Spotlight on the deli

Todays typical in-store deli delivers much more to shoppers than a service counter with items such as sliced turkey and macaroni salad by the pound. It also brings to them piping-hot prepared meals and entrées; a host of packaged salads, dips and spreads; imported gourmet cheeses; and more.

But store brand representation within the deli area varies widely from retailer to retailer. To get an idea of what a few grocery retailers are doing in the store brand deli space, we toured a Schnucks store (operated by Schnuck Markets Inc., St. Louis) and a County Market store (operated by Quincy, Ill.-based Niemann Foods) in Champaign, Ill., as well as The Fresh Market store in Kildeer, Ill. (operated by The Fresh Market, Greensboro, N.C.). Our visits took place in mid-April.

Schnucks
General observations: The deli department in the Schnucks store we visited is situated on the right-hand side of the store (looking into the store from the front entrance), about 10 feet or so from the far right-hand wall, toward the back of the store. The bulk of the department consists of a four-sided rectangular island, with one long side merchandising specialty cheeses and the other long side merchandising salads and other deli items by the pound. The meat and cheese service deli is located on the short side of the island closest to the back of the store, while in-store prepared salads, packaged salads under the retailers Chefs Express brand, and in-store prepared meals and entrées – including hot rotisserie chickens in several flavors – are located on the short side closest to the front of the store. Additional packaged deli products are located in refrigerated cases against the far right-hand wall and the back wall; a separate wooden display unit in front of the main deli island holds Schnucks own Chefs Express premium refrigerated soups.

The store was very neat and well stocked. Foot traffic was moderate during our visit, which took place on a Sunday morning.

The upside:

• During our visit, the store was merchandising bags of its own Culinaria Bruschetta Olive Oil and Sea Salt Bread in a basket next to the wooden display holding its Chefs Express soups (but the display lacked signage providing the price). It also includes brochures within the display describing the soups.
• In an open refrigerated case near the deli, the store was merchandising a large number of Schnucks Deli Thin Sliced packaged meats in tubs; large signage touted the products $3.49 \"Low Price Every Day.\"

The downside:

• When it opted to use the prime shelf space on the top of the four-sided main deli island, the store gave that display space to sauces, condiments and other items offered by national and regional brands.
• With the exception of premium soups, packaged salads, in-store prepared items, deli pizza and a few other items, deli products and free-standing displays near the deli were limited to products offered by regional and national brands.

County Market
General observations: The deli department in the County Market store is located against the right-hand wall (and in the area directly in front of it), just past the produce section. Large, very attractive permanent signage divides the deli section into sections that include Meals to Go, Niemann Bros. Cookhouse, From the Oven and more. The service deli offers quite a few varieties of the County Markets own Neimann Bros. Cookhouse brand of deli meats, while other areas of the deli house the retailers own Spoon River deli salads, dips and spreads. A free-standing display in front the deli, close to the specialty cheeses, holds hot rotisserie chickens in several flavors.

The store was neat and well-stocked. Foot traffic was light during our visit, which took place mid-morning on a Sunday.

The upside:

• The store used large signage to communicate to shoppers the sale prices for its in-store prepared Spoon River salads.
• In addition to its Spoon River salads sold by the pound, the store offers a number of prepackaged salads under the same store brand name. We could find no regional or national brand counterparts competing in their space.
• The store gives one whole short side of a four-sided refrigerated display case situated in front of the deli area to other Spoon River deli items – including Dill Dip, Buttermilk Ranch Dip, Pimento Cheese Spread, Western Veggie Dip, and Ham, Green Onion and Cheese Spread.

The downside:

• Most of the free-standing displays within the stores deli area held only national or regional brand items.

The Fresh Market
General observations: At The Fresh Market store, the deli is located mid-store, almost centered between the right- and left-hand sides of the store. Like in the Schnucks store, the main area consists of a four-sided island, with the front side holding some hot prepared cooked items such as salmon, ribs, pork loin and rotisserie chicken and the back side offering refrigerated in-store prepared items – many branded under The Fresh Market (TFM) brand – such as pizza, salads and entrees, as well as branded refrigerated offerings. The left-hand side of the area holds specialty cheeses (none of them TFM branded), while the right-hand side holds more prepared items, as well as the service deli for meats, cheeses and salad-type items. A free-standing soup display holding TFM premium soups is situated to the left of the deli area. The store seems to use all available space (including the shelf area on the top of the island, baskets situated around the area, and free-standing displays) to cross-merchandise both store brand and name-brand products.

The store was neat and well-stocked. Foot traffic was moderate during our visit, which took place early afternoon on a Monday.

The upside:

• To the right of the front of the main deli area, the store was merchandising two varieties of TFM tortilla chips (Restaurant White and Restaurant Blue) in big baskets, as well as several types of TFM salsa in a shelving unit nearby. Prominent signage called out the products sale prices.
• On a shelf above the side of the deli island housing specialty cheeses, the store was merchandising TFM Olive Oil and TFM chutney-type products. Again, prominent signage touted promotional pricing.
• Near the back side of the deli island, the store was merchandising TFM Pretzels in large baskets. Large signage communicated the price to shoppers.
• A free-standing three-tier display near the back of the island held several varieties of TFM Kettle Chips. Large signage communicated the price to shoppers.

The downside:

• The abundance of displays did make it somewhat difficult to maneuver a shopping cart around the area – especially when other shoppers were present.

Put the spotlight on store brands
Although many retailers have taken steps to increase their store brand products presence and visibility within the deli, many others have ample opportunity to improve here. And they might want to begin by rethinking the products themselves.

\"There are too many me-too items on the shelf that are solely reliant on price as the point of difference,\" contends Mark Russell, director of business management for West Liberty, Iowa-based West Liberty Foods. \"Branded products are still driving innovation, with store brands following.\"

But differentiation need not be limited to the product; Russell notes that packaging represents a quick and easy way for retailers to innovate within the deli arena.

\"Consumers today are looking for new and interesting packaging that delivers value,\" he says. \"They want a package that is more sustainable [and] uses less packaging materials.\"

Still, the package also must retain the products freshness, Russell stresses. He points to West Liberty Foods peel and reseal packaging as an example of a packaging innovation that allows easy access to the product while still promoting freshness.

\"Another sustainable packaging style that is being requested by retailers is a chipboard box,\" he says. \"A package like this is made from 100 percent recycled materials and fits the need of the health-conscious consumer looking for an all-natural type of product.\"

On the merchandising front, retailers also might want to provide more in the way of product information to shoppers, suggests Alan Hiebert, education information specialist with the Madison, Wis.-based International Dairy-Deli-Bakery Association (IDDBA).

\"That doesnt mean everything needs to be on a sign next to each product,\" he says, \"but it does mean that more in-depth food safety, recipe and nutrition information should be available on flyers that customers can take with them, on a stores website and on customers mobile devices.\"

IDDBA also has seen stores attract attention to store brand products by using words such as \"ours\" on the signage for such products, Hiebert notes.

\"It gives shoppers the feeling theyre eating something thats made in smaller batches in their own store,\" he says.