Market Visit Report Vienna, Austria - Sales is Not Simple

Market Visit Report Vienna, Austria - Sales is Not Simple

Market Visit Report Vienna, Austria - Sales is Not Simple


You also want an ePaper? Increase the reach of your titles

YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.

<strong>Market</strong> <strong>V<strong>is</strong>it</strong> <strong>Report</strong><br />

<strong>Vienna</strong>, <strong>Austria</strong><br />

April 2010

Summary<br />

overview:<br />

the goal of th<strong>is</strong> report to <strong>is</strong> share with the Canadian CPG / Retail industry some<br />

innovations and observations found during our recent market v<strong>is</strong>it to <strong>Vienna</strong>, <strong>Austria</strong>.<br />

we hope that you find these insights useful in your day-to-day work and that you<br />

can draw inspiration from them.<br />

if you would like any more information on what you see in th<strong>is</strong> report please feel free<br />

to reach us at jdoucette@sales<strong>is</strong>notsimple.com

<strong>Austria</strong>n CPG <strong>Market</strong><br />

overview:<br />

The <strong>Austria</strong>n CPG market, has many similarities with the German market given its<br />

proximity and shared language.<br />

Many CPG companies are in the process of merging the operational back-end (IT,<br />

Finance, Customer Service, Log<strong>is</strong>tics) of Germany, Switzerland and <strong>Austria</strong> under<br />

one umbrella.<br />

<strong>Austria</strong> also acts as a regional headquarters for Central and Eastern Europe (CEE),<br />

which includes as many as 32 countries from Hungary to Romania to Turkey, so<br />

there <strong>is</strong> a substantial supplier community based here.<br />

From a retail perspective, the roughly 3 million population in urban <strong>Vienna</strong> <strong>is</strong> served<br />

by a combination of supermarkets (Billa, Spar), hard d<strong>is</strong>counters (Hofer and<br />

Zielpunkt) as well as drugstores (DM, Bipa).<br />

<strong>Vienna</strong> also hosts a couple of unique retail concepts that we have highlighted here<br />

such as a Nespresso flagship and Tchibo - a German cafe / retail concept.

Summary<br />

observations:<br />

1. Cool Messages From Billa Supermarkets<br />

2. Chiquita Goes Beyond Bananas<br />

3. Pringles Scores with the World Cup 2010<br />

4. Hofer - A Hard D<strong>is</strong>counter<br />

5. Zielpunkt - A Soft D<strong>is</strong>counter<br />

6. Added Freshness at Spar Gourmet<br />

7. BIPA Drugstores - Standing Out In a Crowd<br />

8. DM Drogerie Markt - A Leading European Drugstore<br />

9. Tchibo - Cafe or Retailer?<br />

10. Nespresso Flagship Store - a CPG Brand Like No Other

Cool Messages at Billa<br />

Communicating with shoppers in the frozen<br />

section can be like trying to strike up a<br />

conversation at a Winnipeg bus stop in mid-<br />

January.<br />

Billa has managed to create attractive<br />

shopper communication by using bright colors<br />

that stand out from the typical packaging<br />

colors found behind the glass door.<br />

Top: Price D<strong>is</strong>count Tags with clear d<strong>is</strong>count<br />

communication and fresh connotation from<br />

the use of strawberry image.<br />

Middle: Private Label price guarantee<br />

communication on the Clever brand.<br />

Bottom: Health information for consumers<br />

talking about the benefits of eating F<strong>is</strong>h.

Billa Supermarkets<br />

Billa Supermarkets are ubiquitous in <strong>Vienna</strong> and have over 1000 locations across <strong>Austria</strong>.<br />

The chain <strong>is</strong> now owned by Germany’s REWE Group.

Chiquita Goes Beyond Bananas<br />

In our Par<strong>is</strong> <strong>Market</strong> <strong>V<strong>is</strong>it</strong> <strong>Report</strong> we told you about Innocent - the smoothie brand from the UK that was taking the drinks<br />

market by storm and had recently seen Coca Cola take a controlling stake in the brand.<br />

At Billa, a supermarket chain, we found a natural competitor in the fruit smoothie business - Chiquita.<br />

It makes a lot of sense doesn’t it? If I asked you to name a fruit “brand” Chiquita would likely be a top choice.<br />

What a better way to extend the brand beyond one category (although bananas are an important category appearing in<br />

more baskets than any other item - hence its use in No Frills’ brand imagery.<br />

It <strong>is</strong> definitely a value added product at €1.69 ($2.23 CDN) for a 200ml bottle, much better than bulk bananas at $0.79 per<br />

pound!<br />

Also, from reading the package, Chiquita <strong>is</strong> not licensing the brand in th<strong>is</strong> effort. Watch th<strong>is</strong> space.

Pringles Scores With the World Cup 2010<br />

Can you imagine if the Stanley Cup or the Super Bowl was awarded only once every four years? That would mean a huge<br />

hit to many retailers and suppliers top and bottom line - especially in February, April and May.<br />

The FIFA World Cup 2010 will start in June and CPG companies in <strong>Austria</strong> (and across Europe) are cashing in already with<br />

promotional efforts to leverage th<strong>is</strong> huge consumer event.<br />

One supplier, P&G has launched a promotional package changing the brand name to Pringoooals with a nod to the<br />

enthusiastic play-by-play of fanatic football commentators.<br />

What <strong>is</strong> your company doing to support th<strong>is</strong> event? Some of you may wonder who in Canada actually cares about the<br />

“beautiful game”.<br />

There are millions of Canadians that claim heritage from World Cup countries.<br />

That’s a big opportunity to boost summer sales by ramping up the excitement at store level and targeting national<strong>is</strong>tic fans.

Hofer - A Hard D<strong>is</strong>counter<br />

Hofer <strong>is</strong> a hard d<strong>is</strong>counter owned by Germany’s Aldi<br />

Sud. They have 410 stores in <strong>Austria</strong>.<br />

Aldi <strong>is</strong> also at our border with over 1000 stores in the US.<br />

A hard d<strong>is</strong>counter squeezes out costs through high use<br />

of shelf ready packaging and low staff levels. Only two<br />

cashiers were available on a busy Friday evening and<br />

lines were long (above).<br />

The assortment <strong>is</strong> nearly 100% Private Label with even<br />

the biggest brands being excluded. No Coca Cola,<br />

Pampers, or Kellogg’s Corn Flakes are to be found as the<br />

cereal section at left reveals.

Zielpunkt - A Soft D<strong>is</strong>counter<br />

Zielpunkt <strong>is</strong> a soft d<strong>is</strong>counter owned by Germany’s<br />

Tenglemann Group (the former owners of A&P<br />

Canada) and affiliated with the Plus chain in other<br />

European countries. They have 300 stores in <strong>Austria</strong>.<br />

A soft d<strong>is</strong>counter uses many of the cost saving<br />

tactics of a hard d<strong>is</strong>counter but will have a larger<br />

assortment and a selection of national brands.<br />

Aggressive PL strategies (Nutella €2.39, PL €0.99)<br />

and heavy use of shelf ready packaging are used.<br />

<strong>Not</strong>ice the position of Heinz ketchup at left. Only one<br />

large size SKU in the bottom left of the plan-o-gram.

Added Freshness at SPAR Gourmet<br />

Breakfast starts off right at SPAR Gourmet! Shoppers can squeeze and bottle their own orange juice with th<strong>is</strong><br />

machine that <strong>is</strong> right in the produce section.<br />

<strong>Austria</strong>n shoppers often bag their groceries on tables located after the check out (right). SPAR Gourmet also allows its<br />

customers to grind their coffee beans before they leave the store. Perfect for the <strong>Austria</strong>n cafe culture.

SPAR Gourmet Supermarkets<br />

Great merchand<strong>is</strong>ing of “bio”<br />

products in the refrigerated section.<br />

Shopping for wine feels like<br />

browsing in a private cellar.

SPAR Gourmet Supermarkets<br />

Extensive d<strong>is</strong>plays for an <strong>Austria</strong>n favorite - Mozart Chocolates. These d<strong>is</strong>plays were all in one<br />

supermarket of 700 square meters - however it was within walking d<strong>is</strong>tance of <strong>Vienna</strong>’s famous opera<br />

house. Kudos to the Mirabell brand owner - Kraft Foods.<br />

Mirabell produces 90 million units per year. <strong>Not</strong> bad for a country of 8.3 million!

SPAR Gourmet Supermarkets<br />

SPAR <strong>is</strong> a buying co-operative similar to IGA in North America. It bills itself as the “world’s<br />

largest supermarket chain” with over 20,000 stores in 31 countries on four continents. The<br />

chain has more than 1500 stores in <strong>Austria</strong>.

BIPA Drugstores - Standing Out In a Crowd<br />

BIPA <strong>is</strong> a chain of 560 drugstores that really standout. More of a beauty store (think SDM less the pharmacy and food)<br />

these stores catch your eye even on the busiest city streets. Cons<strong>is</strong>tent use of the white and pink colors inside and<br />

outside the store <strong>is</strong> an excellent example of strong retailer branding.<br />

BIPA <strong>is</strong> owned by REWE Group and <strong>is</strong> closely tied to BILLA supermarkets.

BIPA Drugstores - Standing Out In a Crowd<br />

BIPA <strong>is</strong> more of a perfumery than a traditional drugstore as we<br />

know it in North America. Cosmetics, Health & Beauty and<br />

Toiletries make up the bulk of the offer.<br />

Branding <strong>is</strong> very cons<strong>is</strong>tent with the hot pink extending to BIPA’s<br />

private label cosmetics brand “b.pretty”.

DM Drogerie Markt<br />

DM <strong>is</strong> one of Europe’s biggest<br />

drugstore chains. Based in<br />

Germany, the company has more<br />

than 2,200 stores in Germany,<br />

<strong>Austria</strong> and CEE. It’s 354<br />

drugstores in <strong>Austria</strong> make it the<br />

country’s second largest chain.<br />

An innovative leader in the format<br />

with a strong private label program<br />

called Balea.<br />

DM has experienced explosive<br />

growth in the past five years driven<br />

by geographic expansion.

Making Gift Giving Easy<br />

The DM store that I v<strong>is</strong>ited in <strong>Vienna</strong><br />

had th<strong>is</strong> little kiosk near the exit with<br />

free gift wrap and ribbon.<br />

I thought it was a great way to<br />

encourage gifting especially those last<br />

minute gifts when you are “on your<br />

way to Grandma’s house”.<br />

Placing the kiosk near the door firmly<br />

plants the idea in the shoppers mind<br />

so that when they need a gift they<br />

know where they can get one in a<br />


Balea - A Brand of Its Own<br />

Balea <strong>is</strong> a significant private label brand that competes in many health and beauty categories across the store. The<br />

product range <strong>is</strong> very wide as demonstrated by the skin care range above.<br />

Well respected, the Balea brand <strong>is</strong> featured prominently in DM promotions including it’s weekly flyer.

Babylove - Coming Soon to SDM?<br />

Shopper’s Drug Mart<br />

launched over 300 SKUs of<br />

Balea product in Canada in<br />

2009 across personal care<br />

and hygiene categories.<br />

The latest SDM Annual<br />

<strong>Report</strong> mentions an<br />

expansion of its private label<br />

brands in baby care.<br />

Will babylove be the brand<br />

they use to expand their PL<br />


Tchibo - Cafe or Retailer?<br />

Tchibo <strong>is</strong> a unique retailer in that it <strong>is</strong> principally a cafe just like Starbucks. You can have a coffee or have<br />

beans roasted to take home.<br />

However, step inside and you instantly recognize that it <strong>is</strong> much more than a cafe. Its a retailer that leverages<br />

its high traffic to sell quality seasonal merchand<strong>is</strong>e with a “treasure hunt” philosophy.<br />

It’s like Starbucks meets Costco.

Tchibo - Cafe or Retailer?<br />

View from the entrance<br />

Fresh Roasted Beans<br />

Coffee Accessories

Tchibo - Cafe or Retailer?<br />

Camping Gear and Active Wear Men’s V-neck Sweater

Nespresso Flagship Store<br />

Nestle has significantly changed the coffee market in Europe with the launch of Nespresso - an ultra<br />

premium coffee experience driven by its exclusive capsules and coffee machines.<br />

Most consumers buy capsules through mail order but in several cities across Europe they have built flagship<br />

stores to enhance the brand experience with its upmarket consumers.<br />

Step inside the store and you are in a virtual brand world - for a CPG product.

Nespresso Flagship Store<br />

Interact with the Nespresso capsules. Perfectly controlled brand executions.<br />

Even recycling the<br />

capsules creates a<br />

trip to the flagship<br />

store to make another<br />

purchase!<br />

Everything you need for the Nespresso experience.

4804 16 Street SW

Hooray! Your file is uploaded and ready to be published.

Saved successfully!

Ooh no, something went wrong!