Quri is a San Francisco-based retail solutions firm that specializes in using data to drive merchandising performance. Its new Summer of Merchandising program highlights merchandising performance both on- and off-shelf for 45 brands in 14 categories at Walmart and Target stores throughout the summer.
In studying the confectionery sector, the program will run each month from Memorial Day to Labor Day in 1,000 Walmart and Target stores to measure various on-shelf availability details on Hershey, M&M's, Skittles, and Jet-Puffed Marshmallows.
“Just days before Memorial Day, we see out-of-stock rates ranging from 1% to 17% and off-shelf display presence varying between 16% and 74%n [for all categories analyzed],” CEO of Quri, Justin Behar, said in a statement.
“These significant performance gaps leading up to Memorial Day and throughout the year are greatly minimized when brands continuously measure merchandising conditions at the store-shelf-, and SKU-level and integrate that intelligence into a more dynamic merchandising approach,” he continued.
Huge gap between on-shelf availability of confectionery brands
“On-shelf means the home location of the product, or whichever aisle you would expect to find that product in; off-shelf means, display or secondary location of the product, so any other location that’s not the home shelf location,” Quri’s CMO, James Lamberti, explained.
Among the 14 categories analyzed, candy and confections ranked 10th for on-shelf availability (72%), with carbonated beverages topping the list (97%), according to the program.
Within the confectionery category, Hershey topped the list of with 86% of its products available on shelf, while Skittles only shows 28%.
“Skittles, in particular, is driving this for the category, due to new item status for Skittles America Mix,” Lamberti said.
Lamberti believes there can be various reasons why new confectionery items in particular have low on-shelf availability.
“It could be that product is selling faster than is getting restocked. It could be that there just is no product in backroom inventory to restock,” he said.
Quri will continue monitor this metric over time to see if the low on-shelf availability of new confectionery products is a chronic issue or more isolated to a specific period in time.
“We could look at this metric in conjunction with inventory data to get to the root cause.”
Biggest takeaway for confectionery companies
Lamberti said confectionery companies need to ensure the highest on-shelf availability as possible throughout the entire summer.
“While the confections category did well on the displays (ranking 5th out of 14 categories), there is opportunity for improvement on on-shelf availability,” he said. “Especially for brands that have new items, ensuring those items stay stocked on shelves throughout the season will only increase new item momentum.”
In addition, the program also found the confectionery sector has the highest percentage of displays in the front of the prime grocery stores. It is also successful at securing displays outside of the expected aisle with 67% of products appearing outside the aisle.
Asked how to best promote confectionery brands during summer, Lamberti suggests companies should examine which display locations are driving the highest lifts and ensure that those display locations are well executed at every store.
“For example, Jet-Puffed Marshmallows had displays on the endcap of the aisle, the front of the store, and the back of the store,” he said. “It would be a good idea to pair up sales data with display location data to understand which one of those locations had the highest lift.”