Getting Front and Center A shelving strategy a la PIRATE'S BOOTY
(FORTUNE Small Business) – Launching a new product is never easy, especially on crowded snack-food shelves. But Robert's American Gourmet broke through with an eccentric line of health-conscious chips, puffs, and pretzels that made $20 million in revenues last year. CEO Robert Ehrlich on solving the retail riddle:
1. GIVE 'EM AN EYEFUL Don't ignore the power of packaging. Ehrlich's images include wacky cartoon characters--from pirates to professors. Names like Nude Food and Potato Flyers don't hurt either.
2. BE A SNEAK In retail, as in real estate, location is everything. Especially when it comes to new products. To get his specialty snacks moving when he was first starting out, Ehrlich wasn't above shifting bags from the bottom of store shelves to a more conspicuous eye-level location. Sure, he was repeatedly reprimanded for meddling with merchandise, but he persisted. Says Ehrlich: "Waving a meat cleaver isn't going to stop me."
3. BE COOL Retailers wanna be hip, so keep an eye on trends and consider tweaking your products to stay current. For instance, Ehrlich timed the launch of his first snack, Oat Bran Potato Chips, with the publication of a book claiming oat bran lowers cholesterol. To keep sales healthy since, he's added kava kava, St. John's wort, and ginseng to his fad-filled ingredients list.
4. THINK SMALL Rather than go chip-to-chip with giants like Frito-Lay, which dominate supermarket distribution, Ehrlich focused on indie stores and mom-and-pop shops willing to take a chance on new items. Of the roughly 20,000 stores his snacks are now in, about 30% remain independently owned markets.
5. MILK THE MARKUP Unlike others, Ehrlich's snack bags don't have a price prestamped on the packaging, allowing stores to price his popcorn, potato chips, and pretzels however they please. Retailers love it. (In Manhattan a four-ounce bag of Pirate's Booty can go for as much as $4.) Consumers? Hopefully they're not reading this.