Unlocking the Potential of Multivendor Endcap Programs
NATIONAL REPORT — Americans are encouraged to share starting from early childhood, and the benefits of doing so apply to the convenience store industry, too. Specifically, developing a multivendor endcap (MVE) program that brings together top brands can significantly boost profitability, according to a recent webinar presented by the Convenience Distribution Association (CDA).
Kit Dietz, consultant and president of InfoRhythm Inc., led the May 17 webinar entitled "Developing 'Your Own' Candy and Snacks MVE Program." The webinar was presented by the CDA's Industry Warehouse-Delivered Snacks Committee, which serves to promote the benefits of center-store category management planning and execution in convenience stores.
"[MVE programs] are category management at its finest," said presenter Steve Harris, General Mills' South zone manager for the convenience channel.
A shared MVE leverages brand strengths and satisfies a wide range of consumer cravings as it brings together the best brands across multiple candy and snack segments, according to Harris. Combining highly impulsive brands with incremental high-margin sales is a winning proposition for retailers and suppliers alike.
"Convenience is really a grab-and-go channel," Harris said, noting that while 64 percent of c-store shoppers are there to make an in-store purchase (not just to buy gas), there is only a short amount of time to reach them and prompt a purchase. Retailers should therefore focus on making trips efficient and timely, offering shoppers what they need as quickly and easily as possible, without making them search for it.
"The center store is ripe for optimization," said presenter Mike Gilroy, national channel lead for c-store/broker for Mars Chocolate North America. Shoppers enjoy variety, and MVE programs allow retailers to bring together the core SKUs, which drives sales at a higher rate.
Abby Panfil, director of sales planning and strategy at Kellogg Co. in its specialty division, recommended during the webinar that retailers leverage candy and snacks in the center store because they are high-margin/impulse categories. The store perimeter, on the other hand, should house destination items and traffic drivers, such as beverages.
MVEs that bring together core SKUs are effective not only because they make shopping trips more efficient for consumers, but also because power brands are most responsive to secondary merchandising displays.
Developing a MVE program also allows c-store operators to capitalize on the changing eating habits of Americans, who are increasingly opting for "snackification" over three distinct meals, noted Alan Tobin, senior manager of category strategy and insights for c-store, vending, specialty retail and foodservice at The Hershey Co. Additionally, salty snacks and candy, mint and gum are the most frequently purchased products for c-store customers, he cited.
Tobin suggested placing MVEs in areas of high traffic and where shoppers are dwelling on the path to purchase. Candy endcaps located across from the cash register or the cold vault drive the greatest sales lift, research has shown.
The Convenience Distribution Association is the trade organization working on behalf of convenience products distributors in the United States. Its distributor members represent more than $92 billion in U.S. convenience product sales, serving a wide variety of small retail formats.