The Art of the Wheel
By James Dudlicek
Retailers share best practices and challenges of marketing specialty cheeses.
Progressive Grocer and the Wisconsin Milk Marketing Board (WMMB) recently hosted a roundtable discussion to discuss specialty cheese marketing. Held in New Orleans at the start of the International Dairy-Deli-Bakery Association's annual trade show in June, the gathering revealed keen insights about how retailers position their specialty cheese selections.
The discussion, moderated by PG Editor-in-Chief Jim Dudlicek and The Gourmet Retailer Editor Anna Wolfe, featured James Robson, CEO of the Madison-based WMMB; Gianfranco DiCarlo Jr., gourmet specialty cheese category manager for Pittsburgh-based Giant Eagle Inc.; Louis "Jack" Treuting, culinary director for Thibodaux, La.-based Rouses Supermarkets; and Reginald Pearson, non-alcohol buyer-perishables for Houston-based Spec's Wines, Spirits and Finer Foods.
The full two-hour discussion has been edited for available space; a more complete transcript can be found at www.progressivegrocer.com
Dudlicek: Specialty cheese continues to be a very popular and lucrative category for grocers. Let's talk about what are the most significant developments in specialty cheese sales over the past year.
Treuting: What I'm finding is an acceptance from owners to spend a little bit more money and time on sampling and interaction with customers. We've been able to grow a category in a relatively short amount of time by putting that piece of cheese in the customer's mouth. I know it seems like a simple concept, but as retailers, you know actually doing it is the hard part.
Pearson: I think that a lot of the growth has been helped by all of the cooking shows that we see on television now. People now are more willing to try it because they're seeing recipes that they can apply to everyday life. ... Your staff has to be very knowledgeable about the products, and if they're not passionate about it, they can't convey that to a customer. ... We're also using social media. We have an annual cheese festival. We're now pairing it with wines more. We're also giving recipes. It's not just an event to come in and try a bunch of stuff, it's an opportunity to learn, and it's been quite successful.
DiCarlo: I do find that even better than the vendors is the suppliers, and every year we take a trip up to Wisconsin that the Wisconsin Milk Marketing Board funds, and we've done it now for four years in a row, and last year we took 18 team members. And when these folks come back, they come back energized.
We're in the business; we eat cheese every day. We're always trying to do the newer thing in the business, but the reality is, there's a lot of what we would consider mainstream cheeses that the majority of the customers have never tried. There's always people at that entry level. ... We did an event with Spring Green Colby ... an authentic Colby longhorn, an aggressive sampling program at a really good price–we're buying truckloads now. And then [when] the price comes down, everybody wins.
Robson: With our websites, we have Cheese Cupid, which is a pairing site of cheese with wine, beer and spirits. We have the Cheese and Burger Society, which is a lot of ideas on burgers. We've had retailers take that and run a 12-week burger promotion, using a different cheese [each week]. And we have the Grilled Cheese Academy, which is the same type of thing. So I'm glad to hear education and training is important, because we've invested a lot of dollars into that area.
Pearson: Training improves customer service, which increases sales. Let's say you see a customer and they have a bottle of champagne. Well, my first thought is, let me sell them a piece of brie. They need a vehicle to serve it on, so there you go with the cracker. There's some raspberry chipotle sauce that you could put on the brie. You could go on and on. Eighty percent of the time, a customer comes in a store, they have a mindset of only one item they want to get. They're not thinking or aware of other items that pair with it. But you tie all these other items in, you've got a loyal customer, and you've increased their basket count without them even realizing they're spending more money, because it's such a pleasurable experience.
Dudlicek: It's not just about sales. It's trying to teach [shoppers] about what they might not know about, and if they're happy, they will come back for more, because they'll be able to look to their neighborhood retailer as someone who can help them enjoy life a little bit more.
DiCarlo: Absolutely. I call it culinary credibility. The more wine and cheese you sell, the more culinary credibility you get with these categories, the more you're going to be able to sell your prime beef program, the more you're going to be able to sell your fresh pasta program ... all the things that require that special level of knowledge. ... In a large multiformat store like we are, it's harder to get a customer to buy a piece of Petit Frère [when they're] coming in to buy Tide and diapers. ... I did a quick macaroni and cheese recipe, and we brought in a truckload [of cheese] and said, OK, let's see how fast we sell this. In a week and a half, we were out of cheese. The people kept [asking], "Can we print more of those recipes?"
Treuting: On our end caps, we put blackboards, and we'll take these recipes and incorporate our products into those recipes in a menu format, and it just so happens you'll be able to find those items on that aisle. When we take our cheese and put it next to that recipe, we're seeing those products sell.
DiCarlo: I always tell each team member to have a go-to cheese based on what you know the most and what you like the most and you can talk the most passionately about. And if I can get every one of my team members to pick three or four cheeses, that is a huge leg up. Now, the extra level is to have at least one person in the department who can really talk about pairings, who can really understand a little bit of basic information about wine, basic information about cooking, and at least have one of those people in the shop to be a resource for the whole store.
Treuting: We're learning that this store here, in the center of New Orleans, brings in a large number of local chefs, and where they've decided, because of our rapid movement through the cheese, they're comfortable, they've got that culinary confidence to come in and buy, so we're merchandising certainly some smaller pieces that Mom and Dad can take home, but we're leaving half wheels sometimes or full wheels out, and we're seeing the chefs come in and drive that program for us as well.
DiCarlo: Some customers want to be engaged, and some customers don't want to be engaged. We did cheese flights, these little boxes. We put three different cheeses in it with some dried fruit, and they're about six bucks. And customers are taking them home, trying them on their own time, and it's really a great silent salesman.
Robson: I get phone calls from people that say, "I spent the winter down in Florida and they didn't have any Wisconsin cheese in the store." There's still a lot of people that have not discovered that specialty cheese department over by the deli. The cheese is next to the milk, and that's the only place they look. So we're trying to do things to help retailers.
DiCarlo: I put in a merchandising plan to put in rows of smoked blue in the meat department. How many customers have already passed the cheese shop, going to buy burgers–"Oh, look, smoked–I didn't know they had smoked blue cheese"–and boom, there it is. That makes so much difference, cross-merchandising the right way. ... My merchandising used to be done mostly by country, with some bigger categories, so I have a blue category, I have a cheddar category, I have a Swiss category, and the rest are pretty much divided by country. That seems to work, as kind of like a hybrid between doing it both ways.
Pearson: I have an Italian section, an English section, a French section, a blue section. But there are some that are just kind of specialty cheeses ... they go in one area and they're highlighted. If I'm looking for something that I can take back and impress my friends, that's where I'm going to go.
DiCarlo: It's very difficult to plot out a decision tree. Somebody needs to figure out a way to use some of the marketing analysis practices that are used in the other categories in the supermarket to help the cheese buyer.
Pearson: Comparing sliced Kraft cheese to a specialty cheese, it's not the same customer. And the frequency of those customers shopping and buying those items, there's no comparison.
Robson: That might be something that we could maybe take a lead role in, because we have a pretty extensive market research department.
DiCarlo: I'll pick a cheese, a Sicilian Pecorino. My boss says, "Well, why do we need this?" Because it's good. It's a nice eating cheese. It's a reasonable price point. We have Pecorino Toscanos, but they're expensive. But that's me trying to use my information that I have about what I think people might like and what some other people in some other places like.
Robson: So you've got different drivers for different products, and in order to properly merchandise and reach out to those different consumers, one-size-fits-all doesn't work, and that's a lot of what's happening, is you're doing this broad merchandising and trying to segment it.
Treuting: With 200 stores, it's tough; 40 is also tough. And so it's a different show, but, you know, it's a little different, and I've got to purge by a lot more than 16 percent, because I'm hitting that moving target, because I don't have 240 stores to collect that information from.
Pearson: I'm either anticipating new stores or I'm trying to factor in the ones that just recently opened. When I'm trying to do my forecast–the size of the store, the size of the case is different, so I have so many different variables, and it's not a one-size-fits-all. Our customers are totally different. They may shop and buy that today. They may not buy it again for two months.
DiCarlo: I don't think they will ever replace the intuitive nature of the category, because you really do have to know those things, and it's even more than at the store level. But I have to have the mix that they can pull from, and I've just got to think that there's some data that we're not getting that might help us make our jobs easier or grow our sales.
Dudlicek: The folks coming in for specialty cheeses, are they asking these questions about where the cheese comes from, how it's made, and are your staffs knowledgeable on that end, and are your suppliers providing that story?
Pearson: I am requiring involvement from the vendor/manufacturer to provide that information, not only in a written form, but also by doing the staff training, by having them come and share those things. From a customer standpoint of view, are they coming in and asking about sustainability? Yes or no. You have some customers that, if they're coming in and they're already willing to spend $15 or $20 a pound on some cheese, they already have a pretty good idea of most of that stuff. They're not asking so much for the sustainability, but they are asking questions, and it's because of all of these cooking shows that are pointing these things out.
Treuting: The customer wants to know where the food comes from: traceability. We've redirected our program away from outside-country cheeses. We're going to focus on the American cheesemakers, and so far it's been very well received. When we give that story to them, that we've got a master cheesemaker making this cheese, they gobble that up. Now we're selling them a piece of history and a piece of feel-good, and that's a repeat customer for us.
DiCarlo: It's a great way to layer the story. For example, I buy my Parmigiano-Reggiano from Caseificio. Every wheel of Parmigiano-Reggiano has a QR code on the bottom of it, and it will [show] the specific field where that milk was collected. Talk about being ahead of the curve in traceability.
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