CSM Bakery Products Partners with Large National Grocery Chain to Re-Invigorate Individual Desserts and Crème Island

In 2012 (and throughout all of 2013), CSM Bakery Products has made significant investments to grow and strengthen its partnership with LNGC. Many of these investments have been aimed specifically at delivering category management expertise to help LNGC increase its bakery share of market. Armed with rich data from Nielsen Perishables Group (using LNGC own hierarchy of products), we’ve provided category assessments and have developed strategies and tactics that have driven profitable top-line growth for our customer.

One of LNGC objectives, in its effort to gain market share, is to drive traffic into the bakery and increase the consumer’s basket size. To do this, they employ many of the tactics we’ve recommended, including their very successful $5 "Club" promotion that directly attacks the club channel business. In addition, they differentiate themselves by having the highest quality products in perimeter perishable departments to drive their consumers into the bakery and motivate their purchases.

As a true partner to LNGC, we conduct several category reviews throughout the year. In Q2-Q3 of 2012, we noticed that their cake category was softening and losing dollar sales, volume and market share.

We shared the following insights during our category review:• 40% of LNGC ISB (in-store bakery) $ Sales come from “ISB Desserts”.• LNGC Bakery Share of Market = 28% vs. ISB Desserts = 25%. • Within ISB Desserts, Individual Desserts (I.D.) were declining -5% vs. prior year,

while their competition (or ROM (Rest of Market) was growing +2%.• The decline in I.D. was being driven by a decline in sales of Cake Slices. And

Cake Slices account for 70% of the segment sales. More specifically, Cake Slice $ Sales were declining -4.1%, while volume was declining -22%.

• At the time, LNGC did not offer trending flavors Italian Crème and Red Velvet.• In addition, LNGC had not capitalized on any $5 I.D. promotions to gain dollars

and market share.• Cake Slices require more upscale, modern and simple designs for easier

execution.

Recommendations Made:• Planograms for Cream Island featuring assorted cake slices.

Large National Grocery Chain logo

• New Product – Cake Slices (with emphasis on trending flavors Italian Crème and Red Velvet)

• Promotion – Italian Crème and Red Velvet cake slices in 4-pack offered on $5 Fridays.

• Merchandising – schematics sent to stores for execution

Everyday Cake Slices

Seasonal Cake Slices

White Chocolate Marble Italian Creme Red Velvet

Coconut Lemon CreamCheese

ChocolateCaramel

RaspberryCream Cheese

$5 Fridays – 4-Packs, Italian Crème and Red Velvet

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Large National Grocery Chain Planogram or Schematic

Photos from Large National Grocery Chain

Results: Total Individual Desserts (ID) sales grew +11% in dollars and +6% in volume. 

o 4 count individual cake squares ($5 Promo) added 43% of the total gaino Red Velvet cake slices added 40% moreo Italian Crème Cake slices added 5% moreo Our recommendation to add more facings and re-vamp the look for parfait cups

added an additional 2%o These recommendations of ours account for almost all $ and volume gains,

and equal 90% of gains LNGC market share of ID grew +1.5 points, and their total bakery gained .2 points (over

a 52-week period). More specifically, LNGC market share of crème goods and individual desserts grew to

39%, which compares to their bakery market share of 19% (without bread). LNGC now sells 3.5X more per MM ACV in Individual Desserts than the Total US and

has gained 1.5% in market share on a maturing category. In addition to the promotion, planogram and new products we recommended, we

suggested that LNGC differentiate its crème island further by continuing to use real Whipped Crème and Buttercream made with Butter, something that none of their competitors do. This added product quality has also helped them improve its market position and steal share from the competition.

To summarize, we assisted LNGC in re-invigorating a mature category, and changed 4.7% declines into 11% gains, a 16% dollar spread…

Market differentiation was the 4-count individual cake slices. It supported their strategy of moving more $5 bakery items through checkout, increasing basket size through impulse purchase. In addition to placing these items on the crème island, LNGC placed them in checkout stands which drove those impulse purchases.

In addition to new schematics, the team created new and REFRESHED signage

Refreshed signage that communicates freshly created "Home-Made"

delicious desserts

From: Bill Sanders [mailto:Bill.Sanders@safeway.com] Sent: Thursday, August 08, 2013 2:22 PMTo: Ferlauto, Carrie; Stacy Chan; Bury, Michelle; Whittemore, JenniferCc: MacDougall, Anthony P.; Keeney, Bill; Mark HadleySubject: Bernal Store

Team

Just wanted to say you all did an outstanding job preparing for the new look walk around today!!! I’m so excited to see what we can do once this gets implemented. I see huge sales increases!! Enhancing our image as the premier bakery in the industry!!  50% market share in this category can we get there??

ThanksBill