CPGmatters: Heinz Measures Shopper Behavior To Spur Traffic Flow and Sales
Through a special arrangement, presented here for discussion is a summary of a current article from the monthly e-zine, CPGmatters.
By deploying sophisticated video analysis, Heinz uncovered some key insights around maximizing category adjacencies and end caps in the frozen food aisle.
Its "Frozen Aisle Benchmarking" study analyzed the top ten most-shopped categories in the frozen food aisle to compare traffic flow and sales conversion. Chris Shaw, Group Leader, Category Business Planning, Heinz, outlined his testing and results at the Shopper Insights in Action conference recently in Chicago. His co-presenter was Priya Baboo, president of shopper insights for VideoMining Corp., whose technology powered the research.
"If you think about traffic for premium ice cream or breakfast," said Mr. Shaw, "it brings up the question: If we could drive more traffic, would that actually drive conversion within the store? We were actually able to measure this. We were able to look at which categories actually were more responsive to more traffic. What we found out was when breakfast, premium ice cream, and frozen potatoes were exposed to more traffic, it drove higher conversion in the store."
The research found that grocers have a better chance to increase sales from shoppers already going down the aisle versus trying to get people who aren’t shopping the category to go there. More importantly, the research found that two of three shoppers in the frozen food aisle only buy one category – even though there is a wide range of products for breakfast, lunch, dinner and desserts.
So the challenge, said Mr. Shaw, is to determine what to do in the aisle or on end caps to drive conversion by better understanding the dynamics of cross purchase.
He pointed out that single-serve meals for lunch and dinner are typically stocked in one frozen food aisle, while single-serve breakfasts are in another aisle. "People come into the store trying to fill a bucket of meal occasions. But retailers are trying to make it difficult for them to shop by sticking these meals in different aisles."
The research showed that single-serve meals and breakfasts are key categories for end caps. That’s because they generate the most traffic exposure and also have the highest cross purchase. Two is the optimal number of categories to drive conversion within the store.
"As you add more categories to the end caps, conversion actually decreases," Mr. Shaw cautioned. "We don’t know why. Is it too confusing? It doesn’t stand out so they don’t stop? But clearly, it gives us some direction on leveraging some of this cross purchase information as well as understanding what’s the optimal amount of categories to have on an end cap. This kind of data gives us some ammunition to go out and really think a little bit differently about how to merchandise a category."
What lessons does the Heinz “Frozen Aisle Benchmarking” offer around driving cross-purchases at supermarkets? How should grocers be rethinking the way they maximize end caps and category adjacencies?