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EDITORIAL COMMENT
SEPTEMBER 2008

 
To Test or Not to Test?
Or,
What to Test And Where To Test?

When it comes to the sale of beer and wine in commissaries, there are a lot of opinions, some of which no doubt have been formulated long ago, and some more recently. Here are a few bushels of grist for the mill, that perhaps folks who are new to the military resale environment might not be aware of — whether their work involves exchanges, commissaries, or both.

To begin with the beginning, Congress or the Department of Defense (DoD) didn't just wave a magic funding wand and lo and behold, there suddenly appeared a network of commissaries. Far from it, these stores evolved continuously from the Army commissary department storehouses of the late 1820s into the modern Defense Commissary Agency (DeCA) supermarkets and 'superstores' we have today. More significantly, perhaps, every inch of product carried in those stores bears the scars from the fields of many battles waged over this or that category, and this or that inch of shelf space. Every section had to prove its worth — and with the modern category management practiced by the Marketing Business Unit (MBU), that still holds true.

And so it has been with any number of categories and products — many have had to go under the microscope: How would it affect the exchanges on base? How would it affect the outside-the-gate community? How would their inclusion in this or that assortment affect existing product categories? Should we? Shouldn't we? ... and so on.

Commissaries didn't get a Health and Beauty Aids (HBA) section because someone said “Shazam! Let there be HBA in the aisle today!” Far from it. Civilian supermarkets did not always carry HBA — or Health and Beauty Care (HBC) as it is now known in some stores. HBC sections did not wander across the street from drug stores into civilian grocery stores until sometime during the 1950s. After that, it was a long struggle for HBA to be authorized for sale in the commissary, and an almost equally long one for it to achieve category success.

Initially the category was sold in an HBA “alcove.” The concept was a dismal failure, and it wasn't until HBA found a place in the regular aisles that it took off. Of course, back then, there were many who said that it would hurt the exchanges and would be out of place in a commissary. There were those who protested that there was no shelf space for HBA, and others who complained it would take away space from new items and line extensions. And while some of that was true — or more true in some places than others — over time, the category has unquestionably gone forth, multiplied and prospered, in both exchanges and commissaries. As a pie, it only got larger, and so did its slices.

More recently, when there was a test of magazines in commissaries, it was a dismal failure at first. It took a second attempt to get the program off the ground before it met with success.

Even more recently, there was a long struggle waged over photographic film — we had to say 'photographic,' otherwise some people might not remember what we were talking about — single-use cameras, greeting cards and pre-paid phone cards. The commissaries didn't want them, the exchanges could have cared less; the test took place, and you would have needed a bloodhound to find where in the store they wound up being stocked. Needless to say, that test didn't work too well, either.

And now, another opportunity has presented itself, and history has shown that if the test is not done properly, it's not going to yield results that are worth a doodly.

Plunking down a pallet of beer and a few bottles of wine in a commissary might sound like a simple matter to the uninitiated, but the stocking of the right wines and the right beers is not pot luck, it's a science. And if it's going to be tested at all, it needs to be done right. (That's why we ran the story on page 18. The Nielsen Company has done quite an extensive study of beer and wine sales in the civilian market, and much can be learned from this analysis.)

When the subject of testing beer and wine sales in commissaries was first brought up a few years ago, it was met with reluctance, and no one really wanted to test it.

Now Congress [the House] has given DoD authorization to test. There will be questions. For instance, does such an enterprise fly in the face of DoD's own efforts to deglamorize alcohol in the military? Others might counter that a glass of wine at dinner is not alcoholism in any way. Yet others will say it's part of a healthy diet according to some medical journals and esteemed medical schools. Others are entitled to ask what is wrong with a couple of beers with a buddy while watching a football game?

A test is simply that, a test, and is not to be confused with a final outcome. But if ever there were to be a test where all the proper measurements would need to be taken, and all the implications and expectations would need to be explored, this would be it.

If 10 stores are chosen, they need to be the right 10. Going in, demographics should be studied to make sure that wine sales and beer sales at a given location warrant the test for that beverage class, for that location. For example, it might not make much sense to put a large wine section in a commissary that serves a training base for young, single active-duty soldiers, when such a section would be a better fit on a base with a larger population of established families.

The effects upon incremental sales and foot traffic also need to be considered for both commissary and exchange locations. If beer and wine is a destination category for a Shoppette, Mini-Mart, Marine Mart, Class Six or package store on a given base that is perhaps located in category-competitive proximity to the commissary, would that store suffer an unmitigated loss of patronage? Also, would those exchange outlets lose essential incremental sales as a result of commissaries adding a “driver” category? If such were to be the case for that installation or location, then perhaps one or other or both categories shouldn't go into that particular commissary.

When it comes to space concerns, it would appear DeCA has enough superstores large enough to handle a decent assortment of beer and wine. The parameters for those assortments is another question a successful study would need to take into account — should they include only non-chilled items? Cases? Half-cases? Six-packs? Would the wine selection for a commissary test, for example, focus more on table wines than on higher price-point offerings?

Even as these variables are pondered, it might be worth bearing in mind that beer and wine have not, universally, always fallen within the purview of the exchanges. In some exchange services, and at some locations, they were once the domain of morale, welfare, and recreation (MWR). A lot of wheeling and dealing followed, to ensure MWR got their share of the profits. Expect nothing different here. It's difficult to name another category that presents as many hurdles but promises as great an upside.

One thing we know, some tests in the past have been handled poorly and others well. This is one test that fully deserves to be executed with vision and precision. We'll raise a glass to that.


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