Olive Oil Aisles Result in Superior Supermarket Sales

How olive oils are pre­sented and described in super­mar­kets has a tan­gi­ble impact on sales, the results of a new study reveal.

According to Juan Vilar Strategic Consultants, about 65 to 75 per­cent of olive oil for domes­tic use is sold in super­mar­kets and hyper­mar­kets glob­ally.

As a result, how the olive oils are pre­sented makes a big dif­fer­ence for the pro­duc­tion value chain and con­sumers.

Juan Carlos Marín, the head of gro­cery stores at Grupo Alcampo, and Juan Vilar car­ried out an exper­i­ment in which olive oils were placed into a sep­a­rate aisle at a super­mar­ket and accom­pa­nied by infor­ma­tional signs.

The super­mar­ket, run by Grupo Alcampo, is located in Linares, Andalusia, and receives an esti­mated 3,000 cus­tomers daily. The store sells 650 dif­fer­ent olive oils from 53 brands, both local and inter­na­tional.

In the aisle, the olive oils were divided by cat­e­gory and accom­pa­nied by infor­ma­tional sig­nage and QR codes detail­ing where the olives were grown, infor­ma­tion about the pro­ducer, the olive vari­eties used in the oil and the cul­ti­va­tion method.

After a year of this setup, the study demon­strated that cus­tomers were will­ing to pay 5.5 per­cent more for olive oil and bought 18 per­cent more olive oil than shop­pers in reg­u­larly laid out Spanish super­mar­kets.

The fig­ures were even higher for extra vir­gin olive oil in the setup, with cus­tomers pur­chas­ing 13 per­cent more extra vir­gin olive oil and spend­ing 5 per­cent more than in reg­u­lar super­mar­kets.

“The result of the descrip­tion, expla­na­tion and infor­ma­tion pre­sented to cus­tomers about olive oils gen­er­ated greater loy­alty on the part of the con­sumer, a will­ing­ness to pay for the value of the prod­uct based on its attrib­utes, greater con­sump­tion of the prod­uct and resulted in an increase in sales,” Vilar told Olive Oil Times.

However, the con­clu­sions of this study go beyond olive oil sales and shed some light on how peo­ple shop.

In spe­cialty stores and small busi­nesses, ven­dors gen­er­ally take the time to explain the value of their prod­ucts to the con­sumer, which allows them to make a more informed deci­sion. This is known as active shop­ping.

On the other hand, most con­sumers mak­ing pur­chases at super­mar­kets are engaged in pas­sive shop­ping. They are pro­vided with vast amounts of choices with lit­tle infor­ma­tion besides the food pack­age design and price.

A con­sumer sur­vey from the University of Southern California indi­cated that while 64 per­cent of super­mar­ket shop­pers in the United States read nutri­tion labels, many were unable to use that infor­ma­tion to dis­tin­guish between healthy and unhealthy food.

Instead, the sur­vey found that shop­pers rely on item loca­tion, pack­ag­ing, color and mar­ket­ing buzz­words when mak­ing their pur­chases.

While their study focused specif­i­cally on olive oil, Vilar believes sep­a­rat­ing any type of spe­cialty food from cheaper alter­na­tives and explain­ing its value to con­sumers would result in more sales and higher mar­gins.

“What I would do within the super­mar­kets would be to increase the staff of peo­ple who are ded­i­cated to explain­ing the prod­ucts in an acces­si­ble, sim­ple and fast way,” he con­cluded. ​“In any prod­uct, not only in olive oil, when you describe the prod­uct well, the result is always an increase in sales.”

• Interempresas
• University of Southern California