The Hustle Daily Show The grocery store shelf battle
Jan 10, 2024
Explore the rivalry between Oreos and Hydrox cookies and how grocery stores decide which products to place on their shelves. Learn about the history of the Hydrox cookie and the challenges faced by its resurrection. Discover the dynamics between major manufacturers and grocery retailers, including category captain arrangements and slotting fees. Hear about a current fight between a European grocery chain and PepsiCo, showcasing strained relationships due to inflation and high prices.
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Hydrox Cookie History
- Hydrox was the original chocolate sandwich cookie, invented before Oreo.
- Oreo copied Hydrox and eventually dominated the market, making Hydrox nearly extinct until its revival in 2015.
Shelf Space Power Dynamics
- Major manufacturers pay retailers for shelf space and guidance on product placement.
- These category captain arrangements can stifle competitors by controlling product visibility.
Grocery Stores' Promo Revenue
- Grocery stores earn massive revenue from promotional payments by manufacturers, nearly half their total sales income.
- This heavily advantages large manufacturers and complicates retailer-manufacturer relationships.