so what’s c ooking in t he olive oil category?
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So What’s Cooking In The Olive Oil Category?
By Cindy Beam & Michael Young
Introduction• Who is in control – retailer or brand?
– We say retailer with a few exceptions
WLM 6th St Face
HPS Garland
FaceAldi's 6th St. Face
IGA School Face
TFM Prom Face
N 8 3 3 2
% of Total Sum 16% 15% 7% 5%
% of Total N 13% 13% 6% 4%
N 4 1
% of Total Sum 5% 5%
% of Total N 6% 4%
N 2 1
% of Total Sum 3% 1%
% of Total N 3% 2%
N 3
% of Total Sum 2%
% of Total N 5%
N 6 2 2
% of Total Sum 9% 10% 7%
% of Total N 10% 9% 4%
N 2 4
% of Total Sum 7% 8%
% of Total N 9% 8%
N 1
% of Total Sum 1%
% of Total N 2%
N 5 4
% of Total Sum 9% 6%
% of Total N 8% 8%
Filippo
Share of Display (% Total sum = share of total facings & % Total N = share of SKU's)
Manufacturer
Bertolli
Carapelli
Colavita
Cookwell
Crisco
Davinci
De Cecco
N 1 1
% of Total Sum 1% 2%
% of Total N 2% 2%
N 2
% of Total Sum 2%
% of Total N 3%
N 1
% of Total Sum 1%
% of Total N 2%
N 6
% of Total Sum 9%
% of Total N 10%N 9 9 32 47
% of Total Sum 10% 41% 52% 78%
% of Total N 15% 39% 62% 82%
N 7
% of Total Sum 14%% of Total N 11%
N 7 5 2 6 7
% of Total Sum 18% 20% 100% 18% 16%
% of Total N 11% 22% 100% 12% 12%
N 1
% of Total Sum 2%
% of Total N 4%N 62 23 2 52 57
% of Total Sum 100% 100% 100% 100% 100%
% of Total N 100% 100% 100% 100% 100%
Gem
Lucini
Private Label
Star
Total
Newman'sOwn
Olivari
Other Only In 1 or 2 stores
Pompeian
Importance of DepthStore WLM 6th HPS Garland Aldi 6th IGA School TFM Prom# SKUs 62 23 2 52 57
• Depth is very important– Audited 15 stores– Total 181 SKUs– Depth has increased significantly– Depth seems to be tied more to target market
than competing stores
Typical Walmart SKU’s$0.35/ .oz
$0.30/ .oz
$0.28/ .oz
Typical Fresh Market SKU’s
$2.05/ .oz $0.76/ .oz
$1.76+/ .oz
Source: Spectra BehaviorScape: Total Dollars/Spectra 2013 Jan (Spectra)/Homescan Product Library
Affluent Suburban Spreads
Cosmopolitan Centers
95
Young TransitionalsAny size HHs, No Children, < 35
Older Bustling FamiliesLarge HHs with Children (6+), HOH 40+
Younger Bustling FamiliesLarge HHs with Children (6+), HOH <40
Small Scale FamiliesSmall HHs with Older Children 6+
Start-Up FamiliesHHs with Young Children Only < 6
TotalPlain Rural Living
Modest Working Towns
Struggling Urban Cores
Comfortable Country
Total
Senior Couples2+ person HHs, No Children, 65+
Empty Nest Couples2+ person HHs, No Children, 55-64
Established Couples2+ person HHs, No Children, 35-54
Senior Singles1 person HHs, No Children, 65+
Independent Singles1 person HHs, No Children, 35-64
109
125
131
100119 125 104 96 86 78
90
120
79
63
73
148 161 137 115 120 109
160 148 129 101 112 97
129 133 105 113 100 82
98 87 66 87 68 58
73 71 69 70 59 41
100 86 80 64 70 80
144 144 113 118 102 93
109 114 86 88 74 81
120 120 101 111 74 65
TOTAL OLIVE OIL (SHORTENING, OIL) OZ. Total Dollars BehaviorScape Framework
LifeStyle
BehaviorStage
144 127 112 131 99 75 112
Very High: 150+ High: 120-150
Category Role
• Flagship Option 2*– Maintain sales/increase profits
Sales Volume (000)
HH Penetration
Gross Margin**
Olive Oil Total U.S. $722,133.6 37.8 45%
West South Central $58,942.9 32.6 45%
* Robert Blattberg, PhD. (Consumer-Centric Category Management, pg.88)**Estimate based on the sample stores
ACN Olive Oils WSC 07
Strength of Leading Brand• Bertolli dominates
– Multiple SKUs at 10 of our 15 stores– ACN: Bertolli Item $s are 17% of US category– Average Gross Margin about 45%
Market Stocking Rate• Sum of store count / (#SKUs X #stores)
Brand Store count #SKUs X # Stores Rate
Bertolli 56 135 .41
Crisco 31 90 .34
Pompeian 39 120 .33
Gross Margin Estimates by BrandReport
ManufacturerWLM 6th St
GM%HPS
GarlandGM%Aldi's 6th St.GM%
IGA SchoolGM
%
TFM Prom GM
%Bertolli N 8 3 3 2
Mean 45% 42% 47% 43%Carapelli N 4 1
Mean 51% 60% Colavita N 2 1
Mean 30% 62%Cookwell N 3
Mean 42% Crisco N 6 2 2
Mean 29% 38% 43% Davinci N 2 4
Mean 34% 45% De Cecco N 1
Mean 43% Filippo N 5 4
Mean 23% 54% Gem N 1 1
Mean 45% 71% Lucini N 2
Mean 60% Newman'sOwn
N 1 Mean 28%
Olivari N 6 Mean 41%
Other N 9 9 32 47Mean 34% 41% 44% 46%
Pompeian N 7 Mean 44%
Private Label
N 7 5 2 6 7Mean 56% 58% 49% 55% 46%
Star N 1 Mean 32%
Total N 62 23 2 52 57Mean 41% 44% 49% 47% 46%
44.25% Gross Margins
55.5%, carried in two stores
36.67%
52.8% GM (93.3% store presence)
Is This Consistent with Your Role for the Category?
• Provides value for the customer by meeting their routine, or stock-up, needs.
– Various consumer uses
• Pricing among competitors.
• Promotion Characteristics– Healthier substitute for cooking oils
• Space Allocation
• Assortment Characteristics
Relationship Between Gross Margins & Depth
1 2 3 4 5 6 7 8 9$.00
$.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
Walmart (6th St.) Number of Fac-ings and GM$
Number of Facings
Mea
n Gr
oss M
argi
n ($
)
WLM 6th St GM$
WLM 6th St Face N Mean1 6 $2.09
2 31 $3.04
3 14 $3.57
4 4 $1.51
5 1 $1.50
6 1 $2.68
7 3 $2.91
8 1 $2.54
9 1 $1.82
Total 62 $2.91
Relationship Between Gross Margins & Depth
1 2 3$.00
$1.00$2.00$3.00$4.00$5.00$6.00$7.00$8.00$9.00
The Fresh Market Number of Facings and GM$
Number of Facings
Mea
n Gr
oss
Mar
gin
($)
TFM Prom GM$
TFM Prom Face N Mean1 37 $8.14
2 17 $5.82
3 3 $5.84
Total 57 $7.32
Relationship Between Gross Margins & Depth
1 2 3 4 5 6 7$.00
$.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$4.50
$5.00
IGA (School Ave.) Number of Facings and GM$
Number of Facings
Mea
n Gr
oss M
argi
ns ($
)
IGA SchoolGM$
IGA School Face N Mean1 6 $4.00
2 21 $3.82
3 15 $3.80
4 5 $3.02
5 1 $2.41
6 3 $4.52
7 1 $3.69
Total 52 $3.77
Private Label Opportunities• How strong are private labels?
Products TOTALParent Folder % Penetration Index Quadrant
Colavita (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.7% 119 1.High Index / High Penetration
Botticelli (Shortening, Oil : Olive Oil) Oz. * Olive Oil 1.2% 118 1.High Index / High Penetration
Capatriti (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.7% 118 1.High Index / High Penetration
Bertolli (Shortening, Oil : Olive Oil) Oz. Olive Oil 6.0% 114 1.High Index / High Penetration
Filippo Berio (Shortening, Oil : Olive Oil) Oz. Olive Oil 6.8% 114 1.High Index / High Penetration
Star (Shortening, Oil : Olive Oil) Oz. Olive Oil 1.9% 111 1.High Index / High Penetration
Carapelli (Shortening, Oil : Olive Oil) Oz. Olive Oil 1.6% 110 1.High Index / High Penetration
Private Label (Shortening, Oil : Olive Oil) Oz. Olive Oil 18.8% 110 1.High Index / High Penetration
Pompeian (Shortening, Oil : Olive Oil) Oz. Olive Oil 5.1% 109 1.High Index / High Penetration
Crisco (Shortening, Oil : Olive Oil) Oz. Olive Oil 3.2% 107 1.High Index / High Penetration
Mazola (Shortening, Oil : Olive Oil) Oz. * Olive Oil 0.8% 100 1.High Index / High Penetration
Carbonell (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.5% 121 2.High Index / Low PenetrationCalifornia Olive Ranch (Shortening, Oil : Olive Oil) Oz. **
Olive Oil 0.3% 113 2.High Index / Low Penetration
Vigo (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.4% 111 2.High Index / Low Penetration
Delallo (Shortening, Oil : Olive Oil) Oz. *** Olive Oil 0.3% 110 2.High Index / Low Penetration
Goya (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.7% 109 2.High Index / Low Penetration
Da Vinci (Shortening, Oil : Olive Oil) Oz. *** Olive Oil 0.2% 106 2.High Index / Low Penetration
Racconto (Shortening, Oil : Olive Oil) Oz. *** Olive Oil 0.3% 101 2.High Index / Low Penetration
Napoleon (Shortening, Oil : Olive Oil) Oz. *** Olive Oil 0.2% 100 2.High Index / Low Penetration
Olivari (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.4% 97 4.Low Index / Low Penetration
Gem (Shortening, Oil : Olive Oil) Oz. ** Olive Oil 0.5% 91 4.Low Index / Low Penetration
Pampa (Shortening, Oil : Olive Oil) Oz. *** Olive Oil 0.3% 89 4.Low Index / Low Penetration
ACN Homescan Product Library
Private Label Opportunities• Stores Carrying P/L’s and their Gross Margins
– P/Ls make up over 30% of total dollar share of the US category ($216,278,900)
ManufacturerWLM 6th St
GM%HPS
GarlandGM%Aldi's 6th St.GM%
IGA SchoolGM%
TFM Prom GM%
Bertolli N 8 3 3 2
Mean 45% 42% 47% 43%
Private Label N 7 5 2 6 7
Mean 56% 58% 49% 55% 46%
Total N 62 23 2 52 57
Mean 41% 44% 49% 47% 46%
Olive Oil Gross Margin % Trends
2011 2012 20130%
10%
20%
30%
40%
50%
60%
Recommendations on Private Label Use• Increase in-store cross
merchandising• Introduce low cost strategies to
enhance P/L image• Increase facings of higher GM%
P/L products…with limits• Introduction of premium P/L
products
QUESTIONS??
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