Research conducted among food retailers in fall 2005 and again in spring 2006 explored the activities practiced by retailers and identified creative partnering opportunities with them. The good news is retailers are addressing the obesity crisis through the lens of health and wellness. The even better news is that they are pursuing a surprising number of approaches and report their involvement will grow in the next year.
The study was conducted by St. Joseph's University's Center for Food Marketing, and was funded by the CDC as part of a larger university effort researching issues impacting children and obesity. It involved a comprehensive search capturing retailer activities addressing health and wellness, and obesity activities across 27 best practices pursued by various retailers in the U.S. and the U.K. These activities can be classified as product selection, merchandising and promotion, and educational activities.
A quantitative e-survey with food retailers explored the activities being pursued in the U.S., as well as attitudinal measures. The survey generated responses from retailers representing nearly 40% of total grocery sales in 2005, excluding Wal-Mart's Supercenter sales.
Retailers report health and wellness is not a major concern for them, however, they do believe the obesity crisis is real and lasting. From their perspective, obesity is a larger concern for food manufacturers than food retailers, but nonetheless impacts both.
Retailers report health and wellness isnot a major concern for them, however, they do believe the obesity crisis is real and lasting. From the retailer's perspective, obesity is a larger concern for food manufacturers than for food retailers.
Retailers see themselves in the health and wellness revolution as being in a position to offer more convenient forms of fruit, vegetables and portion control foods. Indeed for branded manufacturers, portion control options such as 100-calorie packs are embraced by retailers and consumers. Retailers have high interest in pursuing private label as a method to capitalize on health and wellness trends. This echoes the tremendous success of U.K. retailers with healthy private label brands, especially their healthy children's brands. Opportunities exist for ingredient manufacturers and contract manufacturers to facilitate retailer development of private label.
Merchandising & Promotion
In the vein of health and wellness, retailers seem most interested in sponsoring physical activity-based events like walk-a-thons and bike-a-thons. These activities permit opportunities for product promotion and exposure. It is an ideal forum for health-focused products to reach consumers that are already motivated by physical activity and want to achieve better health. These types of events also put into practice the balance message of "calories in and calories out" by emphasizing the activity side of the equation.
Retailers also report efforts and interest in product sampling of healthier products, especially for children, and cross-merchandising healthier items. This echoes the success of various health and wellness produce events bringing diverse entertainment entities into promotional partnership with Produce for Better Health Foundation and WalMart Supercenters and Neighborhood Markets.
One such partnership in early 2006 linked Universal Studio's launch of the Curious George movie with extensive produce manufacturer participation, including point of purchase, product sampling, coupons, recipes, educational games and take-home literature. It had an exposure goal of 10 million shoppers, with an emphasis on families with children ages two to eight. It represented the seventh in a quarterly string of successful media and produce promotions with Wal-Mart Supercenters and Neighborhood Markets organized by the Produce for Better Health Foundation. This type of event marketing and "retailtainment" creates in-store excitement and enhances the retailer's stated interest in new and convenient forms of produce.
As far as price promotions for healthier products are concerned they are eagerly pursued by retailers, however, purchase incentives are largely left out of the picture. Lastly, retailers show little interest in eliminating sweets and snacks at the checkout line.
According to the retailer study, there is a lot of educational activity taking place, especially in the form of in-store nutrition tours for children. Retailers are also bulking up the educational information on their websites by offering nutrition tips. However, while a variety of healthy educational activities were identified in the study, they seem to receive minimal use.
Retailers appreciate help with healthy messages, especially those promoting the need to balance calories and physical activity. This complements their interest in activity-based and in-store events, which generate fun and excitement through brand mascots and popular children's characters that carry a healthy message. They also appreciate product logos that flag healthier product alternatives as represented, for example, by PepsiCo's development of the green "Smart Spot" and Nabisco's yellow "Sensible Snacking" logo.
Moving Marketing Dollars into the Store
As government and activist scrutiny continues to be focused on the food industry's advertising efforts geared toward children, whether on TV or on the Internet, more marketing dollars must be directed in-store to promote and protect healthier branded product choices. As companies rush to the defense of brands "on the shelf" the competitive advantage of healthy store brand alternatives will increase. Branded manufacturers will need to be proactive in controlling how their in-store marketing dollars are directed. Trade programs addressing the retailer's preferred interests will be well received and allow for positive brand exposure with consumers. It represents responsible marketing to children and promotes better messaging and education for healthier food choices to families. Understanding and leveraging retailer interests in health and wellness should unleash a triple opportunity for brands, retailers and consumers.NW
About the author: Nancy Childs, PhD, is a Professor of Food Marketing in the Haub School of Business at Saint Joseph's University in Philadelphia, PA. This research was funded by a grant from the DHHS - Center for Disease Control. Dr. Childs can be reached at 610-660-1643; E-mail: firstname.lastname@example.org or