Smarter, Faster, Stronger

PG's 2010 Category Captains winners are breaking new ground with virtual technology and cutting-edge consumer research to help their grocery partners achieve growth.

By Progressive Grocer Editors

Introduction by Jenny McTaggart

Today's grocers have a lot on their plates, so any help that comes from their suppliers is most definitely appreciated. When that help consists of customized solutions involving the latest in technology to help grow profitability and win new customers — it's even better.

That's where the winners of this year's Category Captains awards come in. This contingent of distinguished grocery suppliers, representing the breadth of the supermarket business — from soup to nuts, literally — is using consumer research and sophisticated, intuitive tools to find out what's going on in the aisles, and predicting what likely comes next, with innovative programs to keep a range of categories — and the retailers that sell them — relevant and thriving.

Sometimes, this work involves taking a long, hard look in the mirror. A growing number of suppliers are taking steps to better optimize their product portfolios, weeding out redundant and/or laggard SKUs and taking private label into account more frequently. And when the whole category is taken into account (as opposed to merely their own brands), everyone wins.

It's a virtual world

One of the trends among this year's Category Captains lineup is an increase in the use of virtual technology. General Mills, the Minneapolis-based CPG mainstay that was named either Category Advisor or Category Captain in numerous food categories, is relying more than ever on its virtual-store technology, which the company uses to visually demonstrate new package designs, shelf set concepts, and other initiatives with consumers and retail customers.

This year, General Mills also developed a "Shopdown" modeling capability enabling several retailers to optimize their days of supply, minimize out-of-stocks and allocate appropriate facings in the ready-to-eat cereal category. One participating account saw 6 percent overall total category dollar growth and 3 percent base category dollar growth.

Another leading supplier, the Kellogg Co., has developed a category-exclusive partnership with Jacksonville, Fla.-based Fifth Dimension to conduct virtual-store testing for the ready-to-eat cereal category. Thus far, Battle Creek, Mich.-based Kellogg has employed the technology to test and implement new consumer-based shelf merchandising strategies, promotional pricing optimization, shelf-ready packaging opportunities and the impact of groundbreaking aisle fixtures in the virtual world.

Technology is equally important in the realm of consumer research, as many of the winning entries demonstrate. In the wine category, Gallo's 360-degree strategy starts with its Customer Health Monitor, which the wine pioneer uses to listen to hundreds of consumers on a weekly basis to learn about their various wine shopping trips. When combined with other data sources, this information provides a comprehensive view of consumers' attitudes and behaviors at an individual retailer level. By evaluating each retailer's unique shoppers, specific department objectives, and key performance indicators, the process filters hundreds of activities to create an optimized solution for Gallo's partners.

Product innovation still key

No matter how smart suppliers' technological applications become, product innovation, at the end of the day, will remain paramount in the supermarket industry. While a growing number of suppliers are looking for ways to fine-tune their portfolios, all of them recognize that they also must expeditiously keep up with new trends and consumer needs.

In the fresh-cut produce segment, for example, Chiquita's Fresh Express brand developed the award-winning Natursave bag, which maintains product quality and shelf life while using 50 percent less plastic than existing bags, for its Artisanal Salad line. Further, Fresh Express introduced a proprietary Leaf Locator online tool that allows consumers to find out where their salad's leafy greens were grown. This interactive tool is part of the "Your Salad Story" section within the Cincinnati-based company's website.

It's this kind of marriage between innovation and technology that will continue to make astute, resourceful, aggressive manufacturers the Captains — or Advisors — of their respective categories.

GROCERY - FOOD & BEVERAGES

CATEGORY CAPTAIN

Alcoholic Beverages | Beer

Anheuser-Busch

An application of Anheuser-Busch's (A-B) category management platform in 2010 was its new "Category Leadership MVP" program, designed to drive volume, profit and incremental beer category displays. MVP, which stands for Major Volume Players, targets A-B's top volume accounts nationally, both chain and independents, with beer category selling tools and resources.

A-B's team worked in conjunction with its retail customers and wholesalers, while integrating shopper insight information, to uncover account-specific shopper learnings. This helped the beer maker align program offerings to store-level shopper segmentations and needs — a key priority among today's grocers.

Specifically, the MVP initiative focuses on delivering display enhancers to support floor displays during key sales periods and builds an infrastructure of racks/coolers/bins and other hardware to support incremental displays.

Since the program launched in January, there's been a 75 percent execution rate, according to the St. Louis-based company. Additionally, on a national supermarket level, the beer category and the A-B MVP focus brands have seen improving trends for dollar sales, incremental dollars, number of displays and percent of dollars, due to the presence of a display.

CATEGORY CAPTAIN

Alcoholic Beverages | Wine

E. & J. Gallo Winery

Last year the E. & J. Gallo Winery helped lift wine sales significantly for several major grocers by using its "360-degree Approach to the Consumer."

Gallo's 360-degree strategy starts with its Customer Health Monitor, which the wine manufacturer uses to listen to hundreds of consumers on a weekly basis to learn about their various wine shopping trips. When combined with other data sources, this information provides a comprehensive view of consumers' attitudes and behaviors at an individual retailer level, according to Modesto, Calif.-based Gallo. At the same time, Gallo continuously updates its suite of wine category tactics.

By evaluating each retailer's unique shoppers, specific department objectives and key performance indicators, the process filters hundreds of activities to create an optimized solution for Gallo's partners.

In one example, Gallo's category management team found that one chain's shoppers' wine knowledge and confidence lagged behind that of the channel as a whole. Armed with multiple data points around this insight, Gallo and the retailer evaluated the eight core tactics offered through the 360-degree Approach to the Consumer and focused on "Wine Education Solutions" and "In-store Basket Building."

In April 2009 alone, the grocer saw a 190 percent lift in sales of the focus brands. Further, the sizeable Black Swan brand experienced 15 percent growth when paired with food outside the wine department.

CATEGORY CAPTAIN

Baby Food & Consumables

Abbott Nutrition

Abbott Nutrition helped jump-start sales of its powder infant formula at a large Southeastern chain by focusing on out-of-stocks and promoting its new packaging.

First, Columbus, Ohio-based Abbott recommended its best-in-class planogram with proper placement and merchandising flow to promote accessibility of large-size powder and reduce out-of-stocks on high-volume WIC items. Then it suggested the chain make a full transition to its SimplePac 23.2-ounce packaging.

Meanwhile, pricing was adjusted to reflect the new product mix, and two SKUs were added: Similac Sensitive 23.2-ounce powder in all markets, and Similac Organic 23.2-ounce powder in one state based on shopper understanding.

To create excitement around the category update, the grocer rolled out a six-month customer loyalty program featuring shelf signage, online advertising and print advertising within the retailer's weekly circular.

Thanks to Abbott's initiative, the chain's category performance was up vs. its comp-store performance, sales on large-size powders increased 53.6 percent vs. year-ago, and total retailer shoppers for the large-size powder jumped 19 percent.

CATEGORY ADVISOR

Baby Food & Consumables

Nestlé Nutrition

The category management team at Nestlé Infant Nutrition has stayed busy this year with a major undertaking to rebrand its infant formula as Gerber Good Start. By leveraging the nutrition science of Nestlé with the brand trust of Gerber, the Vevey, Switzerland-based global company aims to position Good Start as the gateway to the entire Gerber stage-based product portfolio.

The Gerber Good Start launch in March was supported by a variety of consumer, institutional and retail vehicles. These included pre-launch efforts such as public relations teasers, announcements to WIC and the medical community, and under-the-cap teasers at retail. A major TV advertising campaign, combined with integrated retail programs, all linked into the "Gerber Generation" theme shared by the balance of the Gerber portfolio.

From a category management perspective, the Gerber Good Start launch linked the infant formula segment to the balance of the infant nutrition portfolio.

Post-launch market research showed strong improvement on all key performance indicators, according to Nestlé.

CATEGORY CAPTAIN

Shelf-stable Dairy Food for Infants & Toddlers

Nestlé Nutrition

Nestlé Infant Nutrition has broken new ground in the baby and toddler food segment by creating the category of shelf-stable dairy. Nestlé's new product line, which is packaged under the well-known Gerber brand, is designed to meet the developmental and nutritional needs of infants and toddlers (6 months to 24 months) for healthy growth and natural immune system support.

Beginning in September 2009, Nestlé launched one product range focused on infants, with four SKUs, and then another for toddlers, with three SKUs. The Vevey, Switzerland-based global company's promotional strategy included advertising via TV, print and online; day care sampling and information material for product and concept education; medical detailing and sampling; and shelf talkers.

Nestlé saw the need for shelf-stable yogurt after learning through consumer research that there's a high yogurt penetration among youngsters in the U.S. market (30 percent for infants and 50 percent for toddlers). The shelf-stable delivery system has been a benefit to retailers as well, according to Nestlé, as they were not required to invest in accommodations for in-aisle refrigeration units.

Gerber and Graduates Yogurt Blends Snacks have been driving incremental growth since their launch, the company notes. Nestlé has obtained national listing in all major accounts for this new category.

CATEGORY CAPTAIN

Breakfast Foods | Ready-to-eat Cereal

The Kellogg Co.

In the $6.5 billion ready-to-eat cereal category, which has experienced a dollar sales decline of 1.9 percent from last year, according to Chicago-based SymphonyIRI Group, Kellogg has proactively taken steps to drive efficiency and future growth. The Battle Creek, Mich.-based company has concentrated on key brands while actively reducing SKU count to optimize space, enhancing shelf presence and focusing distribution. As a result of this strategy, Kellogg's top eight brand franchises now account for almost 25 percent of the overall category — and they're still gaining share.

Kellogg's successful recent introductions included Special K Granola, which quickly climbed to No. 1 in the granola segment; kid-oriented Frosted Mini-Wheats Little Bites; and co-branded Cinnabon cereal, which is steadily gaining momentum.

Further, a category-exclusive partnership with Jacksonville, Fla.-based Fifth Dimension revolutionizes testing of the in-store environment, through such features as confidentiality vs. in-market testing, complete portability vs. other virtual providers with an anchored location, total store layout solutions vs. category/aisle only, more robust targeted shopper samples, unlimited ability to test concepts, and speed to answers and insights. So far, Kellogg has employed this capability with regard to new consumer-based shelf merchandising strategies, promotional pricing optimization, shelf-ready packaging opportunities, and the impact of groundbreaking aisle fixtures in the virtual world.

CATEGORY ADVISOR

Breakfast Foods | Ready-to-Eat Cereal

General Mills

In response to Nielsen research indicating more than $1 billion of ready-to-eat cereal category growth opportunity in the next few years, due to inflation, shifting demographics and increased consumption, General Mills released insights this past year on how retailers can boost their own sales in the category.

The Minneapolis-based company and other manufacturers recently helped a major retail account with a shopper-driven center store redesign divided into two phases: category adjacencies and in-store navigation. The redesign has resulted in optimized adjacencies, a new store navigation package, and higher sales and profits.

This year, the company developed a "Shopdown" modeling capability enabling several retailers to optimize their days of supply, minimize out-of-stocks and allocate appropriate facings. One participating account saw 6 percent total category dollar growth and 3 percent base category dollar growth.

Among General Mills' new products, Chocolate Cheerios was a particular standout, with its appeal to an older population that grew up on tasty cereals. The company also differentiated the Chex line by making it 100 percent gluten-free across all six flavors, leading to a 9 percent lift in total dollars and base dollars.

Additionally, General Mills leads the category in Hispanic initiatives, and has successfully leveraged consumer health concerns with its Honey Nut Cheerios brand and Big G kids' cereals.

CATEGORY ADVISOR

Breakfast Meal Occassion

The J.M. Smucker Co.

As a leader in the breakfast meal occasion — especially since its recent acquisition of the well-known Folger's coffee brand — the J.M. Smucker Co. is helping retail partners take advantage of the economy-driven increase in at-home meals. The Orrville, Ohio-based company developed an innovative shopper marketing strategy that pinpoints unique shopper purchase behaviors and attributes at particular retail accounts, and then develops objectives for a program to reach that shopper specifically throughout the path to purchase.

At one account making use of this marketing approach, all Smucker brands achieved triple-digit unit lifts during the promotional period, with an approximately 15 percent higher redemption rate than average, and drove over 70 percent of incremental units for each category.

In the area of category development, Smucker can simulate account-specific pricing and assortment changes to demonstrate incrementality and transferable demand of certain items or brands in the category. These proactive views of the category enable the company to form strategic partnerships with retailers and project category impact based on possible changes.

Smucker has the capability to form partnerships founded on recommendations relating to pricing, promotions, shelving and assortment, by employing shopper data and cutting-edge research.

CATEGORY CAPTAIN

Candy

The Hershey Co.

Seasonal sales are an important component of the candy category, and since Hershey owns a 31 percent share of seasonal sales, the Pennsylvania-based company has invested in seasonal shopper insights and technology to capture opportunities. Using these insights in conjunction with proprietary technology, Hershey used its order-writing tool, Navigator, to recommend store-level orders, helping its top customers grow total seasonal candy sales.

At one retailer, Hershey helped boost Easter category sales 16 percent, while the category grew a healthy 4 percent across the food, drug and mass channels. The Hershey team took a shopper approach to the season, identifying several key opportunities, among them a focus on growing loyal shoppers and the Easter Egg candy bar business.

After an analysis revealed that the retailer didn't convert Easter shoppers as well as it did shoppers at the other main seasons, Hershey guided the operator to implement merchandising tactics that would resonate with loyal shoppers. This entailed ensuring that high household-penetrating items were in 100 percent distribution, placing appropriate displays of key items in high-traffic areas and communicating good value in feature ads. Additionally, Navigator made sure of maximum potential at store level. This approach resulted in a 9.7 percent rise in purchases by loyal households.

CATEGORY ADVISOR

Candy

Mars Chocolate North America

Mars Chocolate North America conducted several shopper studies throughout 2010 on in-aisle, seasonal and display locations. The goal of this research was to provide best practices based on shopper insights and proven category management practices.

The aisle research uncovered the following POWER principles: leading the aisle with confectionery to leverage the category's expandable and impulse nature, optimizing segment flow and space by anchoring with premium chocolate and gum/mints, and employing a core of 15 power brands to simplify shopper navigation. Retailers abiding by these principles can expect a 3 percent to 8 percent sales increase.

The Hackettstown, N.J.-based division's partnership with Kantar Retail yielded a series of foundational insights providing quantifiable and executable merchandising practices at key seasonal timeframes across the entire category. Spanning the Halloween, Christmas and Easter occasions, this study measured not only at-home attitudinal stimuli such as print advertisements, but also in-store behavioral stimuli including display, promotional and pricing recommendations.

The display study identified the basics for displays by channel. As most candy-buying decisions are made on impulse, a series of trade response models was developed to help field teams and retailers determine which promoted conditions drive the highest sales lifts across all channels. This information will be continually employed to grow sales for the entire category.

CATEGORY CAPTAIN

Canned & Packaged Beverages

Campbell Soup Co.

Throughout the past year, Campbell Soup Co. has contributed significantly to the shelf-stable beverages category, re-energizing the category with authentic fruit and vegetable nutrition powered by V8 branded products: 100% Vegetable Juice, V-Fusion Juice, V-Fusion Juice + Tea, and Splash beverages.

Campbell has leveraged health-and-wellness trends and the credentials of its V8 line with a multipronged strategic approach. The Camden, N.J.-based company differentiated its products, boosted category sales and established a new merchandising paradigm by launching product innovations and renovations; enhancing partnerships to grow alternate channel distribution; creating unique shopper insights-based shelving solutions to improve category shopability, drive category conversion and differentiate retailers; and formulating a high-frequency marketing campaign that reinforced the benefits of vegetable nutrition.

While total U.S. FDMx shelf-stable juice sales fell 1.7 percent, or $79 million, over the prior year, the adult shelf-stable juice segment rose 4.3 percent, and V8 beverages represented 61 percent of that growth — up $31 million over the prior year, according to Nielsen. The strongest-performing retailers — Kroger, up 3 percent; Wakefern, up 1.5 percent; and Publix, up 0.7 percent — had developed strategic joint business plans with Campbell.

CATEGORY CAPTAIN

Canned & Packaged Beverages | Coffee

J.M. Smucker Co.

To help retailers recoup sales lost to out-of-stocks (OOS) for Dunkin' Donuts brand coffee, the J.M. Smucker Co. paired traditional analyses with in-store shopper intercepts and consumer decision trees to shed light on how consumers shop the set and how to increase its relevance and shopability. Orrville, Ohio-based Smucker was able to recommend an optimized layout that applied such lessons as shelving by form within brand blocks to eliminate shopper confusion, and arranging roasts from light to dark to help shoppers find the right coffee and encourage exploration.

Total category OOS levels improved, and within one retailer partner, the Dunkin' Donuts brand experienced a nearly 50 percent reduction in weekly OOS levels. Both segment and category performance outpaced the rest of the market during the same timeframe. Growth was also driven by improved shopability, which yielded a 5 percent increase in trips per buyer and a 6 percent increase in dollars per buyer.

In just this past year, the brand experienced 20 percent growth in dollar sales, which drove a total premium dollar sales increase of 5 percent and category growth of 3 percent. Seventy-four percent of volume sales were incremental to the category in the past year, thanks to increased consumption by existing coffee buyers, and sales from new or infrequent category buyers.

CATEGORY ADVISOR

Canned & Packaged Foods | Baking Ingredients, Spices & Seasonings

General Mills

Gold Medal from General Mills is the flour category share leader, having seen 5.2 percent dollar volume growth over the past two years, according to Nielsen. The Minneapolis-based company maintains category leadership by delivering actionable insights through such vehicles as its Flour Category Management Platform, Baking Aisle Platform and SKU optimization insights.

Last year, the category management team created the first standalone Flour Category Platform, a comprehensive category guide to help retailers maximize assortment, shelving and promotional activity. The platform includes current trends and consumer insights to highlight best practice category management principles.

Using this platform, General Mills worked with a retailer on the July 2010 rollout of a vertical shelf set designed to improve shopability and drive category sales. Based on historical results and modeling, the retailer expects a 2 percent to 3 percent sales increase.

Additionally, the Flour Category Platform was updated in August 2010 to include the most recent trends and recommendations; General Mills published the annual Baking Aisle Platform, which focused on the aisle's role within dry grocery, and optimal aisle layout; and a supplemental Baking Aisle Reference Deck was created to arm the salesforce with current trends and consumer insights on such complementary categories as sugar, oil/shortening and evaporated milk.

CATEGORY CAPTAIN

Canned & Packaged Foods | Desserts

General Mills (Betty Crocker)

According to Nielsen, the $1.25 billion dessert category continues to grow at a steady clip, experiencing 1.0 percent dollar volume growth over the previous year — the highest dollar volume in the past 10 years. General Mills' Betty Crocker, the category share leader, drives the highest category penetration, consumer loyalty and category retention, thanks to pertinent category and consumer insights, profitable new product development, and meaningful consumer support.

Besides providing retailers with SymphonyIRI Group store audits, annually updated "Occasion-based Set" best practice guidance and evolving baking aisle insights, Minneapolis-based General Mills publishes the Desserts Category Platform yearly to provide its salesforce with the latest category trends and best practice actions. September 2010 saw the release of an additional Desserts Segment Platform offering in-depth analysis of segment-specific growth trends, consumer insights and promotional best practices.

Further, the company leveraged Baking Aisle Platform insights in a collaboration with a small-format retailer looking to expand its grocery space. On average, the baking section tripled in size, growing from 4 feet to 12 feet, and experienced 171 percent dollar volume growth over last year, with General Mills contributing 40 percent of that growth.

New Betty Crocker products include premium Decadent Supreme Cake Mix and indulgent Mississippi Mud Supreme Bars.

CATEGORY ADVISOR

Canned & Packaged Foods | Dessert Baking Mixes

The J.M. Smucker Co.

The J.M. Smucker Co.'s optimization of the entire baking aisle has revolutionized how the company guides retail partners and generates growth across many categories.

Orrville, Ohio-based Smucker wanted not only to elicit key learnings aimed at growing a particular category, but also to provide recommendations for a whole aisle. To that end, the project encompassed every category commonly found in the baking aisle. Leveraging a market structure analysis, shopper intercepts, shopper card research, a 2,000-store audit, and store group analysis and focus groups, Smucker spearheaded a 360-degree look into the ingredients for an optimal bake aisle to help boost sales and profits for retailers.

From these exhaustive analyses, Smucker could provide retailers with several new tactics across the entire aisle, among them dividing the aisle into three strategic sections — Dessert Mixes, Scratch Baking and Dual Usage — to make it easier for shoppers to find what they need; anchoring each section with a core category surrounded by secondary high-affinity categories to maximize cross-purchase opportunities; and arranging core categories in a specific way to reduce bottlenecks and optimize aisle traffic flow.

Several retailers have implemented some or most of the study's recommendations and are running their own store tests, with positive results reported so far.

CATEGORY CAPTAIN

Canned & Packaged Foods | Dry Packaged Dinners

General Mills

General Mills' share of the wide-ranging dry dinner category's dollar volume has grown by a full percentage point since last year, due to innovation, delivering value to consumers, providing space and assortment advice, and maximizing consumer support.

Building on the popularity of restaurant-style items, the Minneapolis-based company launched two Helpers SKUs in 2009, and this year will introduce three better-for-you options: Good Earth, Whole Grain Helpers and Gluten Free.

General Mills offers retailers a comprehensive Meal Solutions Platform including consumer insights, prescriptive execution ideas and best practices. A major account that took advantage of the meal solutions opportunity afforded by the Macaroni Grill product line increased its dollar volume by 145 percent over the prior three months. During the same timeframe, the retailer's main meals segment rose 26 percent, handily outpacing the 16 percent growth experienced nationally.

Leveraging SymphonyIRI Group audit data, General Mills created a Gold Standard planogram for the most effective retail shelf set. A Best in Class Scorecard shows that retail accounts adhering to the planogram are seeing five times the growth of total U.S. accounts and driving category growth.

Additionally, a cross-functional group of General Mills experts and Kantar Retail are collaborating on a plan for significant dry dinner category growth over the next three to five years.

CATEGORY ADVISOR

Canned & Packaged Foods | Dry Packaged Potatoes

General Mills

Betty Crocker's innovation in taste, packaging and preparation has brought consumers to the dry packaged potatoes category, which remains on trend as consumers continue to prepare a larger percentage of meals at home and more quickly. Meeting those needs is critical for retailers because potatoes are the second most frequently consumed side dish.

Potatoes are the third-largest category within the $2.2 billion dry side dish segment. Over the past year, dry potatoes had $328 million in sales, with a six-year annual growth rate of 4.2 percent, according to Nielsen. Betty Crocker holds 70 percent of the flavored mashed and casserole segments, and overall, the brand owns a 45 percent dollar share of the dry potatoes category.

Betty Crocker is giving frugal consumers new opportunities to shop the category. A strong value message — "2 Pouches for 2 Meals" — is prominent on the redesigned box, which also includes a bold flavor banner to enhance shopability. Since the package refresh, one retailer reported units per store per week were up double digits during the post-Easter holiday, compared with last year.

Betty Crocker continues to lead in bringing health-conscious consumers to the category: Several SKUs have just 80 calories and 3 grams of fiber, and Gluten-Free Potato Buds are on trend with another key health issue.

A coordinated, high-impact taste campaign; new flavors; and boosts in media spend, category management and shelving optimization also give Minneapolis-based General Mills a clear edge in the category.

CATEGORY CAPTAIN

Canned & Packaged Foods | Fruit Spreads & Peanut Butter

The J.M. Smucker Co.

Economic changes have proved challenging for retailers and manufacturers as volatile market conditions have led to changes in pricing and assortment. The J.M. Smucker Co. has improved capabilities in both assortment and pricing optimization for the fruit spread and peanut butter categories.

From 2008-09, 40 percent of retailers went through assortment reductions, with an average decrease of 5 percent of items across the store. To combat this, Orrville, Ohio-based Smucker has developed a proprietary tool that allows for total category assortment optimization. This tool weighs product attributes that are important in a consumer's decision set, such as brand, form and flavor.

Smucker also developed two pricing simulation and analysis tools to help retailers better manage both base and promoted prices. The first tool helps retailers in optimizing base price gaps by measuring impact on sales in respect to the total category. The second is a price and trade tool, which incorporates both base and promoted price elasticities for all of the items by account, which is used to quantify the impact on category and brand sales given a change in price. Using this tool, Smucker has been able to advise retailers on the effects of deep discounting and recommend potential strategies that lead to more loyal and consistent shoppers.

CATEGORY ADVISOR

Canned & Packaged Foods | Nut Spreads

Ferrero USA Inc.

The category management team at Ferrero USA is getting retailers to rethink the nut spread segment.

On behalf of its Nutella brand, Somerset, N.J.-based Ferrero joined forces with Edgewood Consulting last year to devise a plan for category growth. As a result, several major grocers that enacted the new strategy saw a significant lift in sales of nut spreads, as well as for the Nutella brand.

Ferrero's research unveiled that grocers often misplace Nutella, lodging it in a corner near specialty and organic products, instead of among mainstream spreads where it belongs. Limited facings fuel out-of-stocks, resulting in further lost sales, according to the company. There were 10 percent out-of-stocks in stores audited, with 29 percent of consumers surveyed reporting out-of-stocks.

Nutella is highly incremental, it turns out, and retailers fare better when they place the product next to peanut butter, the company learned.

Among Ferrero's new best practices checklist for its retailer partners:

• Provide sufficient facings (for visibility and to reduce out-of-stocks) — stock both sizes
• Place on the center of the shelf, not hidden in the corner
• Position on an eye-level shelf, not a hard-to-reach top shelf

CATEGORY CAPTAIN

Canned & Packaged Foods | Shelf-stable Vegetables

General Mills

Green Giant is one of the most recognizable brands in America and a key contributor to driving traffic and trips for retailers. Minneapolis-based General Mills leveraged the strength of the brand and its leadership position with a balanced retailer plan encompassing such components as research, tools and capabilities to drive aisle and category sales, a new item launch, and consumer investment.

Along with providing insights on best practice shelving, General Mills collaborated with retailers on optimizing distribution in the category, through an SKU rationalization/incrementality study undertaken with Nielsen. Additionally, using the proprietary Demand Transfer Tool, which determines the incrementality of items in a retailer's assortment and quantifies the volume impact of SKU optimization decisions, General Mills was able to show the true dollar impact of adding or deleting items from the category.

Other research included a 3,000-store audit with Chicago-based SymphonyIRI Group, which found that the category performs best when stocked by segment and commodity, and that multipacks drive consumer value in the current economy.

Green Giant's product innovation included the addition of Super Sweet White Corn and Mixed Vegetable Blend to the specialty sides segment, which extended the iconic brand across the category. The brand also highlighted its ongoing commitment to the environment through on-pack messaging.

CATEGORY CAPTAIN

Canned & Packaged Foods | Soups

Campbell Soup Co.

In an effort to boost the mature shelf-stable soup category, Campbell undertook research that led the Camden, N.J.-based company to restage its Chunky soup line to highlight three power claims: a full serving of vegetables, made with lean meat, and a good source of protein.

Additionally, Campbell introduced Select Harvest Mediterranean soups, which are 100 percent natural and feature extra-virgin olive oil, and reformulated Swanson chicken broth to be all natural. Both products have performed well.

The company's latest version of its iQ Maximizer shelving solution — iQ Maximizer II — now better handles all can sizes across the condensed soup, ready-to-serve soup, microwavable bowl and convenience soup segments, thereby optimizing soup shelving. The system has two new configuration options: "flex" racking that enables the pre-selection of the numbers of doors per shelf, and "optimizer" racking that allows for the addition of a shelf to a vertical planogram. According to Campbell, sales volume increased 6 percent in stores with iQ Maximizer II racks vs. stores using the original system.

A major conventional grocery operator and a big-box retailer experienced customer satisfaction and higher soup sales in tests of the new system, leading the big-box retailer to implement iQ Maximizer II in over 1,000 locations — the first time it's approved a soup-racking system.

CATEGORY ADVISOR

Canned & Packaged Foods | Soups

General Mills (Progresso)

Over the past year, General Mills' Progresso brand has shown leadership in the soup category — the largest meal category, at $3.9 billion, according to Nielsen — in areas such as product innovation (the World Recipes line) and optimization of shelf space, in the midst of a challenging environment that contributed to a 3 percent decline last year.

To help stop the slide, Minneapolis-based General Mills formulated a plan that improved section shopability, enhanced promotional plans, and identified and leveraged category growth drivers.

Redefining the category structure based on consumer usage and needs led to the reconfiguration of the shelf to create a clear distinction between "soup as a meal" and "soup as an ingredient," thereby making the section easier to shop. A further aspect of this reconfiguration was to deliver on meals and ingredients along with health and taste

Also, in recognition of soup's pre-eminent status in the meals aisle, Progresso considerably increased its investment over last year, through taste-focused TV advertising, in-store demos, frequent couponing and event support for such initiatives as "Box Tops for Education."

And Progresso's merchandising plan, which includes sharp price points, consumer support, and significant event exposure through ads and displays, helped a top retail customer increase its wet-soup category sales by 2.4 percent last soup season.

CATEGORY CAPTAIN

Commercial Baked Goods

Flowers Foods

During a time of recession and category deflation, Flowers Foods focused on the fundamentals of growing retail sales, with the result that the company's 3.1 percent sales growth as of July 11, 2010, outpaced that of the overall baked goods category, according to Chicago-based SymphonyIRI Group.

In the past 12 months, Thomasville, Ga.-based Flowers has introduced products that have not just brought new consumers to their respective segments, but have also helped grow sales. These products included Nature's Own 100% Whole Grain Soft Variety Bread; Nature's Own 100% Whole Wheat Sandwich Rolls and Hot Dog Rolls, both of which have helped grow Flowers' share of the sandwich bun/roll segment as well as overall segment sales; and Nature's Own Sandwich Rounds in a resealable bag, which, by being the only sandwich round product to feature such packaging, have brought new consumers to the segment.

Flowers also provides its retail partners with ideas that benefit the overall category. In the past year, using automated scripts and analysis tools, the company optimized retailers' shelf configuration and assortment at store level. Other retail solutions from the company included dedicated, on-site category analysts; benchmarking; promotion analysis; assortment studies; new product analysis; and outstanding in-store execution.

CATEGORY CAPTAIN

Convenient Wholesome Foods

General Mills

General Mills is leading profitable growth in convenient wholesome foods through innovative new items, strong brand-building support and category insights that help retail partners drive sales.

Convenient wholesome foods (CWF) is a $2.4 billion category, with sales up 5.3 percent over last year, according to Nielsen. General Mills is the leading manufacturer for CWF sales growth (6.9 percent). Category growth is being driven by three key factors: increased snacking occasions and more at-home eating; consumer demand for more healthy snacks; and value packs.

General Mills leads the adult health category with its Fiber One brand, the fourth-largest grain franchise, with a 90-calorie offering launched this year that outperformed sales expectations by up to 40 percent. The Minneapolis-based company is also seeing great success with better-for-you products like Simply Fruit Rollups; "permissible indulgences" such as cereal treat bars, Clusters and Granola Thins; and innovative Fruits Snacks for kids.

General Mills leads the adult health category with its Fiber One brand, the fourth-largest grain franchise, with a 90-calorie offering launched this year that outperformed sales expectations by up to 40 percent. The Minneapolis-based company is also seeing great success with better-for-you products like Simply Fruit Rollups; "permissible indulgences" such as cereal treat bars, Clusters and Granola Thins; and innovative Fruits Snacks for kids.

General Mills brands currently hold 30 percent of grain dollar volume share, and were responsible for 36 percent of grain sales growth over the past year. For fruit snacks, share is 54 percent and growth contribution was even more significant.

CATEGORY CAPTAIN

Cookies & Crackers

The Kellogg Co.

Innovation in the Kellogg's Snacks Division (KSD) includes the June 2010 extension of both the Townhouse and Club lines of the Keebler brand with the rollout of Townhouse Flatbread Crisps and Club Minis, and two unique cookie forms under the Keebler Fudge Shoppe line: Coconut Dreams and Cheesecake Middles.

Additionally, the Battle Creek, Mich.-based company's Optimal Shelf Merchandise Store Audit, consumer decision tree work, and "In-Store Shopper Study" provided key insights into shopper behavior and guided category strategies. Building on this research, Kellogg undertook a 2010 three-phase "Snacking Category Optimization" study that uncovered general attitudes and shopping behavior related to the snack category, identified how shoppers would like products grouped on shelves, and created an innovative store layout based on attitudes and shopping behavior.

Further, Keystone event research helped the company better understand the shopping behavior during key seasonal timeframes; proprietary on-the-go (OTG) research findings continue to explore the relevance and importance of the OTG category for consumers during a merger economy; a matched panel analysis aims for a better understanding of brands within the context of the category, particularly the impact of brand expansion; and a cross-shopping analysis investigated KSD brand fit/alignment in categories beyond traditional core categories.

CATEGORY CAPTAIN

Ethnic Foods

General Mills (Old El Paso)

General Mills' Old El Paso brand is growing the Mexican meals category — in which it boasts the largest dollar share — through aggressive promotional support, on-point advertising, packaging innovation, new products and extensive research, all of which enable retailers to meet increasing shopper demand.

Minneapolis-based General Mills has identified three key trends affecting consumer behavior in regard to Mexican meals: value, convenience and family-focused occasions. A factor in this growth is the rise in at-home meals during the recent recession.

Noting the popularity of tacos for dinner — consumption has jumped 13 percent from the prior year, according to the NPD Group — Old El Paso aimed to nudge "Taco Night" usage even higher via a merchandise overlay fund. Additionally, using the insights from an analysis revealing that the best ways for grocers to keep pace with accelerating Mexican meals category growth were to leverage topturning SKUs, concentrate on incremental brands and optimize shelf space at 22 base feet, the brand developed a best practice planogram to spur future category growth.

In the realm of new products, Old El Paso this year introduced three SKUs to its convenient Heat N Serve product line, as well as two microwavable tortilla stuffer SKUs, which provide a filling for tortillas in just 60 seconds.

CATEGORY ADVISOR

Frozen Baked Goods

General Mills

Accounting for an estimated $847 million in annual sales, the frozen baked goods category consists of four subcategories: dinner bread sides, all-day sides, pie crusts, and specialty sweets and sweet rolls. The category is up 8 percent since 2007,according to Nielsen, and shows plenty of promise going forward as consumers eat more meals and snacks at home.

The category management team at Minneapolis-based General Mills has determined that products emphasizing value and health are key to capitalizing on that growth opportunity and driving penetration. This year, the company introduced Grands! Mini Buttermilk Frozen Biscuits under its Pillsbury division to offer a dollar-stretching, calorie-cutting option.

Mini biscuits help drive new usage occasions, because they're ideal as appetizers, sliders, mini-sandwiches and tea biscuits, the company found. Research shows that just one additional usage occasion per year in this segment will drive a 15 percent increase in buy rate.

Beyond product innovation, General Mills continues to offer its retail partners category, aisle, and store-level, solution-based insights. The company makes extensive use of consumer segmentations, point-of-sale analytics, the "Willard Bishop Super Study," SymphonyIRI Group shelf audits, virtual-store technology, and more.

CATEGORY CAPTAIN

Frozen Breakfast

The Kellogg Co. (Eggo)

Kellogg continues to facilitate future growth in the frozen breakfast category by driving consumer- and insights-driven innovation in 2010. The Battle Creek, Mich.-based company also helps its retail customers through innovative proprietary/syndicated category management tools and research.

Using a SymphonyIRI Group Menu Analysis, custom trending, consumer analysis and its 2009 consumer decision tree, Kellogg's category management and shopper insights teams outlined an optimized portfolio that maximized reach and volume for the Eggo brand and the category as a whole. This custom research led to the current portfolio's limited SKUs and elimination of the 16-count size from the portfolio.

Cognizant of changing in-market conditions, Kellogg ran an online test to understand optimal promoted price points for Eggo. Along with traditional lifts, the company probed shoppers on their brand and price point perceptions. This study will enable retailers to remain competitively priced and boost category dollars.

CATEGORY ADVISOR

Frozen Breakfast

General Mills (Pillsbury)

General Mills is fueling growth in the recession-resilient frozen breakfast category through several key initiatives.

Since the Minneapolis-based company's Pillsbury Toaster Strudel product line drives incrementality in the frozen aisle at nearly three times the department average, General Mills has continued to invest in the pastry segment through nationally released 12-count offerings in the top-performing Cream Cheese and Strawberry and Cinnamon Roll flavors. Overall, accounts that carry the 12-count SKUs have 29 percent higher dollar turns than those that don't stock the items.

The company also offers retailers the following strategies for winning in frozen breakfast: encouraging cross-purchases across the department by optimizing category space and adjacencies; focusing space, assortment and distribution efforts to drive growth; and using best practice shelving tactics to facilitate browsing.

CATEGORY CAPTAIN

Frozen Entrees

Unilever

Unilever continues to demonstrate its dominance of the category with a line of Asian skillet meals developed in partnership with the P.F. Chang's restaurant chain.

Offering a restaurant-quality experience at home, the new line leverages a strong brand name and loyal consumer base by bringing new foot traffic to the frozen aisle. The product's new brick packaging offers superior shelf efficiency, and a more stable bag improves shopability while allowing up to three dozen units to fit on a store shelf and easier storage in home freezers.

Created through collaboration between P.F. Chang's and Unilever's Frozen Meals team, the new line is pulling shares of up to 12.5 percent out of Unilever's total 40.5 percent share of the category, according to Nielsen data provided by Englewood Cliffs, N.J.-based Unilever. A major national grocery retailer reported P.F. Chang's items ranked first, second, third, fifth, sixth, 10th, 13th and 22nd out of 25 new items.

CATEGORY ADVISOR

Frozen Entrees

General Mills

Frozen prepared foods generate the most dollar volume in the entire frozen department. With steady year-on-year growth, the category currently stands at $8.6 billion and is expected to grow 27 percent by 2015, according to Nielsen. The frozen multiserve entree category contributed 62 percent of the growth over the past year.

To meet consumers' needs for restaurant-quality taste in frozen entrees, General Mills introduced Macaroni Grill dual-serve entrees, offering the convenience of the restaurant taste experience with enhanced quality to the typical in-home experience. The new frozen entree offering is seeking similar results to the dry dinner Macaroni Grill dinner kits from General Mills, which brought 36 percent percent new buyers to the main meal category.

Through various category management initiatives, General Mills has been able to help retailers optimize their distribution mix and improve consumer loyalty to the category, enhance shopability, and grow profitability by providing category, aisle and store solutions.

CATEGORY CAPTAIN

Frozen Fruit

General Mills

Frozen fruit is a challenging category. While dollar volume has grown, unit volume has actually declined year-on-year, with the exception of last year, when the category grew nearly 8 percent, Nielsen found.

In September 2009, Minneapolis-based General Mills introduced the Yoplait Smoothie line, which is largely responsible for the category growth over the past year: More than 50 percent of the unit and dollar growth was attributed to Yoplait Smoothie sales.

Primary purchase decisions center on taste, health and convenience, and Yoplait Smoothies are designed to deliver. The smoothie kits are pre-portioned pouches containing real pieces of Yoplait yogurt with live and active cultures, which are blended with milk. With the success of the initial flavors — Triple Berry, Strawberry Banana and Strawberry Mango Pineapple — General Mills launched the trendy Blueberry Pomegranate combination.

Additionally, General Mills leveraged extensive research and insights to develop retailer-customized solutions pertaining to the category, aisle and total store to enhance shoppability and consumer loyalty.

CATEGORY CAPTAIN

Frozen Hot Snacks

General Mills

In the highly fragmented frozen hot snack/sandwich category, Minneapolis-based General Mills is the only manufacturer with more than a share point in growth since last year. The company has two brands within the category: dollar growth leader Totino's in the everyday snack segment, and Pillsbury Savorings in the special occasion segment.

Strategies for category growth included new item introductions such as the Pillsbury Savorings Crescent Dog, featuring "Box Tops for Education" program points on Totino's packaging, a 28 percent increase in Totino's promotional campaigns, harmonized packaging for Totino's pizza and pizza roll products, and increased marketing to Hispanic consumers. Totino's is currently the top brand in Hispanic market share, which is projected to constitute about 30 percent of the U.S. population by 2050.

Additionally, General Mills guides retailers on combining the frozen hot snack category's incrementality with its size, growth and household reach to strategically align the section to maximize sales; better aligning the aisle to shopper behavior, according to a needs-based approach, to enhance shopability and boost loyalty; and facilitating browsing through brand blocking within subcategories to capitalize on high consumer brand loyalty.

CATEGORY CAPTAIN

Ice Cream & Novelties

Unilever

In the packaged ice cream category, eight of the top 10 dollar volume innovation SKUs were introduced by Englewood Cliffs, N.J.-based Unilever. Ben & Jerry's Milk and Cookies was the No. 1 packaged ice cream item introduced — four of the top six innovations were Ben & Jerry's introductions — while Breyers Smooth & Dreamy Coffee Fudge Brownie earned the No. 2 best-selling innovation spot.

In frozen novelties, the Popsicle Jolly Rancher 20 Pack was the top seller in all novelties innovation, so far selling almost $1 million more than the second-ranked SKU. The Breyers brand introduced Smooth & Dreamy Novelties, which offer a slightly more indulgent, better-for-you option at an attractive price point.

The better-for-you segment grew more than 12 percent, and Unilever reported that its Breyers Smooth & Dreamy novelties contributed to more than half of that growth. Klondike alone contributed 18 percent, and Unilever in total contributed 48 percent of absolute dollar volume change over the prior year.

CATEGORY CAPTAIN

Frozen Pizza

General Mills

Frozen pizza, a $3 billion category, is the third-largest section in the frozen food department, and since 2007 has been frozen's fastest-growing category in terms of space, according to Nielsen, which noted that household penetration increased to 73 percent this year, and frozen pizza is projected to grow 26 percent by 2015.

Totino's Party Pizza from General Mills is at or near the top of the category, both in terms of dollar (second) and unit growth (first) among the top 15 frozen brands. Minneapolis-based General Mills recently invested in research to better understand frozen pizza shoppers and how best-in-class retailers are connecting with them.

That consumer research led General Mills to four key opportunities to help retailers win in frozen pizza: encourage cross-purchases across the department by optimizing category space and adjacencies; focus space, assortment and distribution efforts against growth categories; promote frozen pizza year-round; and employ best-practice shelving tactics.

Totino's is fueling category growth through several key initiatives, including the "Box Tops for Education" program, the "Guaranteed Smiles" TV campaign and harmonized packaging. Further, due to targeted marketing, Totino's is the leading pizza brand in Hispanic market share, which is projected to constitute about 30 percent of the U.S. population by 2050.

CATEGORY CAPTAIN

Frozen Vegetables

General Mills (Green Giant)

Striving to be the go-to manufacturer for more retailers each year, General Mills makes extensive use of such tools as consumer segmentation, point-of-sale analytics, and cutting-edge research to bring insights and profitability-enhancing solutions to the frozen vegetable category, which is currently at $2.3 billion and growing, according to Nielsen.

To help retailers capitalize on those insights, the Minneapolis-based company advises retailers on how to focus space, assortment and distribution efforts to drive growth; promote frozen vegetables year-round and cross-promote similar categories; and use best practice shelving tactics to boost buyer conversion through the creation of planograms.

Virtual-store technology also provides retailers with simulated in-store performance, without the time and cost associated with real-life resets.

Additionally, General Mills' Green Giant brand is driving category growth through such initiatives as the new Valley Fresh Steamers Healthy Colors Line, the endorsement of Weight Watchers on product packaging, and the introduction of the first value-sized sauced steam bag to meet the convenience needs of larger households.

According to the company, future growth will arise from innovation continuing to fulfill consumers' primary needs for taste, health and convenience. Nielsen notes that the frozen vegetable category is expected to increase an additional 26 percent by 2015, outpacing the entire frozen department's outlook of 23 percent growth.

CATEGORY CAPTAIN

Frozen Veggie Foods

The Kellogg Co. (MorningStar Farms)

The MorningStar Farms brand from Battle Creek, Mich.-based Kellogg is driving growth in the frozen veggie food (meat substitute) category by focusing on a consumer-centric brand strategy, solid innovation, and proprietary and shared category management and shopper insights tools and research.

Kellogg's 2010 consumer decision tree employed a virtual platform to understand not only how shoppers perceive the category's structure, but also to comprehend how purchase decisions are made once within the category. From this study, the company has identified shopping and consumption patterns for itself and its retailers.

The post-promotion analysis approach, redesigned in 2010, includes a compliance audit and a modeled lift analysis, and uses loyalty card data to incorporate shopper understanding. This new approach has driven more efficient and effective spend, as well as providing insights that will grow the entire category. A virtual promoted price analysis enabled Kellogg to gauge shopper reaction and perspective regarding new price points, allowing the company to counsel retailers on how to maximize category profitability.

Also, a better-for-you segmentation study for frozen categories resulted in a clear view on "needs gaps" in the category.

CATEGORY CAPTAIN

Total Frozen

General Mills

In 2010, General Mills increased support in the frozen department by investing heavily in best-in-class insights, capabilities and brand support to deliver solutions to its retail partners. The Minneapolis-based company leveraged this increased investment to become department captains and advisors at several top-20 customers.

General Mills is leading frozen department in growth by recognizing elements critical to its future. Frozen shoppers spend nearly 30 percent more per trip than on the average dry-grocery trip, and frozen is one of the top trip drivers for center store. Frozen sales have grown 21 percent over the past five years, and are projected to continue to grow 23 percent over the next five, according to Nielsen.

General Mills has invested heavily in a shopper research project to best understand how shoppers shop the frozen department, teaming with more than a dozen key retailers to conduct in-store "shop-alongs." Additionally, it commissioned an extensive Nielsen consumer segmentation study that provided insights regarding adjacency alignment, space allocation and in-store tactics. The company also analyzed what best-in-frozen retailers do better than the competition.

General Mills has invested heavily in a shopper research project to best understand how shoppers shop the frozen department, teaming with more than a dozen key retailers to conduct in-store "shop-alongs." Additionally, it commissioned an extensive Nielsen consumer segmentation study that provided insights regarding adjacency alignment, space allocation and in-store tactics. The company also analyzed what best-in-frozen retailers do better than the competition.

General Mills has become an even bigger player by driving strong baselines through brand-building efforts and product innovation. As of last year and into the next, the company will have launched more than 20 new frozen items into key growth categories, with iconic brands such as Macaroni Grill frozen entrees, Green Giant steamable vegetables and Yoplait Smoothies.

CATEGORY CAPTAIN

Gum

Wm. Wrigley Jr. Co.

For decades, Wrigley has meant gum, and the Chicago-based company continues to bolster that reputation by striving for maximum in-store performance through careful study and management of best practices on shelving, distribution and merchandising at each customer. Wrigley is focused on category development and increased household penetration through promotion and in-store activation aimed at its best customers..

For over five years, Wrigley has provided consistent, positive results for retailers who continue to test and migrate to over-the-belt gum and mint positioning. A cornerstone of Wrigley category management, over-the-belt positioning has yielded proven in-market testing results, as merchandising gum and mints this way results in an increase in both front end sales (9.3 percent) and profits (9.7 percent) for items that moved. With 65 percent of grocery ACV expected to be over the belt by the end of 2010, retailers continually reap the benefits.

Throughout 2010, Wrigley has worked with retailers on testing new front end merchandising concepts for the entire confectionery category. This year, Wrigley implemented a retailer-based initiative designed to create an effective in-store experience that engages shoppers through state-of-the-art merchandising and creates a "candy store within a store" feel for the consumer. The company continues to push the envelope on the in-store experience and provide thought leadership and new ideas to enhance the total experience.

CATEGORY CAPTAIN

Mixed Salty Savory Snacks

General Mills

General Mills has been turning to consumer insights and product innovation to help grow the mixed salty savory snack category in the salty snack aisle. As the maker of Chex Mix, Cheerios Snack Mix, Gardetto's and Bugles, Minneapolis-based General Mills is the key category advisor for many grocers.

Mixed salty savory snacks is a $1.2 billion category within the $10.8 billion salty snack universe, according to General Mills. The segment has experienced an 8 percent increase in dollar volume from two years ago, Nielsen has found. The category also considered a profitable space within dry grocery, with a 137 space-to-profit index.

For 2009-10, General Mills' new items included Caramel Bugles, Chocolate and Peanut Butter Bugles, and Chipotle Cheddar Chex Mix. Caramel Bugles are now a top-10 item in the snack mix category based on dollar volume.

The company also redesigned its Chex Mix packaging, with a new focus on each SKU's distinct flavor segment.

Display has been the key to maximizing effectiveness in the category, as General Mills' category managers see it. Variety packs, potato chips and tortilla chips overindex on display and merchandising, as do DSD items. The company's category analysis, which leverages Nielsen and SymphonyIRI Group research, suggests retailers can benefit by implementing a best practices shelf set, ensuring productive adjacencies and leveraging top category items to drive retail sales.

CATEGORY CAPTAIN

Natural & Organic Foods

General Mills

The organic food industry has had its challenges over the past few years, as commodity costs have fluctuated and many grocers have been focusing on low-cost items to attract shoppers. Yet the industry is still projected for long-term growth, and the category management team at General Mills' Small Planet Foods division is making itself available to retailers that want to stake their claim in this better-for-you segment.

Specifically, Small Planet has invested in tools that have resulted in improved natural/organic category management capabilities. The brand has also continued to invest in product innovation. As a result, its sales have grown by an impressive 5.2 percent.

In one example of Minneapolis-based General Mills' category management prowess, a national retailer used Small Planet's virtual-store technology software to view recommended changes before investing in the store.

In other instances, Small Planet has initiated optimization projects that resulted in distribution gains in several of its categories, while increasing productivity for retailers.

This year, many retailers were able to gain critical mass on Small Planet's products, which allowed for direct shipment. This change led to savings for the grocers, allowing them higher margins and lower prices at the shelf, according to General Mills.

As for product innovation, Small Planet rolled out Cascadian Farm Fruitful O's cereal for kids, Cascadian Farm Peanut Butter Chocolate Chip Granola Bars, and new flavors and packaging in its Larabar division.

CATEGORY ADVISOR

Natural & Organic Foods

Kashi

Kashi's category management mission is to ensure its retailer partners have a robust strategy for natural and organic foods. The division of Battle Creek, Mich.-based Kellogg provides industry-leading research, category management tools, shopper insights, retailer-specific programs, innovation and brand building to achieve this goal.

As Kashi sees it, a retailer's assortment should vary depending on the geographic location and size of the store, as well as the grocer's individual strategy. To help, Kashi has developed tools such as SKU prioritization and a store-level demand index.

In an effort to assist retailers in better understanding consumer behavior, Kashi designed an educational platform that identifies the importance of wellness as a competitive advantage. The platform identifies the role of natural and organic in establishing a credible wellness program.

As part of that initiative, Kashi invested in an IRI store analysis, which found that natural/organic ready-to-eat cereal performed better when Kashi was stocked in dual locations.

A regional grocer that executed dual placement on Kashi's top six items in June 2009 ended up growing market share of Kashi, natural/organic ready-to-eat cereal and total ready-to-eat cereal dollars. Kashi's core business grew 12.5 percent, while the retailer's top-20 natural/ organic brands grew 15.5 percent.

CATEGORY CAPTAIN

Wholesome Portable Breakfast & Snacks

Kellogg Co.

As the share leader in the wholesome portable breakfast and snack category, Kellogg is driving profitable sales growth for retailers through an integrated strategy of successful product innovation, industry-leading category management tools, and comprehensive integration of actionable category, shopper and consumer insights.

For the category — which encompasses toaster pastries, granola and cereal bars, and fruit snacks — Battle Creek, Mich.-based Kellogg is the share leader, contributing 37.9 percent of category sales dollars, and the leader in sales growth, contributing nearly 50 percent of increased sales dollars.

In the second half of 2009, Kellogg introduced 10 innovation items in the category, generating more than $67.6 million year-to-date and contributing 41.8 percent of the category innovation dollars year-to-date. In the first half of 2010, Kellogg introduced eight innovation items, generating more than $41.5 million year-to-date and contributing 49 percent of the innovation dollars year-to-date.

By understanding shopper trip types, brand loyalty and shopper segments, Kellogg better engages with core consumers. Further, the company's partnership with Orlando, Fla.-based Fifth Dimension revolutionizes testing of the in-store environment toward implementing new consumer-based shelf merchandising strategies.

GROCERY - NONFOOD

CATEGORY CAPTAIN

Nonfood | Pet Care

Nestlé Purina Petcare

While three out of every four American households buy pet care products, only half of them are buying them in grocery stores, mainly due to the market's fragmentation among many mass retail channels as well as pet specialty retail stores.

It's not that the fundamental value of the pet care category is lost on grocers, according to St. Louis-based Purina, as pet is often one of only a few full-aisle categories in their stores. Rather, it's taken for granted.

What grocers need to do, according to Purina, is work the consumer-centric approach aggressively — optimizing the mix of new and established products, creating attractive end aisle and secondary displays to bring excitement to the department, and laying out the aisle to emphasize ease of shopping.

One major Midwest food retail chain worked with Purina to reinvent the pet care category via space reallocations, assortment improvements, promotional enhancements and stronger signage. As a result, total category sales and profits in all segments improved.

Purina also contributed to category growth through numerous product innovations. The company recently launched Beneful Snackin Slices snacks, expanding the dog food brand into the dog treats segment as well. For cats, Purina's Fancy Feast Appetizers introduced a whole new cat snacking occasion to the category.

CATEGORY ADVISOR

Nonfood | Pet Care

Del Monte Foods

In response to the challenges of the recent recession, Del Monte Foods set out to identify an innovative approach to managing the pet care category that was driven by shopper insights. Specifically, the company looked for opportunities to improve sales and profitability by optimizing the category's most profitable segment — dog treats.

To that end, the San Francisco-based company commissioned a third-party research firm to assess qualitative and quantitative data that would identify shopper pain points and barriers to purchase. Research included a macro trends assessment, a pet aisle assessment, and test-and-learn retailer partnerships, in which Del Monte and three retailers worked collaboratively to identify specific problems in the pet aisle broadly and specifically within dog treats.

Based on the findings, Del Monte worked with a design company to develop a new shelving concept that would positively change shopper behavior in-store. The design incorporated navigation aids to help shoppers understand the new organization and educate them on new treating occasions.

Del Monte brought the concept to two retailers for testing. In the first test, dog treat sales in the test store outpaced non-test stores by almost 3 percent (7.6 percent vs. 4.8 percent growth, or 2.8 points higher).

In the second instance, the retailer found the research findings and recommendation so compelling that it opted to skip testing and approved implementation across all stores.

HBC

CATEGORY CAPTAIN

Analgesics

Bayer HealthCare

Analgesics is a high-penetration category in HBC, but category managers have been met with several challenges. Sales growth has been modest, there's a limited understanding of the key drivers for in-store purchase behavior, and retailers lack a long-term vision for the category.

The team at Pittsburgh-based Bayer HealthCare engaged in two innovative studies to identify purchase behavior. Highlights of the "Path to Purchase" study and purchase observation analyses included the following:

• At retailers outside the drug channel, consumers were more likely to decide "store" before "category."
• Most category purchases were driven by running low or being out of product.
• Shoppers spend a significant amount of time at shelf, because many are occasional or first-time buyers, with several decisions being made in store.

In addition to addressing retailers' immediate category needs, Bayer developed a long-term platform, creating customized solutions to meet the unique needs of each of its individual retail accounts.

According to SymphonyIRI Group data cited by the company, total category dollar sales in food/drug/mass improved in 2009, growing 1.2 percent vs. only 0.3 percent in 2008. However, performance was much stronger for Bayer products and the catego-

CATEGORY CAPTAIN

Antiperspirant/Deodorant

Unilever

With so many SKUs in the antiperspirant/deodorant category, Unilever worked with several retailers on a category SKU rationalization initiative it created to optimize the category's assortment.

The theory behind Unilever's program is that with a reduced SKU count, retailers would be able to dedicate more shelf space via additional facings to the most productive SKUs. From the shopper perspective, a lower SKU count limits clutter at the shelf and permits better brand blocks, thereby enabling shoppers to easily and efficiently find what they need.

On average, retailers working with Englewood Cliffs, N.J.-based Unilever on the SKU rationalization program found that rationalizing slow-moving items in the category has increased productivity (dollar sales per SKU) by 6.8 percent. One retailer even reduced its average number of items by 8 percent, while growing category sales by double digits during that same period.

Unilever product innovation has also contributed to retailer category growth in general. Its Dove Ultimate Go Fresh Revive 2.6-ounce Antiperspirant Deodorant stick, launched in early 2010, now ranks in the top 25 in overall category dollar sales and is the No. 1 new item in the female deodorant segment.

CATEGORY CAPTAIN

Diabetes Management

Abbott Nutrition

Abbott Nutrition, which claims to be the first manufacturer to deliver a mega-diabetic category, worked with a national retailer this year to help address its diabetic consumers' needs and boost sales in the category.

Abbott's strategy was to use fact-based shopper insights to create new schematics, resulting in an easier shopping experience for diabetic consumers. The mega-diabetic section should not only include meters and strips, but also diabetic nutritionals (such as Abbott's Glucerna brand) and medical supplies, according to the Columbus, Ohio-based company.

The retailer that Abbott advised typically placed diabetic nutritionals and nonprescription supplies in a separate area. In addition, its nutritionals section was underdeveloped.

Abbott and the retailer mapped the stores that indexed high to the diabetic shopper and implemented the section in these locations. Abbott worked to bring new users to the segment through TV, online, FSI and diabetic awareness marketing events. Educational signage and pamphlets were also featured in the stores with the new sections.

Over the latest 13-week period ending Aug. 7, 2010, sales at stores that implemented the mega-diabetic schematic were up 3.6 percent. In addition, diabetes nutritionals saw an increase of sales of 0.4 percent during the same period vs. sales at stores that weren't reset.

CATEGORY CAPTAIN

Digestive Health

Novartis Consumer Healthcare

In 2009, with a presence across the digestive health category and a large pharmaceutical product positioned to switch to over-the-counter distribution, Novartis Consumer Healthcare, which makes Maalox, Gas-X, Benefiber and Prevacid24HR, invested in a comprehensive category analysis and shopper marketing plan.

The project started with a series of interviews with leading retailers to gain a better understanding of the opportunities, challenges and types of information needed to best run the category.

The centerpiece of the initiative included two proprietary pieces of research and development. One element, led by Edgewood Consulting Group, was a retailer differentiation online study across thousands of digestive health shoppers to identify which key attributes were driving category and retailer loyalty on an account-specific basis.

Second, East Hanover, N.J.-based Novartis leveraged a unique process, developed by IDEO, that studied ethnographic and environmental elements of the shopping experience to understand the digestive health shopper's real attitudes, motivations, fears and behaviors in the category.

For Novartis, these trade insights were the impetus behind a new retailer tool that evaluated the category and its shoppers both in terms of breadth and depth, ultimately making best practice recommendations in terms of merchandising strategy in-store, marketing strategy both in and out of store, and even strategic partnerships.

CATEGORY CAPTAIN

Hair Care

Unilever

In 2008, the hair care category was declining 2 percent — only the niche, higher-end (salon) segment was growing. Unilever saw an opportunity to fuel profitable growth in the category by leveraging the men's grooming trend in hair care, as it had done before in deodorants and personal wash.

Englewood Cliffs, N.J.-based Unilever launched Axe Hair Care, a full line of men's hair products, in 2009. The product mix included Wash and Care, as well as Styling. The company positioned the line with premium pricing to set it apart from the mainstream items in the category.

Unilever took an innovative marketing approach as well, by focusing on converting guys from female and unisex shampoos and styling products to Axe — persuading them that a guy's hair matters in the mating game.

Axe ended up adding an incremental $36 million to the category. The new line also succeeded in driving market development by bringing in nonusers of styling products, with 28 percent of total Axe styling users being new. In addition, Axe delivered profit to its retail customers by trading consumers up from less premium brands.

In one example involving the grocery channel, Axe was the fastest-growing brand within hair care at a retail account during its launch year, contributing $3.2 million.

CATEGORY ADVISOR

Nutritionals (Vitamins & Supplements)

Bayer HealthCare

Bayer HealthCare took part in several major studies last year that helped grow category sales and deepened its relationship with key retail partners.

The “Path to Purchase” study helped identify the specific process, both in and out of the store, that shoppers go through when purchasing the category, while the purchase observation study quantified the in-store dynamics associated with the category.

New insights and actions taken by Pittsburgh-based Bayer included:

• Engaging occasional and nonusers to increase conversion. Bayer developed a range of programs to help retailers connect with consumers beyond the store, as well as identify and execute cross-selling and secondary placement opportunities with select categories.
• Cultivating the vitamin shopper. Consumers enter the category by using multivitamins where Bayer is a major player. This insight helped gain enhanced placement within the set for this segment and supported securing additional acceptance of new Bayer items.
• Enhancing the shopping experience. Bayer has begun several retailer initiatives to provide additional navigation, education and communication at shelf.

Category dollar sales in food/drug/mass were up 11 percent in 2009, according to SymphonyIRI Group data cited by Bayer, whose One A Day and Citracal brands performed significantly better than the segments in which they compete.

CATEGORY CAPTAIN

Oral Electrolytes

Abbott Nutrition

Retailers are looking for ways to grow the $50 million oral electrolytes category, and Abbott Nutrition — manufacturer of the leading brand, Pedialyte — is coming up with solutions.

Earlier this year Columbus, Ohio-based Abbott joined forces with one of its retail customers to try new placement for the category, as well as to test new packaging. The initiative drove sales to $340,000, with $111,000 in incremental volume attainable to the program.

Abbott's retailer partner had been placing electrolytes solely in the infant/toddler nutrition set, a common practice among grocers. But shoppers need to find these products more easily when they're are also shopping for cold/flu/diarrhea remedies, according to Abbott.

The manufacturer decided to test additional placement of electrolytes in the children's cough/cold/analgesics section. It also established a cross-merchandising relationship between oral electrolytes and cough/cold/diarrhea medications for children.

At the same time, Abbott looked to add incremental growth to the category through product innovation with a new strawberry flavor, as well as Pedialyte Powder Packs.

In addition to the incremental volume the retailer realized, the test was successful enough to warrant permanent secondary placement for oral electrolytes in its latest reset.

CATEGORY CAPTAIN

Skin Care | Personal Wash

Unilever

Unilever's Dove brand has been a market leader in the personal wash category for decades, accounting for more than one out of every four dollars of bar soap/body wash sales, according to recent Nielsen data. However, the brand has always been closely associated with the female consumer.

In the summer of 2009, Englewood Cliffs, N.J.-based Unilever approached retailers with a rather bold proposition: that Dove's superior skin care benefits and associated premium positioning could appeal to a male audience.

The company found naysayers to be numerous and quite vocal, saying that broadening the base of a brand that was built on decades of feminine leaning was too much of a stretch. However, with the assistance of a Super Bowl ad that encouraged men to be comfortable in their own skin after tackling the challenges of today's hectic world, Dove Men+Care hit the ground running in December 2009.

One large Northeastern grocery chain saw the brand's potential and aggressively supported the launch. The Men+Care brand is now the No. 6 bar soap selling at the chain — with a 3.9 percent share of the category — and has surpassed Olay, Tone and several other brands in the segment.

CATEGORY ADVISOR

Sports Nutritionals

Abbott Nutrition

Abbott Nutrition played a major part in growing the sports nutritionals category last year, thanks to a new product line that helped differentiate selection.

In the sports nutrition segment, consumers are looking for products that cater to their level of exercise and nutritional desires. Under its EAS brand, Columbus, Ohio-based Abbott launched 25-gram protein shakes and bars to meet consumers' requests for a moderate protein offering.

In addition to the new product launch, Abbott grew its retail customer base by offering category leadership in the sports nutritionals segment. In one example, the company began working with a retailer that had an underdeveloped sports nutrition section. The retailer had a 9.8 percent share of the segment, driven by a 10.5 percent share of the EAS Carb Control market.

Abbott used shopper insights matched to the retail store clusters to create a more appropriate assortment of sports nutrition items. Changes were made in merchandising and selection, and the retailer added 10 new items led by the EAS product innovation.

After implementing the changes, the retailer has seen the sports nutrition segment grow 24.3 percent vs. a year ago, and its share of the sports nutritional segment increased 8.1 percent.

CATEGORY CAPTAIN

Therapeutic Nutrition

Abbott Nutrition

Therapeutic nutrition is still a relatively new category for grocers, and Abbott Nutrition aims to help retailers understand the business better while increasing sales and profitability.

Columbus, Ohio-based Abbott, which makes two leading therapeutic drinks, Juven and Nepro, aligned forces with a regional chain this year to convert the grocer's dedicated diabetic nutrition section to a new, multifaceted therapeutic nutrition section designed to meet and treat more disease states.

The grocer's section was restructured in two waves. The first wave included the introduction of private label durable diabetic items, offering consumers an option other than the drug channel to meet their needs. The second wave featured a May 2010 SKU rationalization that eliminated redundancy in the category while making way for new nutritional offerings.

With the second wave, the diabetic nutritional offerings were expanded, and new items were introduced to aid in wound care (the Juven brand), and to provide nutritional support to dialysis patients (two flavors of the Nepro brand).

Since the SKU rationalization took place, the category is up 12.5 percent vs. the previous 26 weeks. In addition, the change should help drive increased market basket for the store, since consumers now have a new place to find these products, Abbott notes.

In general, the therapeutic segment is up 100 percent in the food trade, and it brought in $350,000 in the latest 52 weeks. Nepro and Juven accounted for $113,000 of those sales.

CATEGORY CAPTAIN

Vitamins

Pharmavite

Pharmavite, maker of Nature Made vitamins, says it represents the No. 1 share of the category's national-brand new product dollar sales, with a 31.6 percent share. Its new products have generated $5.4 million so far in the 2010 calendar year.

In addition to product innovation, the company's category management team focuses on buyer conversion rates, product assortment and planning, and customized research to help its retail partners succeed. One major grocer describes Pharmavite's category management approach as "very proactive."

Pharmavite works with retailers to understand the buyer conversion rate and trend vs. a year ago across each of the 80-plus segments in the vitamin category. The Mission Hills, Calif.-based company also helps grocers look at which competitive retailers they're losing sales to.

In one instance, Pharmavite showed a large mass retailer that one of its lowest buyer conversion rate segments in the category was CoQ10. Within CoQ10, the 300-milligram to 400-milligram strength represented a majority of the conversion opportunity vs. the 100-milligram and 200-milligram strengths.

Pharmavite has been working with retailers to integrate this type of insight into new strategies and tactics for each segment, to help them defend their sales from being lost. Product assortment and promotion planning have been two important areas of focus.

PERIMETER - BAKERY

CATEGORY ADVISOR

Baked Goods

Rich Products Corp.

For many retailers, cinnamon roll sales have been flat to declining over the past few years. However, during the economic downturn, Buffalo, N.Y.-based Rich Products Corp. realized that cinnamon rolls are an affordable indulgence for many consumers, and sought to combat sagging sales and regenerate excitement with a promotion designed specifically for Associated Wholesale Grocers (AWG).

Using Rich's Cinn-Sational cinnamon rolls and created with input from AWG retailers, the program offered a kit including a poster, banner, static cling, 100 gourmet cinnamon roll wrap labels, four rolls of "Best Served Warm" dome stickers and how-to instructional sheets to easily execute the program.

With the addition of the promotion and product sampling, an additional 109,880 cinnamon rolls were sold, with a 256 percent increase in dollars over last year.

The program was an ultimate win-win-win, affirms Bill Smith, bakery/deli director at Kansas City, Kan.-based AWG: "The Cinn-Sational cinnamon roll promotion was one of Rich's most successful bakery sales initiatives of the year. The secret ingredient to the success of this campaign was how well our retailers executed this promotion with innovative displays.

"The sweetest part of the promotion," adds Smith, "was the positive comments from the consumers about quality of the cinnamon rolls they purchased from our bakery departments."

PERIMETER - DAIRY

CATEGORY ADVISOR

Specialty Cheese

Beemster Cheese

After six years in the U.S. market, Beemster Cheese, a Dutch cheese manufacturer, undertook extensive market research to make sure its customers were satisfied. Focus groups revealed that Beemster's cheese was almost unanimously loved — once it was sampled. Participants were also excited about Beemster's company history. But in some cases, consumers said they were afraid of not liking a cheese once they got it home.

As a result, Beemster made two significant changes. First, the company created a new brand image, which was unveiled this past June at the Fancy Food Show. The "Generations of Great Taste" campaign shows three generations of master cheesemakers and highlights the company's history of artisanal cheesemaking.

Secondly, Beemster introduced a 100 percent taste guarantee on all of its repack labels for end users, at no cost to its retail customers. If a consumer buys a Beemster product and is not entirely happy with it, she can go to the Beemster website and get a complete refund.

Beemster continues to be involved in promotional activities, including creative giveaways. The company is also entering its second year as an official sponsor of Susan G. Komen for the Cure. Each wheel of special-edition Beemster Vlaskaas features the large pink-ribbon logo. Additionally, repack labels, posters and special Beemster pins all feature the pink-ribbon logo.

CATEGORY ADVISOR

Refrigerated Baked Goods

General Mills

General Mills is the dollar share leader in refrigerated dough, with a 70 dollar share. Although the category has been impacted by the tough economy (dollar and unit volume growth have not increased for fiscal year 2010), General Mills is up 1.2 share points vs. last year, and the Minneapolis-based company continues working with its retail partners to achieve growth.

Its category management tools continue to be an asset to grocers. An example of this is its use of SymphonyIRI Group audit information to address optimum shelf size and segment configuration, as well as best category adjacencies to maximize category sales, with an overlay of the "Willard Bishop Super Study" on profitability.

The company has also used its Dairy Aisle Insight platform to address market-/customer-specific requests on refrigerated baked goods category size recommendations.

Meanwhile, General Mills' virtual-store technology has been a major capability, which the company uses to visually demonstrate new package designs, shelf set concepts and sell-down impacts with consumers and retail customers.

Another way in which General Mills is working to achieve growth is by adding a new segment within the category, refrigerated indulgent desserts. Sweet Moments is a new line of brownies that speaks to the consumer needs of indulgence and convenient portion-control packaging.

CATEGORY CAPTAIN

Yogurt

General Mills

Yogurt continues to be the growth engine in the dairy aisle. The category grew 3 percent in dollars in 2009, according to Nielsen.

General Mills' Yoplait brand remains the leader in the category, with 33 percent dollar share. The Minneapolis-based company says it holds category captaincy at 19 of the top 20 food retailers.

Based on research done with Willard Bishop and SymphonyIRI Group, the company became aware of unique challenges within the yogurt category, including space and in-store labor.

Given the category's space constraints, General Mills expanded its educational effort to increase yogurt space last year by optimizing dairy aisle layout and balancing days of supply (DOS) across all dairy categories. Yogurt is already underspaced by roughly 50 percent when comparing its DOS to the overall aisle, according to the company. Using proprietary capabilities such as virtual-store technology, General Mills teamed with retailers across the country to increase the yogurt base footprint by 4 to 8 feet at a time. The latest SymphonyIRI Group shelf audit shows these efforts to be working, according to General Mills.

A major time saver at the shelf, display-ready cases, completed a national rollout in 2010, making General Mills the first yogurt manufacturer to offer this benefit in its product portfolio. Time studies showed these cases cut stocking time in half.

As for product innovation, General Mills introduced Yoplait Delights lowfat yogurt parfaits and Yoplait Splitz, a new all-family/kid yogurt.

PERIMETER - DELI

CATEGORY CAPTAIN

Deli

Sandridge Food Corp.

In May 2010, Medina, Ohio-based Sandridge Food Corp. took an innovative approach to its line of fresh prepared retail deli salads. The traditional prepared salads received a package makeover and were rebranded as 1st & Main Deli. The goal was to invigorate a dull category by offering a product that would catch consumers' attention and help delis merchandise the salads better.

The product offers an upscale feeling without the upscale price, as well as a handmade experience at a matching margin for retailers, without an increased cost to the customer. The more identifiable packaging has resonated with customers, as sales have increased by more than 50 percent since its introduction.

Standard promotions, such as a two-for-one deal and redeemable coupons, have yielded notable results: One Sandridge sales rep saw more than a 60 percent increase in prepared salads sales since 1st & Main was introduced. One retail customers also reported significantly rising sales.

In addition to end consumers favoring the updated container, retailers support the new packaging, reporting that the new square containers take up less space, helping maximize the deli display.

PERIMETER - VARIABLE-/FIXED-WEIGHT MEAT

CATEGORY CAPTAIN

Variable-/Fixed-weight Meat

Tyson Foods Inc.

Given fresh chicken's standing as one of the meat department's most important categories, the underpinnings of Tyson Foods' award-winning program, implemented in conjunction with a leading grocery retailer, tapped extensive consumer insights on buying habits and purchase dynamics, to accurately understand how to better meet shoppers' needs.

Specifically, Tyson's innovative approach focused carefully on analyzing the markdowns within the category, which has since paid significant dividends for both Springdale, Ark.-based Tyson and, more importantly, its key retail customer.

By quantifying total fresh chicken dollar volume and total markdown dollars by particular divisions vs. pack sizes, brands and various cuts, Tyson and its retail partner harnessed shopper loyalty card data to precisely "slice and dice" the corresponding data. By understanding markdown dynamics within each of the aforementioned areas, the partners were able to determine best-in-class divisions across the entire chain for each cut, which in turn established benchmarks by cut and pack size companywide to ascertain appropriate markdown levels.

Among the most compelling results, Tyson's program helped its retail partner decrease the average unit cost by 12 percent while spurring a 40 percent decrease in the 52-week period of total markdowns of Tyson's small-pack wings alongside a total unit lift of 9 percent — which helped the retailer net $250,000 in bottom-line annualized savings from just one fresh chicken SKU.

CATEGORY ADVISOR

Variable-/Fixed-weight Meat

Hormel Foods

Springboarding off its diverse portfolio of differentiated fresh meat products, Hormel Foods' wide range of in-demand items for the variable-/fixed-weight meat category is only one way the Austin, Minn.-based company has become a benchmark category leader.

Hormel has also helped raise the profile of the total category while educating consumers on how to easily prepare and serve meat at mealtime. The manufacturer's resourceful, consumer-friendly website, www.hormel.com, contains high-visibility links to "Protein Made Easy," which is dedicated to sharing nutritional information about various types of fresh proteins, as well as tips on how to create tasty, diverse protein-rich meals.

Additionally, the company's category management team works closely with its retail partners to understand and adapt to the needs of stores in specific markets vs. a one-size-fits-all approach, while also providing ample support and guidance for retail partners, for which successful program execution is foremost.

As consumers have become more value-conscious during difficult economic times, Hormel's category management team helped its retail partners adjust their assortment while furnishing actionable insights about how exact-weight pork items enable shoppers to stick to their budgets while still enjoying high-quality Hormel brand products.

CATEGORY CAPTAIN

Variable-/Fixed-weight Meat | Deli

Dietz & Watson

Dietz & Watson is fast emerging as the first name in quality deli meats and cheeses among an ever-expanding base of retailers and consumers, in no small part by leveraging innovative category management strategies.

As firm believers in customized programs for each unique retail customer, Dietz & Watson employs a cache of sophisticated analytical category tools to ensure that the proper assortment — including specific flavor preferences to meet the needs of the consumers in each market — helps build true partnerships with retail partners to grow total category sales. In addition to ongoing performance tracking and establishing attainable category management goals, the company carefully analyzes point-of-sale data to build insights to guide price, promotion and assortment recommendations.

During the past year, Dietz & Watson engaged in an in-depth partnership with an East Coast retailer, whose sales have grown consistently over the past six quarters — for an overall increase of more than 1,000 percent. Dietz & Watson determined the appropriate assortment and found an opportunity for low-sodium bulk deli meat, which grew nearly 225 percent during the 52 weeks ending June 26, 2010, vs. the year-ago period, while also leading the retailer's low-sodium deli sales with an 83 percent penetration and an addition of nearly $2 million to the growing segment.

CATEGORY ADVISOR

Variable-/Fixed-weight Meat | Deli

Sara Lee North America

Sara Lee Deli positions itself as a category management leader and product solutions provider in the deli department through innovation, as well as consumer and customer insights. Committed to nutrition and wellness, Sara Lee Deli has embarked on a companywide initiative to reduce sodium in its food products by an average of 20 percent over the next five years, including the 2009 launch of Sara Lee Deli's Fresh Ideas Lower Sodium line for the service deli meat counter.

The Downers Grove, Ill.-based company has grown its presence in service deli meat since the launch, and helped draw more attention and consumers to the lower-sodium deli segment.

After commissioning multiple research studies and focus groups to understand the deli meat consumer's purchase drivers of wellness and nutrition, as well as to clearly identify its target market, Sara Lee Deli found a limited lower-sodium presence in service deli meat (less than 4 percent of total deli meat sales) in 2008. After focusing its resources on providing lower-sodium options — and giving consumers compelling reasons to purchase them with point-of-purchase/point-of-sale blue ribbons and AHA checkmarks, targeted marketing and promotions, and product demos — the Sara Lee Fresh Ideas Lower Sodium service deli meats line has increased distribution throughout the past year, growing 255.7 percent in the latest 52 weeks ending June 26, 2010, and contributing significantly to total lower-sodium deli meat volume growth and dollar sales.

PERIMETER - VARIABLE-/FIXED-WEIGHT PRODUCE

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce | Avocados

Chiquita Fresh

In 2009, Chiquita introduced its Fresh & Ready (F&R) avocado, which employs proprietary technology that extends shelf life and provides uniform ripeness, leading the shift of the avocado category from a commodity basis to a value-added one.

Chiquita category management provides leadership with data analysis that proves the velocity advantage of the F&R avocados and the benefit to retail partners. Cincinnati-based Chiquita has invested in a retailer database for the avocado category from the Perishables Group, and also employed information from multiple avocado associations and the NPD Group in the creation of the selling deck.

Avocados are the No. 1 volume-driving category in produce, with a growth rate of 29 percent (2010 year-to-date). But research shows one-third of planned avocado purchases result in a lost sale because of dissatisfaction with available inventory.

So Chiquita teamed with several retailers to test the sales impact of F&R avocados. Going into the Chiquita program, one retailer was ahead of year-ago by 8 percent on units, and 10 percent on dollars. After adopting the program, the stores were up 34 percent on units and 21 percent on dollars. Also, stores that switched to the Chiquita brand now outperform the remaining stores by 16.7 points (units) and 13.1 points (dollars).

Further, Chiquita is the only avocado supplier that can cross-promote avocados with its other products. Following a promotion with Fresh Express salads, avocado sales were up 29.5 percent in units and 20.3 percent in dollars.

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce | Fresh-cut Produce

Del Monte Fresh Produce

Category management has become an integral part of the way Del Monte supports its key customers. As Del Monte continues to grow its management support, the Coral Gables, Fla.-based company helps retailers develop category-specific strategies, design planograms, perform sales analyses, conduct business reviews, assess promotion and pricing initiatives, and increase traffic and sales.

In 2009, Del Monte obtained the fresh-cut business for a western division of a major national retailer. Syndicated data was used to identify fresh-cut sales trends nationally, regionally and by market. This data was cross-referenced with a list of actual scanned store sales provided by the retailer to identify any missed opportunities. Spectra data was used to confirm any proposed changes to product offerings. After reviewing and analyzing the data, planograms were revised and Del Monte merchandisers visited select stores to monitor the effects of the changes.

In the end, Del Monte was able to help the retailer meet its shrink and profitability targets, decreasing shrink 12 percentage points and increasing profits 14 percentage points.

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce | Melons

Del Monte Fresh Produce

Del Monte recognizes the importance of category management in its customers' daily business activities and understands the need for a holistic approach that incorporates quantitative analytical tools. The Coral Gables, Fla.-based company helps retailers develop category-specific strategies, assess promotion and pricing initiatives, and increase traffic and sales. Del Monte also provides full technical support and expert merchandisers that work with each retailer's produce department to guarantee optimal product quality, product display and in-store merchandising.

In 2010, Del Monte assumed the role of melon category captain for a major Southeastern retailer. The company used Fresh Look Marketing data to compare the retailer's cantaloupe sales trends with trends in the surrounding market. Market Track Ad Data reports were then run to compare the retailer's ad frequency with the prior year and its competitors, and Spectra data identified the retailer's potential cantaloupe sales by store.

The exercise resulted in a list that clearly outlined the stores with high sales potential but lower-than-expected actual sales. Once the underperforming stores were identified, merchandiser store audits began. As a result of the analysis and subsequent actions, dollar sales increased 15 percent in a four-month period, while shipment to the stores increased 89 percent.

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce | Potatoes

U.S. Potato Board

The U.S. Potato Board (USPB) is committed to adding value to the potato category for growers, shippers and retailers by expanding its collaborative program with retailers across the country, and sharing innovation and proven best practices to drive potato demand.

During this past year, the USPB fielded research, conducted merchandising programs, and shared information with retailers and their suppliers. Having commissioned a market basket study that revealed the key role potatoes play in driving up transaction averages at supermarkets to more than twice the norm, the Denver-based board devised new merchandising planograms for fresh potatoes based on tests at four major retail chains, with successful results leading to widespread implementation in every case.

The USPB's current retail outreach program has evolved to 15 retail chains (up from 10 in prior years) and is expanding to embrace the club, mass and specialty channels as well. The objective of the program is to communicate the latest in shopper insights, category trends and proven best practices through a comprehensive category review delivering specific recommendations to grow each retailer's category.

CATEGORY ADVISOR

Variable-/Fixed-weight Produce | Potatoes

Potatoes: Idaho Potato Commission

The Idaho Potato Commission (IPC) is committed to helping its retail partners improve overall potato category sales with a platform of proven strategies, including an in-depth analysis tool employed by at least five stores with five distinct potato sets. Using proven statistics and carefully evaluating merchandising sets, Eagle-based IPC conducted a thorough market analysis of competitive stores within a five-mile radius of each location to evaluate product mix, displays and other relevant store-level information.

After studying sales and merchandising trends, as well as shrinkage and movement reports, IPC prepared a customized presentation for each retail partner with a comprehensive category review including best practice recommendations on how to improve total potato category sales, including positive and negative aspects of their competitors' stores.

IPC's category management efforts also employed and leveraged many leading practices of the United States Potato Board (USPB), which further enhance and extend the reach of the board's effective and highly successful category programs. IPC also provides additional data and analysis to assist retailers in maximizing their profitability for the entire potato category. Retailers that work in concert with both the IPC and USPB gain the best information customized to their specific market and customer base.

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce | Strawberries

Driscoll's

Through collaboration and cooperation with key retailers, Driscoll's developed the "Berry Festival" with the purpose of highlighting the berry category through special themed displays, advertising, in-store activities, consumer giveaways, contests, coupons, recipe tearpads and merchandising materials. This program focuses on consumer engagement by drawing attention to the berry display in the produce department.

The comprehensive program included a retail kit provided to all retailers to maximize visibility and success of the initiative by supplying berry information fact sheets, collateral and promotional attire. The objective was twofold: to excite retail partners and energize the berry category at a time when fruits are highly competitive, and to delight consumers and drive category sales.

The three retailers participating in the Berry Festival achieved the company's goals, plus increased category volume and dollar sales. Also, two retailers exhibited category volume and dollar trends that outpaced total U.S. averages and that of Watsonville, Calif.-based Driscoll's key accounts in its best-of-class composite. For July through August, the three retailers achieved double-digit category volume growth, and two retailers exceeded total U.S. and best-of-class averages by several points. The three retailers grew category contribution by 0.3 to 2.1 points, and their category contribution levels exceeded the total U.S. category contribution.

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce -Value-added Salads

Fresh Express (Chiquita)

This was a challenging year for national value-added salad brands because many large retailers expanded their assortment of private label salads. Margins were further squeezed by unit growth of 2.1 percent on a dollar sales decline of 0.3 percent vs. a year ago, according to Nielsen.

Fresh Express from Cincinnati-based Chiquita executed several key initiatives over the past year to combat these trends: investment in television advertising, development of a profit-partnership approach to promotional analysis, introduction of artisan salads, and launch of the Leaf Locator.

Fresh Express launched the first value-added salad TV test markets, followed by a national TV campaign. The "Consistently, Deliciously Fresh" campaign and creative "Music Bag" generated category lifts of 0.9 percent to 6.1 percent, and brand lifts of 3.6 percent to 6.5 percent.

In an effort to optimize profitability for both manufacturer and retailer, Fresh Express analyzed promotions based on net margin results for both parties. Data led to recommendations for changes in promotional calendars for items/prices and timing, as well as promotional contract elements.

For its Artisanal Salad line, Fresh Express developed the award-winning Natursave bag, which maintains product quality and shelf life while using 50 percent less plastic than existing bags. Further, the brand developed a proprietary Leaf Locator online tool that allows consumers to find out where their salads' leafy greens were grown. This interactive tool is part of the "Your Salad Story" feature within Fresh Express' website.

CATEGORY CAPTAIN

Variable-/Fixed-weight Produce | Value-added Vegetables

Mann Packing Co.

The vegetable tray is the second-largest subcategory in the fresh-cut convenience vegetable category. But in 2009, after many years of double-digit growth, it began to decline.

Mann Packing Co. added a new vegetable platter that also included ranch dip, beef bites and cheese cubes. The Salinas, Calif.-based company also developed an extensive occasion-based labeling program using consumer insights gleaned from dressing sales. Following key holiday periods where dip sales increased, Mann developed 11 rotating occasion-specific labels. The company says this occasion-based label approach was the deciding factor for leading retailers to add the Mann meat-and-cheese tray where they previously weren't stocking the item, or to drop the competitor's meat-and-cheese tray for the Mann product.

The vegetable tray category, on a 26-week basis, is now $122.7 million vs. $115 million a year ago, and it's showing growth of 5.8 percent above the prior year. Mann's tray sales are showing a 70 percent increase over the prior year, and its meat-and-cheese tray is the best-selling supplier-branded tray in America, with a year-to-date increase of 886 percent.

While the single-leaf subcategory is maturing, with improvements in processing and packaging, Mann is the only supplier adding to the category, with a growth rate of nearly 215 percent over the prior year for its Simply Singles washed, ready-to-use single lettuce leaves.

OTHER PERIMETER

CATEGORY CAPTAIN

Rental Kiosks

Coinstar

Automated Retail is an expansion of Coinstar's initial emphasis on post-checkout, or what the company calls "4th Wall," solutions in a retail store, which include coin conversion services, and movie rentals via its network of 26,000 Redbox kiosks.

A major emphasis in 2010 for Bellevue, Wash.-based Coinstar was leveraging its Redbox movie rental "platform" to enter an entirely new market for grocers — video games — an initiative that involves a different primary consumer target, supplier network, marketing program, and pricing/policies with consumers and retailers. It also began selling high-definition DVDs through the Redbox kiosks.

Coinstar began with extensive consumer research to identify opportunities for category growth with current and potential users, key platforms used by consumers (PS3, XBOX 360, Wii, PS2), and key genres for the target markets (family, kids, top 10, independent).

The initiative was supported with marketing plan elements that included new and emerging media platforms. Coinstar also introduced a technology platform within the Redbox kiosk that enables expanded offerings such as games, and features "rent while returning" capability — which allows two consumers to interact with the kiosk at one time — as well as remote location servicing and up-time performance.

Finally, Coinstar created pricing strategies for the games, in addition to a retailer revenue share approach that recognizes different cost structures, merchandising requirements and rental habits.

NONFOODS

CATEGORY CAPTAIN

General Merchandise | Magazines & Periodicals

Time Warner Retail Sales & Marketing

Understanding the importance of front end checkstands and the state of industrywide merchandising practices led Time Warner Retail Sales & Marketing (a division of New York-based Time Warner), Masterfoods USA (a division of Mars Inc.), and Coca-Cola USA to sponsor a major cross-industry initiative in collaboration with Dechert-Hampe & Co. (DHC), an independent consulting firm.

The mission of the group was to work in partnership with retail customers and other stakeholders to improve store performance and enhance consumer satisfaction by studying consumer shopping behaviors and attitudes, developing benchmarks and best practices, and then creating innovative solutions to optimize in-store merchandising.

The result was the "Front-End Focus" study, which was updated this past year. Six retailer groups agreed to participate in the study, representing more than 3,200 stores and 12 percent of total U.S. grocery volume.

The consumer research identified what front end categories had the highest household purchase penetration and the highest frequency of purchase, as well as which categories generated the highest rate of impulse sales. Armed with this crucial consumer data, the retailers were able to reallocate valuable space and focus on the key consumer categories that increase productivity, among them adding merchandising racks to self-checkout units to recoup some of the $100,000 lost per store when they initially installed the self-service units.

METHODOLOGY

Progressive Grocer's annual Category Captains competition aims to shed light on the outstanding category management initiatives implemented in the retail grocery market over roughly the past 12 months. This list of winners reflects some of the best strategic thinking and execution in the category management field, as revealed in the winning companies' applications.

The competition is predicated on the accuracy and completeness of each entry submitted for consideration. Each entry is considered on an equal footing. As such, the best entries deliver not only a selection of facts relating to a manufacturer's or a brand's most recent category management achievements over the past 12 months, they also tell a compelling story of challenges confronted, strategies developed and implemented, and collective results of trading partners working together toward a common goal.

In essence, the actual entry submitted is the key to the judging process in this competition. In winning entries, a company's importance and influence in a given category are represented as comprehensively as possible. This keeps the awards process dynamic from year to year, as well as keeping intact the possibility that up-and-comers can be recognized alongside well-established players.

Each of the following award criteria figured into the judging of each entry to qualify each for the award of Category Captain, Category Advisor, or neither. Entries were asked to describe details and compelling results of new category management initiatives over the past 12 months.

The factors that figured into judging were:

• Product innovation
• Creativity in merchandising, marketing, promotion and advertising
• Consumer insights
• Innovative, dynamic category management tools
• Demonstrated commitment to meeting retail customers' specific needs
• Effectiveness at differentiating a line or brand within the category
• Effectiveness at lifting sales for a brand's products in the category
• Effectiveness at lifting an entire category's sales for a retailer or retailers
• Hard evidence of market-specific or account-specific sales results that support the vendor's claims of excellence

To win the premier award of Category Captain, contestants had to demonstrate excellence in all of the above criteria in their entries. Category Advisors also exhibited excellence, but ranked lower overall than the threshold set for Category Captaincy. Both designations reflect outstanding contributions to the industry at the category level.

The pool of entries we received this year was outstanding, and PG extends congratulations to all of our award-winning Category Captains and Advisors.