Retailers confront the challenge of growing the center store

Dive Brief:

  • A panel discussion at this week’s National Grocers Association Show had food companies offering advice on how to grow center store sales, according to Supermarket News.
  • Top tips included cross merchandising with fresh products, focusing on snacking, highlighting craft beer and creating a treasure hunt atmosphere by mixing in local and specialty items.
  • “Doing business in center store is easy. It’s growing it that’s tough,” said Michael Day, manager, digital commerce and innovation at Wakefern Food Corp.

Dive Insight:

The maturity of many grocery categories coupled with the ascent of the fresh perimeter has led some in the industry to proclaim that center store is dead.

But the center store remains a major draw for anyone who needs milk, eggs or a frozen meal. The problem is growth, which can be difficult to achieve with many of the everyday items that people rely on. Not only has demand flattened for many grocery items, but alternative channels like dollar stores and c-stores are stepping in to capture those purchases.

Growth is certainly possible for supermarkets, but it retailers need to know which products and categories within center store can drive traffic. Just look at Trader Joe’s and the many whimsical, flavor-forward products it offers. Not everyone can emulate its strategy, but the company offers an important lesson in the value of innovation and unique offerings. Also, note the categories Trader Joe’s hones in on: snacks, desserts, and frozen food. Each of these categories offers gourmet, highly innovative options that are sought after by shoppers.

According to a recent report from Nielsen (which, by the way, also says the death of the center store is greatly exaggerated), snacks lead the way in terms of growth, followed by beverages, candy and coffee. On the flip side, the once-booming cereal category seems to be cooling off.

Center store is full of legacy brands that generate as much as half to two-thirds of an average store’s sales. Tinkering with these brands and the overall merchandise mix can be hard, but it may be the only path to growth for grocery managers.

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Filed Under: Grocery Marketing