Forecourt Trader
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Deal time

01 February, 2010
Page 26 

Cartoon frog moneyboxes, multi-purpose car chargers and luggage scales have all been flying off forecourt shelves in the past year.

And, according to those in the sector, working to get your promotions offering just right can pay big dividends.

Asiffa Gadatra, director at Spot Promotions, says the key to promotions in the current economic climate is to keep them affordable. She says: "The past year has been a struggle with the recession and fuel prices soaring and I think the promotions side of the business has felt the pinch. Our strategy has been to keep our range to items under the 5.99 mark and it's proved really successful. Apart from one product that we brought out over Christmas kids' laptops at 14.99 just about everything's been 5.99 or less.

"For example, one of our best-selling products in 2009 was a range of jumbo money tins covered in pound signs. Priced at 1.99, they flew out like nobody's business. They needed to be opened with a can opener so they were a bit of a novelty. We sold 60,000 in three weeks.

"Other successes included a drinks bottle with an ice-stick inside that went for 2.49 during the summer. There was also a digital alcohol test for 4.99 just before Christmas. It's battery operated and you blow into it and it tells you how drunk you are according to three lights. They were so popular we ran out of them. We'll definitely be carrying on with the 5.99 maximum price theme for the next year. We're expecting fuel prices to soar again, and after the election people will probably have less cash to spend, especially with VAT going back up. Our products are often an impulse purchase so getting the price right is crucial." Gadatra, who deals with most of the retailers on our Top 50 Indies list, adds that the company also hopes to bring in more licensed lines this year, such as Mr Men and Toy Story. And the latest product to be introduced is a 'Snuggle Blanket' for 5.99 a blanket with pockets in the middle so users can snuggle up in front of the TV with the remote controls.

Asif Ayub, sales director at Fast Trak, takes a different approach. He says: "With the recession we were previously looking at the 2.99 price point, but we soon realised that the people who still have money in their pocket are still spending. And the people who don't have money don't have anything and don't want to spend even 2.99 on an item. And there's no middle ground. That's why we've been sticking to the higher price points, and will be for this year. By that I mean anything between 7 and 10. Then even if you don't do the massive volume you still get the margin."

According to Asif, the best-selling items in the past year have included a multi-purpose car charger (Fast Trak included an iPod charger in the product) at 3.99, a laptop tray which protects the user's legs from the heat of the laptop at 11.99, and luggage scales more than 60,000 of these units were sold at 4.99 each. For this month, Fast Trak is introducing a pint mug featuring top dog breeds for 2.99.

Asif says: "Promotions can be very successful for a forecourt if they are done in the right manner. They also need to be marketed properly for example with a floor stand or a display near the till." Asif reckons retailers can increase sales if a stand is placed next to a till.

He adds: "As a business I'd say we've been steady through the recession. We've ridden it very well."

According to DSL Group, which supplies about 3,000 retailers in the UK, the key to getting promotions right is to encourage repeat visits and get plenty of feedback on products. DSL sales director Roy Landa says: "We recognise that our customers are the ones who are dealing with the consumers and we get an enormous amount of feedback from them. It's not a simple case of delivering the promotions and then leaving it with the retailers to determine the success of the promotion. We know what levels of sales we should be expecting for each promotion and close monitoring flags up those retailers that are under-performing and then it's our job to help our retailers. It's often the simple things that need rectifying but at the end of the day this is where DSL comes in and helps manage our customers' business in a professional way."

Despite the challenging economic situation, DSL says the company and many of its retailers enjoyed a good year in 2009, showing substantial increases in product turnover and cash profit. One of the company's most successful promotions last year was a range of fleece blankets featuring popular kids' characters such as Hello Kitty, Transformers and Night Garden. Priced at 5.99 each, customers couldn't get enough of them.

Other collectables that did particularly well were a selection of cute cartoon-like animal moneyboxes which included a frog, tiger, elephant and ladybird. DSL operations director Bill Landa says: "We found that once consumers purchased any one of these they almost appeared determined to complete the set and this was purely down to the marketing and product packaging." He says retailers also benefited from the introduction of innovative products at the right time of year such as a range of Thinsulate hats and gloves.

According to the Continuity Company, which has worked with BP and Chevron on major promotions, the key for 2010 is to overcome recession and 'price fatigue' and to reinvigorate the shopper experience. David Ringer, the company's general manager for UK & Ireland, says this involves rewarding customers for their loyalty and making them feel good about their purchase decisions.

He explains: "The fear factor among shoppers is slowly diminishing and they will be more confident about the future. Recovery is looking closer than before. As people are feeling more secure about the future they are looking for more affordable treats.

"This year offers many opportunities with events such as the World Cup and big movie releases like Shrek 4. Being associated with feel-good events through sales and marketing promotions that maximise the use of official licensed products, will enhance the shopper experience and generate excitement.

"It's all about allying your store with pleasure. Creating special promotions and events that will engage your customer, distracting them from doom and gloom rather than continually reminding them through price cutting.

"It's about instilling loyalty through providing fun. Retailers need to engage their shoppers with delivering more pleasure and value in 2010 if they are to really succeed and prosper in the year ahead."