sourcing - Kantar Retail iQ

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ALIGNING WITH A CHANNEL IN FLUX
Presented by:
Sara AlTukhaim
Principal Analyst
Warehouse Club Webinar
March 2013
Agenda
• Internal Alignment & Opportunities
–Club Peer Benchmarking Survey Highlights
• Warehouse Club Spotlight
–Sam’s vs. Walmart’s “Battle of the Bulk”
• Channel Trends & Innovations
–What’s New in Club?
© Copyright 2013 Kantar Retail
2
Internal Alignment & Opportunities:
Club Peer Benchmarking Survey Highlights
© Copyright 2013 Kantar Retail
3
Overview: Online Survey, 94 Completes
What is your company’s
approximate annual global
sales volume? (US Dollars)
25%
18% 18%
13%
11%
7%
4%
4%
Club Product Departments
(Please select all that apply)
57%
Edible Dry Grocery
34%
Health and Beauty Care (HBC)
28%
Frozen
21%
Dairy
18%
General Merchandise
16%
Behind the Counter OTC
16%
Deli
15%
Pharmacy
12%
Non Edible Dry Grocery
12%
Baby/toddler
12%
Meats
12%
Non-Alcoholic Beverages (NAB)
12%
Pet
7%
Stationery
5%
Beer/Wine/Spirits
5%
Consumer Electronics
5%
Produce
2%
Toy
Total
61
Note: Total = 94
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
4
Growing Importance Attributed to Club
How has club importance to your company changed
over the last year?
Less Important
No Change
More Important
62%
50%
49%
39%
31%
29%
12%
5%
4%
Costco
Sam's Club
BJ's Wholesale
Note: Total = 94
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
5
Clubs Rank 3rd, Just Below Mass, Grocery
Please rank the following channels in order
of importance to your company's current
business volume.
Mass
6.1
Grocery
5.7
Warehouse Club
4.7
Chain Drug
4.1
Value Discounters
3.9
Convenience
Category Specialists
Most
Important
=7
3.6
2.3
Least
Important
=1
Note: Total = 94
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
6
Generally Positive Satisfaction with Club
How satisfied are you with the success of your [Club]
business within your company today?
Costco
Sam's Club
56% 56%
BJ's Wholesale
53%
26%
24%
19%
19%
6%
5%
Extremely satisfied
Somewhat satisfied Somewhat unsatisfied
5%
4%
Not at all Satisfied
Note: Costco = 39, Sam's Club = 27, BJ's Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
7
Club Team Structures Are Not Alike
Where are your company's [Club] team resources
primarily located?
Near the customer's headquarters
Regional offices
78%
At your company's headquarters
Office in the home
More than half (56%)
of Sam’s Club teams
report into Walmart
(N=27)
41%
36%
29%
26%
21%
18%
18%
11% 11%
Costco
Sam's Club
18%
7%
BJ's Wholesale
Note: Costco = 39, Sam's Club = 27, BJ's Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
8
More Resources Devoted to Sam’s Club
How many DEDICATED resources are on your [Club] team?
Costco
Sam's Club
BJ's Wholesale
70%
60%
50%
40%
30%
20%
10%
0%
0
1-2
3-5
6-10
11-20
21-30
More than
30
Note: Costco = 39, Sam's Club = 27, BJ's Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
9
Apart from Sales, Club Team Roles Vary
Of the staff dedicated to your company's [Club] team, which of
the following roles are represented? (Select all that apply)
Sales/Customer Management
Supply Chain
Category Management
BJ's Wholesale
Marketing
Sam's Club
Costco
Consumer/Shopper Insights
Finance
Data Management/IT
0%
20%
40%
60%
80%
100%
120%
Note: Costco = 39, Sam's Club = 27, BJ's Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
10
Where Are Club Resources Gaining?
Compared to last year, have you noticed any shifts in the following
internal resources devoted to [Club Retailer]?
% Reporting an Increase
Costco
Sam's Club
BJ's Wholesale
59%
56%
48%
44%
44%
41% 41%
44%
41%
35%
29%
31%
29%
24%
23%
21%
18%
12%
Senior
Funding/Financial
management buyresources
in
Product
development
New capabilities Team head count
New positions
Note: Costco = 39, Sam's Club = 27, BJ's Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
11
Products Most Customized for Costco
What % of your club business at
each of the following retailers is
from a unique item that is NOT
sold to other retailers?
Costco
Sam's Club
BJ's Wholesale
For which club is your
company MOST
successful at providing
unique (customized)
product?
35%
BJ's
11%
30%
25%
20%
15%
Sam's
Club
33%
Costco
56%
10%
5%
0%
Note: Total = 61
Note: Costco = 51, Sam’s Club = 51, BJ’s Wholesale = 48
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
12
Club Receptivity to Key Initiatives Widely Varies
Which club has been most receptive to your
involvement in each of the following activities?
Application of Consumer Insights data
Co-branding
Gen Y appeals
Health & Wellness alignment
Improved pack sustainability
Improved product sourcing
In-club research
Incorporation of mobile codes on packs/pallets
Involvement in Facebook
Involvement in non-retailer blogs
Involvement in Pinterest
Involvement in Twitter
New member acquisition
New product launch(es)
Participation in retailer’s mobile apps
Price increases
Private label production
Product/Pack customization
Retrieval of Consumer Insights data
Small business appeals
Costco
Sam's Club
16%
48%
21%
44%
33%
43%
16%
11%
5%
3%
0%
0%
36%
34%
7%
11%
52%
61%
13%
7%
44%
10%
11%
28%
38%
16%
44%
33%
20%
26%
16%
15%
21%
25%
33%
16%
11%
23%
46%
62%
BJ's
Wholesale
21%
0%
11%
8%
5%
3%
15%
7%
7%
2%
3%
3%
15%
16%
0%
30%
3%
2%
21%
3%
Note: Total = 61
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
13
At Costco, Growing IRC, Demo Involvement
How has your participation in the following Costco initiatives and programs
changed this year compared to the previous year?
More Involved
Less Involved
IRC/Instant Savings in Costco MVM
Demos
Endcap
MVM Coupon, Excluding IRC/Instant Savings
Stand-Alone Instant Savings (Excluding MVM)
Social Media Involvement
Sustainability Messaging
Member Insights
Cross-Merchandising Promo with Other National Brands
The Costco Connection
General price reduction (beyond a promo)
Emails (i.e., to Costco members from Costco)
Vendor Managed Inventory
Prospective Member Insights
Costco Online (e.g., promotional banner, feature)
Cross-Merchandising Promo with Kirkland Signature
Road Show
Costco Fence (Cart Rail) Program
0%
5%
10% 15% 20% 25% 30% 35% 40% 45% 50%
Note: Costco = 39
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
14
Also Where Most Satisfaction with ROI Lies
In terms of return on investment, how satisfied have you been with
your participation in these efforts?
Somewhat/Very satisfied
Not at all/Not too satisfied
77%
IRC/Instant Savings in MVM
MVM Coupon, Exc. Instant
Savings
69%
Costco Fence Program
Stand-Alone Instant Savings
(Exc. MVM)
General price reduction
(beyond a promo)
Vendor Managed Inventory
Member Insights
31%
General price reduction
(beyond a promo)
5%
Social Media Involvement
5%
Costco Online
5%
21%
13%
Social Media Involvement
13%
13%
Road Show
31%
28%
Member Insights
21%
Demos
33%
Endcap(s)
31%
The Costco Connection
51%
Demos
38%
Endcap(s)
Cross-Promotion with
Costco Service(s)
IRC/Instant Savings in
Costco MVM
10%
5%
3%
Note: Costco = 39
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
15
Strong Continued Growth from KS
How has the number of [Club] private label brand items
changed over the past year in your category (ies)?
Costco
Sam's Club
BJ's Wholesale
53%
48%
44%
33%
29%
28%
13%
7% 6%
Increased a lot
3%
Somewhat
increased
Stayed the same
Somewhat
decreased
0%
Decreased a lot
67% of Costco suppliers report the presence of Kirkland Signature in their category has
very/somewhat negatively impacted performance; 56% of Sam’s Club vendors report the
same for its private brands.
Note: Costco = 39, Sam's Club = 27, BJ's Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
16
KS, Brand Development Top Concerns
In your dealings with Costco, what are your main concerns in
working with them today? (Select all that apply)
Expansion of Kirkland Signature
67%
Development of our brand within Costco
49%
Customization of SKUs for Costco
46%
Localization/Regionalization of Costco offers
41%
Internal buy-in/support for our Costco business
31%
Effectiveness of MVM coupons
28%
Costco’s push toward Instant Savings
28%
Price constraints brought on by inflation
23%
Sharing of member insights
23%
Attracting/retaining Gen Y members
18%
Threat of online competition, including Amazon
15%
Logistical pressures from international expansion
New member growth
Overall membership retention
10%
3%
0%
Note: Costco = 39
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
17
At Sam’s, Growing IRC, Insights Involvement
How has you participation in the following Sam’s Club initiatives and
programs changed this year compared to the previous year?
Sam’s Instant Savings (formerly eValues)
Member insights
Demos
Sam’s Club Online
Emails (i.e., to members from Sam’s Club)
Healthy Living Made Simple Magazine
Endcap(s)
Simply Delicious Meals
Prospective member insights
Business member appeals
Joint Business Planning (JBP)
General price reduction (beyond a promo)
Cross-Promo with Sam’s Club Service(s)
Cross-Merch Promo with National Brands
Cross-Merch Promo with private brand(s)
Social media involvement
Mobile Texts (e.g., alerts/offers)
Sustainability Messaging
Road shows
Cart Rail/WOW wall program
Online Samples
Free Online Delivery
More Involved
Less Involved
0%
10%
20%
30%
40%
50%
60%
Note: Sam’s Club = 27
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
18
Suppliers Most Satisfied with Demo ROI
In terms of return on investment, how satisfied have you been with
your participation in these efforts?
Somewhat/Very satisfied
Not at all/Not too satisfied
Demos
59%
Member insights
56%
Sam’s Instant Savings
(formerly eValues)
Sam’s Instant Savings
(formerly eValues)
Healthy Living Made Simple
Magazine
52%
Endcap(s)
48%
33%
30%
Endcap(s)
26%
Demos
26%
Sam’s Club Online
41%
Simply Delicious Meals
26%
Emails (i.e., to members
from Sam’s Club)
41%
Cart Rail/WOW wall program
26%
Prospective member
insights
41%
Joint Business Planning
Joint Business Planning
37%
Business member appeals
30%
Cross-Merch Promo with
Other National Brands
30%
General price reduction
(beyond a promo)
Cross-Merch Promo with
Other National Brands
Business member appeals
19%
19%
19%
15%
Note: Sam’s Club = 27
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
19
Sam’s/Walmart Overlap the Top Concern
In your dealings with Sam’s Club, what are your main concerns in
working with them today? (Select all that apply)
Overlapping SKUs between Sam’s and Walmart
Development of our brand within Sam’s Club
Overlapping shoppers between Sam’s and Walmart
Expansion of Sam’s Club’s private brand(s)
Sharing of member insights
Customization of SKUs for Sam’s Club
Push toward Instant Savings (formerly eValues)
Attracting/retaining Gen Y members
Expansion of Instant Savings to all members
Overall membership retention
New member growth
Shifting focus toward small businesses
Price constraints brought on by inflation
Localization/Regionalization of Sam's offers
Growing competitiveness with Costco
Internal buy-in/support for Sam’s business
Threat of online competition, including Amazon
78%
48%
44%
41%
41%
41%
37%
37%
33%
30%
26%
26%
26%
26%
22%
22%
11%
Note: Sam’s Club = 27
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
20
At BJ’s, Growing Involvement in Insights
How has your participation in the following BJ’s initiatives and programs
changed this year compared to the previous year?
Prospective member insights
Member insights
General price reduction (beyond a promo)
BJ’s Wholesale Online
Social media involvement
Emails (i.e., to members from BJ’s)
BJ’s Big Brand Mailer (BBM)
Demos (e.g., in-club sampling)
BJ’s Member Journal
More Involved
Sustainability Messaging
Less Involved
Cart Rail program
Business member appeals
Endcap(s)
Cross-Merch Promo with other National Brands
Road shows
Cross-Promo with BJ’s service(s)
Online Samples
Free Online Delivery
0%
5%
10%
15%
20%
25%
Note: BJ’s Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
21
Suppliers Most Satisfied with BBM, Journal
In terms of return on investment, how satisfied have you been with
your participation in these efforts?
Somewhat/Very satisfied
Not at all/Not too satisfied
BJ’s Big Brand Mailer (BBM)
Demos
65%
BJ’s Member Journal
47%
47%
Endcap(s)
18%
Demos
29%
General price reduction
(beyond a promo)
18%
Cart Rail program
29%
Social media involvement
18%
Endcap(s)
24%
Prospective member insights
18%
General price reduction
(beyond a promo)
24%
Member insights
18%
BJ’s Wholesale Online
24%
BJ’s Wholesale Online
12%
Emails (i.e., to members
from BJ’s)
24%
Cross-Merch Promo with
BJ’s private brand(s)
12%
Prospective member insights
24%
BJ’s Big Brand Mailer (BBM)
12%
Member insights
24%
BJ’s Member Journal
12%
Note: BJ’s Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
22
Customization of SKUs a Key Concern
In your dealings with BJ’s Wholesale, what are your main
concerns in working with them today? (Select all that apply)
Customization of SKUs for BJ’s
47%
Shift to premium (organic, natural) messaging
35%
Development of our brand within BJ’s
35%
Internal buy-in/support for our BJ’s business
29%
Expansion of BJ’s private brand(s)
29%
BJ’s competition with supermarkets/grocers
24%
Sharing of member insights
24%
Threat of online competition, including Amazon
18%
New member growth
12%
Price constraints brought on by inflation
12%
Overall membership retention
6%
Attracting/retaining Gen Y members
6%
Localization/Regionalization of BJ’s offers
6%
Note: BJ’s Wholesale = 17
Source: Kantar Retail 2013 Annual Club Peer Benchmarking Survey (March 2013)
© Copyright 2013 Kantar Retail
23
Key Takeaways & Implications
• Suppliers are attributing growing importance to club. As the role of club grows
in CPGs, the competition and retailer expectations are also likely to grow.
• Clubs vary in their receptivity to initiatives. Costco stands out in customization,
Sam’s in business appeals, insights, and BJ’s in price increases – supporting the
need for differentiated strategies.
• Suppliers are notably increasing involvement in key efforts. Namely, IRCs,
demos, and endcaps at Costco; Instant Savings, insights and demos as Sam’s; and
insights, reductions at BJ’s – Pointing to evolving retailer strategies.
• Efforts with better perceived ROI also vary by retailer. Expect the biggest bang
for your buck with IRC/MVMs, demos at Costco; demos, insights and Instant
Savings at Sam’s; and BBM, Journal at BJ’s – Enhance these further with digital.
• Top concerns with club reveal several shared challenges. Costco suppliers
point to KS and brand development as the top concerns, whereas Walmart
suppliers contend most with overlap in Walmart SKUs and BJ’s with customization
– in lieu of these concerns, don’t neglect Gen Y, member growth and Amazon.
Source: Kantar Retail research and analysis
© Copyright 2013 Kantar Retail
24
Warehouse Club Spotlight:
Sam’s vs. Walmart’s “Battle of the Bulk”
© Copyright 2013 Kantar Retail
25
Walmart Emphasizing More Bulk Value Sizes
“Value size”
Bonus (“$25 Coupon Book”)
EDLP on Bulk
“New bonus size”, “10% More Free”
“Everyday Low Price”
Source: Kantar Retail research and analysis; store visits (January 2013)
“Party Size!”
© Copyright 2013 Kantar Retail
26
Sam’s Shoppers Overlap Strongly with Walmart
Shopped Retailer in the Past 4 Weeks
100%
90%
82%
80%
70%
60%
50%
100%
100%
40%
30%
Walmart
Sam's Club
22%
20%
10%
0%
Walmart
Sam's Club
Note: Walmart excludes Neighborhood Market; Walmart=31,608, Sam's Club=8,409
Source: Kantar Retail ShopperScape® (2012)
© Copyright 2013 Kantar Retail
27
Key Question: To What Extent is Walmart
Really Encroaching on Sam’s Club?
• When: Kantar Retail pricing study
conducted January 2013
• Where: Co-located Sam’s and
Walmart stores in New Hampshire
• What: Basket of 16 national brand
edible/non-edible grocery, HBC
• How: Identified largest pack size
at Walmart for analysis; analyzed
by price per unit, pack size
Source: Kantar Retail research and analysis; store visits (January 2013)
© Copyright 2013 Kantar Retail
28
Price Per Unit Results
Sam’s Club’s Basket Narrowly Outpaces Walmart’s
Higher Price
Lower Price
Category
Product
All Purpose Cleaner
Baby Wipes
Bleach (Liquid)
Bottled Soda
Cat Litter
Detergent (Liquid)
Dog Food (Adult, Dry)
Grated Cheese
Ketchup
Liquid Dish Soap
Multi-Vitamin
Paper Towels
Peanut Butter
Chips
Processed Cheese
Toilet Paper
Fabulosa Lavender
Huggies Simply Clean
Clorox Regular-Bleach
Pepsi Regular, Plastic Bottle
Fresh Step Odor Shield, Clumping
Era 2X Ultra, Active Stainfighter
Purina Dog Chow, Complete & Balanced
Kraft 100% Grated Parmesan Cheese
Hunts Fancy Grade A
Dawn Ultra
One A Day® Women's
Bounty Select-a-Size (White)**
Jif Creamy
Tostitos Original Restaurant Style
Kraft Velveeta Original
Scott 1000***
Total
Shelf Price
Walmart
Sam's Club
$3.97
$6.98
$12.47
$15.28
$3.50
$8.39
$3.98
$17.34
$15.97
$14.98
$8.97
$12.44
$24.88
$26.78
$3.50
$18.87
$1.98
$3.18
$5.64
$8.28
$13.92
$13.82
$13.97
$18.98
$3.98
$9.98
$3.98
$2.99
$5.88
$9.98
$19.77
$21.98
$146.36
$210.25
Price/Unit
Walmart
Sam's Club
$0.04
$0.04
$0.02
$0.02
$0.03
$0.02
$0.03
$0.03
$0.42
$0.36
$0.06
$0.06
$0.54
$0.54
$0.44
$0.26
$0.05
$0.03
$0.10
$0.09
$0.07
$0.06
$0.57
$0.56
$0.14
$0.12
$0.22
$0.19
$0.16
$0.16
$0.04
$0.03
Note: Price per unit for paper towels and toilet paper calculated per 50 sheets; Tostitos chips were part of Sam's Club's Choose Any Two offer, therefore the
total $5.98 price is divided by two to provide an accurate reflection for one item (see Figure 2 for all items by size)
**12 "Big" rolls at Walmart versus 12 "Super" rolls at Sam's Club
***27 rolls at Walmart versus 36 rolls at Sam's Club (1000 sheets per roll)
Source: Kantar Retail research and analysis (data collected January 2013)
© Copyright 2013 Kantar Retail
29
Pack Size Results
Bulk Pack Sizes Markedly Bigger at Sam’s Club
Category
All Purpose Cleaner
Baby Wipes
Bleach (Liquid)
Bottled Soda
Cat Litter
Detergent (Liquid)
Dog Food (Adult, Dry)
Grated Cheese
Ketchup
Liquid Dish Soap
Multi-Vitamin
Paper Towels
Peanut Butter
Chips
Processed Cheese
Toilet Paper
Product
Fabulosa Lavender
Huggies Simply Clean
Clorox Regular-Bleach
Pepsi Regular, Plastic Bottle
Fresh Step Odor Shield, Clumping
Era 2X Ultra, Active Stainfighter
Purina Dog Chow, Complete & Balanced
Kraft 100% Grated Parmesan Cheese
Hunts Fancy Grade A
Dawn Ultra
One A Day® Women's
Bounty Select-a-Size (White)**
Jif Creamy
Tostitos Original Restaurant Style
Kraft Velveeta Original
Scott 1000***
Metric
Ounces
Wipes
Ounces
Ounces
Pounds
Ounces
Pounds
Ounces
Ounces
Ounces
Tablets
Sheets
Ounces
Ounces
Ounces
Sheets
Larger Size
Smaller Size
Pack Size
Size Difference*
Walmart Sam's Club Numeric
Percent
90
169
88%
79
512
800
56%
288
121
546
351%
425
144
576
300%
432
38
42
11%
4
150
225
50%
75
46
50
9%
4
8
72
800%
64
38
114
200%
76
56
90
61%
34
200
250
50
25%
1,236
1,704
38%
468
28
80
52
186%
18
16
-2
-11%
36
64
28
78%
27,000
36,000
9000
33%
*Sam's Club versus Walmart
**12 "Big" rolls at Walmart versus 12 "Super" rolls at Sam's Club
***27 rolls at Walmart versus 36 rolls at Sam's Club (1000 sheets per roll)
Source: Kantar Retail research and analysis (data collected January 2013)
© Copyright 2013 Kantar Retail
30
Key Takeaways & Implications
Communicate
Internally
Define Your
Appeal
Watch for
Erosion
Source: Kantar Retail research and analysis
• Recognize Walmart could impact
member growth
• Coordinate internally as to how your
offer differentiates beyond size
• Be prepared to articulate your packs’
business member proposition
• Anticipate more direct comparisons to
Costco and its business appeals
• Monitor lower income shopper
penetration in your category at Walmart
• Leverage this to support why appeals at
Sam’s, Walmart must be differentiated
© Copyright 2013 Kantar Retail
31
Channel Trends & Innovations:
What’s New in Club?
© Copyright 2013 Kantar Retail
32
What’s on Our Radar?
DIGITAL
STRATEGIES
THE CLUB
EXPERIENCE
BUSINESS
APPEALS
What’s
New?
PRIVATE
BRANDS
HEALTH &
WELLNESS
Source: Kantar Retail research and analysis, club visits
MEMBER
ATTRACTION
SOLUTIONS &
SEASONAL
© Copyright 2013 Kantar Retail
33
Costco Ramps Up Digital Strategy
Earn Kicks on Shopkick
Friday Finds in CA
Digitized Costco Connection
Free UK Pick-Up
Shopping List in Canada
Source: Kantar Retail research and analysis, club visits
UK Delivery Included
© Copyright 2013 Kantar Retail
34
Sam’s Club & BJ’s Get More Involved, Integrated
Aligning Across Platforms
Looking to Drive Traffic
Focusing on Engagement
Promoting Coupons
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
35
Business Appeals Also on the Rise
Targeting Promos to Small Businesses
Incorporating H&W
Spanning Categories
Messaging “Business News” to Members
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
36
New Member Promotions Take Shape
Offers new
members
products valued
at more than
USD 50
Let’s members
gift memberships
on FB through
eGift Social
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
37
Sam’s Club Experiments with Living Social
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
38
Solutions Focus is Strong, Growing
Crossing Categories to Drive Solutions
Educating to Appeal, Drive Basket
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
39
Sam’s, BJ’s Look to Penetrate at Home
BJ’s turns to the kitchen
BJ’s targets new parents
Sam’s continuing to leverage meals
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
40
BJ’s Gets More Solution-Savvy on Pinterest
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
41
Clubs Also Kick Up the Seasonal Solutions
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
42
Health and Wellness Top of Mind
“Made in USA”
“Costco Health Solutions” PBM
Source: Kantar Retail research and analysis, club visits
“35 Calories Per Cup”
“Free Screening”
“Locally Grown”, “Certified”
“100% Natural”
© Copyright 2013 Kantar Retail
43
Sam’s Club Infusing H&W Across the Box
Mobile Rx Refills
Healthy Living Made Simple Calendar
Item Introductions
Integration of Fresh
Source: Kantar Retail research and analysis, club visits
H&W Services in Consumables
© Copyright 2013 Kantar Retail
44
BJ’s Integrating H&W into More Categories
Fresh in Pet
Natural in HBC
Cold & Flu Solutions
Coupons
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
45
Private Brands Continue to Develop
Focus on Size:
“42% larger than
leading brand wipes”
Entering New
Categories:
“Products available
behind the counter”
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
46
Sam’s Club Touting Simply Right
Focusing on
Educating
Members
Supporting a
Bigger Cause
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
47
BJ’s Revamping Portfolio
New,
Exclusive
Brand
Source: Kantar Retail research and analysis, club visits
Focus on
Fresh,
Organic
© Copyright 2013 Kantar Retail
48
Still All Comes Down to Experience
Source: Kantar Retail research and analysis, club visits
© Copyright 2013 Kantar Retail
49
Key Takeaways & Implications
• Digital Strategies: Integrate online with the box; leverage digital to engage,
target key audiences and drive more interactive solutions, platforms
• Business Appeals: Call out value-adds specific to businesses, and look across
categories to drive more innovative and complete business solutions
• Member Attraction: Identify opportunities to better align with club efforts to
attract and retain members; consider appealing shoppers at key life stages
• Solutions & Seasonal: Look beyond your categories and brand to drive
solutions and align with member lifestyles; consider packaging as a product itself
• Health & Wellness: Focus on sourcing, services and savings (in terms of both
value and healthcare); Fresh provides ripe opportunities for collaboration
• Private Brands: Anticipate ongoing private brand development and look for
opportunities to align or differentiate where necessary
• The Club Experience: Strive to add to the club experience and drive awareness
of your SKUs through events, unique item development and continual innovation
Source: Kantar Retail research and analysis
© Copyright 2013 Kantar Retail
50
Learn more about the leading warehouse club
Join us as we explore the key directions that drive Costco’s
current strategy, and review the fresh opportunities and
challenges for Costco and the club channel.
• Explore Costco’s economic and competitive dynamics;
• Obtain key updates on Costco, including its
international, digital, and merchandising strategies;
• Understand Costco’s performance and strategy within
the context of the fundamental club model, six rights of
merchandising, and its organizational structure and
leadership; and
• Align with the needs Costco’s evolving shoppers and
their shifting demographics and preferences.
© Copyright 2013 Kantar Retail
51
Sara AlTukhaim
Principal Analyst
[email protected]
501 Boylston Street
Suite 6101
Boston, MA
02116
T + 617 912 2859
F +1 630 245 5647
www.KantarRetailiq.com
© Copyright 2013 Kantar Retail
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