Tobacco display bans and supermarket “prime real estate”
A couple of years ago, I read an article that demystified how and where products are displayed in supermarkets. It described in great detail the bidding process between brands for prime placement, and how virtually no placement is random. Supermarkets charge a premium to be at eye level, at the entrance, and at ends of the aisle where they can catch shoppers' attention. The article made me realise different areas of the supermarket are essentially chunks of valuable real estate which follow the age-old rule of "location, location". It changed forever the way I look at shops, especially Australia's big two supermarkets.
Earlier this year, legislation came into effect in NSW that all tobacco products must be hidden from view. "Power walls" of tobacco displays used to dominate the customer service counter at the front of shops; now shoppers are confronted with a largely blank area. Knowing how valuable every square metre in a supermarket is, it seems bizarre that this prime space is taken by a bland cabinet and dominated by an enormous poster warning of the dangers of the product hidden from sight. While some other products are starting to creep in, the space is largely a void. Are the tobacco companies paying to keep other products out? Admittedly, legislation dictates that tobacco products can only be sold from one counter, but surely supermarkets would be better off giving the space over to "power walls" for more lucrative products with a brighter sales future - download vouchers, mobile phone products, even the ever-expanding pharmaceutical ranges they are carrying (including nicotine replacement therapy products, which are apparently a big target for thieves). It is hard to believe that other big companies are not bidding to pull this space away from tobacco companies.
I can't help wondering how much it costs the tobacco companies to continue to occupy this prime space in the face of declining returns. When will we reach the tipping point where it is no longer worth the while of supermarkets to even carry cigarettes? With plain packaging around the corner, which is likely to further dampen the enthusiasm of young people to take up smoking, perhaps we don't have to look too far into the future to imagine cigarettes being the exclusive domain of a dwindling number of specialist tobacconists. No wonder the industry fights tooth and nail against these kinds of restrictions!
Picture courtesy of www.ashaust.org.au