The Final Four of the Total Store

The Final Four of the Total Store

Each spring, college teams compete in the NCAA Division I men’s basketball tournament, also known as “March Madness,” which narrows the teams down to the “Sweet Sixteen,” the “Elite Eight” and the “Final Four,” until just two are left to compete for the title of national champion. In the same spirit, we’ve designed Nielsen’s Total Store Final Four to discover retail’s sales champions.

From nearly 1,000 unique categories across the grocery store, we first narrowed the field to 16 food and beverage categories based on the largest absolute dollar growth over the past two years. With a mixture of perishable, grocery, dairy and frozen categories, each category in the bracket saw sales increase at least $245 million over that period, and collectively they represent $6.5 billion in growth since February 2015. The growth of volume suggests these categories have more to offer than just rising prices.

The saying goes that defense wins championships, so what wins consumers’ dollars? The answer isn’t quite as straight forward, though a few commonalities span categories: health, convenience, multicultural influence and innovation. Often products that solve for multiple needs at once have the most sustained success.

Deli salads is the first category to cut down the nets. Although inclusive of both UPC and non-UPC products such as potato salad or chicken salad, sales from the deli service counter are the team’s most valuable player. Sales have consistently increased each year as consumers turn to the deli department for convenient solutions, and retailers are responding with new and innovative offerings that turn some deli departments into “grocerants.”

Joining deli salads as a representative from the deli department is sushi. There are two options when it comes to driving growth: reaching more people or getting your buyers to purchase more often. Led by Millennials, more and more households have purchased deli sushi, although household penetration is still below 10%. The future is bright for this emerging category as palates continue to evolve, the influence of multicultural households continues to gain momentum, and distribution expands to alternative channels like drug stores.

Packaged salad kits punched their ticket to the Final Four courtesy of a burst of innovation in recent years. Combined with an inherent health component, salad kits offer a powerful one-two punch. The introduction of a complete set of ingredients for lunch on-the-go or a dinner side in minutes has elevated this category to innovation hall of fame. Salad kits have also capitalized on rising multicultural trends, with strong sales from Asian-inspired chopped salads to spicy southwestern ingredients, which keeps this category relevant and exciting.

Yet just as most tournaments feature a tournament surprise, so does ours. While the first three categories hail from deli and produce, bottled waters round out our Final Four as the lone grocery representative. Perhaps most surprising, the leader of all category growth has managed this feat as a separate category from the innovation and growth thanks to sparkling and enhanced waters. Water certainly fits the bill of a healthy choice, but convenience plays a critical role for this category as well. Although re-usable water bottles might be popular with some, bottled water has managed to both reach more households and get them to buy more often, proving that sometimes consumers are willing to pay for even the simplest of convenience solutions.  

About the bracket

For the first time ever, a true comparison of total store sales has been developed by utilizing Nielsen’s fully integrated data set that combines UPC and non-UPC data. For this release, all edible categories across the entire store were ranked according to their absolute dollar growth over the last two years from Nielsen’s xAOC universe. The top 16 categories were selected for the ‘tournament.’ From there, each category was matched in a traditional bracket style with the fastest growing category (No. 1 seed) paired against the lowest category of the group (No. 4 seed). Categories progressed through the rounds to our “Final Four” based on their cumulative two-year absolute dollar growth from February 2015 – February 2017.