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[5 comments]

H-E-B Goes Adventuring in Toyland

November 17, 2011

Last year, H-E-B opened a Toyland pop-up store during the holidays and was encouraged by the results. This year, the company is planning on opening at least three of the temporary locations. Who knows, if the test shows results, how many H-E-B Toylands will be opened next holiday season?

According to a source who requested anonymity in speaking with RetailWire, the H-E-B plus supercenter format is "showing strong growth" in toys and electronic games, making the Toyland format a natural to test during a critical sales period for those product categories. The small format stores, under 3,000 square feet, will be open until Jan. 15.

"We're always trying to innovate around retail to see what we can do that's different and better and that better serves our customers," Dya Campos, an H-E-B spokesperson, told the San Antonio Express-News.

The pop-up format allows the chain to test "different things to make access points more convenient for our customers," Ms. Campos said.

Discussion Questions:

Discussion Questions: What do you think of H-E-B's Toyland format test? Are there other mass market merchants that you think would benefit from operating a similar pop-up strategy?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How likely is it that H-E-B will significantly expand its Toyland pop-up concept in the years to come?

Comments:

H-E-B is a trusted retailer in their markets for each of its various formats. The pop-up format for toys is a natural extension. It uses the buying power gained from their Plus format and allows them to sell to customers that they might not otherwise reach.

The pop-up strategy could work for any mass merchant who wants to enter a mall or retail area in which they lack a presence, but I would caution them to be careful. If poorly done it could negatively impact their brand instead of enhancing it.

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Steve Montgomery, President, b2b Solutions, LLC

Here's where H-E-B gets it right. They open one and it works. Then a year later they open three. Who knows if they will ever do it again? But they don't go out and open 150 only to find out they just got lucky with one. If I go to the horse races and pick 3 winners in a row, does that make me an expert? No.

H-E-B is the kind of mass merchant that has a cult-like following in their region with a dedicated workforce. Consumers see them as a proud symbol of their community. So this should be tried by those kinds of companies. Wegmans could probably pull this off. I would not recommend some company like Kmart or A&P try this.

David Livingston, Principal, DJL Research

Traditional food retailers like HEB have always battled the supercenters on the food side of the equation. This experiment allows them to test the impact of focusing on non-food items, traditionally the sweet spot of supercenters and mass merchandisers. In addition, it may create additional excitement and consumer interest around the rather boring food shopping trip. Others can learn from this test and perhaps expand to well defined categories in well defined placements within existing formats.

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Richard J. George, Ph.D., Professor of Food Marketing, Haub School of Business, Saint Joseph's University

H-E-B has their game plan down. They know what they need to do to determine the expansion year over year. They already know what they will do next season based on a series of "what if" questions only to be answered by foot traffic and sales numbers.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

This is a good thing for HEB, and reflects the ability to better address their current customer's needs...who knows you might be able to see Halloween or another pop-up next....

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Kai Clarke, President, Kowa Optimed, Inc.

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