Many grocers have scaled back their traditional general merchandise offerings. Can their natural and organic counterparts fare better?
By Carol Radice
In a time when grocers are cutting back space in the nonfoods department it might seem a bit counter-intuitive to suggest expanding the general merchandise assortment to include more natural items such as soy candles, natural cleaners, greeting cards made from recycled paper and natural pet products.
However, experts tracking consumer behavior and purchasing habits say done the right way, adding natural general merchandise products into the mix creates excitement in the category and attracts consumers that may be otherwise purchasing these items in other channels.
While no one is suggesting clearing 80 linear feet to make room for natural GM, there is a strong case to be made for smaller sets or at the very least secondary fixtures featuring an assortment of top-selling items from multiple categories.
At the Natural Product Expo West show in March, there was no shortage of companies offering interesting and unique items. The resonating theme—products that perform as well as or better than traditional counterparts and are better for the environment. For example, Long Island City, N.Y.-based VerTerra featured its line of dinnerware.
According to company founder and CEO Michael Dwork, the all-natural, party-ready, stylish, sustainable and compostable dinnerware is made from fallen palm leaves, steam, heat and pressure and unlike similar products they are not made using plastic, glue, lacquer or veneers. He says the product currently has wide distribution in Whole Foods and Bed, Bath and Beyond and Wegmans is reportedly considering carrying the line.
“Our mission is to produce the highest quality products at fair prices using sustainable production methods and fair wage labor for the environmentally and socially conscious consumer,” says Dwork. “We collect fallen leaves from plantations, which means no trees are ever cut down to make our dinnerware. The leaves are then brought to our factory, where they are sprayed with high-pressure water, steamed and UV sterilized,” he explains, noting that more than 80% of the water used is recaptured and reused.
He says that while the company’s product often is compared to other single-use products such as bamboo, it sells for much less. “As soon as retailers realize we have a competitive price-point, they get excited about our line,” he says.
The plates were not created to appeal to the consumer having a large gathering, but rather the growing number of people entertaining at home by throwing smaller dinner parties, according to Dwork. “We appeal to those looking for a better-quality disposable that adds a unique element to their dinner party,” he says.
Dwork recommends introducing their line during the spring or summer months and begin with creating a pyramid display, then progress to an end cap and in aisle placement. “Shoppers interpret products that are stocked and displayed prominently as something the retailer is excited about.”
The movement toward taking care of the planet has gone beyond fad only observed by a few and is a true trend, notes Jeff Kreidenweiss, director of sales for EnviroMAX, a line of environmentally responsible batteries from Canton, Ohio-based Fuji Batteries. “For grocers, this is an opportunity to build incremental sales and gain back market share in a category largely dominated by drug and mass merchandisers,” he says.
As Kreidenweiss explains, Fuji EnviroMAX alkaline batteries were created to bring a long-overdue dimension of eco-responsibility to the replacement battery market. “It’s possible to get the best of both worlds at no added cost—a battery that is better for the environment that also has unsurpassed power and longevity,” he says. “Because they contain no mercury, cadmium or PVC and are labeled and packaged with recycled paper and P.E.T. plastic there is nothing inside or outside a Fuji EnviroMAX battery or package that will harm the environment.”
Based on their research, Kreidenweiss say EnviroMAX batteries should displayed in the traditional battery set. “Consumers have no trouble identifying our product as an eco-friendly item, what we are challenged with is educating them that in addition to being better for the earth this is also an effective product,” he says. “Merchandising it alongside traditional batteries is a good way to convey its efficacy.”
According to officials at Rodale Inc., magazines offer retailers a two-fold opportunity to both grow sales and profits, as well as coveting the unique position in their ability to assist retailers’ differentiation efforts in the nonfoods category.
“There are many retailers today who recognize the role played by staples like Prevention Magazine and Men’s Health to move consumer understanding of the connection between good health, wellness and a happier life,” says Richard Alleger, senior vice president of retail for Rodale, Inc., based in Emmaus, Pa. “The impulse nature of the product makes it a natural transaction builder for those looking to increase basket size, especially when considering the average unit retail is $3 to $4.”
Alleger says executed properly the category offers high potential and low risk. “We believe consumers are always looking for new information not only in health and wellness, but cooking, home improvement, decorating, fashion, etc.”
However, as Alleger notes, based on penetration figures there is a huge opportunity for grocers to increase their market share. “Magazines are well penetrated in the marketplace with 85% of households engaged in the category,” he says. “While interest in the category is there, it’s puzzling when the average category penetration in grocery is under four tenths of a percent.”
While retailers may be more educated today about the natural shopper and their interests, when it comes to the natural household cleaning category some are under the false impression it is a niche segment, says Jason Allen, marketing manager for Minneapolis-based Mrs. Meyer’s Clean Day. “Some retailers have the impression that the natural cleaning product consumer is a tree-hugging hippie,” he says. “In actuality, this consumer is anyone looking for an authentic, non-toxic, environmentally friendly option. These consumers are willing to pay a bit more to trade up because they feel they are getting a better quality product that is safer for the earth and their family.”
Allen says some retailers are unsure where to place green cleaning products. His advice is to fish where the fish are. “If you want to capture people looking for cleaning products, natural products need to be placed in the cleaning aisle, in a carved out separate set featuring environmentally friendly products,” says Allen.
Sam Jeffries, president and CEO of Raynham, Mass.-based OSM, makers of Dragonfly Organix natural household cleaners and Mother Nature’s Cuisine garden fertilizers, says consumers in this category are very loyal. “We get phone calls daily from people who have finished up one of our products and want to know where they can buy more because they store they bought it in stopped carrying it.”
Jeffries says the Dragonfly Organix cleaners have earned the USDA BioPreferred label and because they are made from plant-based ingredients they are safe to use around children and pets. “All of the cleaning products sell for $3.99 to $4.99 and not only are they cost-competitive, they are also extremely effective,” he says.
The Mother’s Garden Cuisine garden products are gaining a loyal following too. “Shaw’s and Whole Foods are doing extremely well with our garden products,” says Jeffries.
Boulder, Colo.-based Clementine Art recently launched a line of six natural, non-toxic art products created for everyday play. The products, which are carried in a number of retailers including Whole Foods, appeal to kids ages 3 to 12 and focus on the highest volume art supply segments including paint, markers, crayons, glue and dough. “The category, quiet honestly was in need of a little refreshing,” says John Maggio, CEO of Clementine Art. “Our naturally non-toxic products appeal to moms looking for safe products for their kids to play with day in and day out. All of our product ingredients are listed on the package.”
Maggio calls the company’s positioning “eco chic” and says the products offers retailers and consumers a trade-up option previously not available in the category. “People are willing to pay more for functional products they feel are safer for their family.” Displays, shippers and hang tags are available so that the items can be displayed on or off shelf.
In the last five years, a number of reusable bag companies have come on the scene, some better than others. One of the early entrants in the category was Edmonton, Alberta, Canada-based N’Take. Company CEO Steven Searle says his goal from the start was to create a quality, versatile product using fair trade ethics that would help the environment by removing the number of disposable bags being used. “The majority of consumers describe themselves as being ‘green’ and are shaping their lives with health and environmental concerns in mind,” says Searle. “Increasingly, they understand that one simple act can make a big difference.”
That said, he wants retailers to be aware not all bags are created the same and those that cost much less are typically not made well with corners being cut on silk screening, stitching and fabric strength. “Cheap bags fall apart easily, which undoes the purpose it was meant for to help the environment as well as the retail need,” Searle says. “We took the high road and created lasting value in a throw-away culture by making bags that are convenient, fashionable, durable and long lasting.”
While larger bags are popular for carrying groceries, Searle says that specialty sizes and types of reusable bags are also gaining popularity. “People are buying our bags to transport frozen items home from the grocery store, to take lunch to work or school, etc.”
Pleasing pet owners
David Tagliatela, national sales manager, mass and grocery for World’s Best Cat Litter, based in Muscatine, Iowa, says that the interest in natural products continues to transcend from people to their pets. “Mainstream consumers are demanding natural products for themselves and their pets,” says Tagliatela. “They are leading healthier lifestyles, care about our planet and making more educated decisions on their purchases. The natural category is experiencing tremendous growth and has the ability to bring in incremental sales to grocery.”
Tagliatela says the company launched its World’s Best Cat Litter, made from whole-kernel corn, to help fill the need for natural products in the litter category. “Consumers are looking for natural products for their pets, yet we found there were very few natural litter options available for them. Considering limited shelf space available today, grocer’s need to evaluate their offerings and make the decision to include natural products in their plan-o-grams. This may mean eliminating a SKU from a brand that currently has multiple shelf facings,” he says. In June, World’s Best Cat Litter is introducing a Multiple Cat Clumping Formula to complement its current Clumping Formula. “This new offering is to support the growing demand by consumers for natural, earth-friendly cat litters.”
Susan Weiss, president of Naples, Fla.-based Ark Naturals, says if retailers have any doubt consumers are interested in these types of products for their pets all they need to do is look at sales trends in better-for-you products for people. “Increasingly people are taking proactive measures with their health and the health of their pets, in part due to rising medical and veterinary costs,” says Weiss.
One way to attract shoppers is by offering a more diversified mix of products. “Unfortunately, most retailers still struggle with the larger picture and are not always aware of the differences in ingredient quality,” says Weiss. “As is the case with products created for people, there is a correlation between cost and quality. Products that don’t work well will not incite excitement or more importantly repeat purchases.”
Known for its health and beauty products, Lodi, Calif.-based Auromere Ayurvedia Imports has expanded its offerings to include incense. The incense is free of glue, chemical perfumes or dyes and comes in 24 unique fragrances in three assortments—ayurvedic, aromatherapy and flowers and spice. According to company president Dakshina Vanzetti, the incense sells best when placed by the register for impulse sales or in the natural product section of the store.
A free bundle of 50 mini-sample packets for customer promotions comes with each purchase of a display prepack. “The incense also comes packaged in sampler gift packs which do really well around the holidays,” she says.
Scent of success
More recently the company introduced a “Flowers for the Soul” line of greeting cards. The card collection comes in three themes—Flowers for the Soul, Roses for the Soul and Gardens for the Soul.
According to Vanzetti, the cards were created to appeal to consumers of all kinds and contain inspiring and uplifting quotes. “We believe that people, when they choose a card, look for something extra special to bring joy and inspiration to someone they care about,” she says.
Spinner rack prepacks are available for the Flower Cards in 12- or 24-count variety assortments. These countertop displays are free with the purchase of a prepack. The cards also come in gift-boxed sets in three assortments.