Jeremy Rockett: the pros and cons of shelf squeeze

on 10 September, 2015

few years ago I remember rushing into a supermarket with a few like-minded colleagues, like kids in a sweet shop, filling trolleys with clearance wines, which were perfectly good but the retailer had decided to cull the range and these were the victims, the shelf-warmers – genuine half-price bargains for once.

Imagine you’re shopping for pizza and the supermarket has 700-odd to choose from. How would you cope with the thought of hundreds of different toppings, many of them almost exactly the same? Would you shop around or buy what you always buy? What if the choice was pared down to just a few, the selection made for you by clever buyers, but your favourite was not there?

This is the conundrum for wine, where supermarkets have to decide between an overly narrow selection, satisfying most consumers, but not all, and the problem of having a “wall of wine” that’s totally confusing. Too few wines can lack credibility and disappoint more discerning consumers, who may take their high-value business elsewhere. Too many wines and most people are intimidated, confused, and resort to the easy decision – buy the one they always buy.

Wine is comparatively low margin for retailers, tricky to merchandise and takes up a disproportionate amount of space. But it’s sexier than toilet rolls and great for driving footfall. no wonder then that it is subject to space and therefore range fluctuations, as it goes in and out of favour.

But how do you cope as a branded supplier, one minute listed in the race for the best range on the high street, months later seeing your pride and joy at half price with a big yellow clearance ticket?

The first answer surely must be that you should have a distribution strategy and stick to it. If you’re listed across the independent sector and a multiple listing raises its head, you should think hard about whether or not it’s right for your brand. Will you lose that hard-won distribution among your loyal wine merchants? Distribution is a key part of brand strategy, and where you’re seen says a lot about your brand.

A strong brand is more resilient when it comes to range rationalisation, even if it isn’t the strongest performer on shelf, but it also has the capacity to take consumers with it. Surely then, the best defence is to focus on building your brand with consumers, and try to create demand so they’ll buy it wherever it sits on a real, or virtual, shelf.

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