Attention, Please

To reverse a recent growth slowdown, retailers will need to take steps to reinvigorate their store brand oil and vinegar segments.

The ancient Greek dramatist Aeschylus once said, "If you pour oil and vinegar into the same vessel, you would call them not friends but opponents." Well, the two kitchen staples might have difficulty staying together without the help of an emulsifier "mediator," but scores of salad-loving consumers still love the savory combination of the duo.

Do remember that quality should trump price when it comes to olive oil — consumers will be willing to pay a bit more to get the flavor they expect.

And individually, both oils and vinegars boast a versatility few other culinary ingredients are able to match. (In the case of white distilled vinegar, usage even extends to household cleaning.)

But oils and vinegars haven't exactly been setting the world on fire in terms of growth, at least within food, drug and mass merchandise outlets. Data from Nielsen, New York, show negative to flat growth for all the segments' total subcategories during the 52 weeks ending June 11. (See the table, p. 44.) The only big gainer was private label olive oil, which saw 5.7 percent and 6.9 percent dollar and unit sales gains, respectively, outperforming the total subcategory.

Of course, small specialty-type olive oil and vinegar retail outlets (not included in the data) seem to be springing up all over, so they very well could be taking a piece of the business from the more traditional outlets. That said, more traditional retailers could do much to reinvigorate the products' growth within their stores.

Give olive oil its due

Olive oil, the health-minded darling of the culinary world, might be the best place to start. According to Mike Forbes, vice president of marketing for Oroville, Calif.-based California Olive Ranch, the "foodie movement" really has not impacted supermarket oil in a significant way — yet.

"But the olive oil category is starting to really undergo a revolution, just as we've seen in wine in the past few decades," he says. "We're now seeing some new growing regions — Australia, Chile and California — produce exceptional oil that's on par [with] or better than that from traditional olive oil-producing countries."

If marketers, including retailers, are able to educate consumers about these new offerings properly, Forbes contends, the result will be opportunities to introduce new products and price points to the category. But retailers that put price over quality here will lose out.

"Olive oil is not just a commodity," he explains. "It is a fruit juice, so there are a lot of things that make a big difference in final product quality. It's important to know exactly where the oil is from, as well as how the product was grown, harvested, milled, stored and bottled."

Mark Coleman, vice president of Ayer, Mass.-based Catania Spagna's Retail Division, echoes Forbes' comments regarding quality. Unlike soy, canola, sunflower and other commonly used vegetable oils, olive oil's flavor is to be noticed — and that flavor can be impacted dramatically as quality drops.

"As a matter of fact, most private label extra virgin olive oils are nothing more than a glorified pure olive oil," he says. "Retail buyers today use a bid process of some sort to compare pricing from the different suppliers in the market. The bid process needs to focus more on quality than … price, which may work for vegetable oils or paper cups or sugar."

Don't get too specialized within the oil and vinegar segment, or the program will become unmanageable.

The reality? Consumers actually are willing to pay a little more for an extra virgin olive oil that delivers the expected, Coleman adds.

Consider the newbies

But olive oil is not the only oil worthy of consideration within the segment's store brand reinvigoration plan. Michael Cohen, vice president and general manager of La Tourangelle Inc., Richmond, Calif., says coconut oils are becoming very popular with consumers.

Do consider on-trend oils with a strong consumer following, including coconut oil and high-heat oils such as grapeseed.

It's worth noting that coconut oil usage is fairly evenly split between edible and body care applications, Cohen notes. And thanks to coconut oil's purported reported health benefits, it's pretty popular as a dietary supplement as well.

High-heat cooking oils, especially grapeseed oil, also are on-trend, as are gourmet-type items such as roasted walnut and roasted pistachio oils. But he advises retailers outside the gourmet space not to drift too far into the specialized arena with their store brand oils — to save that for national brand specialty players.

"We can effectively manage that type of program as a manufacturer, but the retailer doesn't want to do that," he says.

Tout vinegar's health benefits

Although the drinkable vinegar push that's taking hold on the restaurant scene hasn't made much of a splash at retail (yet), retailers could take advantage of the related publicity to tout the health benefits of existing store brand vinegars. Apple cider and other vinegars, for example, are said to promote weight loss, while balsamic vinegar is said to have anti-bacterial and anti-viral properties.

"Consumers that are seeking healthy all-natural products will gravitate to vinegars because of the no-fat, no-cholesterol, low-carbohydrate ingredients," adds Mark Birchall, president of Cuisine Perel, Richmond, Calif.

Don't limit oil and vinegar placement to the baking and condiment aisles — consider placement within the produce department and other areas with complementary products.

Like olive oil, however, the quality of certain types of vinegars counts greatly. Balsamic vinegars, for example, have different grades and price points, Birchall explains.

"If consumers have the opportunity to taste the private label product and compare it to branded products, they are able to make an educated choice," he says.

Present it with care

Quality is critical, but presentation matters as well. The right package can go a long way toward infusing new life into the store brand oil and vinegar segments. Forbes believes a "great" package answers two basic questions: "What am I?" and "Why should you buy me instead of everything else on the shelf?"

Many retailers do a good job in response to the first question, he contends, but come up short in relation to the second by relying solely on a low price point as a means of differentiation.

If it's a premium oil or vinegar, glass is the way to go, Cohen believes.

Oils and Vinegars

"But it depends on what kind of glass," he explains. "Glass can also represent value, depending on what style you choose."

Still, don't get too complicated on the packaging side, Birchall advises.

"Keep it simple, and focus the packaging on your core market," he says.

Thoughtful merchandising, too, puts store brand oils and vinegars in the spotlight — and often into consumers' carts. Retailers might consider cross-promoting olive oils, for example, with complementary products within the produce department, bakery and other areas of the store, notes Jeffery Freeman, CEO of Borges USA, Fresno, Calif.

"People use olive oil to dip bread, make salad dressing and create pasta sauces," Forbes adds. "Olive oils should be in those parts of the store, not just in the oils section."

Gourmet-type vinegars, too, make a logical produce department addition. And retailers also could include store brand white vinegar within spring-cleaning-type displays, with messages outlining its uses and cost-effectiveness.

And don't be afraid to give store brand oils and vinegars more space overall, Forbes suggests.

Look What's New

Archer Farms Popcorn Oil from Minneapolis-based Target Corp. is said to combine canola oil with natural butter flavor. The premium product is billed as great for popping and toppings. It retails in an 8-fl.-oz. PET bottle.

Grand Selections Balsamic Vinegar of Modena from Hy-Vee Inc., West Des Moines, Iowa, has been repackaged to feature a new design. The product retails in a 1-pt.-0.9-fl.-oz. (500ml) colored glass bottle.

New from Monrovia, Calif.-based Trader Joe's is Trader Giotto's Cold Pressed Extra Virgin Olive Oil. The product retails in a 1-pt.-0.9-fl.-oz. (500ml) clear glass bottle.

Private Selection Garlic Balsamic Dipping Oil from Kroger Co. of Cincinnati combines canola oil and olive oil with balsamic vinegar. The premium-quality product retails in an 8.5-fl.-oz. glass bottle.