In the latest round of research from HIM’s Cash Carry Tracking Programme, 1,600 confectionery shoppers from independent retail businesses were interviewed at cash and carries.
Other research by HIM shows how important confectionery is to independent retailers’ sales mix. Whatever type of operation, from forecourt to standalone convenience store, confectionery has been a main part of the offer. With so much focus put on health we must not lose sight of the importance of a traditionally strong category.
Our Convenience Tracking Programme (CTP), where 30,000 shoppers are interviewed in store, shows that on average confectionery is appearing in 21% of baskets and that best in class retail operators show a penetration as high as 34%.
Fast lane chillers and emerging categories such as sweet snacks are appearing in more estates, which adds to basket size through associated purchases. If confectionery space in store is being lost to strong emerging categories then retailers must ensure that the offer is correct for the shopper.
These developments are seen mainly in the company managed networks, and when asked 77% of retailers at a cash and carry depot said their confectionery display is the same as it was 12 months ago. How long before they start to mirror what is seen elsewhere?
So do we see any of these in store improvements reflected in the results from the depot study? At every depot where we carry out interviews in our cash and carry study, we see that a customer with confectionery on their trolley spends 22% more than the average customer ( pound;1,120 compared with pound;918). They also visit an average of 3.2 times per week.
One result that does not mirror shopper behaviour at store is that in a cash and carry we see slippage from category intentions, meaning that cash and carry customers do not spend as much on confectionery as they arrived intending or expecting to. The average actual confectionery purchase at cash and carry is pound;138 compared with an average intended spend of pound;149. The main reason customers gave for this slippage was out of stocks, although continual strong promotions within this category also have a bearing. The potential spend that is lost could be huge as 60% of customers buy into the confectionery category when visiting the cash and carry.
While these customers are not spending what they intended, more buy the category than expected to, so this does reflect the same behaviour as shoppers in the stores. Fifty five per cent of customers arrive at cash and carry depots expecting to purchase so we see impulse of 9% once inside. For instance chewing gum has an actual penetration of 29% compared with an intended penetration of 27%.
Cross purchases in depot are strong across the other traditional CTN lines with those that purchase confectionery buying soft drinks (72%), cigarettes (68%) and crisps and snacks (56%) so there is an opportunity to look at secondary sitings in depots to encourage that cross purchasing.
Displays need to be well stocked and visual to gain the most from the impulsiveness of the customers. Promotions need to be clearly displayed and well signposted with dual siting to put product in front of the customer on more occasions.