Here programs and key insights from commissary insiders including Land O’Lakes Heinz Kraft and Unilever plus everything you need to know to go in-network with America’s 11.7 million active and retired service men and women.Modern-day grocery stores can be challenging platforms for innovative marketing tactics. After years of consolidation most “local” grocery outlets have become part of nationwide conglomerates. For marketers that often means more layers of red tape more months of advance planning and less flexibility to execute events on the fly. But one grocery chain America’s global network of 267 military commissaries offers all the benefits and reach of a worldwide conglomerate but with a unique community-level dedication to each individual store. “As a marketer and sales manager I get impact for my brands and my products that you just don’t get in the civilian market ” says Paul Burke national account manager at Land O’Lakes.
EM got a behind-the-scenes look at the members-only commissary world and discovered a channel primed for more brand engagement. Here programs and key insights from commissary insiders including Land O’Lakes Heinz Kraft and Unilever plus everything you need to know to go in-network with America’s 11.7 million active and retired service men and women.
Commissary shoppers pay 30 percent less than civilian prices. With estimated annual savings of $3 000 per household (and generally below-market salaries) the perk is not surprisingly their No. 1 non-paid benefit. In addition to the prices commissaries also do double duty as community centers—places to connect while stationed abroad and sources for favorite brands from home. “When you’re on a military base it’s a tight-knit family and the commissary is one of those activities that you do ” says Burke. “Shopping is an experience—an event almost.” Stores are busiest around bi-monthly paydays and consumers frequently buy in bulk. Shoppers are also heavy coupon clippers. But unlike Wal-Mart and other competitors commissaries don’t carry private-label brands—a nice perk for name-brand packaged-good marketers.
The Defense Commissary Agency (DeCA) is the central organization that runs the commissaries approves products for sale into the network and manages the calendar of in-store events and promotions. Marketers can work directly with DeCA or hire brokers which can help develop programs that benefit brands across portfolios to save costs. For civilian event marketers the on-site execution may seem small fry—coupons end-cap promotions and homespun parking lot barbeques are de rigueur. But the platform is ripe for change and growth. “Commissaries have made leaps and bounds in allowing manufacturers to create events within their stores and really to engage their shopper ” says Barbara Stabno president of Bard Advertising an agency that brokers deals between companies like General Mills and DeCA. “Seventy percent of purchasing decisions are made at the point of purchase so if it involves something besides a typical coupon it definitely makes an impact.”
At commissaries sampling can generate an immediate uptick in sales. Since 2004 Land O’Lakes has been running monthly sampling events most recently offering a slice of cheese along with a coupon and a recipe card. For 2007 volume sales are up more than 10 percent “pretty good for the third year running ” says Burke. He attributes the increase to the in-store tasting experience. “Linking them all to an activity and executing it at the point of purchase it’s a home run.”
Unilever last spring rolled out an event-driven point-of-sale strategy that leveraged the popularity of NASCAR among military consumers. At each of 54 events a Unilever NASCAR simulator car or pit box interactive experience was set up. Other activities included sampling couponing and t-shirt and hat giveaways. Products sampled included Ragu Wisk Snuggle and Hellmann’s. The program inspired a 75 percent lift in sales (Agencies: SSG/Brandintense Archdale NC; Bulldawg Marketing Mooresville NC).
Besides helping families save money helping their patrons stay connected to loved ones who are deployed is at the top of DeCA’s priority list. Brands with programs that can help on both fronts will make an impression and likely earn loyal buyers. “Naturally with a war going on it’s a big concern with as many troops that are deployed and with their families home alone ” says Randy Chandler chief of the semi-perishable division at DeCA. Brands should consider partners such as the USO Chandler says which help establish communication overseas a critical benefit for deployed troops.
Kraft makes altruistic connections with at-store activities around troop returns and health screening events on base—blood pressure body mass tests eye check-ups nutritional information—which help further DeCA’s health and wellness initiatives. Heinz runs an annual program every July called Helping Hands that ties in-store purchases to the funding of educational materials for base daycares and preschools.
Commissaries are locally staffed and managed—often by military family members—so there is a unique entrepreneurial spirit and local pride that helps turn small-scale promotions into memorable events. “It’s the mindset of store-level decision making ” says Stuart MacGregor regional sales manager west for Unilever’s Military Team. “The single biggest separator and why our [NASCAR] program has been so successful is because the store gets to play an active role in putting it together.”
Kraft immerses itself into day-to-day on-base activities by serving hot dogs from its Oscar Mayer Weinermobile at Air Force Academy football games cooking DiGiorno or Tombstone pizzas in commissary parking lots and having the Kool-Aid Man or Mr. Peanut attend store grand openings. The initiatives may seem small-scale compared to many civilian market retail events but the long-term payoffs can be substantial. “Probably the two most important points to keep in mind about the commissary business are the unprecedented loyalty of the patrons and the return on your investment ” says David McMurtry Kraft customer vp-military sales. “DeCA patrons are very loyal to national brands and there’s no better ROI one could derive than to invest in DeCA’s business. Being ‘not for profit ’ every penny invested gets to the patron. I’m not aware of another channel where this is the case.”