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Center Store Competition Heats Up

December 6, 2010

The center store represents about two-thirds of total consumer packaged goods sales and private label offerings are making national brands work harder for every SKU placed and sold, according to Symphony IRI.

The research company’s current edition of Times & Trends, “Center Store: At Center Stage for Future CPG Success,” finds that the heart of the store is increasingly complex due in large part to private label success.

“The center store offers a wide range of very different products, so you can’t make an apples-to-apples comparison between trends in complex and distinctive center store segments, such as beauty care and carbonated beverages,” said John McIndoe, senior vice president of marketing of SymphonyIRI Group. “Increasing the complexity is the issue of private label and how it is reshaping the center store and lighting a fire under branded manufacturers, who are stepping up the intensity of their marketing game and getting results.”

The center store battleground is also expanding beyond grocery stores. For example, Walgreens is offering an increasingly expansive selection of center store products and is making the most of opportunities in underserved areas, such as in what it terms “food deserts.”

The Symphony IRI report offers action items for manufacturers and retailers seeking to protect and grow share across the center store.

“Too often, manufacturers and retailers devote time and resources to collecting critical information about shopper attitudes and behaviors and apply this information about past behaviors to future strategies,” said Susan Viamari, editor of Times & Trends. “This is akin to fighting a new war with old weapons. Innovative manufacturers and retailers must study these past behaviors but also incorporate additional information, such as macroeconomic data, and harness predictive analytics to accurately forecast future shopper preferences.”

The following are a few recommendations made in the Times & Trends report: