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    FEATURE: Customs house

    Megaretailers are increasingly turning to custom-made national brands and promotions to differentiate themselves from the competition.

    By Richard Turcsik

    It was a few days before Halloween--or "Friday the 31st" as Target Corp. has branded the holiday this year--and shoppers were zeroing in on their local Targets to stock up on all the latest tricks and treats for their ghosts and goblins. One of the most popular--seemingly making its way into every cart--was the bright orange Friday the 31st 22-gallon latching storage tote from Rubbermaid. At only $4.44, it's easy to see why--and shoppers couldn't find it anywhere else because it was made exclusively for Target.

    "What differentiates what we had in Target from another retail account is that it's packaged or labeled in a manner that fits with their theme for Halloween," says Keri Butler, senior manager, communications, at Rubbermaid in Wooster, Ohio. She adds that Rubbermaid has available to retailers a menu of products in different holiday offerings, which can be customized with labels or for promotions.

    In addition to Rubbermaid, Target has lots of other brand-name products that can't be found anywhere else. Take a walk down the cereal aisle, and what immediately catches the eye are the stark white boxes of Trix, Lucky Charms, and Cocoa Puffs breakfast cereals. The limited edition "Color the Box" line was made by General Mills exclusively for Target, with each box containing a pack of four Crayola crayons so kids can decorate the boxes themselves.

    "An overall trend in retailing is how can the packaging be used in the way of creating some trial and awareness to hop off the shelf, and the white cereal boxes are a beautiful example of that," says Ted Taft, a partner in Euro RSCG Meridian, a consulting firm based in Westport, Conn. "Today manufacturers are trying to figure out what 'marketing through the retailer' means and what it could mean. It goes beyond just doing in-store demos or that type of thing, but how can they use the store, where an awful lot of purchasing decisions are made, to talk to the consumer."

    Wal-mart magazine

    When it comes to proprietary merchandise, by no means does Target have the only exclusive deals. Membership clubs have been doing it for years, selling super-large sizes, and shrink-wrapped, bundled packs of everything from condiments to tuna fish in their outlets. But here's a news flash: Now proprietary national brands are being taken to new, never-before-seen levels, including the checkstand newsrack.

    According to recent news reports, Time Warner is working closely with Wal-Mart on creating a low-priced women's service magazine that will be sold through the discount giant, which now controls 15 percent of all newsstand sales. Dubbed "the Wal-Mart magazine" by industry insiders, the periodical reportedly will have a wholesome image because Wal-Mart has had problems with the racy covers of Cosmopolitan, Vogue, Marie Claire, and other titles.

    But the majority of exclusive name-brand products continue to be in the grocery field. Recently, Meridian conducted a survey asking its clients what they think will be important in the next three to five years. "People are saying that they need to show growth," Taft says. "They can't cut costs any more, or it won't be a differentiator. Even Wal-Mart is saying that. They need to look at things to become better marketers, like marketing through the retailer and using technology at the shelf. People are saying that's going to be much more important in the years ahead."

    That's exactly what Campbell's Soup did Aug. 30 when it held the World's Biggest Lunch event at Wal-Mart—a massive one-day sampling of 1 million containers of its microwavable soups. "We wanted to get the product in hand," says John W. Faulkner, director, brand communications, at the Campbell Soup Co. in Camden, N.J.

    Campbell isn't alone. On Oct. 26, Women's Day magazine teamed with 21 of its advertisers, including Wish-Bone salad dressing, Splenda artificial sweetener, Rold Gold pretzels, Children's Claritin, Yoplait yogurt, Jimmy Dean sausage, and Kellogg's Rice Krispies, for a massive one-day Wal-Mart supercenter sampling extravaganza held in nearly 100 stores.

    Of course, the risk with these exclusive promotions is that they can alienate the rest of the trade. "I was aware of a couple of comments of retailers who asked, 'Why can't we do that here?'" Faulkner admits. "But retailers realize there are certain things we can do with a Wal-Mart that we just can't do with a local chain."

    Campbell recognizes, however, that its soups are sold in just about every store, and so the manufacturer creates a variety of trade programs through its Equity Marketing Alliance program. "We work with the retailer's own individual calendar, as well," Faulkner says. "They may emphasize back-to-school and leverage our Labels for Education program. Another retailer may have a food drive in conjunction with the Stamp Out Hunger program run by the post office in May. We have different programs for different-size chains, and there's a menu of options that they can pick from."

    More manufacturers need to work closely with retailers to come up with piping-hot exclusive products and programs, like Campbell's, to help the supermarket industry in its battle to win back sales.

    By Richard Turcsik
    • About Richard Turcsik

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