Carla Moore, VP of talent acquisition at HBO — explained why closing the confdence gap that women face is so important: “I believe that when leaders change, businesses change,” she said, “and sometimes it takes a personal transformation to lead a business transformation.” More succinctly, as Junger advised, “Don’t let the butterfies in your stomach hold you back.” PG Joan Toth is president and CEO of the Network of Executive Women, Retail and Consumer Goods, a learning and leadership community representing 10,000 members, 750 companies, 100 corporate partners and 20 regional groups in the United States and Canada.

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Call out ‘good source of protein’ at the shelf and on qualifying dairy packages. Use store tours and events to identify milk as a go-to choice for natural protein.

All’s Wellness By Karen Buch

Harness the Power of Protein

This key wellness trend can help grocers boost historically lagging milk sales.

ow’s milk has earned its reputation as a nutritious beverage because it delivers nine essential nutrients, including 8 grams of high-quality protein. In fact, milk is the leading food source of three out of the four “nutrients of concern” (calcium, vitamin D, potassium and fber) identifed by the Dietary Guidelines for Americans as lacking in the typical American diet. Why, then, are sales of this nutritional powerhouse falling, and what can retail dietitians do to help?

Convenient and Flavorful Sales of white milk gallons, while still the most popular, are declining overall. One key reason for this may be that the gallon jug may just be too large for many Baby Boomer and Millennial households. Sales of favored milk, however, are on the rise. It retains all of the nutrient benefts of milk and may represent the best opportunity to drive consumer interest in the category. Te milk industry is responding by introducing smaller, portable containers of milk in unique and seasonal favors beyond the traditional chocolate and strawberry. Innovations that meet consumer demand for convenience, favor appeal and “clean” natural ingredients appear best able to compete in the fooded beverage market. Protein-packed and Satisfying Nutrition experts encourage consumption of 20 to 30 grams of protein per meal to curb hunger and preserve lean muscle. Despite this, just 29 percent of consumers know that protein is naturally found in milk, and only 25 percent are familiar with whey protein. Tis is a major consumer education opportunity. Research shows that when targeted consumers receive a protein message, demand for milk at breakfast increases by up to 25 percent.

| Progressive Grocer | Ahead of What’s Next | January 2016

Making an Impact Tere are a number of ways retail dietitians can make an impact. First, call out “good source of protein” at the shelf and on qualifying dairy packages. Next, use store tours, in-store and community events, and broader consumer communications to identify milk as a go-to choice for natural protein, and suggest healthful food pairings. Highlight available research supporting chocolate milk as a recovery drink for athletes and avid exercisers. Finally, customize various industry campaigns to boost consumer awareness and drive milk sales at your retail location(s). Here are two examples: Milk Life, a national initiative launched in 2014 by the Washington, D.C.-based Milk Processor Education Program (MilkPEP) and funded by America’s milk processors, spotlights everyday moments of accomplishment, achievement and enjoyment to reinforce milk’s many nutritional benefts. A campaign guide is available to help retailers customize the program and extend its impact. See social media #MilkLife, and watch for info on a new 2016 initiative, My Morning Protein. Realizing that milk is desperately needed but seldom donated to food banks, the National Dairy Council partnered with the Academy of Nutrition and Dietetics and Feeding America on the nationwide, multiyear Great American Milk Drive to inspire people to donate milk to hungry families. It provides an opportunity for retailers to address the epidemic of food insecurity while spotlighting milk’s vital nutrient contributions. Shoppers can buy milk at their local stores and donate it to an area food pantry. Resources are available to assist with customized checkout programs. Te movement is also active on social media, via #MilkDrive. PG Karen Buch, RDN, LDN, is a registered dietitian/ nutritionist who specializes in retail dietetics, and food and nutrition communications. One of the first supermarket dietitians, she is founder and principal consultant at Nutrition Connections LLC, providing consulting services nationwide. You can connect with her on twitter @karenbuch and at NutritionConnectionsLLC.com.

HOW WE’RE CHANGING THE YOGURT CATEGORY Let’s start with some facts: Yogurt Smoothies are growing like crazy, at +10.5%*, even outpacing their spoonable cousins. LALA is showing great momentum, with almost 22% sales growth versus last year*. We’re also expecting accelerated sales with new ﬂavors and better distribution. And we are supporting these efforts with a media campaign in early 2016, with national TV, digital and social efforts, achieving over 4 billion impressions. We know shoppers are on the move more than ever and our campaign is about just that. #YOGURTING is that moment when you’re drinking a yogurt smoothie at the same time you’re doing one of the million things life brings your way every day. Simple, right? By turning yogurt into a verb, a movement has been created. Join us. Stock your store.

*Source: IRI, MULO 52 Weeks Ending 11/1/15

Feature

GMA’s SmartLabel

Playing it

Smart GMA leads the industry into the information spotlight. By Joan Driggs

t might be an overstatement to call it overused, but there’s no denying that “transparency” is one of the top words of the decade. Its relevance to the grocery industry is undeniable. From required nutrition statements and allergens to voluntary clean labeling, carbon footprints or GMOs, consumers want to know about the products they’re buying and consuming, as well as about the companies that are selling to them. “Transparency is essential to build trust with today’s consumers,” says Benno Dorer, CEO of Te Clorox Co., in Oakland, Calif. Dorer is one of more than 325 grocery industry participants from among 90 companies working to build SmartLabel, a new platform that aims to put product and company transparency at consumers’ fngertips. While just making its way to CPG products and retailers across the nation, SmartLabel holds the potential to demonstrate to consumers the degree to which the retail food industry is committed to meeting demand for transparency in an organized, responsible manner. Te initiative essentially pulls back the curtain on nutrition, ingredients, allergens, third-party certifcation and company information. More than 30 companies have already A CliCk AwAy committed to the initiative, with Te Each product in Hershey Co. the frst to have products Smartlabel has its searchable through SmartLabel. Te Groown landing page, but information cery Manufacturers Association (GMA), is uniform across which is leading the work to create and all products, so initiate SmartLabel, estimates that nearly consumers will 30,000 products will use SmartLabel by easily learn how to access information the end of 2017. Retailers committed to important to them. SmartLabel include Walgreens, Wakefern, Ahold USA, Amazon, Kroger, Meijer, Target and Walmart. In addition, a consumer survey commissioned by Washington, D.C.-based GMA found that 75 percent of respondents would be likely to use SmartLabel. “With nearly 43,000 products in the average supermarket, the grocery industry is clearly about providing options that cater to a diversity of customer preferences and ofer products appealing to a wide range of consumer inclinations,” says Mark Baum, SVP

| Progressive Grocer | Ahead of What’s Next | January 2016

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Feature

GMA’s SmartLabel

and chief collaboration ofcer at Arlington, Va.-based Food Marketing Institute, a SmartLabel partner.

The grocery industry is clearly about providing options that cater to a diversity of customer preferences, and products appealing to a wide range of consumer inclinations.” —Mark Baum, Food Marketing Institute

Instant Information GMA CEO Pamela G. Bailey describes SmartLabel as “a transparent, transformative initiative that provides easy and instantaneous access to hundreds of attributes of food, beverage, pet care, household and personal care products. It’s designed so that consumers can have a wide variety of information and the ability to home in on the information they want in one or two clicks. SmartLabel is enlisting various technologies to enable consumers to access product information, among them scanning a QR code on the package, using a web search engine, going to a participating company’s website or, eventually, through an app projected to launch in mid-2016. According to GMA, a number of retailers have said that they can help shoppers without smartphones at their stores’ customer service desks. “We think SmartLabel refects the way people shop today,” Bailey said as she unveiled the initiative to media. “SmartLabel is the modern way; it’s beyond what’s on the label or ingredient statement.” SmartLabel takes consumers beyond what’s available on a package or nutrition statement, and gives products and brands a better way to share what they ofer. Attributes cover thousands of products, and drill down into such categories as item benefts, features, safe handling, uses and advisories, as well as company and brand information. “Te foundation for SmartLabel is the information consumers want to know: why an ingredient is in a product, what it does, how it was sourced,” explains Jim Flannery, senior EVP of GMA, who’s leading the initiative. “Te essence is the consumer experience — getting to the SmartLabel landing page. Each product has a landing page of ingredients and attributes. All pages look consistent.” Each product participating in SmartLabel has its own landing page that features 52 required attributes, including nutrients, allergens and thirdparty certifcations. Rather than breaking down ingredients into a list, as on packages, SmartLabel drills down into the elements of a product, so that a breakfast sandwich, for example, will provide all of the ingredients used to make the bread, the egg, the cheese, any spread or dressing, and the meat, if any. Brands can voluntarily disclose an additional 197 attributes, including no artifcial preservatives or MSG, for example. Consumers will see the same format for each landing page, whether the user is looking at a gallon of ice cream or a gallon of laundry detergent, making it easy for a shopper to go directly to the information he or she is looking for.

| Progressive Grocer | Ahead of What’s Next | January 2016

“Tis is not a great big database in the sky,” says Flannery. “It’s brand data stored and maintained by the manufacturer. It protects consumers’ privacy, but gives them access to the information they’re looking for within two quick clicks.” Examples of products currently using SmartLabel are at www.smartlabel.org. While SmartLabel doesn’t require GMOs to be disclosed, it does recognize them as a hot-button issue for consumers. However, until a national standard is adopted, the “patchwork of state-mandated labeling” makes GMO disclosure challenging to ft the uniform nature of the SmartLabel platform. “GMA is urging Congress for a standard on GMO labeling,” says Bailey. “We want to emphasize that this is the very earliest stage of this initiative,” she goes on to assert. “SmartLabel will become ubiquitous and the routine way that shoppers make decisions and research information about the products they buy.” According to Clorox’s Dorer, the personal care and household products company is an early supporter of SmartLabel because “to win with consumers and grow our business proftably, we must delight consumers with superior products and lead technology-enabled change to engage them in real time.” SmartLabel leverages GS1 Global Data Dictionary standard defnitions for the more than 350 Gen 1.0 attributes, and the Global Data Synchronization Network (GDSN) to enable brand owners to store and maintain information in one location for real-time accuracy and have that information fow to whomever needs it via the GDSN. “Tis is the frst time information can seamlessly and accurately fow when SmartLabel participants publish out via the GDSN and data recipients receive that information,” says GMA’s Flannery. “I believe all of the retailers and most of the data aggregators/collectors who participated on the project are committed to leveraging GS1 standards for seamless information fow. Tis is a huge productivity and accuracy improver.” PG For more information on SmartLabel, please visit ProgressiveGrocer.com/SmartLabel.

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Store of the Month

Strack & Van Til, Schererville, Ind.

Now They’re Cooking Strack & Van Til ups its grocerant game with a northwest Indiana remodel focused on customer service. By Jim Dudlicek

“T

here’s nothing here that we won’t cook.” Tat’s Chris Bengtson, VP at Highland, Ind.-based Strack & Van Til (SVT), outlining the enhanced prepared food services now ofered at the 20-unit chain’s newly remodeled store in Schererville, Ind., during a recent midday visit. “If someone asked us to smoke a turkey for dinner tonight,” he said, “we could do it.” Tat speaks to the banner’s renewed focus on a fullservice shopping experience, from the Café to the front

end to the concierge who helps customers with meal and party planning. “We set out to create the region’s most extensive fresh offering, with a focus on the customer through an expanded full-serve offering and a commitment to customer service,” explains Bengtson, whose purview includes public relations, community affairs, customer service and corporate inventory control. “Tis wasn’t just another refresh — it was really a pivotal store remodel for SVT,” he continues. “We looked to set the stage for who we want to be. Tis was our chance to jump in feet frst with what our customers were asking us for. We’ll continue to evaluate and, moving forward, we’ll implement components in future store remodels.”

| Progressive Grocer | Ahead of What’s Next | January 2016

Photos by Marta Garcia

Te Schererville remodel provided an opportunity to launch some new signature oferings unique to the store. Te Sweet Shop features candy from two local companies, Albanese Candy Factory and South Bend Chocolate Co., along with fresh store-made popcorn. Tere are also fresh-cut fruit and a fresh-squeezed juice bar, and skilled chefs prepare made-to-order sushi. Joining customer favorites like fried chicken and store-baked cakes are in-house smoked brisket, fresh-made pasta and pizzas, fresh-made peanut butter (made in-house), a hummus and olive bar, and a destination natural and organic department.

at your service From left: sandy Janda, deli manager; Bob Bonham, assistant store director; chris Bengtson, vP; randy Gootee, store director; Ken Bair, director of operations; Paul Neumann, produce manager; chris, Kocoj, head chef; and Kevin Bynum, assistant bakery manager

January 2016 | progressivegrocer.com |

Store of the Month

Strack & Van Til, Schererville, Ind.

Front and center From top: Fresh floral brightens the front end and encourages impulse purchases; Bengtson points out key features of the store to PG editorin-chief Jim dudlicek; each day’s count of organic offerings is posted in the produce section.

“Our associates and the shoppers love to talk about the food,” Bengtson says, “and there’s a lot to talk about.”

Freshness Blossoms For regular Schererville shoppers, perhaps the most striking diference since the remodel is seen the moment they enter the store. Previously, visitors coming in the front door were greeted by a warehouse-style “wall of values.” Tis was torn down to create a wide, open space for the new vibrantly colored produce section. “Everyone thinks we expanded, but we just took down the wall,” Bengtson remarks. Te produce section includes expanded organic oferings, with a daily tally of how many are available. “Just the produce is a new experience for our shoppers.” An extensive fresh foral department was added

| Progressive Grocer | Ahead of What’s Next | January 2016

at the front of the store as well. “We know it’s an impulse buy, and there’s no better way to steer shoppers to fresh-cut fowers than to put them up front,” Bengtson explains. Nearby is the sweet shop, where a store associate ofers samples of a new popcorn favor — pumpkin spice — from a recipe she created herself. “Everyone coming in walks by and grabs a sample of popcorn,” Bengtson notes. Produce is also home to SVT’s new expanded fresh-cut fruit program, along with fresh-squeezed juice, a pet project for the banner. “We’re the frst to do it to this extent in northwest Indiana,” Bengtson

Store of the Month

Strack & Van Til, Schererville, Ind.

Sweet truth A highlight of the remodeled Schererville store is the Sweet Shop, offering confections from local companies and housemade flavored popcorn.

says. “A lot of what you see here is at the request of our customers. Nobody else around can do combinations like we can, on the spot. If someone wants beets with lemonade, we can make it.”

Next along this inner perimeter is the sushi bar, where chefs make selections to order of “true restaurant quality,” says Ken Bair, SVT’s director of operations, who notes that sushi sales have soared by double digits since the addition of the in-house chefs. “Te theater really drives sales.” Bengtson, leading the tour around the bend into the specialty cheese department, notes, “We went back and forth for months on how to arrange the departments.” Te stafed cheese counter is always busy, with shoppers stopping to chat with the cheesemonger about the latest selections and get advice on wine-and-food pairings. “You can taste anything you want,” Bengtson says, indicating the international selections, cross-

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| Progressive Grocer | Ahead of What’s Next | January 2016

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Store of the Month

Strack & Van Til, Schererville, Ind.

the Meal deal a new salad bar concept brackets traditional offerings with wings and soups (above). the Café offers everything from sandwiches to pastas to a carving station.

merchandised with wines, jams, crackers and other complementary products. Tese are perfect opportunities to upsell, Bengtson acknowledges, and SVT’s vendors appreciate the chance to enrich sales here. “Tey have as much stake in this as we do,” he says. “Tey’re working hard to partner the right items, because we want to take this [concept] to the next store.”

Building Meals SVT has signifcantly ramped up its prepared food program at the Schererville store. Te Café, led by head chef Chris Kocoj, ofers everything from deli sandwiches to full meals, aimed at delivering easy solutions for shoppers. “We’re

| Progressive Grocer | Ahead of What’s Next | January 2016

learning that’s what people want,” Bengtson says. “Te idea is to allow people to build their meal.” Order a custom-made sandwich, or pick up a grab-and-go item. Ask for a slice of pizza, build a whole pie to exact specifcations, or buy one to bake at home. Enjoy smoked-on-premise pulled pork and beef brisket with a range of sides, try Asian entrées, or sample a selection of carved meats. For Continued on page 50

Store of the Month

Strack & Van Til, Schererville, Ind.

Strack & Van Til 1515 U.S. Highway 41 Schererville, IN 46375

Grand opening: Aug. 5, 2015 Total square footage: 87,000 Selling area: 55,000 square feet SKUs: 37,000 Employees: 270 Checkouts: 13 Hours: Open 24 hours Designer: CIP (décor); internal layout design by Strack & Van Til executive management team, led by Director of Construction Russ Webber

| Progressive Grocer | Ahead of What’s Next | January 2016

January 2016 | progressivegrocer.com |

Store of the Month

Strack & Van Til, Schererville, Ind.

a cut above In-house smoked brisket is carved to order for sandwiches (above). the new olive bar adds a fresh and vibrant touch to the perimeter.

Continued from page 46

just $6, choose an entrée and two sides, or try a $3.99 pasta bowl, with your choice of noodles (made fresh daily), sauce, vegetable and protein. “Tis has become our private label,” Bengtson says of Café oferings. “We love that.” Also available at the front-positioned café are ready-to-cook seasoned meats, which shoppers can take home or have prepared before their eyes. “We’re doing a ham for a customer on Sunday,” Store Director Randy Gootee noted during PG’s visit on a Friday afternoon. Te store’s new salad bar concept ofers traditional greens and toppings, fanked on opposite

| Progressive Grocer | Ahead of What’s Next | January 2016

ends by an assortment of chicken wings and soups. Over at the full-service deli counter, shoppers can get sliced-to-order lunchmeats and a range of salads, the most popular of which are also ofered in grab-and-go packaging. Te scratch bakery now features a wider array of upscale cakes, as well as

fresh bread. “We have great cake decorators that we weren’t using to their full potential before the remodel,” Bengtson says. Te store’s meat department used to be entirely self-service, but now a fullservice butcher counter, along with an extensive seafood department complete with lobster tank, not only provides custom cuts but will cook anything that’s for sale. Equipped with ovens, fryers and steamers, the department ofers a range of seafood dinner specials, and the store works closely with its seafood vendor on how best to merchandise products. Not far away, shoppers can pair their meat or fsh with the perfect libation at the store’s expanded beer and wine department. Featuring a selection of local wines and beers, including products from northwest Indiana’s wildly popular Tree Floyds Brewery,

Daily grinD The full-service meat department offers many value-added selections.

:the section ofers mixed 6-packs of craft beers and discounts on wine purchases of six or more bottles.

Destination Departments Outside of a general refreshing, center store was fundamentally unchanged, with two notable exceptions.

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January 2016 | progressivegrocer.com |

Store of the Month

hiGh SPiritS the remodel brought an expanded wine department. Opposite page: Evelyn Schwitters, the store’s concierge, offers a product sample to a shopper.

Strack & Van Til, Schererville, Ind.

First, the destination natural and organic section, which includes refrigerated, frozen and grocery items all in one area, was added. Te concept has proved popular, and SVT is so committed to it that the grocer created the position of natural and organic department head to oversee it, Bengtson notes. Second, along the wall at the far end of this section is an array of bulk food bins, containing nuts, candies, seeds and grains. Te bulk section “has done a lot more than I thought it would,” Bengtson admits, calling its placement at the end of the organic aisle “a brilliant merchandising decision.” Further changes included retroftting the dairy cases with doors to conserve energy, and installing LED lights in refrigerated and frozen cases. “We have reduced energy consumption quite a bit,” Bengtson says. Tere are 13 checklanes at the front end, all

stafed. “We actually took out self-checkout,” Bengtson declares, noting that the store got “more positive feedback for taking them out than putting them in.” He continues: “Our focus is creating a unique experience, with emphasis on full service. We want our cashiers to thank every single one of our customers.”

The introduction of Pompeian New SMOOTH EVOO is a big hit with the retail trade! When Pompeian, the leader in the EVOO category*, introduces a new EVOO, the retail trade tends to listen. And for good reason. Pompeian, always the innovator, never launches a new product without national market research which includes taste proﬁle testing. Our research shows that consumers are willing to purchase both our Robust EVOO and our New Smooth EVOO. You’ll also beneﬁt because both items have parity pricing making it easy to promote both products. Our Robust and new Smooth EVOO is perfect for your bottom line!

| Progressive Grocer | Ahead of What’s Next | January 2016

SVT takes customer feedback seriously, to the extent that one planned part of the remodel was scrapped: Te retailer was going to remove the awning at the front of the store to create more retail space, Bengtson explains, but customers voiced their opposition, favoring the sheltered area for drop-ofs and pickups on shopping trips. “If they don’t like what we’re doing,” Bengtson

says, “they’re not spending their money with us.” Te Schererville store serves a diverse customer base, with a broad demographic and income profle. “We border on many demographics, so we can sell anything,” Bengtson says, calling the store’s location, at the junction of Highways 30 and 41, “the heartbeat of northwest Indiana.” What’s more, in the short time since its unveiling, the newly refurbished store has already amassed a devoted following. Notes Bengtson: “I have neighbors who pass two of our other stores to shop here.”

Heartbeat of Customer Service With a staf of about 200 associates — up from 176 before the remodel — SVT is clearly aiming to enhance its customer service.

Pompeian pours on the support through 2016! Support for the Pompeian brand will only increase in 2016. Our TV commercial will reach more consumers and will be heavily supported by a print and digital campaign as well as a strong public relations program.

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January 2016 | progressivegrocer.com |

Store of the Month

Strack & Van Til, Schererville, Ind.

hiStory check Displayed above the front end are photos depicting the grocer’s past in northwest indiana.

Leading the charge at the Schererville market is Evelyn Schwitters, the store’s concierge. An SVT employee for 34 years, Schwitters conducts product samplings, provides recipes, helps customers plan parties and is otherwise the banner’s liaison to shoppers.

2012

2013

2014

“She knows our customers by name,” Bengtson says. “She helps tie everything together for them.” During PG’s visit, Schwitters was sampling smoked ham, a favorite in her own home, she told shoppers. “I love my customers,” she declares. Bengtson adds: “She’s the heartbeat of customer service for this store.” Tat efort is paying of. “Without a doubt, the most rewarding part of remodeling the store has been the positive feedback we’ve received from our shoppers,” Bengtson says. “Tis store is an important store for us, located in the heart of northwest Indiana. We knew that if we didn’t provide them with what they were looking for, they would tell us about it. Since we opened the doors, the feedback has been overwhelmingly positive. I’ve been blown away.”

2015

Four years in a row –

the best keeps getting better. Total Pages Page Share

Progressive Grocer

Supermarket News

2015 808 46.66%

2015 245 14.13%

2014 689 38.77%

2014 375 21.10%

Source: 2015 Inquiry Management Systems

| Progressive Grocer | Ahead of What’s Next | January 2016

Grocery Headquarters

2015 2014 679 714 39.21% 40.13%

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Te store team continues to learn how to adapt to a whole new level of service. “Since the grand reopening, we’ve realized that the demand in our café has meant that we need to bring on more people in the department,” Bengtson explains. “It’s very much a full-service department that requires a lot of interaction between our associates and shoppers. It’s a balance between getting them out in a timely manner and still providing them with a fresh, full service experience. Making that work requires great people, and a lot of them.” Tere’s a lot at stake, despite the loyalty of northwest Indiana shoppers. Te Schererville store operates around the clock to better compete with the Walmart in the same shopping center. And with a new Whole Foods Market that opened last fall just 2 miles away, SVT can’t pull any punches in this battle for fresh. “We are fortunate to have Central Grocers as our main supplier,” Bengtson says of the Joliet, Ill.based wholesale distributor, of which Strack & Van Til is a subsidiary. “Tey’ve been extremely supportive of us through the remodel process and stand to grow as we continue to grow our ofering — all of our suppliers do. We introduced so many new items in Schererville, many of which are available only in

this store. Our suppliers all have skin in the game here. Tey know that if it works, we’re going to do more of it in future remodels.” Bengtson also credits the store’s team for its success to date: “From our store director to our freight crew, this team moves in the same direction. We put them through a lot during the remodel. We moved every single thing in the store, and through all of it, they’ve remained positive and excited about the change. Tere’s no doubt that our customers’ positive reaction to the remodel has been driven in large part by our Schererville store team.” One of Bengtson’s favorite design features of the store is a décor package that includes a series of photos taken during the company’s early history in northwest Indiana. Te current company, with roots reaching back to 1930, was created when grocers Ernie Strack and Nick Van Til merged their operations in 1960. “We value the history we have here and are proud to showcase it,” Bengtson says. “Every once in a while, we have a shopper that comes to us, identifes a person in one of the photos and reiterates the fact that they’ve shopped with us since then. We value that loyalty and are proud to be that grocery store in this community.” PG

We set out to create the region’s most extensive fresh offering, with a focus on the customer through an expanded full-serve offering and a commitment to customer service.” —Chris Bengtson, VP

January 2016 | progressivegrocer.com |

Grocery

Shelf-stable Soup

Taking

Stock

New delivery systems, healthier profiles, fun shapes and an emphasis on versatility aim to enliven soup and related products. By Bridget Goldschmidt

s the shelf-stable soup category continues to decline — by 2 percent in sales dollars for the 52 weeks ending Oct. 24, 2015, according to Nielsen — manufacturers and retailers are fnding new ways to keep shoppers interested. Among those ways are additional organic options and convenient new delivery systems. Meredith Gremel, VP, corporate afairs and communications at Grand Rapids, Mich.-based SpartanNash, a food distributor and operator of 165 grocery stores, notes that “our Full Circle Organic aseptic broth is selling very well,” although she admits, “It is too early to judge the overall impact of these innovations [on] the total [soup] category.”

Taking a broader view, Gremel adds: “While readyto-serve soup in aseptic packaging is of to a slow start, we anticipate this will be the packaging preference of the future, similar to where we are currently in aseptic broths. Te acceptance of soup in a K-cup ofering convenience is in its early stages, with limited customer acceptance. While we have seen declines in condensed soup, we are seeing growth in the broth-based segment due to the healthier perception at the consumer level. We are [also] seeing growing demand for bone broth, driven by the Millennial consumers.” One leading manufacturer currently tapping into those trends is Campbell Soup Co., whose recent product introductions include Organic Kids Soups available

| Progressive Grocer | Ahead of What’s Next | January 2016

Continued on page 60

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State of the Deli: Paving the Path to Prepared Foods Tyson Foods recently asked 3,000 deli customers about their shopping experiences. Four out of ten surveyed reported experiencing problems in the prepared foods department, stating their paths to purchase were generally blocked by issues in three key areas. According to Eric LeBlanc, director of marketing for deli and bakery at Tyson Foods, Inc. — “ We see consequences of failure to drive traffic to the deli mainly in general deli issues, product issues and staffing. Once grocers recognize and address those problem areas, there is tremendous opportunity to develop shopper category awareness, encourage trial and invite repeat purchase behavior.”

Staffing Problems The top staffing issues identified by respondents in Tyson Foods’ 2015 Consequences of Failure study focused on lack of friendliness or knowledge, rudeness, and not being helpful. Perhaps most disturbing, 80% of dissatisfied customers didn’t

report their problems to the deli staff or store management, they just stopped shopping at that store’s deli. What can retailers do to help ensure deli customers have a positive experience and keep coming back? The answer is not necessarily to hire more employees, but to ensure current staff is well trained, that they can properly prepare and display products, and they’re helpful and friendly with customers. Managers should focus on scheduling staff to be available during peak shopping times, as well as during optimal cooking times.

Product Issues In the same study, Tyson asked those who considered purchasing fried or rotisserie chicken but chose not to make that purchase why they passed by the deli counter. 70% said it was because of

product issues – chicken appearance, such as looking dry and not fresh, or issues with product out-of-stock. Other issues were only discovered after taking the chicken home, where they found it to be overcooked, soggy or tasteless. yet another product issue reported.

To curb these problems, LeBlanc advises managers to be more mindful of in-store execution. The cooking times for rotisserie chickens are often driven by the employee schedule instead of peak shopping periods. Retailers often meet demand by having chickens cooked earlier than needed. By adjusting the cooking schedule, grocers can reduce product-related issues. Source: Tyson Consequences of Failure Study, 2015 ©2015 Tyson Foods, Inc. Tyson is a registered trademark of Tyson Foods, Inc.

General Deli Concerns The most commonly reported issue was a long wait time. This is considered a general deli problem, along with problems such as products not being ready or not available. Many of these concerns are related to and can often be resolved by addressing product and staffing issues; however, Tyson’s findings revealed additional consequences not so easily reversed. While 39% of consumers

experiencing a general deli problem will stop shopping the retailer for a short period of time, 9% will stop for longer, and 7% say they will never shop that store again. Those experiencing recurring general deli problems were even more likely to stop shopping that retailer.

How to do it right. You don’t need more staff but rather well trained, knowledgeable and friendly staff

The consequences of doing nothing to correct issues in these three problem areas are significant.

Nearly half of the 80% who said they stopped shopping at the deli because of staff issues also said they stopped shopping with that retailer overall. What may have gone unnoticed by management or might have seemed like a minor issue could ultimately drive shoppers and their purchasing power to other retailers as they search for a better experience.

Grocers who strive to pave a more frictionless path to purchase by improving these three key areas can be assured that deli prepared foods will become a bigger part of their customers’ regular consideration sets. The positive results even spill over into the entire customer experience, boosting increased awareness, trial and repeat behavior in the deli department and beyond to the rest of the store.

Get to the right place. At the right pace. Tyson Deli / Bakery.

Managers should schedule deli staff around peak shopping times

Cook times should be determined by shopper demand – not employee schedule

Prepare products according to manufacturer instructions

Always have staple products – like rotisserie chicken and fried chicken – hot, ready and available

Grocery

Shelf-stable Soup

Continued from page 56

While we have seen declines in condensed soup, we are seeing growth in the broth-based segment due to the healthier perception at the consumer level.” —Meredith Gremel, SpartanNash Co.

in three aseptic-carton SKUs and FreshBrewed Soups, created to be prepared in a Keurig brewer. The company is also trying to get on the right side of the Force with Special Edition Star Wars Soups featuring intricate die-cut pasta shaped like such classic characters as R2D2, Yoda, Darth Vader, and, available exclusively at Target, Chewbacca and C3PO. None of the soups in this line contains added MSG, artificial f lavors or artificial colors. “We’ve seen consumer shifts in people choosing food that is more ‘real’, organic and locally produced,” observes Jim Sterbenz, SVP U.S. retail sales at Camden, N.J.-based Campbell. “Retailers are seeing the same fundamental consumer shifts in how to make the category more attractive to consumers by better meeting their needs. As a leader in the shelf-stable soup production category, we are working to preserve what people love about our food, while reimaging the brand for a new generation.” In particular, he notes, the Star Wars and Organic Kids Soups “are part of our commitment to make products which are simpler and ft with changing consumer preferences.” To reafrm its connection to consumers, last October the company unveiled its frst integrated soup portfolio advertising campaign in more than fve years. Te Made for Real Real Life campaign “shows how Campbell’s products ft into people’s hectic everyday lives in an authentic, humorous and relatable way,” explains Sterbenz.

Nutritious and Delicious When it comes to better-for-you oferings, Gurnee, Ill.-based Frontier Soups has already carved out a comfortable niche in that segment. “Frontier Soups’ dry mixes appeal to consumers seeking healthier options because there is no salt added, no preservatives or MSG, and we require all suppliers to provide ingredients that are not genetically engineered,” notes company founder Trisha Anderson. “Also, soups, by their nature, are flled with foods consumers are trying to add to their diets, like beans, lentils and vegetables.”

| Progressive Grocer | Ahead of What’s Next | January 2016

Of Frontier’s latest soup mix oferings, Pacifc Rim Gingered Carrot and Kentucky Homestead Chicken and Rice, Anderson notes: “Despite being very diferent soups in style, both of these soups cater to consumers’ desire to add highly nutritious foods to their diets.” She further notes, “Soup is a very versatile dish, and ... food producers can fnd success by coming up with creative ways to add ingredients that consumers are seeking to add to their diets in a way that is family-friendly.”

What’s Cooking Speaking of versatility, soups — and especially their near relations, broths and stocks — are instrumental in many recipes, and manufacturers and retailers hope to encourage sales across those segments by playing up that fact. Afrms SpartanNash’s Gremel, “We have done a number of cross-merchandising promotions on end caps with other meal and recipe ingredients.” Soup itself can also serve as a base for culinary experimentation. Frontier’s Anderson points out that her company’s products “provide a shortcut to homemade soup. While they are a convenience product, home cooks add fresh and pantry ingredients to the mix, and that gives them a satisfying feeling of cooking something healthy for their families.” Frontier employs a merchandising strategy similar to Spartan Nash’s. “We have had great results with end cap displays that allow retailers to cross-merchandise ingredients home cooks add to our mixes, like broth and canned tomatoes,” says Anderson. Additionally, Campbell’s Swanson line of broth has recently launched two lines: Bottled Broth in Chicken and Natural Goodness Chicken varieties, ofering a new easy-measure strip so consumers can pour what they need and know how much is left, and Unsalted Broth in Beef and Chicken varieties that, according to the brand, “provides the perfect foundation to work from, letting you make your dishes the way you like them.” PG For more about shelf-stable soup and related products, visit Progressivegrocer.com/soup.

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Frozen & Refrigerated

Pizza

Upper Crust

Retailers and manufacturers raise the ante on frozen pizza. By Bridget Goldschmidt

G Restaurantstyle type of selection will become a key factor in keeping households engaged with frozen pizza.” —Jannah Jablonowski, Giant Eagle

iven that Americans eat 60 percent of the world’s pizza, according to Albuquerque, N.M.based Lavu POS — enough to blanket the city of Denver, apparently — it’s in retailers’ and manufacturers’ interest to capture as much of that action as they can. But how can supermarket frozen pizza, sales dollars of which have edged up by less than 2 percent over the past two years, per Nielsen, hope to compete with pizzeria fare? “Frozen pizza is a staple in many households, and often a convenient meal solution for our busy customers,” notes Jannah Jablonowski, spokeswoman for Pittsburgh-based Giant Eagle, which operates nearly 400 retail locations in Pennsylvania, Ohio, West Virginia and Maryland. “At Giant Eagle, we continually strive to meet the evolving needs of our customers by ofering a wide variety of high-quality products at a great overall value.” To that end, the item “ is often included in various promotions, highlighted in our weekly circular and displayed in end cap freezers,” she explains. “In October, we executed a frozen pizza promotion in

| Progressive Grocer | Ahead of What’s Next | January 2016

which an assortment of frozen pizza oferings was available at $1, $2, $3 or $4 price points for a limited time. By including frozen pizza oferings across multiple brands and segments in this promotion, we were able to reach a number of Giant Eagle and Market District households.” Asked about emerging trends, Jablonowski addresses the need to keep consumer interest high through exciting new products: “Looking forward, we expect to see innovation across the category with more global ingredient profles, like Cuban or diavolo, and interesting crust types, like ancient grain and pencil-thin,” she says. “Tis restaurant-style type of selection will become a key factor in keeping households engaged with frozen pizza.”

‘Strong Contender’ Despite the overall category’s modest growth, Schwan Consumer Brands Inc.’s pizza oferings, led by Red Baron and the newly introduced Bon Appetit, are doing well at retail. Observes President Kevin McAdams: “Our pizza portfolio had a very strong 2014 in terms of share growth. Tis has helped us re-establish ourselves in 2015 as a

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Brick oven has been an untapped opportunity in the premium segment, with very few offerings that do not deliver on taste or quality.” —Kevin McAdams, Schwan’s Consumer Brands

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strong contender within the frozen pizza category.” Accordingly, Marshall, Minn.based Schwan’s “plan[s] to continue the momentum in 2016, with several new brand platforms, including the launch of Red Baron pizza’s new Timeless brand campaign,” he adds. Kicking of Red Baron’s 40th anniversary, Timeless “speaks to an active, hectic family that craves simplicity and a time-tested answer to bring everyone together around a great-tasting pizza,” explains McAdams. “Similarly, with the Freschetta brand platform’s Te Best Tings in Life Are Real campaign, we are addressing consumers wanting the brands they know and love to be authentic, relatable and understand that life is unperfected. Tese two brand campaigns will be the cornerstones for our growth in 2016.”

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| Progressive Grocer | Ahead of What’s Next | January 2016

Te company is also paying close attention to what eateries are serving, and formulating products in response. “Te top trend in restaurant pizza continues to be brick-oven crust,” asserts McAdams. “Brick oven has been an untapped opportunity in the premium segment, with very few oferings that do not deliver on taste or quality. To tap into this opportunity, we launched a new, authentic Red Baron Brick Oven pizza in February 2015 [featuring] a unique crispy, bubbly texture with a perfectly imperfect golden-brown crust.” Product innovations coming to retail this February include a revitalized Red Baron Tin & Crispy ofering, with both a packaging refresh and new restaurant-quality BBQ Style Chicken and Bacon Lovers varieties, and a Freschetta Artisan Crust pizza line, leveraging technology from the company’s Schwan’s Food Service Inc. division. “Te [Freschetta] line … features a diferentiated, 51 percent multigrain crust made with a unique blend of three whole grains kneaded into the dough, delivering a slightly sweet favor, hearty texture and all the benefts of whole grain,” notes McAdams, adding that the product “delivers on current food trends, with 75 percent of shoppers looking to buy more whole grains, and Millennials’ emphasis on real food, transparency and authenticity.” Schwan’s puts comparable thought into its merchandising strategy for frozen pizza. “We know that we compete in the segments of the category that are the trafc drivers for the total frozen category,” says McAdams. “We look to execute tactics that will not only help sell a Red Baron pizza, for example, but will also increase household penetration, drive trafc and buy rate for our brand, the pizza category and beyond. We have a team of merchandising experts on staf who are focused on working with stores to optimize the placement of every pizza SKU in such a way that makes the most sense to the consumer and guides them down the pizza aisle.”

Getting Better Pizza may be an indulgence for many, but it hasn’t been immune from the general trend toward healthier foods. Giant Eagle, for one, has seen “increased customer interest in better-for-you frozen pizza options, and as a result, [we] have made these products more visible in our supermarkets,” according to Jablonowski, who adds that, along with artisan oferings, the grocer has noted growth among items positioned as healthier. At Schwan’s, “we continue to see consumers interested in innovative favor combinations, gluten-free

market. “To be Certifed Gluten Free is no longer oferings and better-for-you options,” afrms McAdenough,” asserts Wintz. “Our packaging draws ams. Last October, the company revealed its commithealth-conscious shoppers to our product with its ment to eliminate four ingredient groups — partially transparency and convenience.” PG hydrogenated oils and artifcial trans fats, artifcial dyes, high-fructose corn syrup, and artifcial favors — from its portfolio of foods, including pizzas, and For more about frozen pizza, visit there’s also the aforementioned multigrain Freschetta Progressivegrocer.com/frozenpizza. Artisan Crust launch in the ofng. “In addition to our ingredient simplicity work, we have been reformulating our Freschetta and Red Baron pizza brands to reduce sodium in both lines while maintaining the same great favor,” he continues. Another player in the artisan, BFY and gluten-free segments, Pittsfeld, Straight and narrow. A new aisle-warming solution N.H.-based American Flatbread, recently introduced a line of meatfor nagging cold aisle complaints. topped pizzas. “Our premium pizza has continued to show great growth,” says Brad Sterl, CEO of Rustic Crust, maker of American Flatbread pizza. “Sales are up over 35 percent yearEC m over-year. He cites “[c]lean ingredients o opt tor and limited processing” as keys to the ion brand’s momentum, further noting, “Gluten-free has also been a successful product for us.” Te company’s frst oferings of this kind rolled out last February. “Te gluten-free pizza category continues to grow,” notes McAdams, “as gluten-free oferings have been found to be highly incremental — 64 percent incremental to the pizza category, 24 percent incremental to stores and 75 percent incremental to our Freschetta brand,” the leader in the segment, which introduced two single-serve gluten-free varieties last year to compleSpecifically designed for narrow ment its multiserve gluten-free pizzas. aisle applications in grocery For gluten-free do-it-yourselfers, stores, Airius’ Narrow Aisle fan there’s Wholly Wholesome’s Gluten provides an elongated airflow Free Pizza Dough Balls, whose sales, pattern to maximize spread according to founder and CEO Doon down the length of an aisle Wintz, “have excelled at over 300 perwhile minimizing interference cent.” One reason for this, he believes, with open cases. Features is the Chester Township, N.J.-based energy-efficient electronically company’s decision to change the commutated (EC) motor. product’s packaging to feature “clearly marked allergen information, from the ingredients used in the pizza dough to the additional products housed in our facility, that might be of concern to Call 303.772.2633 allergen-sensitive consumers.” or visit As can be gathered from the information included on the Pizza Dough The World Standard www.airiusfans.com Balls packaging, Wholly Wholesome For Destratification has its eye on the larger free-from

Narrow It Down

January 2016 | progressivegrocer.com |

Fresh Food

Produce

New and

Improved

The produce industry reinvents snacking, with healthy and flavorful results. By Jennifer Strailey

Most people understand they need to eat more fruits and vegetables, but the biggest reason they don’t eat more is the prep.” —Sarah Glunz, Giant Food Stores

s consumers increasingly turn to snacking in place of meals, they’re looking for convenience, but also greater nutritional value from the foods they defne as snacks. According to Te Hartman Group, in Bellevue, Wash., consumers now consider half of all eating occasions as snacks, and while the defnition of snacking is evolving, it typically consists of mini meals that involve little to no preparation or cleanup. Hartman’s “Culture of Food 2015: New Appetites, New Routines” report fnds that these “food decisions are driven by availability, wants and whims, aspirations and ethics,” but at the same time, we’re also “more conscious of health outcomes when choosing what to eat.” Consumer demand for healthy convenience is driving innovation in produce, turning the perimeter of the store into an epicenter of fruit- and vegetable-based snacking solutions.

Easy Does It As lead nutritionist for Carlisle, Pa.-based Ahold USA banners Giant Food Stores and Martin’s Food Markets, Sarah Glunz frequently hears from cus-

| Progressive Grocer | Ahead of What’s Next | January 2016

tomers who say that ready-to-eat is the single most determining factor in their consumption of produce. “Most people understand they need to eat more fruits and vegetables, but the biggest reason they don’t eat more is the prep,” she notes. “Everyone says if it’s ready to go, they’ll eat it.” Plenty of fresh fruit — apples, bananas, oranges and pears, for example — is virtually prep-free, so Glunz steers customers to these items, suggesting that they keep them in a bowl on the kitchen counter, as research shows that people eat more fruit when it’s in plain sight. She also points customers toward the variety of fresh-cut items available in produce that are equally convenient to eat. “It’s about fnding ways to make it as easy as possible to consume produce quickly,” says Glunz, who adds that many customers will buy a fruit or veggie tray to keep in the fridge and share with family members throughout the week. Health-conscious snacking is also fueling growth in packaged chip-style products in the produce department, from Harvest Snaps to Zippy’s Veggie Bites to Sunkist’s Snack it Forward freeze-dried fruit. “I see people gravitating to those kinds of snacks,” afrms Glunz, adding that, per the Produce for Better

Macad amia Nut M is coming soon. ilk A delic ious dairy-a customers wi lternative ll crave.

Fresh Food

Produce

Health Foundation, fruits and vegetables in all forms count as consumers strive to up their daily intake. Products that pair a fruit or veggie with dip are also resonating with Giant’s customers. “Families who can aford them and who are pressed for time are going to the snacks like celery and ranch [dressing], or carrots and peanut butter,” observes Glunz. “I like those packaged snacks, because even if consumers aren’t buying them, it’s a good reminder of the combinations they can create at home.”

Dipping Delight Targeting the health-conscious and convenienceseeking consumer who digs dipping, Duda Farm Fresh Foods, of Oviedo, Fla., recently introduced Te Dandy Celery Snack Line of six ready-tosnack items. “More than half of Americans snack two to three times a day,” notes Dan Duda, president and COO. “Te mission of our company is to ofer our products in ways that directly meet the needs of consumers, particularly in the celery category.” Te line includes Celery Sticks in a 1.6-ounce single-serve package; Celery and Peanut Butter Fun Packs (in 2.3-ounce and 4.15-ounce sizes that feature a Peanut Butter & Co. squeezable pouch); and Crunchables, a grab-and-go cup that contains celery sticks with three varieties of ranch-favored dips from Marzetti’s (Ranch, Light Ranch and Southwest Ranch). For its part, Mann Packing Co. continues to create new ways for consumers to enjoy veggies and dip. Te Salinas, Calif.-based company recently introduced a new seasonal veggie tray in 18-ounce and 40-ounce sizes. Te trays, which feature celery, carrots, broccoli, sugar snap peas, tomatoes and a creamy ranch dressing, are shipping through this month to customers nationwide. Produce Every Time As a nutritionist, Glunz focuses less on how consumers are eating — whether it’s a snack or a meal — and more on what they’re eating. “Te conversation is the same if the customer is eating three meals a day or six small meals or snacks a day,” she explains. “We always talk about balance. Making half the plate fruits and vegetables still stands, whether they’re eating a snack or a meal. We need to make it the norm that we have fruits and vegetables every time.” With this in mind, Glunz teaches customers how to incorporate more produce in their diets in fun and appealing ways. She recently led a class for high school students where she taught them how to make smoothies with avocados. “Tey really liked it,” she reveals. “Smoothies overall are a big trend, but I remind people that just because it’s a smoothie doesn’t mean it’s healthy,” adds Glunz, who fnds that smoothies are also great for families with picky eaters. “It’s not always taste, it’s often the texture of a fruit or vegetable, that kids object to.”

| Progressive Grocer | Ahead of What’s Next | January 2016

In the Bag For most people, giving up chips would be like giving up chocolate: impossible. However, thanks to the introduction of crunchy and favorful produce-based snack products that satisfy like a chip but ofer nutritional value, consumers don’t have to forsake this cherished snacking experience. “Tere is a long way to go on consumers consistently making healthy snacking choices,” says Keith “Zippy” Mullin, founder of Zippy’s. “Until we see a decline in obesity, Zippy’s will keep on fghting and educating Americans that snacking healthy will help them do the things that they love, longer.” Zippy’s Veggie Bites, which Mullin describes as a salad on the go, use a patent-pending process to bind non-GMO vegetables together in a shelfstable format. Te La Jolla, Calif.-based company’s most popular product is Veggie Bites California Ranch; Zippy’s also makes Veggie Bites in Simply Cae-

sar, Spinach & Cranberry, and Lemon & Kale favors. Mullin created the line, as well as some new favors that are in development, with the goal of giving consumers a healthy, tasty snack that they would choose over conventional chips. “Snacks that I liked slowed me down,” says Mullin. “Te ones that were healthy tasted like old cardboard. I wanted a snack that would help me do the things I liked to do and tasted good.” When it comes to merchandising packaged shelf-stable snacks in produce, Mullins says placement is key. “Recently, we have seen grocers building dedicated shelving for healthy snacking within the produce section, which is efective merchandising for many reasons,” he notes. “Consumers are moving away from three big meals a day to more snacking throughout the day,” observes Nick Desai, CEO of Los Angeles-based Snack it Forward, which has partnered with Sunkist Growers Inc. to create better-for-you snacks

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Consumers want their snacks to have nutritional value, not empty calories.” —Nick Desai, Snack it Forward

Fresh Food

Fresh produce has undoubtedly become a snack of choice in the United States.” —Dionysios Christou, Del Monte Fresh Produce

Produce

such as Sunkist Fruit Chips and Sunkist Trail Mix Redefned. Snack it Forward is now expanding into the savory side of healthful snacking with an upcoming, but as yet to be ofcially announced, acquisition of a pea-based snack company. “Te quality of the snacking has also evolved,” adds Desai. “It’s not getting a cookie from the vending machine. Consumers want their snacks to have nutritional value, not empty calories.” Te Sunkist Fruit Chips, a line of 100 percent pure freeze-dried fruit snacks in four varieties (Crunchy Strawberries, Crunchy Grapes, Crunchy Banana and Crunchy Fuji Apple) landed in Walmart stores last October. Desai has been pleased with the initial consumer response. “Our Fruit Chips ofer all the convenience of a chip, but they only have one ingredient — fruit,” he notes. Most trail mixes are nut-based, but Sunkist Trail

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| Progressive Grocer | Ahead of What’s Next | January 2016

Mix is more fruit-focused. “We’re doing a lot of premium fruits like blueberries, strawberries, mangoes and pineapple,” says Desai. Te mix is 60 percent to 70 percent fruit, with premium tree nuts as a complement. Te company will be introducing single-serve packs of both the Fruit Chips and Trail Mix, and new favors in both lines are in the works. According to Desai, while the products’ opaque packaging “bucks convention,” it also keeps the contents of the bags fresher and crunchier than clear bags.

Protein and Produce As snacks replace meals, fresh fruit and vegetable products that also contain a protein are increasingly in demand. From salads with chicken or quinoa that can be eaten on the go to snack packs that feature a combination of fruit and nuts, innovative products are making a splash with consumers in search of quick and nutritious fuel. Pro2snax, the newest product from Reichel Foods Inc., of Rochester, Minn., provides a combination of apples and protein. Te line currently ofers two favors: Sliced Apples with Mild Cheddar Cheese and Sweet Gala Apples with Almonds. Reichel plans to expand Pro2snax with up to four new favor combinations. “Be sure to stand the product up so consumers can see it while making their purchasing decision,” advises Nicole Ly, Reichel customer operations manager. She further recommends merchandising Pro2snax and similar products in the fresh-cut and/ or convenience section of produce, as well as promoting multiple-product pricing such as four for $5. Game Day Snacking Increasingly, fresh produce suppliers and organizations are promoting occasion-based snacking. With this in mind, Avocados From Mexico (AFM) has joined forces with Old El Paso, a brand of Minneapolis-based General Mills, to capitalize on peak guacamole consumption leading up to and during the Super Bowl. Te Guac Nation program ofers ways to increase consumer avocado demand and consumption around football gatherings. “Te Big Game ranks as one of the top occasions where avocados are served, and guacamole is the No. 1 usage for avocados,” says AFM President Alvaro Luque. AFM further notes that the Super Bowl is among the top three special occasions among Hispanics where avocados are served. Te campaign includes a consumer sweepstakes, consumer savings and a digital media campaign. Guac Nation will also feature in-store support, including a retail display contest, in-store

radio and in-store merchandising focused on bins shaped like a molcajete (a mortar and pestle used to mash homemade guacamole). For the second straight year, AFM will run a commercial during the Super Bowl. Last year, AFM became the frst fresh food commodity to advertise during the game, earning more than 1.6 billion impressions in one week.

Fresh-cut On the Go “Fresh produce has undoubtedly become a snack of choice in the United States,” asserts Dionysios Christou, VP marketing for Del Monte Fresh Produce, in Coral Gables, Fla. “We have a full pipeline of new products that address consumer and customer needs, especially focused on snacking.” Del Monte’s approach is to target healthconscious snackers in general, and those with busy lives in particular. “We have also expanded our fresh-cut range and packaging to meet the needs of this growing and demanding consumer segment,” notes Christou.

“For example, our fresh-cut fruit and vegetable containers now include features such as nonspill containers and cups that ft in car cup holders.” Marketing to these onthe-go consumers in a way that promotes a healthier lifestyle is also top of mind for Del Monte. “One tactic has been leveraging POS, merchandising and social media to encourage healthy eating habits for sporting events, holidays and for fueling up at work and school,” he explains. “Te great thing about fresh produce is that many of our fruits and vegetables naturally lend themselves to portability and snacking,” adds Christou. “Since consumers have grown to expect healthy snacks that are fresh, convenient and on-the-go, many of our newest items have also been very popular.” PG For more about produce snacking, visit Progressivegrocer.com/producesnacks.

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Fresh Food

Produce Category Spotlight

Move Over,

Meat

Consumers are making room for more mushrooms in their diets. By Jennifer Strailey

As more people try The Blend in restaurants and learn about it in the media, fresh mushroom consumption continues to increase.” —Kathleen Preis, The Mushroom Council

mericans are eating less meat. Health-conscious consumers have moved beyond Meatless Mondays to embrace a new food culture that has more vegetables in the center of the plate. Umami-rich mushrooms, which provide a favorful and healthful alternative — or an addition to meat — are benefting from this trend, which isn’t necessarily about eschewing beef altogether. Chicago-based research frm Mintel reports that while only 7 percent of consumers identify themselves as vegetarian, 36 percent say that they use meat alternatives.

The Blend Such is the brilliance behind Te Blend program, from the San Jose, Calif.-based Mushroom Council. Te initiative encourages consumers to chop mushrooms to match the texture of ground meat — beef, pork, chicken and turkey — and use it in place of some of the meat in their favorite dishes, from tacos to meatballs to burgers. Te council notes that mixing chopped mushrooms in with

| Progressive Grocer | Ahead of What’s Next | January 2016

ground beef can eliminate as much as half the fat and calories per serving. Last year, the council partnered with the James Beard Foundation on its Better Burger Project to challenge chefs and restaurants across the nation to include mushroom-blended burgers on their menus. “As more people try Te Blend in restaurants and learn about it in the media, fresh mushroom consumption continues to increase,” notes the council’s Kathleen Preis, who has observed that many retail trends begin with foodservice. “Te Blend opens up a new avenue for mushroom sales in addition to traditional mushroom sales.” “People are really starting to get into the idea of ‘blendability,’” agrees Ed Wuensch, of Kitchen Pride Mushroom Farms Inc., in Gonzales, Texas. “With more and more people wanting to eat healthy, they’re looking for creative ways to make healthier versions of their favorite meals, without sacrifcing taste.” Wuensch further notes that social media is helping to introduce consumers to new foods and cultures like never before. “People are becoming more and more interested and open-minded when it comes to trying new, exotic foods,” he says.

Pete Wilder, marketing director for To-Jo Mushrooms Inc., in Avondale, Pa., also sees consumers becoming more experimental in the kitchen, and credits the success of Te Blend at retail and foodservice with inspiring home cooks to eat more mushrooms and fnd more uses for them. “People are looking at mushrooms not just as a side dish, but as a center-plate meal. Tey’re cooking with mushrooms more frequently, and they’re using them to add favor to dishes they’re used to making,” asserts Wilder, who adds that Millennials in particular are driving this more veg-centric diet trend. Supermarkets around the country, including Hy-Vee, Kroger and Weis Markets, are also helping to promote Te Blend and share its recipes. For example, Sunbury, Pa.-based Weis featured Chicken Marsala Meatballs, made with 33 percent mushrooms, on the cover of its Healthy Bites consumer publication. Te grocer also posted a video online that features one of its registered dietitians demonstrating how to prepare the meatballs. Te Mushroom Council plans to continue to pilot Te Blend with grocery chains in 2016. It’s also working with registered dietitians to promote mushroom nutrition.

People are looking at mushrooms not just as a side dish, but as a centerplate meal.” —Pete Wilder, To-Jo Mushrooms Inc.

“We have seen the importance of supermarket registered dietitians in their communities,” says Preis. “Tey provide nutrition information, recipes and cooking instructions for consumers looking to improve their health. By arming supermarket registered dietitians with mushroom and Blend recipes, demo kits, and handouts, we can continue to keep mushrooms and Te Blend top of mind for consumers.” Te council encourages supermarkets interested in hosting a Blend pilot to visit the newly updated www.mushroomsatretail.com site, which also ofers a link to the demo kit for registered dietitians.

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Fresh Food

Mushrooms are one of the most perishable categories in the produce department.” —Mike O’Brien, Monterey Mushrooms

Produce Category Spotlight

Specialty Mushrooms In terms of sales, white mushrooms are the front-runner, with 63 percent of the market, according to Preis, but brown and specialty mushrooms are gaining ground as consumers become increasingly willing to experiment. Mike O’Brien, VP of sales and marketing for Watsonville, Calif.-based Monterey Mushrooms, attributes the growth in specialty mushrooms to their favor profle and versatility. “Te mushroom consumer is becoming more sophisticated, and is moving from the traditional white mushrooms to brown mushrooms, and exotics such as oyster and shiitake,” he observes. Within the market for brown mushrooms, which represents 32 percent of the category, crimini mushrooms are showing the most gains, with 5.9 percent sales growth, notes Preis. Criminis account for 22 percent of sales, while portabellas make up 10 percent of total mushrooms sales. “Portabellas are great mushrooms to substitute for meat,” asserts O’Brien. “Tey have a dark-brown color and a very rich favor. You can even grill them whole as a ‘burger.’ Tey’re also good chopped into

fllings, sauces and casseroles.” For the shopper who values favor and convenience, Monterey Mushrooms has introduced a stufed baby portabella package in three favors: Spinach & Artichoke, Tomato Basil, and Poppin’ Peppers. Keen to feed the nation’s growing appetite for specialty mushrooms, To-Jo Mushrooms last year introduced a foraged fresh mushroom program for upscale retailers and foodservice on an order basis. Under the program, To-Jo has created a seasonal calendar of foraged mushrooms to keep its customers informed as to availabilty. Wilder fnds that demand is high for these limited-availability items. “We’re still seeing continued growth in retail for specialty mushrooms,” he observes. “I think the trend is being driven by younger consumers who are more adventurous cooks and are looking for more favor and quality.”

Merchandising Variety “Mushrooms are one of the most perishable categories in the produce department,” points out O’Brien. “To minimize shrink and maximize sales, it’s important to know your consumer and ofer the variety that matches the store demographics.” Monterey Mushrooms is currently fnding success with larger packages, brown mushrooms, exotics and organics. “Larger packages increase consumption and sales,” says O’Brien. Once product assortment is dialed in, cold-chain management, product rotation, impactful displays and signage each play an important role. BEEF UP YOUR PRODUCE SALES “We encourage supermarkets to create a large, eye-catching display WITH GIORGIO MUSHROOMS. of fresh mushrooms with diferent varieties, sizes and value-adds,” We’ve been in the mushroom business for three generations, enhancing suggests Preis. “We also encourage our status as the premier brand, year after year. We have the variety, cross-merchandising mushrooms in a quality and reputation your customers demand. Our fresh mushrooms second location near the meat case, to encourage blending.” meet the most rigid inspections and certifcations. When it comes to growing Te Mushroom Council further recsales in your produce section, you can’t pick a better partner than Giorgio. ommends signage that briefy explains the favors and cooking techniques of diferent mushroom varieties. PG Equal Opportunity Employer

Giorgio Fresh Co. | 347 June Avenue, Blandon, PA 19510 800.330.5711 | www.giorgiofresh.com

| Progressive Grocer | Ahead of What’s Next | January 2016

To learn how one supplier has been playing up the health and convenience aspects of mushrooms, visit Progressivegrocer.com/mushrooms.

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Fresh Food

Produce Roundtable

All toGether now Produce Power Session participants, from left: Brian huh, Dole Fresh Vegetables; PG Contributing editor Jennifer Strailey; Mike orf, hy-Vee; David Krause, wonderful Citrus; Jeff Fairfield, new Seasons Market; Jim Grabowski, well-Pict Berries; teri Miller, Delhaize America; Glenn Daniels, earthbound Farm; Josh Padilla, Alpha 1 Marketing; PG Chief Content editor Meg Major, Mimmo Franzone, longo’s; and Craig Ignatz, recently retired from Giant eagle

Produce Power Session An executive roundtable shared key challenges and predicted future growth in the category. By Jennifer Strailey

hat was the single biggest headline relating to fresh produce sales in the past 12 months? Which are the hottest-selling categories? What are the most signifcant challenges facing the industry? Produce industry executives from across North America explored these and other topics at PG’s Produce Power Session. Held in Atlanta on Oct. 23, just prior to the Produce Marketing Association (PMA) Fresh Summit, the event — moderated by PG Chief Content Editor Meg Major — featured six retail panelists and four supplier sponsors.

Discussion of headline news elicited a virtually unanimous response from the retailers and suppliers in attendance. “California’s weather — that’s the big news, and not only for this year, but for what could happen next,” said Glenn Daniels, VP, customer development, East at San Juan Bautista, Calif.-based Earthbound Farm, a division of Te WhiteWave Foods Co. “We’re seeing a lot of changes with weather and how it afects supply,” agreed Jef Fairfeld, director of produce, New Seasons Market. Te Portland, Ore.-based chain of 18 privately owned grocery stores is in a growth phase, with plans to open one to two stores in each of its three

| Progressive Grocer | Ahead of What’s Next | January 2016

markets — Portland, Puget Sound and the San Francisco Bay Area — each year. When the weather afects supply, the challenge then becomes gaining the customer’s understanding. Shoppers have come to expect many items in fresh produce year-round. Tey want it today, and they want it to be locally grown, without necessarily grasping the complex nature of the fresh produce supply chain. Meanwhile, demand for fresh produce continues to soar as health-conscious consumers seek a bounty of fresh produce, from ingredients for juicing to healthy fats in the form of avocados and coconuts, to value-added convenience items, noted Craig Ignatz, the now-retired VP of produce and foral merchandising for the Pittsburgh-based Giant Eagle chain of nearly 400 stores. “We can’t supply stores with what they need geographically with local produce,” said Ignatz, noting that weather and related sporadic supply challenges are a familiar headache for produce trading partners. While Brian Huh, VP of category development and customer strategy at Monterey, Calif.-based Dole Fresh Vegetables, conceded that the weather’s potential to thwart a consistent supply of fresh fruits and vegetables presents challenges, he didn’t consider

Last year, we launched a freshly sqeezed juice program, and we’ve doubled sales this year over last.” — Mimmo Franzone, Longo’s

it a deal breaker for consumers. “Instead of buying peaches, maybe they’re buying nectarines, but they’re not leaving produce,” posited Huh. “Te customer has fundamentally shifted to buying more produce.”

Trends and Super Sellers Longo Brothers Fruit Markets, which recently opened its 29th Toronto-area store, is posting double-digit growth in produce, according to

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Fresh Food

Produce Roundtable

Director of Produce and Floral Mimmo Franzone. Among the chain’s top sellers, Franzone points to packaged salads, grapes and avocados. “Te packaged salad category continues to grow — all SKUs. It’s such a strong

From snack time to mealtime

The customer has fundamentally shifted to buying more produce.” —Brian Huh, Dole Fresh Vegetables

category for us,” he said. On the supplier side, Dole couldn’t agree more. “Chopped kits have changed the game for us, and I think that will continue,” Huh said. “Te grape category, led by proprietary varieties, is showing double-digit growth,” observed Franzone. Retail panelists concurred that sales in the grape category have taken of in recent years. Products such as Cotton Candy, Witch Fingers and Gum Drops, from Shafter, Calif.-based Grapery; Sweet Celebrations; and Hobgoblin Grapes, a fall-themed branding campaign of Pretty Lady Grapes by J.P. Dulcich & Sons, in McFarland, Calif., illustrate the branding genius of the table grape industry. “I think that’s the biggest point of diferentiation,” said Ignatz, referring to the shift from commodity to creative branding that’s driving the grape category. Brands like Hobgoglin and Cotton Candy are designed to resonate with kids, a highly sought-after demographic in today’s produce department. “Easy-peel mandarins are posting 20 percent year-over-year growth,”

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anTicipaTing neeDs alpha 1 Marketing’s Josh padilla noted that retailers should be ahead of trends.

said David Krause, president of Los Angeles-based Wonderful Citrus, adding that the marketing budget behind Halos has played a critical role in the success of the kid-friendly fruit.

of something, whether it’s berries or caulifower, they start fnding more uses for it.” According to United Fresh’s Q2 2015 “FreshFacts on Retail” report, berries are No. 1 in dollar sales within fresh produce. Seventy-four percent of households purchase berries. Both volume and sales are up, with stores reporting $5,419 in weekly sales, an increase of 3.9 percent from Q2 2014. “Te increase in package-size options is one thing that’s driving berry sales,” explained Jim Grabowski, director of marketing at Watsonville, Calif.based Well-Pict Berries. “We’ve seen an increase in 2-pound strawberry packs, and 12-ounce raspberries have become a standard item — they’re not just a club store item.” Grabowkski added club stores have introduced 18-ounce raspberry packs. Panelists agreed that larger berries with a

Organic Gains While a number of fresh produce categories are performing exceptionally well for Hy-Vee Inc., Mike Orf, assistant VP produce operations, noted that organic is clearly outpacing conventional produce. Te West Des Moines, Iowa-based grocer has more than 230 stores in eight Midwestern states. Delhaize, the Brussels-based chain of some 1,100 stores in Europe and the United States, has also witnessed a phenomenal surge in organic produce. “In the last two or three years, we’ve seen double-digit growth in dollars and units in organic salads,” said Teri Miller, produce category manager at Salisbury, N.C.-based Delhaize America. “We’ve even seen 30 percent to 40 percent growth in organic salads in places like South Carolina, where consumers didn’t traditionally buy organic.” Te demand for organics as a whole is indicative of a major shift in consumer behavior, noted Earthbound’s Daniels. A focus on health and food integrity has made organic produce top of mind for more shoppers. “At the end of the day, branding that communicates to the customer that you are organic is really important,” he asserted, while Ignatz agreed, “Organics branding is about building Comfortable loyalty with consumers.”

Brand aId Craig Ignatz, recently retired from Giant Eagle, says organic branding builds customer loyalty.

Warm Up Your Sales!

Juicing It As the home juicing trend continues, some supermarkets are both selling the ingredients and ofering fresh juices of their own creation. “Last year, we launched a freshly squeezed juice program, and we’ve doubled sales this year over last,” Franzone noted of an initiative that has rolled out to all Longo’s stores. Supply can also present challenges here. “Te juicing trend is moving faster than production,” observed Krause, while Franzone admitted, “Tere’s so much demand, it’s tough to pull of the gas.”

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Big Berries “Berries continue to be a juggernaut of sales,” said Orf. “Raspberries are exploding.” “Berries are all driven by the halo of antioxidants,” said Huh. “When consumers learn about the health benefts

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Fresh Food

CItrUs sUCCess Wonderful Citrus’ David Krause points out that easypeel mandarins are now highly popular.

It’s just an incredible time in produce because there’s never been a period of such innovation throughout the supply chain.” —Mike Orf, Hy-Vee Inc.

Produce Roundtable

“wow factor” and an increase in supply are further fueling berry sales, but the perishability of berries remains a concern. “When you consider that the average household spends $25 to $30 a week on produce, and $3 of that budget on berries, throwing out bad berries can equal a 10 percent loss,” observed Ignatz, who stressed the importance of product rotation and expanding and contracting berry displays as needed.

Value-added Fresh Produce “It’s just an incredible time in produce because there’s never been a period of such innovation throughout the supply chain,” asserted Orf. “Customers are driving the value-added equation. Tey want products that are closer to the consumption stage.” At New Seasons, Fairfeld has seen not only an increase in demand for value-added, but for more chef-prepared and restaurant-style produce. Te grocer is launching what Fairfeld described as a “quick bites” concept, which will include fresh-cut pineapple with lime zest and chiles. “We’re looking at how best to get those convenience dollars,” he said. With an estimated $200 billion in annual buying power, Millennials are driving much of the innovation in value-added produce. More adventurous eaters and experimental in cooking, this generation represents tremendous opportunity for the entire industry. “Everything is worth trying in produce right now,” said Miller. “Not everything will work, but there are home runs out there.” Both Han-

Up and Coming Progressive Grocer asked the Produce Power Session panelists to share their thoughts about the produce department of the future. Will supply chain management and the battle against shrink change the design of the produce department? “I think store design is the most interesting consideration,” said Craig Ignatz, recently retired VP of produce and floral merchandising for Pittsburgh-based Giant Eagle, which has started putting its cut fruit and bagged salads behind

naford and Food Lion stores have had success with putting items like green beans and peppers in handled graband-go bags. “It’s more appealing and seems fresher to the consumer,” she added. Te popularity of valueadded produce is changing the look and feel of the department. Josh Padilla, who leads produce marketing, merchandising and operations for West Harrison, N.Y.-based Alpha 1 Marketing banner stores, including C-Town, Bravo and Aim Supermarkets, noted his stores are using fewer 8-foot wet decks, and more salad kits and value-added oferings.

Multicultural Ingredients Multicultural consumer spending in the United States has reached $3.4 trillion, according to a Nielsen report, “Te Multicultural Edge: Rising Super Consumers.” Tese shoppers are having a tremendous impact on the U.S. mainstream in many categories within the store. For example, Nielsen found that Hispanic shoppers, who represent $1.5 trillion in buying power, spend $175 more on fresh food per year at traditional grocery than the national average. “We need to be ahead of the trends, not reacting to them,” advised Padilla, who observes New York metro area ethnic markets. “Look at Hass avocados. Tey used to be consumed largely by the Hispanic population, but now they are mainstream.” Padilla predicted other fruits and vegetables traditionally eaten by consumers of Caribbean descent will become increasingly important to fresh produce in the coming years.

closed refrigerated doors in some stores. “Salads and berries are our No. 1 customer complaints,” he noted. Jeff Fairfield, director of produce at Portland, Ore.-based New Seasons Market, put forward the idea that the industry may be moving toward the customization of refrigerated cases to meet the atmospheric requirements of different produce items. Undoubtedly, the produce department will continue to evolve based on the need to offer consumers the highestquality fresh fruits and vegetables possible.

| Progressive Grocer | Ahead of What’s Next | January 2016

Fresh Food

what’s new Craig Ignatz talks produce trends with (from left) Jennifer strailey and Meg Major.

Produce Roundtable

Produce Partnerships Te growth in fresh produce, while exciting, has also spelled increased competition in every facet of the industry. How can suppliers stand out as desirable partners for grocers? Across the board, retail panelists expressed their preference for suppliers that take the time to visit their stores, meet with produce managers, and gain an understanding of their businesses and customers. “I think the people who are best positioned to help us are the ones who come into our stores and work with us, versus the ones who say, ‘I’ve got fve loads of X to sell you,’ ” said Ignatz, adding that Giant Eagle also expects vendors to provide shrink analysis for every store. “We want to work with suppliers who help build the brands they supply,” agreed Orf. “It’s working hand in hand with our people — not just meeting

with our buyers, but also our marketing people to help sell the product all the way through.” At Longo’s, Franzone is interested in collaborative relationships as well. “It’s about being true partners in innovation,” he said. “We would invite suppliers to involve us in the early stages of planning if they are looking to introduce something new in our stores.” PG

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| Progressive Grocer | Ahead of What’s Next | January 2016

Nonfoods

Health Beauty & Wellness

Smooth Operators

Moisturizers lead the pack in the skin care category derby. By Barbara Sax

raditional moisturizers are outpacing anti-aging products, but products with a therapeutic positioning are gaining steam in both the facial and body moisturizer categories. Dollar sales of facial moisturizers grew 1.7 percent in the supermarket channel for the 52-week period ending Oct. 4, 2015, according to Chicago-based IRI, but growth among dermacosmetic/pharma-branded products outpaced sales of traditional brands. While Johnson & Johnson’s Neutrogena and Procter & Gamble’s Olay both hold about a 20 percent dollar share of the market, Olay’s share slid nearly 5 percent, while Neutrogena’s grew 20 percent. Valeant Pharmaceuticals’ CeraVe saw a 46 percent leap in dollar sales, and Galderma Laboratories’ Cetaphil brand experienced a 5 percent dollar sale gain during the same period. Dermocosmetic/pharma brands such as Neutrogena and CeraVe are an important part of skin care, according to research from London-based Euromonitor. “Neutrogena, the largest dermocosmetic skin care brand, with sales of $878 million in 2014, is marketed as being dermatologist-recommended and as ofering premium-quality skin care products,” notes Ashley Sellers, a Euromonitor spokeswoman. “J&J’s Aveeno sister brand, marketed with the ‘Active Naturals’ tagline, is also a dermocosmetic brand and is ranked ninth in skin care, with $366 million in sales.” According to Sellers, there’s little distinction between therapeutic brands, which include Beiersdorf’s Eucerin, and standard skin care brands, and both segments have extended their oferings to include added benefts such as sun protection or anti-aging properties. Meanwhile, “masstige” brands like Olay have seen sales sag. “Lack of innovation and lack of the right experience in mass retail that justifes the premium price points has negatively impacted growth in facial moisturizers in the mass market,” says Wendy Leibmann, CEO of New York-based WSL Strategic Retail. During the recession, she adds, shoppers were willing to trade down from department and specialty beauty stores, but since the economy has improved, consumers are no longer willing to “settle.” As a result, promotional pricing is common in this segment of the category.

Anti-aging Products Flat Dollar sales of anti-aging facial moisturizers fell 3 percent to $139 million at supermarkets for the period previously cited, according to IRI. “While advanced anti-aging technology is increasingly incorporated into mass-market products, many consumers believe that premium anti-agers sold at specialty and department stores still hold a performance edge over mass-market brands,” says Euromonitor’s Sellers.

| Progressive Grocer | Ahead of What’s Next | January 2016

She adds that serums and eye treatments could be an area of development for mass-market shoppers. “Anti-aging, concentrated serums and eye treatment products are performing well in the prestige market, since the delicate eye area is one of the frst areas to show the signs of aging and consumers seek to reduce the appearance of crow’s feet, pufness and under-eye bags through eye treatment serums,” notes Sellers. But Leibmann cautions that since mass consumers are more inclined to keep their skin regimens simple, it may take a while for supermarket retailers to build this segment of the business. “In time, if the benefts and value are really clear, these segments could grow in the channel,” she explains. “But for now, getting mass shoppers to add one more item to their skin care regimen remains a big challenge.” One segment that has shown signifcant growth at retail is that of fade/bleach products. “Skin-whitening products are a niche category in the U.S., comprising around 5 percent of total facial skin care value sales in 2014,” observes Sellers, “but pale skin is becoming more accepted in the U.S., with the rise of certain pale-skinned celebrities such as Anne Hathaway and Emma Watson. Tese products are marketed as brightening the skin for a youthful radiance, or as reducing the appearance of dark spots, which are the result of aging and sun exposure.” Olay Regenerist Luminous Tone Perfecting Cream, introduced last year, performed well, as did Burt’s Bees Dark Spot Corrector. Among natural/ organic skin care products, the Oakland, Calif.based Clorox Co.’s Burt’s Bees is the leader, according to Euromonitor research. Sales of natural and organic products have risen as consumers have grown more concerned with ingredients. “Companies have been focusing more on products with free-from claims as they realize that consumers are increasingly aware of the possible irritation from artifcial fragrances and preservatives, as well as gluten,” says Sellers. “Burt’s Bees ... has been able to achieve strong sales due to wide availability in ... retail outlets ranging from natural foods supermarkets to drug stores to mass merchandisers.” Burt’s Bees isn’t alone on store shelves, as mainstream supermarket chains have broadened their departments in an efort to grab a bigger share of the natural product segment. Rochester,

N.Y.-based Wegmans Food Markets, for example, devotes up to 20 feet to an in-store Nature’s Marketplace section that prominently features Burt’s Bees alongside such brands as Weleda, Andalou Naturals, Alba, Jason and Giovanni.

Therapeutic Products Drive Body Lotions Products that have a dermocosmetic/pharma or therapeutic positioning are driving growth in the body moisturizer segment. CeraVe body moisturizers had the biggest dollar share spike of the period, with a 33 percent leap over last year, according to IRI, while Chattem’s Gold Bond, which has had specialized therapeutic formulas in its lineup since 2013, grew its dollar sales by 11 percent. Under its Gold Bond brand, Chattem, a division of Bridgewater, N.J.-based Sanof, launched Diabetics’ Foot Cream, Diabetics’ Body Cream and Eczema Body Cream in 2013, following up with the introduction of Rough & Bumpy Skin Daily Terapy Cream, Diabetics’ Hand Cream, Eczema Hand Cream, and Strength & Resilience Cream over the following 18 months. Te line’s latest product is Dark Spot Minimizing Cream. Formulation innovations have also been driving the body moisturizer segment. Tis summer, Cincinnati-based Kao USA launched Jergens Wet Skin Moisturizer. Designed to be applied to wet skin so it’s instantly absorbed, the product is touted as providing twice the moisturization in half the time. Available in three fragrances, Jergens Wet Skin Moisturizer has a suggested retail price of $6.99 for a 10-ounce bottle. “Jergens Wet Skin Moisturizer sinks right into wet skin and locks in hydration at the moment when skin is most receptive to moisturization,” notes Jergens Brand Manager Vivian Bastos. “Because you don’t rinse it of, none of the hydrating ingredients get washed away. Tis new formula allows consumers to get better moisture even faster, which we’ve found has helped to increase women’s overall total moisturizer usage.” Nivea, from Wilton, Conn.-based Biesdorf, offers a similar product line, Nivea In-Shower Body Lotion, in four fragrances. Te new wet-application products are the frst innovations in the category since manufacturers introduced spray-on moisturizers in 2013, when Edgewood Clifs, N.J.-based Unilever launched Vaseline Spray & Go. PG

Companies have been focusing more on products with free-from claims as they realize that consumers are increasingly aware of the possible irritation from artificial fragrances and preservatives, as well as gluten.” —Ashley Sellers, Euromonitor

For more information on skin care, visit Progressivegrocer.com/specialtycreams.

January 2016 | progressivegrocer.com |

Nonfoods

Household Cleaners

Nice and

Neat

Convenient, affordable green products can allow grocers to clean up. By Barbara Sax

hoppers want a clean house, but they don’t want to spend a lot of time cleaning. “Consumers are more likely to prefer to clean as they go, doing quick cleanups that fit into their schedules, than setting aside time to give the whole house thorough top-to-bottom cleanings,” affirms Todd Elms, VP marketing at Dallas-based Scotch Corp. Category segments that place extra emphasis on simplicity, convenience, and quick cleanups and disinfection have had the strongest performance in the category, according to a recent report from Chicago-based Mintel, while products associated with more laborintensive or time-consuming cleaning, such as abrasive cleaners and furniture polish, have experienced declines. Dollar sales in the specialty cleaner segment were down 6 percent in the food channel for the 52-week period ending Oct. 4, 2015, according to data from IRI, also based in Chicago.

Convenience is Key A shift away from cleaning the whole house at once to quick cleanups has fueled sales of wipes and touch-up products such as SC Johnson’s Windex Touch-Up Cleaner, an inventive push-down pump dispenser the company introduced in 2013. “Windex Touch-Up Cleaner was truly the frst product of its kind to hit the market and really change the category,” says Kelly Semrau, SVP of global corporate afairs for communication and sustainability at Racine, Wis.-based SC Johnson. “It was created for consumers who are ‘quick and convenient’ cleaners.” Semrau adds that the company conducted extensive research that tested a wide range of designs and delivery mechanisms. “Te resulting product design was chosen because it was aesthetically pleasing, works well in either their kitchen or bath, and is easy to use, so cleanups can naturally become part of your daily routine and weekly cleaning becomes more manageable,” she explains. According to Elms, consumers are migrating to products positioned as quick-cleanup solutions. “Our Instant Power Shower Tub & Tile Cleaner is

| Progressive Grocer | Ahead of What’s Next | January 2016

designed to tackle messes quickly and efciently,” he says. “More cleaning products promote a quicker clean, with less scrubbing time needed.” Tose distinctions are important in a category where purchasers are only moderately loyal to individual brands: Mintel’s study shows that roughly one-third of consumers tend to buy the same brand every time in most household cleaning categories.

A Push for Brand Loyalty SC Johnson is looking to change that fnding with a new program that displays the company’s products, including Glade, Windex, Scrubbing Bubbles, Pledge, Shout and Drano, as a family. “Products will be displayed in end caps and free-standing displays across retailers in classes of trade,” notes Semrau. “We have had signifcant partnership in grocery retailers, with executions planned with most major retailers.” Te company is teaming on special programs with such companies as Meijer, Albertsons/Safeway and Dollar General. “In-store and shopper promotions will place all SC Johnson products together on the shelves,” says Semrau. “Tis will help consumers identify the brands they use on a regular basis, with the trusted notion that comes with SCJ being a family company.” SC Johnson also launched a FSI and DSI coupon event in November. “We have not ofered this type of incentive [on] this scale in the past,” admits Semrau, adding that the company is likely to model future programs on the success of this event. “We coupon occasionally on these products to increase the trial and repeat on our products and brands.” Price is also important in this category. Recent research from Mintel found that looking for promotions and discounts in the aisle is among the most common household care product shopping behaviors. “Coupons and discounting drive this category,” agrees Shelley Cade, VP of marketing at St. Louis-based Willert Home Products. “Te category is very pricesensitive, and customers are not very brand-loyal.” Green Segment Growth Natural cleaners are becoming a bigger part of the category. In the all-purpose cleaner segment, where IRI data show a 2 percent overall increase in dollar sales in the food channel for the period cited earlier, the Mrs. Meyer’s Clean Day brand, from SC Johnson, saw dollar sales surge 50 percent. Method brand dollar sales in the segment were up 15 percent for the same period. Rochester, N.Y.-based Wegmans Food Markets devotes an 8-foot section to environmentally friendly cleaning products, including products from Mrs. Meyer’s Clean Day, Seventh Generation, Earth Friendly Products’ Ecos brand and private label eco-friendly cleaning products. “Natural cleaners are growing, and will continue to do so, because consumers are looking for

alternatives to the classic cleaners that focus on sustainability and child/pet safety,” asserts Eddie Morabito, retail business development manager for Toledo, Ohio-based Canberra. “But they are also not willing to compromise on the efcacy” of such products. Morabito points to research showing that a majority of consumers want products that work and are green. “A very small percentage of consumers want the product to ‘just work’ and don’t care how, and a very small percentage want the product to be ‘green’ and will sacrifce efectiveness, but an overwhelming majority — over 90 percent — want both,” he says. “Tey want a clean house, and they want to feel good about what they are using.” Canberra recently redesigned its Just Add Water System (JAWS) package for national launch. Te frst bottle of JAWS comes pre-mixed and ready to use. Once the bottle is empty, the consumer reflls the JAWS reusable spray bottle with water, and then inserts a concentrated refll pod. JAWS is currently available in four streak-free, nontoxic, biodegradable formulas; the company plans to introduce additional cleaning products in 2016. Meanwhile, trusted classic brands are also getting in on the natural act. Willert has launched Ty-D-Bol Natural, a line of all-plant-based bathroom cleaning products. All products in the line retail for less than $5. Willert plans to expand its natural oferings in the future, as the Ty-D-Bol brand is outpacing growth in the toilet bowl cleaner/deodorizer segment, with double-digit growth, according to IRI. Natural positioning, combined with a competitive price, should give brands a bigger boost. Notes Willert’s Cade, “We saw a need for natural-based cleaning products at an afordable price point.” PG

In-store and shopper promotions will place all of our products together on the shelves. This will help consumers identify the brands they use on a regular basis, with the trusted notion that comes with our being a family company.” —Kelly Semrau, SC Johnson

January 2016 | progressivegrocer.com |

Operations

Workforce Management

The Labor Force

Awakens

Cutting-edge technology can help manage 21st-century workplace challenges. By Jenny McTaggart

G How great would it be if the POS system sent a signal that a particular product is almost out of stock, and then an alert came through the workforce management solution so that the retailer could generate a task for someone to replenish the product?” —Tyler Owen, JDA Software

rocers might feel like calling on Yoda, the legendary Jedi master of “Star Wars” fame, when they consider the multitude of labor challenges on the horizon: a rising minimum wage, unrelenting demands from labor unions and a lack of dependable workers, to name just a few. Yet there’s already a diferent kind of force poised to strike back, which will help grocers enter a new era of food retailing in which store environment is more important than ever, and labor efciency must be measured as accurately as possible. Tis “force” is workforce management, and several tech companies, including JDA Software, Manhattan Associates and Empower Software, are working to help midsize and large retailers increase labor productivity as well as employee satisfaction. Workforce management traditionally has been tied to grocers’ warehouse management systems (WMS), to aid in the intensive pick processes in warehouses and distribution centers, and to drive optimal productivity. Now the technology is showing even more promise in the last mile of the supply chain — the store — to better manage a myriad of ever-changing labor roles and tasks that can, in one day, conceivably include restaurant service, pharmacy, and picking and assembling orders that a consumer made online. Regardless of the task, workforce management advocates agree that the store experience is more important than ever, so a retailer’s position on the front lines can’t aford to sufer. “Store labor is critical in the last few links of a grocer’s supply chain,” notes Derek Hannum, VP of marketing at Orlando, Fla.-based Empower Software. “Te largest grocers spend hundreds of millions — probably billions — collectively focusing on making sure they have the right product on the shelf at the point of demand. Yet if someone has to wait 10 minutes at the deli to be serviced and walks out of the store without purchasing the 10 other items they’d selected, all that work could be lost.”

| Progressive Grocer | Ahead of What’s Next | January 2016

Tyler Owen, senior director of solution strategy at JDA Software, based in Scottsdale, Ariz., says his company is in the process of developing what he calls an “intelligent store” to make better use of associates’ time while also tackling out-of-stocks. “Te largest overriding trend in the industry is the end of cheap labor, with the minimum wage going up and other legislative issues,” observes Owen. “What that all boils down to is having the right person in the right place at the right time, and ensuring that their work is efcient. “In the distribution centers, you have software that tells the employee where to go, what to do, what to pick, etc.,” he continues. “You don’t waste trips going up and down the aisles. It’s a very efcient operation. But your normal grocery store isn’t, from the perspective that there isn’t a WMS that is managing the fow of goods within the store itself. JDA is doing an awful lot from that capacity to become more efective and more efcient with in-store labor, based upon what the store’s needs are.” JDA already has a foot in the door, so to speak, as the company ofers category management solutions to help grocers analyze shelf capacity. “How great would it be if the POS system sent a signal that a particular product is almost out of stock, and then an alert came through the workforce management solution so that the retailer could generate a task for someone to replenish the product?” he asks. “I wouldn’t call it WMS in the store, but in a sense that’s what it is. We’re having to pull from multiple systems to get that information, and it’s still a work in progress, but when you start to think about the next level of efciency from a workforce management perspective, it’s going to get down to logistics in the store,” says Owen. As Peter Schnorbach, senior director at Atlantabased Manhattan Associates, sees it, “Measuring employee productivity is the biggest imperative for the grocery industry as it pertains to the workforce.” He points to the importance of newer mobile applications, which help keep track of employee performance in real time. “Tis enhances the entire

process by exposing critical productivity information in real time,” he observes. Rick Schlenker, SVP of sales and marketing for Southlake, Texas-based Logile, also sees employee productivity as a top-of-mind issue among grocers. “Traditional labor scheduling and time and attendance [aren’t] sufcient anymore,” he maintains. “Companies are now seeking advanced labor modeling tools that incorporate engineered labor standards, store-specifc characteristics and UPC volume movement to determine their true labor costs at a day or 15-minute increment by subdepartment.”

Organizing Labor In addition to the need for more efcient work, many retailers are encountering more demands than ever from labor unions, as well as from part-time workers who may have more than one job. Workforce management systems can help them by more closely monitoring shift priorities and other requirements, while also allowing for more fexible scheduling, which seems to appeal particularly to the younger, technology-inclined members of the workforce. In one example cited by Empower, a midsize retailer was asked by its local union to be 100 percent

compliant in strict seniority scheduling, essentially making sure that the most senior employees had the most hours in the week, the earliest shift in the day and the most hours in a day. Empower worked with the retailer to make sure its workforce management system provided these scheduling requirements, although the union ended up changing its position after seeing how its requirements weren’t ultimately benefting employees. In addition to union concerns, Empower and other technology providers see a growing movement toward fairer scheduling that has the retail industry closely watching labor debates playing out on the West Coast and in New York. In these instances, companies are being pressured to publish employees’ schedules sooner, sometimes two to three weeks in advance. Indeed, it seems that on-call scheduling could one day be a thing of the past. “Tis trend has actually helped workforce management providers, because retailers now have to make their schedules further in advance,” notes Martin Linusson, VP of professional services for workforce management at Empower. In fact, retailers can actually use this technology to their advantage by promoting a more fexible January 2016 | progressivegrocer.com |

Operations

Measuring employee productivity is the biggest imperative for the grocery industry as it pertains to the workforce.” —Peter Schnorbach, Manhattan Associates

Workforce Management

company culture, he adds, noting, “It’s a tough labor market right now, as more associates are starting to move around, and more people have more than one part-time job.” With new technology, not only can associates know about their upcoming shifts sooner, but they can also swap and drop shifts as needed, often in real time, if they can access the retailer’s schedules from their mobile devices. Tis is a huge advantage for grocery employers, notes Linusson. Asheville, N.C.-based regional chain Ingles Markets is one grocer seeing benefts from using Empower’s solutions. Cindi Brooks, VP of human resources at Ingles, says: “Empower Workforce Management has vastly improved our scheduling process. Store associates have easy access to their schedules via the web, and soon we will be introducing the mobile scheduling app to our associates. Web and mobile apps give associates access to their schedules as soon as they are published, as opposed to calling the store for that information. Tis saves our store managers hours in phone time, hours they can spend on the foor with our associates and shoppers. And our associates love getting their schedules earlier and easier. With Empower, we not only improve our store operations, we enhance associate engagement at the same time.”

Picking More Efficiently Another growing area of the grocery business that’s being aided by workforce management technology is in-store picking as it relates to online ordering. While U.S. supermarkets are still largely in the experimental phase of how they can best ofer this type of service, many have realized that operating separate warehouses for picking orders isn’t efcient. “Te omnichannel trend has had a big impact not only on our systems, but also on our retail customers,” notes Empower’s Martin. His company recently worked with a large nonfood retailer during its beginning stages of the pick-in-store model, and he says everyone was surprised by how much the new service afected store labor.

| Progressive Grocer | Ahead of What’s Next | January 2016

“Te retailer came to fnd out very quickly that almost all the labor in the selling department, which was supposed to be spending time helping customers, ended up being used to fulfll the orders that were placed online. Today, they designate someone in the specifc department to handle order picking,” he says. “Now we’re forecasting for each store individually to predict how many orders the store will need to fulfll, so we have a historical pattern that we can look at. Tis helps generate extra labor in each department.” In a similar vein, JDA Software is working hard to aid retailers with in-store picking. “We currently have two solutions when it comes to in-store picking that are integrated with our supply chain technology,” says JDA’s Owen. “Te frst one is an IBM solution, which is like the traditional buyonline, pick-up-in-store ofering. It has a great order management engine that determines the best fulfllment process, the best place to pick, and the best place to pack and ship from.” JDA has also developed a “very detailed grocery in-store picking solution” that allows the employee to pick multiple orders at a time, adds Owen. “It does all the substitution logic and weighs the items,” he says. U.K. grocer Sainsbury’s is currently using this solution, according to the software provider. Logile, for its part, provides a real-time task management solution that ensures compliance with on-time order picking, notes Schlenker. With all of this work underway to help retailers better manage their labor, perhaps a retail galaxy with happier workers and higher profts isn’t so far, far away after all. PG

Consumer Engagement

Technology

Omnichannel Retailing:

A Work in Progress Getting ready now is critical. By John Karolefski

he grocery-buying process will change because of the emergence of omnichannel retailing. Consumers want options, and grocers need to be ready to provide them. As a result, experts say retailers will have to deal with the selling price, venue, payment and customer experience in all transactional channels. Doing so efectively is easier said than done, however. One person who understands that better than most is Jim Wisner, formerly a VP at Jewel Food Stores and Shaw’s Supermarkets. He contends that omnichannel retailing is being able to operate — in any fashion — when and where the customer wants to interact with you. Tat can take a lot of forms: customer service via social media, online chat, email or phone; allowing them to browse or shop in-store or online; letting them receive products via home delivery, in-store pickup or good old-fashioned aisle browsing; or making coupons or discounts consistent across channels.

“As much as the ultimate goal needs to be a complete integration of ‘all things at all times,’” says Wisner, now president of Libertyville, Ill.-based Wisner Marketing, “it is important to make sure that each individual piece can operate functionally and efectively on its own. Pasting an online shopping portal onto a website that hasn’t been redesigned in several years or mobile-optimized won’t ring true to shoppers.” Tat being the case, getting started correctly with omnichannel retailing becomes critically important. DyShaun Muhammad, VP of Westport, Conn.-based consultancy Catapult, ofers the following three key steps and advice for retailers: Educate yourself. Te frst step is to get to know the shoppers, especially those who are most valuable to you. Get beyond the basics of location and price. What really drives a shopper to actually purchase a particular category from you? What are the barriers to his or her doing more transactions with you? Where do tools like mobile apps, fexible fulfllment, digital couponing and January 2016 | progressivegrocer.com |

Technology

Consumer Engagement

more traditional merchandising mechanisms ft in his or her path to purchase for your priority categories? How could you best deploy these tactics to better deliver your retail brand proposition to drive stronger afnity and share with the shopper? How could your vendors help via product mix, operational support or co-marketing?

As much as the ultimate goal needs to be a complete integration of ‘all things at all times,’ it is important to make sure that each individual piece can operate functionally and effectively on its own.”

Evaluate your ecosystem. Once you have a good understanding of shoppers’ needs and key drivers, you must evaluate your own ecosystem. Do you have the technology, logistics, data and organizational resources to operate against a unifed view of shoppers and their activity across channels? What are the gaps in your systems that impede delivering the quality of experiences that will drive the desired level of shopper loyalty and conversion? What frustrations are shoppers communicating to your customer service teams or via social channels?

Experiment to find what works. At this point, you can then engage in the hard work of determining which things to experiment against, where to invest and how to restructure your organization to deliver. It can’t be done all at once, but each step —Jim Wisner, Wisner needs to be able to deliver meaningful value for Marketing shoppers and make it easier for them to accomplish their shopping goals with you.

What is Omnichannel Retailing? “Omnichannel” is a popular buzzword in the grocery industry. But what exactly is omnichannel retailing? Executives have different definitions. “Omnichannel retailing is an operational strategy to deliver a seamless, integrated and personalized customercentric retail experience to the shopper across all transactional channels,” says DyShaun Muhammad, VP of Westport, Conn.-based consultancy Catapult. “The term ‘omnichannel’ suggests being able to do it all and pre-emptively meet the shopper’s expectations without disruption across any and all channels. Given that’s not currently possible, ‘omnichannel’ is an aspirational strategy, but one retailers must pursue.” Meanwhile, Stephanie Waters, CEC grocery industry principal for SAP Hybris, a division of Walldorf, Germanybased multinational software corporation SAP, explains that omnichannel engagement is more than just a great marketing strategy or deciding to add online grocery. It’s about leveraging data and insights and recognizing the

Obstacles Ahead As with any major new initiative, obstacles stand in the way of smooth implementation. Wisner, Muhammad and others point to organizational silos in diferent departments as one challenge to overcome. “Tere are operational, organizational and experiential issues to resolve,” afrms Channie Mize, general manager for the retail sector for Periscope, a McKinsey solution. “It’s easier to do multichannel, but that creates silos and doesn’t extend to customer service. Also, branding may not be consistent across the channels with a multichannel versus omnichannel approach.

need to deliver a real-time, contextual and relevant experience at the various stages of the shopper’s journey. “Foundationally, omnichannel is a device-based, connected and harmonized ecosystem,” explains Jeff Seabloom, managing director of Alsbridge, an Addison, Texas-based global consulting and advisory services firm. “For the consumer, it means a predictable and comfortable, almost untethered experience across all sales channels, whether brick, web or machine, and across customer interaction points.” For his part, Chester Ritchie, SVP of Atlanta-based Worldpay, a provider of payment-processing technology, says that omnichannel is about increasing and strengthening connections with consumers by offering them a way to live and shop better. “Successful omnichannel strategies require a focus shift by grocers from the products they sell to the shopper’s experience buying and using these products,” he says. “They have the power to shop however is most practical, whether in-store, online or via mobile, and this ability has set the bar higher than ever before.” —John Karolefski

| Progressive Grocer | Ahead of What’s Next | January 2016

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Best Practices from a National Cause Marketing Campaign with Local Community and Sales Impact Wednesday, January 27, 2016 | 3:30 p.m. ET/2:30 p.m. CT/12:30 p.m. PT | Duration: 1 hour The dairy aisle – and specifcally milk – remains the top proft driver in retail. Increase shopper loyalty to your store and bring new excitement to this powerful real estate by connecting with a meaningful social cause – feeding your community’s hungry children. Cause marketing has the power to bring new shoppers in store and keeps them coming back. Through MilkPEP’s frst-of-its-kind partnership with Feeding America, the dairy aisle presents a unique opportunity to beneft kids and families in need in your local community, connect with your shoppers and increase sales. For the second year in a row, Kroger has brought to life MilkPEP’s Great American Milk Drive program as Pour It Forward – a uniquely-branded initiative under its Bringing Hope To The Table platform to fght hunger. You’ll hear frsthand how and why Kroger chose to activate this campaign in more than 2,300 stores from coast-to-coast, and within 16 banners – to deliver nutritious milk to children in each store’s local community. From check-out programs to in-store POS and additional marketing support, there are many ways retailers can customize The Great American Milk Drive for their local communities to help drive shoppers to the dairy aisle and increase the purchase of milk gallons for their local food bank. Participating retailers will learn: • Insights and best practices from Kroger’s successful activation • The community and sales impact of Corporate Social Responsibility efforts at retail • How to activate and customize the program for your stores with turnkey assets from MilkPEP • Insights that can help you drive milk category growth

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Register today at: www.progressivegrocer.com/awards-events/events/MilkPEP_webcast_2016 Presented by: Sponsored by: Moderator: Jim Dudlicek, Editor-in-Chief, Progressive Grocer

Technology

Consumer Engagement

“In more traditional multichannel environments,” she continues, “the chief merchant ofcer controls the merchandising in the physical stores, while the CIO, or ‘head of online,’ controls the ofering in the online stores. Tey each have diferent agendas tied to diferent or misaligned incentive structures. Tis can cause the same retailer to cannibalize itself across channels, which inherently provides for less than optimal results for the customer.” With all of these challenges, it’s not surprising that none of the major grocery retailers that Catapult works with on their omnichannel journeys have figured it all out. Muhammad notes that certain items like buy online/in-store pickup, mobile apps, and digital circulars/offers are becoming “table stakes” for grocery retail. And consumers are receptive. In 2014, Walldorf, Germany-based multinational software corpora-

tion SAP used social sentiment to study the grocery consumer. Te survey found that sentiment toward grocery apps and digital technology was 62 percent positive, and that most shoppers used their mobile devices to make grocery lists or schedule deliveries. “With the industry getting increasingly more digital and consumers coming to expect an omnichannel experience, we’re seeing more and more grocers following suit,” says Randy Evins, senior principal IVE

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| Progressive Grocer | Ahead of What’s Next | January 2016

for food, drug and convenience at SAP Hybris. But getting a single view of every customer has been a difcult process for grocers, according to Daniel Raskin, VP of strategy for ForgeRock, a San Francisco-based identity and access management software corporation. Tat’s because customers interact with grocery stores across many diferent devices, which leads to a fractured customer identity. “Tis makes it difcult for grocers to know the customer,” he explains, “leading to an impersonal, generic customer experience that fails to excite, motivate and retain. Customers now expect services to recognize and adapt to their purchase history, tastes and preferences. “Te fx for this is for grocers to connect the identities of its customers, their digitally connected things and cloud services,” he adds. “Unifed customer identity is critical for creating a seamless omnichannel customer experience. Te information linked to customer identities enables grocers to accurately and authentically interact with customers in-store and online. To stay competitive, grocers must actively engage customers with personalized ofers, relevant recommendations, timely alerts and other individualized customer experiences, both online and in-store.”

Getting it Right Catapult’s Muhammad doesn’t know of any retailer that has reached such a state of “omnichannel nirvana” — especially not in grocery — but he adds that many are doing the right things to evolve. “Walmart and Whole Foods are both doing a good job at providing tools and integrated content that align with their unique value proposition to core shoppers,” he notes. “I love that Target is testing on multiple fronts, including ongoing updates to their mobile apps, breakthrough omnichannel marketing campaigns, and personalization via their mobile sites. But they have not yet made the experiences between touchpoints sufciently seamless.” While it’s important for grocery retailers to offer omnichannel options to shoppers, Wisner cautions that it’s even more critical for them to do it well. Tat’s because consumers — especially those who tend toward digital media — are highly sensitive to inconsistencies and inefectiveness. Even so, he observes, “Consumer adoption at large is not growing quickly enough to be signifcant for a number of years to come.” PG

With the industry getting increasingly more digital and consumers coming to expect an omnichannel experience, we’re seeing more and more grocers following suit.” —Randy Evins, SAP Hybris

Technology

In-store Marketing

Engage Shoppers With Digital Devices Mobile is the linchpin for connections. By John Karolefski

The successful grocers are those who are leveraging their loyalty data to deliver personalized value through their mobile applications for an enhanced in-store experience.” —Michael Colaneri, AT&T

n the near future, supermarkets will routinely engage shoppers with a variety of digital devices. Setting the stage for this scenario are beacons, digital signage and at-shelf tags being unveiled around the country as stores serve as testing labs for new technologies. Nobody knows which ones will survive and fourish, but one thing is clear: Mobile will be the linchpin of most in-store technology. Safeway, Kroger, Giant Eagle, Wegmans and other chains are using mobile apps to make the in-store shopping experience relevant. Tese apps are all tied to loyalty programs and customerspecifc marketing campaigns. “Mobile applications are the most widely adopted technology across the grocery industry, but with varying degrees of functionality, from basic ads, coupons and recipes to m-commerce and BOPUS [buy online, pick up in store] and home delivery,” says Michael Colaneri, associate VP of retail for Dallas-based AT&T. “Te successful grocers are those who are leveraging their loyalty data to deliver personal-

| Progressive Grocer | Ahead of What’s Next | January 2016

ized value through their mobile applications for an enhanced in-store experience.” Adds Nick D’Alessio, retail solutions development manager for Lincolnshire, Ill.-based Zebra Technologies, a provider of tracking and printing technologies: “Te retail market as a whole is facing the growing demand of connecting with digital mobile shoppers who are time-constrained and like to shop anywhere at any time.” Many grocers are creating their own smartphone loyalty applications for rewards and coupons, according to D’Alessio, who adds that

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Technology

In-store Marketing

customer-facing Wi-Fi is being ofered to facilitate a better shopping experience, with digital coupons and store maps available. Mike Pufer, senior director of mobile solutions and strategy for Detroit-based digital marketing company HelloWorld, agrees, noting, “Te brands establishing the strongest foundation in mobile and other innovative areas are coming out ahead.” Pufer provides the following evidence: Mobile optimized email, SMS and PMMS communications strategies aligned to each phase of the customer life cycle; that is, promotions, circular distribution and rewards Strong mobile web experience for fnding and navigating stores, and getting coupons A mobile app presence that allows users to build a user profle with the brand, access local ofers, locate stores, manage their loyalty programs, and integrate with beacons Mobile wallet integration for storage of loyalty cards and coupons, and native integration with beacons.

Shelving technologies can help brands and retailers drive customer engagement and loyalty.” —Jeff Pinc, Panasonic

“Tere are many technologies available today and on the horizon that will enhance the in-store experience,” enthuses AT&T’s Colaneri. “With CPG companies becoming savvier to consumer behavior analytics and loyalty to their brands, these producers will also expect their key distributors to be wise and conscientious about their merchandising. Te smart grocers will partner with these companies to bridge the gap between what they know today versus what they will need to know about their consumers and local penetration tomorrow. Tis will not only drive trafc into their stores, but increase basket size as well.” Te following technologies aim to enhance the in-store experience:

Beacons Make Connections Beacons are Bluetooth-enabled devices that connect with partnered smartphones nearby. Beacons rely on apps to receive their signals, which then trigger ads, coupons or product information to be sent to shoppers. Data released by inMarket, a Venice, Calif.based operator of a beacon platform, show that 38 percent of the 9 million U.S. Millennial moms — those born between 1982 and 2000 — are actively using beacon-enabled shopping apps every month. Trading partners can reach this audience via location-based mobile engagements such as welcome messages when consumers enter stores and calls to action based on specifc marketing outreach. Some stores operated by large chains such as Safeway, Target and Marsh are outftted with beacons. But now smaller operators are deploying these transmitters as well. For example, Salt Lake

| Progressive Grocer | Ahead of What’s Next | January 2016

City-based Associated Food Stores (AFS) has launched a Shopper Radar mobile app that uses Bluetooth beacons to send alerts to shoppers’ smartphones. Shoppers tap their phone screens to have store credits or digitWal coupons added to their Rewards accounts. To retain the savings, a customer must also buy groceries before leaving the store. Te app is available at several AFS retailers, including Maceys, Dan’s, Dicks, Lin’s, Fresh Market, Blair’s Supermarkets, Broulim’s Fresh Foods, Peterson’s Fresh Market, Soelberg’s, Stewart’s, Bowman’s, Davis Food and Drug, Stokes Fresh Market and Prather’s Market.

Signage Points the Way Proponents of digital signage say these systems can increase grocery sales by creating an engaging retail environment. Audiovisual displays aren’t static — they actively involve the customer. “Some of the immediate benefts include aiding in a shopper’s decision-making process, entertaining customers and strengthening brand visibility,” explains Lou Carulli, marketing manager of YCD Multimedia, which ofers digital signage software solutions for retailers. Te New York-based company’s software has been integrated in supermarket and hypermarket chains around the world. According to Carulli, integrating QR codes with digital signage can give customers immediate information on products or specials, and even allow consumers to connect to the digital signage system by mobile phone. Tis gives local supermarkets the opportunity to use digital mobile alerts to send coupons, promote time-sensitive deals, or even give the exact location of an item or the grocery store itself. It can also help extend the retailer’s social media reach as customers share their deal or purchases online. “Digital signage is now providing two-way interactivity via integrated mobile apps, beacon technology, analytics, and customer database integration that is growing interest in the grocery space,” afrms AT&T’s Colaneri.

New Tags at the Shelf Electronic shelf labels (ESLs) and other shelf tags are drawing interest from appreciative shoppers as more grocers test these devices. “Shelving technologies can help brands and retailers drive customer engagement and loyalty,” says Jef Pinc, director of retail and food services at Newark, N.J.-based Panasonic, who goes on to predict, “We expect more widespread adoption down the road as retailers become more familiar with new shelving technology benefts.” Te company’s integrated retail merchandising solution, Powershelf, currently being tested by Whole Foods Market, combines ESLs and features beacon mobile advertising capability, plus inventory and price management software. Here’s how it works: Powershelf ’s weight-sensitive mat is placed on a shelf. When a shopper takes the last item of the shelf, a store associate instantly gets a text message identifying the exact product that needs to be restocked, thus avoiding out-of-stocks. Meanwhile, Cincinnati-based Kroger has developed and is testing a “smart” shelf in a store in Cold Spring, Ky. Some 2,000 shelf edge devices are installed in center store to show digital prices and ads. Ofcials say that once testing is complete, they’ll roll out the system, which may eventually be able to communicate with shoppers’ smartphones (the store was featured in PG’s December 2015 issue). “One way that retailers can capitalize on product imagery at the shelf is by placing strips and tags on the shelf edge that feature the product’s image, price and other pertinent details,” says Susan Sentell, president and CEO of Lisle, Ill.-based Gladson,

which provides such items. “Tese image-based strips and tags serve as a language-neutral merchandising tool that allows shoppers to quickly locate the item. In the event the item is not stocked, the product image underneath an empty shelf space illustrates that the item is typically carried at that location. “Beyond the consumer benefts, image shelf strips and tags provide merchandising teams with a visual road map to better maintain the set, including faster product reordering and restocking, and planogram compliance,” continues Sentell. “By ensuring the product gets on the shelf faster and in the right spot, a retailer can improve on-shelf availability, customer satisfaction and sales.” Gladson’s database of CPG product images aims to increase sales and maximize ROI and customer satisfaction.

Other Technologies Debut For a 90-day test in Atlanta, 38 Golden Pantry Food Stores were equipped with ISIGN Smart Antennas to send messages to all nearby mobile devices and deliver coupons without an app downloaded to a smartphone. Results of the pilot include lifts of 10 percent to 26 percent. All shoppers involved received instant data on acceptance. At last year’s Milano Food Expo, in Milan, Italy, Reaves Wimbish, senior executive in Accenture’s U.S. Retail Strategy Group, noted that the Supermarket of the Future exhibit transformed the customer experience with digital tools that make shopping more convenient, relevant and personalized. “Tanks to the interactive food display tables and smart shelves, consumers have a range of product information, such as provenance, allergens, nutritional data and carbon footprint,” he said. “Digital displays share real-time information on promotions, best-sellers and more. A mobile app helps customers navigate the store, augments product information and identifes products that are compatible with their lifestyle needs. Second-screen technologies allow suppliers to provide product or promotional content and interact with shoppers.” Tat might not become standard fare in U.S. grocery stores any time soon, but the pace at which technology is advancing suggests that even such futuristic scenarios may be plausible one day. PG

Retailers can capitalize on product imagery at the shelf by placing strips and tags on the shelf edge that feature the product’s image, price and other pertinent details.” —Susan Sentell, Gladson

January 2016 | progressivegrocer.com |

Technology

Mobile Apps

Applied Marketing

Mobile apps are adding a new dimension to food retailing. By Bob Ingram

Location-based marketing will become a larger part of mobile for retail food companies, in addition to expanded use of the mobile wallet experience.” —Mike FitzGibbon, 3Cinteractive

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“T

he grocery industry is at the beginning of a digital revolution,” says Rebecca Roose, senior product marketing manager at MyWebGrocer, in Winooski, Vt. “Mobile will play a major role in this shift, and it will very much be ushered in by Millennials who are aging into the mainstream buying public. Tey crave personal, relevant connections, and mobile technology is what will facilitate this level of personalization.” MyWebGrocer manages digital solutions for more than 130 retailers worldwide, representing more than 10,000 stores and 500-plus major CPG brands. It powers mobile sites and apps, providing tools that integrate across all of a grocer’s digital platforms, encouraging online sales or driving customers into brick-and-mortar stores. Roose notes that more than 40 percent of a grocer’s web trafc comes from mobile devices, and, citing Google, points out that when consumers go to a website that isn’t mobile-optimized, 61 percent will leave and go to a competitor. Also, consumers who

| Progressive Grocer | Ahead of What’s Next | January 2016

use mobile to plan shopping trips spend 107 percent more than shoppers who don’t use digital tools, and those who use mobile to shop online place more orders than those who use desktop only to shop.

‘Engagement is the Key’ At 3Cinteractive, in Boca Raton, Fla., President Mike FitzGibbon observes that, according to a recent article in the Harvard Business Review, mobile consumers spend roughly 82 percent of their mobile minutes with apps, and just 18 percent with web browsers. “Brands are leveraging mobile apps for everything from promotions and item information to loyalty programs and geo-targeted discounts,” he says. “Engagement is the key, though.” FitzGibbon cites industry stats showing that consumers opt out of push notifcations 50 percent of the time, but 90 percent of SMS (short-message service, or text) messages are opened within minutes, since consumers are so familiar with that form of communication. “Additionally,” he concludes, “location-based marketing will become a larger part of mobile for retail food companies, in addition to expanded

How Grocery Shoppers Shop: Changing Trends in Grocery Shopping Tuesday, February 16, 2016 2:00 pm EST/ 1:00 pm CST/ 11 AM PST Duration: 1 Hour

New consumer behaviors are quickly changing grocery shopping in multiple ways. Our new national study of 1,500 grocery shoppers, the subject of this webinar, underscores some reasons why. Super price sensitivity, customer time defciency, and instant access to promotions and product information are putting greater pressure on retail and product companies to shift with consumer demands. The good news is the industry is growing, and with the right adjustments to customer preferences, there’s room for everyone. Our survey found that price is the number-one reason shoppers choose a primary grocery store, and that the majority of shoppers (75 percent) identify themselves as “budget” or “discount” shoppers. That’s why 59

percent use shopping apps for savings, with individual grocery apps heading the list. The picture that emerges from the study is one of a shopper always prepared, arriving at the grocery store knowing exactly what they’re going to buy, and most importantly, why. The why is value.

Other topics covered in this webinar: • How greater acceptance of store brands is changing the price/value equation for all brands • How shoppers have already found their deals and savings before they walk through the door • Insights into the promotional strategies shoppers prefer that also allow you to preserve the highest proft margins

www.progressivegrocer.com/awards-events/events/Blackhawk_2016_webcast Presenting Publication

Presenter

Moderator

Rodney Mason GVP, Marketing, Blackhawk Engagement Solutions

Joan Driggs Editorial Director, Progressive Grocer

Presenting Sponsor

Technology

The future of leveraging mobile apps for retail marketing is integration with the pointof-sale system. Retailers will no longer have to leave the helm of their business to go into the back room and fire off marketing emails.” —Mark Schulze, First Data’s Clover App Market

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Mobile Apps

use of the mobile wallet experience.” In Richardson, Texas, Blue Calypso Director of Sales Jef Spock asserts: “We believe that retailers are coming to the realization that consumers do not want to have a mobile app for every store they shop, as adoption rates are typically not high. In fact, Nielsen reports that the average consumer uses a total of 26 apps a month.” He believes that this leaves “only a handful of space for retail-specifc apps,” and that retailers should adopt a universal app that results in greater per-visit sales, higher store trafc, more engaged shoppers and, ultimately, greater proftability. According to Spock, by becoming part of a universal app, which molds to the retailer’s specifc look and feel once the customer walks through the door, retailers can still ofer the same benefts to consumers through a trusted platform and be equally successful in the mobile app game, without the recurring costs of operation and maintenance of their own app. Using its patented cloud-based platform, Blue Calypso’s apps — Mobile ADvantage and KIOSentrix — ofer in-store coupons, savings features, and additional tools such as price comparisons, he notes. Spock adds that Blue Calypso’s KIOSentrix app acts as a “personal mobile concierge” and an engagement tool for brands, retailers and their customers by connecting users to key features and promotions.

Third Parties Rich Donahue, marketing VP at Denver-based Ibotta, says that the company’s free app pays consumers cash when they make purchases at stores such as Target, Walmart, Kroger, Best Buy and Macy’s. He notes that a recent Localytics report shows that 76 percent of users abandon single-retailer apps within the frst 30 days, and that this has resulted in an opportunity for a new, third-party app like Ibotta. “Because these apps work everywhere, they reach consumers who otherwise wouldn’t download the retailer’s app,” Donahue explains. “Ibotta is building this one-stop shop for consumers to earn cash back when they shop, and for retailers to receive incremental exposure, trips and spending. Plus the brands win, too. Te consumer engages with brand content, and is informed and educated, and has a chance to discover new and exciting products. “Te retailers who invest in this transformation and best leverage the growing network of ofine afliate partners like Ibotta, who are focused on driving in-store sales, will win,” he adds. In Sunnyvale, Calif., Mark Schulze, who leads First Data’s Clover App Market, says: “Te future of leveraging mobile apps for retail marketing is integration with the point-of-sale system. Retailers will no longer have to leave the helm of their business to go

| Progressive Grocer | Ahead of What’s Next | January 2016

into the back room and fre of marketing emails.” According to Schulze, the Clover App Market has more than 10 apps that enable retailers to market their businesses from their POS devices. With email, SMS, social and all-in-one marketing apps, retailers using Clover can connect with their customers in a variety of ways. For example, Rocket Responder, from Abreeze Technology, simplifes e-mail marketing, allowing retailers to produce and distribute promotional emails and schedule follow-ups, all while taking orders from customers in-store. Social Media Marketing with BeSocial, from BuyFi, automatically shares content on social channels, leverages social media analytics to improve online reputation, and uses Facebook to attract and convert new customers. Clover Station, Clover Mobile and Clover Mini all come with access to the Clover App Market, which has more than 100 apps for all facets of running and growing a business, notes Schulze, who says, “Clover is either a smart-payment terminal or a full point of sale, capable of securely accepting virtually all types of payments.” Bruce Nagle, CEO and founder of Danville, Calif.-based RW3 Technologies Inc., observes that at his company, “we see a direct correlation between today’s shopper and feld reps. Many of the technologies being used and data points collected can beneft both parties.” He continues that suppliers and brokers use RW3’s applications to improve on-shelf availability, monitor trade compliance and streamline communication to the feld. As retailers begin to enhance their in-store technology and capabilities, RW3’s in-store application will allow CPG feld sales teams to employ similar technology to improve their workfow and help grocers deliver a complete omnichannel shopping experience. “For example,” Nagle explains, “third-party beacons could help enhance a CPG feld rep’s impact at the shelf and help guide them to areas of opportunity as they are passing through the store.” PG To learn about real-world deployments of mobile apps at retail, visit Progressivegrocer.com/apps.

Equipment & Design

Foodservice

Becoming a

Grocerant

Equipment is key in developing into a retail foodservice destination.

By Bob Ingram

n the shape-shifting world of food retailing, the one constant is change. Today’s supermarkets are now competing with recognized traditional foodservice operators, and as Jef Schneider, SVP of sales and marketing at Muskegon, Mich.-based Structural Concepts Corp., asserts: “Supermarkets have to establish credibility that they ofer a restaurant-quality experience for dine-in or takeout meals. Tey need to become a grocerant.” According to Schneider, one of the most dramatic ways of doing this is to make prepared foods highly visible so customers can see — and smell — for themselves how good the food is. “Sophisticated operators like Whole Foods have a welldeveloped vision of how they want to present their prepared food, so we work with them to create customized display fxtures to support their specifc menu and décor,” he notes.

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Structural Concepts recently introduced the Grocerant Series of modulated food bar merchandisers, designed to give retailers highly customized displays that are more cost-efective and delivered in shorter lead times. Te Grocerant Series blends seamlessly with the company’s other merchandising systems built on the proprietary Alignext platform, which creates minimalist integrated prepared food departments by eliminating what Schneider calls “trainwreck” lineups.

Easy Integration At Charlotte, N.C.-based Electrolux Professional Inc., Director of Marketing Angelo Grillas says: “We integrate our equipment into packages that make life easier for our customers. A combi-oven can stand independently, but works more efciently when paired with a blast chiller and used as a system.” New retail foodservice equipment from Electrolux includes the Tower of Power, a compact cook-and-chill

| Progressive Grocer | Ahead of What’s Next | January 2016

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Equipment & Design

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Foodservice

solution with a 3-foot footprint, which ofers retailers the ability to plan today, cook today and serve tomorrow, and preserves nutrients and product integrity safely per HACCP guidelines. Also new are the Pressure Braising Pan to preserve product yield and cook in record time, and the High Speed Sandwich Press, which integrates cast iron grilling, infrared toasting and microwave cooking to produce consistently hot sandwiches in 60 seconds. According to Rob Napkori, marketing manager of the commercial products division of Wilkes-Barre, Pa.-based InterMetro, a provider of prep-area products under the Metro brand, the company’s SmartWall puts items within arm’s reach for associates making take-home items for busy consumers. “Our new C5 3-Series heated holding cabinets with Insulation Armour are being introduced to grocery chains for grab-and-go items in both full

and half sizes,” he notes. “Our new MetroMax4 All Polymer Shelving System ofers corrosion-proof performance, proven Metro stability and unrivaled value.”

Prepared Food Evolution Cheryl Beach, marketing communications manager at Bridgeton, Mo.-based Hussmann Corp., points out that supermarket fresh prepared foods will be the top sales growth category — an estimated 7.5 percent annually — in the in-store foodservice industry during the next decade. “To achieve this sales growth,” she says, “retailers’ prepared foods departments are changing and attracting shoppers by cooking to order, ofering more variety in food choices, and incorporating healthier, customized meal solutions.” In the past year, sales growth at Hussman has come from the Q Series and ISLA refrigerated display merchandisers, particularly within the fresh perimeter. “Our Q Series has an upscale styling,

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| Progressive Grocer | Ahead of What’s Next | January 2016

watch the video

with designs that can be confgured into a gourmet prepared foods department,” notes Beach. “We are seeing demand for multiple display levels within both the service and self-service displays as retailers are increasing variety and ofering more choices to shoppers.” Te ISLA family of products ofers various island confgurations that let the retailer determine the combination of hot, dry, and refrigerated modules that work best for a particular store. “Our ISLA islands can be used to extend the prepared food oferings away from the perimeter wall and into the center store, or even at the front, providing quick, easy and convenient access to snacks or mini meals for the daypart shopper,” observes Beach. Store size, interior layout and product mix will all change over the next fve years, she predicts, as Millennial and Generation Z consumers demand traditional brick-and-mortar stores to be more connected to them while delivering personalized meal solutions.

Controlling Costs In Beloit, Wis., Chad Vendette, director of marketing at Broaster Co., highlights among the vendor’s products Pressure Fryers, designed to cook food in a fraction of the time of open fryers. “Not only are they built for producing Genuine Broaster Chicken, but [they] can be used to cook a wide range of other products,” Vendette notes. Te SmartTouch touchscreen controller is a new addition to the Pressure Fryer that allows for easy and fast selection of product when cooking, and signifcantly reduces training time for new employees. Te cost to bring food to counters will continue to be a big concern in the future for supermarket foodservice operations, Vendette asserts, adding that items like energy costs, base food costs and labor will ratchet upwards and drive margins down. “We monitor industry information sources and stay ahead of trends to keep our customers in the proftable zone,” he says. “We provide simple stand-alone solutions all the way up to full-store advance control,” says Mark Schmalz, business development manager, food retail, at Cleveland, Ohio-based Parker Hannifn, which ofers mechanical and electronic controls to keep retail foodservice systems running smoothly. Te company recently launched an electronic conversion kit that converts a mechanical A8 or SPORT valve to a stepper motor-driven modulating valve, thereby eliminating the need for brazing because the valve body stays in the system piping. Tis application can save up to 15 percent on energy, according to Schmalz. “We are seeing [a] trend to smaller store footprints, larger focus on fresh food, and more self-contained cases,” he notes. “Due to these trends, we are develop-

ing solutions to address food preservation and electronic controls focused on diagnostics and reduced service costs.”

Greater Adaptability At Eaton, Ohio-based Henny Penny Corp., Dann Woellert, product manager for ovens and holding equipment, says, “Te growth of prepared food items has allowed for more focus on fexible cooking equipment like our Space$aver Plus combi-oven, and on merchandising and display of deli products.” Woellert notes that the Space$aver combi-ovens are smaller versions of the FlexFusion line that can ft into smaller spaces. Te stackable ovens ofer productivity in a smaller footprint because of their ability to cook at diferent temperatures and conditions in the top or bottom oven. “It is clear that prepared foods will grow in importance for retail foodservice,” he says. “Te trend of adding new favors and dishes from around the world into delis will require more fexibility in cooking and more unique ways to serve and display these foods.” PG

broAster booster the smarttouch touchscreen controller is an addition to broaster’s Pressure Fryer.

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January 2016 | progressivegrocer.com |

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Food, Beverage & Nonfood Products

Ethical Eggs

Convenient Indulgence

J&J Snack Foods Corp. has teamed up with CPG giant General Mills to launch Pillsbury Mini Pies, a line of “perfectly portioned” frozen dessert squares. Available in Apple Cinnamon, S’mores and Chocolate Lava flavors, each package contains four 1.8-ounce frozen mini pies and a flavored icing packet. Designed with convenience and portion control in mind, Pillsbury Mini Pies can be prepared in 15 minutes or less. The SRP is $3.79. www.pillsbury.com

Frozen Fare

Nuts With a Twist

Latest in the brand’s cornerstone line of savory and crunchy snacks, Royal Hawaiian Orchards Dark Chocolate Macadamia Nuts deliver a twist on traditional chocolates, inspired by “tropical aromas and native Hawaiian island flavors,” says Scott Wallace, the company’s president. Available in Dark Chocolate Blueberry Açai, Dark Chocolate Blackberry Goji and Dark Chocolate Pomegranate Mango varieties, these rich, dark chocolate-covered roasted macadamia nuts are free of gluten, wheat, cholesterol and artificial ingredients, and come in 4.5-ounce resealable bags for an SRP of $4.99.

www.BlueSkyFamilyFarms.com

“Throughout the year, we review our customers’ flavor requests, examine trends in the food industry and put our collective heads together to come up with the most delicious new flavors we can imagine, and we’re so excited to add these new flavors to our already popular lineup,” says David Yuengling, president of Yuengling’s Ice Cream, of the brand’s latest super-premium varieties. Butter Pecan, Cherry Vanilla Chunk, Cinnamon Churro, and Cookies & Cream will debut in March 2016, joining Yuengling’s 14 year-round flavors and two seasonal offerings. The new varieties will be available in both quarts and pints for an SRP range of $5.49-$7.99. www.yuenglingsicecream.com

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Blue Sky Family Farms says it holds to the highest Humane Farm Animal Care “Certified Humane” standards for free-range and pasture-raised eggs. The company’s Free Range Non-GMO Brown eggs and Organic eggs, each carrying an SRP of $4.50 per dozen, have recently expanded to more than 100 Natural Grocers locations in 19 states. “We’re ecstatic to enter Natural Grocers, as we share the same passion for sustainability and ethically sourced food,” says John Brunnquell, founder and president of Blue Sky Family Farms.

| Progressive Grocer | Ahead of What’s Next | January 2016

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Goldstür Launches Jewelry-to-cash Kiosks Newport Beach, Calif.-based Goldstür has launched a kioskbased service for exchanging jewelry for cash or a retailer store gift card. The company claims to be the first to create an automated, selfservice kiosk to evaluate and measure gold, silver or other precious-metal jewelry, and offer a bid to buy the items directly from the consumer. Goldstür kiosks electronically scan virtually any item of jewelry, connect consumers in real time with commodity prices to ensure the best possible price for their items, provide an appraisal within two minutes for a $2 fee, and pay consumers immediately in cash or a store gift card. There are no labor costs or cost of ownership, and the kiosk brings an innovative technology to the retailer’s space that can generate as many as 500 transactions per day. In an agreement with Supervalu banner Cub Foods, the debut placements are at stores in the Minnesota cities of Silver Lake, Stillwater, Midway, Coon Rapids and Apple Valley. www.goldstur.com

Hershey Pilots SmartLabel With Holiday Releases Te Hershey, Pa.-based Hershey Co. launched its Holiday Hershey’s Kisses Milk Chocolates and Hershey’s Milk Chocolate Bars, made with simple ingredients and no artifcial favors, this past holiday season. Tese are some of the company’s frst products to transition to simpler ingredients, a commitment announced during 2015. Te Holiday Kisses were also the frst to pilot the SmartLabel, a new mobile tool launched by the Grocery Manufacturers Association (GMA) (see story on page 36) that allows consumers to use various technologies to instantly get detailed product information, from ingredient and nutrition facts to allergens. Hershey led GMA’s industry-wide collaboration to create a universal solution that gives people access to information about where their food comes from and what goes into making it. “Our commitments to simple ingredients and transparency continue with some of our most popular products,” says Mary-Ann Somers, Hershey’s VP and GM of U.S. confection. www.thehersheycompany.com

Robot Coupe Adds Chef to Market Solutions Team Ridgeland, Miss.-based foodservice equipment maker Robot Coupe USA Inc. has hired Michael Kalajian for the new position of market solutions advisor. Kalajian will focus on expanding opportunities in multiunit environments such as health care, school foodservice, culinary schools and chains. He will also be responsible for working with independent rep organizations and foodservice distributors from South Carolina through New England. Kalajian, a graduate of the Culinary Institute of America, has more than 30 years of foodservice experience: 20 years as a chef in upscale New York City restaurants. and the last 10 years in foodservice equipment sales with US Foods, Restaurant Depot and BFA Foodservice. www.robot-coupe.com

Skaff Joins Staff at USA Bouquet Doral, Fla.-based USA Bouquet Co. has teamed up with special-events forist and home décor specialist Michael Skaf to help bring his style aesthetic to mass retail foral found in chains throughout the country, by creating value arrangements that speak to quality, freshness and contemporary styling. Skaf recently opened his special events and home decorating foral company, Skaf Floral Creations, in Hinsdale, Ill., after more than 30 years working in every facet of the foral industry. As VP of design for

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FTD, he worked on product development initiatives with top brands such as Todd Oldham, Vera Wang, Better Homes and Gardens and Te Smithsonian Institution. USA Bouquet imports, manufactures and distributes fresh-cut fowers and related items and services in the United States from regional facilities in Miami, Atlanta, Chicago, Dallas, New Jersey, and Vista, Calif. Scott Hill, USA Bouquet’s VP of sales and marketing, says Skaf “will bring design and color expertise, as well as assist us in developing marketing programs that will drive sales and customer satisfaction with our retail partners.” www.usabq.com

| Progressive Grocer | Ahead of What’s Next | January 2016

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www.lalafoods.com

Boston Beer

www.samueladams.com

Conagra Foods

3, 43

www.conagrafoods.com

Cosmopolitan

111

olenak@cosmopolitanmp.com

Domino Foods

www.dominosugar.com

www.evolocityAD.com

Evolocity

Kollin Stagnito Chief Operating Officer 224-632-8226 kollinstagnito@stagnitomail.com

Food Marketing Institute

www.fmi.org

Forte Product Solutions

www.forteproductsolutions.com

10-11

www.generalmills.com

Giorgio Foods, Inc

www.giorgiofoods.com

Ned Bardic Senior Vice President/Partner 224-632-8224 nbardic@stagnitomail.com

Heineken USA Inc.

15, 39, 47

www.italianmade.com

www.house-foods.com

Korry Stagnito Chief Brand Officer 224-632-8171 korrystagnito@stagnitomail.com

General Mills Inc

House Foods America Iovate Health Sciences Italian Trade Commission

www.sixstarpro.com

24-25

www.italianmade.com

J. Skinner Baking Company

www.skinnerbaking.com

John Wm Macy’s Cheesesticks, Inc

www.cheesesticks.com

Mason Ways Indestructible Plastic

70, 107

www.masonways.com

Milk Pep

www.milkpep.org

Back Cover

www.millercoors.com

National Confectioners

www.sweetsandsnacks.com

National Restaurant Association

www.Restaurant.org/Show

Jeff Friedman Vice President/Brand Director 201-855-7621 jfriedman@stagnitomail.com

MillerCoors LLC

Nature Sweet

www.naturesweet.com

John Huff Midwest Regional Sales Manager 224-632-8174 jhuff@stagnitomail.com

New Hope Natural Media

www.newhope.com

Elizabeth Cherry Western Regional Sales Manager 310-546-3815 • Cell 310-990-9597 echerry@stagnitomail.com

Organic Valley

www.organicvalley.coop

Ovention Inc

105

www.OventionOvens.com

Wonderful Pistachios

www.wonderfulpistachios.com

Pharmavite LLC

www.pharmavite.com

Pompeian Olive Oil

52-53

www.pompeian.com

Premier Nutrition

www.premierprotein.com

Robbie Flexibles

www.robbieflexibles.com

Maggie Kaeppel Eastern Marketing Manager 630-364-2150 • Cell 708-565-5350 mkaeppel@stagnitomail.com

Robot Coupe USA, Inc

Simplot Custom Foods

Mike Shaw Northeast, Marketing Manager 201-855-7631 • Cell 201-281-9100 mshaw@stagnitomail.com

Stemilt Growers, Inc.

www.stemilt.com

The Happy Egg Company

www.thehappyeggco.com

The Jel Sert Company

www.jelsert.com

www.triononline.com

Janet Blaney Marketing Manager (AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY) 630-364-1601 jblaney@stagnitomail.com

Tyson Foods

Jackie Batson Advertising Manager 224-632-8183 jbatson@stagnitomail.com

112

Borden Dairy

Royal Hawaiian Orchards Sanders & Morley Candy

Trion Industries Inc. Zoo Fans

106

www.robotcoupeusa.com

www.royalhawaiianorchards.com

www.sanderscandy.com

109

www.simplot.com

Inside Front Cover, 58-59

www.tyson.com

www.zoofans.comm

Progressive Grocer (ISSN 0033-0787, USPS 920-600) is published monthly by Stagnito Business Information, 570 Lake Cook Rd. Deerfield IL 60015. Single copy price $10, except selected special issues. Subscription: $135 a year; Canada $164 (Canada Post Publications Mail Agreement No. 40031729. Foreign $270 (call for air mail rates). Periodicals postage paid at Deerfield, IL 60015 and additional mailing offices. Printed in USA. POSTMASTER: Send all address changes to Progressive Grocer, P.O. Box 1842 Lowell, MA 01853. Copyright ©2016 Stagnito Business Information All rights reserved, including the rights to reproduce in whole or in part. All letters to the editors of this magazine will be treated as having been submitted for publication. The magazine reserves the right to edit and abridge them. The publication is available in microform from University Microfilms International, 300 North Zeeb Road, Ann Arbor, MI 48106. The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

| Progressive Grocer | Ahead of What’s Next | January 2016

the last word

The Dawning of Content and Commerce

ith the frst federal interest-rate hike enacted in nearly a decade, oil prices near historic lows and continued proftmargin pressures looming large, 2016 is primed to present another wild ride for food retailers and marketers. To help make sense of some of the most important consumer and industry twists and turns poised to play out in the coming months, I turned to Karen Fichuk, president, North America for Schaumburg, Ill.-based Nielsen, for a glimpse of what’s swirling in her sagacious crystal ball. “What’s really caught my eye of late is the convergence of content and commerce. Content providers are dabbling as commerce suppliers,” says Fichuk, pointing to Pinterest and Facebook, which are now explicitly selling to consumers. “Retailers are creating their own content as well” — as well they should, she afrms, noting as stellar examples Walgreens’ wellness newsletter, and online videos from Te Kroger Co.’s super-productive Harris Teeter division that help folks better grasp topics like everyday cooking and product labels.

Unconventional Opportunities “In 2016, we’re going to see more and more of this line-blurring,” afrms Fichuk, “and there certainly is an opportunity for food retailers to extend the in-store experience online as well,” which begs a yin/yang question from me about what she foresees as the greatest yet-to-be-seized opportunities and potentially most taxing hurdles for retailers as the year unfolds. “I think one of the biggest opportunities … is certainly around connected commerce,” she replies. “Other industries are signifcantly further ahead,” as a result of indigenous barriers to consumers’ adoption of online grocery shopping. But let there be no doubt, maintains Fichuk: “As Millennials enter new life stages and continue to become heads of households, connected commerce will take of in this space as well.” Accordingly, the onus will be squarely on traditional retailers “to fnd new ways to adapt and own it.” Asked to elaborate on her view of “owning it,” Fichuk begins by citing unconventional players jockeying to disrupt this space. “Who would have thought that Uber would be in the grocery delivery business? But they’re there! Retailers have to evolve; they have to think about

where they should be making big bets,” she notes. “Tey have real advantages,” foremost of which is their native status as fundamental owners of the shopping experience. “Tey own the consumer data and consumers trust them,” Fichuk continues. “Te next step is harnessing these advantages to their beneft.”

Entertainment and Personalization While the majority of food retailers today are in varying stages of adapting to the new world order and well aware that the present pace of change is unprecedented, I asked Fichuk to briefy expand on her personal philosophy of the changing role of food retailers today. “It’s indeed a whole new world for retailers today,” she agrees. “Tey play a bigger role than just supplying ingredients for in-home cooking; they are now the restaurants and the entertainment for consumers. I think one of the biggest changes in the role of food retailers today is with the shopping experience. It’s no longer enough to just purchase ingredients in the store to take home and concoct whatever” comes to mind. To the contrary, she notes, “Retailers are now expected to play the role of a restaurant ofering high-quality prepared meals, along with imparting a little entertainment at the same time.” Tinking back on “when my kids were little,” Fichuk says her yesteryear grocery store experiences “were far less engaging and completely diferent. Now retailers can win by making it an entertaining outing for the whole family.” Which players does she admire from a retail experience standpoint? Fichuk tips her hat to Nike, explaining that she “loves what they’re doing. If you go into a Nike store, they are masterfully combining two trends: entertainment and personalization. Across media, advertising or shopping, digital has unleashed the power of personalization. Nike has taken it to shoes, allowing customers to personalize them with color and style,” as well as handwritten touches by their owners. Consequently, Fichuk believes food retailers are the next logical candidates “to hop on the personalization bandwagon.” I’ll chime in with a bit of supplemental parting advice: If you can’t hop, get a ladder. Whatever you do, though, keep moving forward. PG Meg Major mmajor@stagnitomail.com Twitter @Meg_Major/@pgrocer

The onus will be squarely on traditional retailers to find new ways to adapt and own connected commerce.

January 2016 | progressivegrocer.com |

113

Mac & Cheese

Chicken & Broccoli Cheddar Orzo Chicken raised without the use of antibiotics

Exclusive Manufacturer & Partner of Panera Retail Soups, Sides & Meals.

What’s not to love? With a new twist on enduring favorites, your busy customers will love everything about Panera’s Mac & Cheese with uncured Bacon. Delicious, premium ingredients feature fruitwood-smoked bacon without added nitrates or nitrites. Put the power of Panera on your shelves. When your customers eat well, you proﬁt well. For more info, call your Blount sales rep at 800-274-2526

Available in conveniently-sized microwavable bowls that give busy customers more choices for eating well.

Turkey Bolognese

Turkey Chili with Beans

Turkey raised without the use of antibiotics

ÂŠ2015 Blitz-Weinhard Brewing Co., Milwaukee, WI * Flavored Malt Beverage