Caitlin Pappas, vice president of U.S. sales for Johnson & Johnson (J&J), is particularly enamored of retailing and retailers, so much so that she spends about half of her working life meeting with retail executives and visiting stores.

David Pinto, Caitlin Pappas, Johnson & Johnson , J&J, Target, Walmart, Stop & Shop, Listerine, Band-Aid, Neutogena

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Inside This Issue - News

J&Jís Pappas surveys the retailing scene

April 15th, 2013
by David Pinto

WATCHUNG, N.J. – Caitlin Pappas, vice president of U.S. sales for Johnson & Johnson (J&J), is particularly enamored of retailing and retailers, so much so that she spends about half of her working life meeting with retail executives and visiting stores.

This, despite the many internal demands of her job, one focused on directing and managing sales of J&J’s wide-ranging portfolio of category-leading health and beauty brands.

Atop these responsibilities, Pappas, whose husband also works for J&J, is a mother of two, a teenage daughter and an about-to-be-teenage son. Finally, she is immersed in a variety of business, civic and women’s organizations, commitments that effectively round out her days and weeks.

So it was that, on a cold and cloudy mid-March Friday, she could be seen walking stores in the northern New Jersey bedroom community of Watchung, some 30 miles west of New York City, there to ascertain how effectively Target, Walmart and Stop & Shop — three tenants that anchor a major shopping mall here — were serving the customer. While there, she also sought to determine the merchandising effectiveness and sales impact of the J&J brands within those stores.

In the main, Pappas was impressed with all three stores, though she did note some opportunities. She first stopped at the Target store, where she observed immediately on entering that the photo kiosk just inside the store’s entrance was dark and, more tellingly, untended by a Target team member. "This is not the first time I’ve noted an absence of personnel at the photo counter: I don’t think any consumers use our retailers for photofinishing anymore," Pappas, who, as a consumer, shops this particular Target about once a month, told a friend who had accompanied her on the store tour. "I believe that area could be more productive — and more valuable — if Target transformed it into a health and wellness center." Had she ever mentioned that idea to the people at Target? "Not yet."

The J&J executive also observed the inordinately high out-of-stock condition, although she did note that, it being a Friday, store personnel might be occupied preparing for a busy weekend.

On the positive side, there was much that impressed the 47-year-old J&J executive. "The graphics are particularly appealing," she noted, adding that "the signage is very clear and easily seen, and the illustrations and creative use of indirect lighting in such areas as cosmetics further simplify the customer’s job of finding the products she’s looking for." She was impressed as well with the fact that Target — as well as Walmart, as she was later to discover — had put out such seasonal categories as sunscreens and antiallergy products two weeks before the start of spring. "We’ve found that when retailers put up these products in advance of the season, customers often buy them in advance of the season," she noted.

Pappas, who, as a former marketing executive, is thoroughly familiar with such concepts as product penetration at the consumer level, noted that Target had led a gondola run with toothbrushes, which have a 98% household penetration rate, while putting mouthwash, a category with only 35% household penetration, further down the gondola. "It seems to me," she said, "that you would want to expose shoppers to mouthwash at the beginning of an aisle, rather than burying it in the middle of a gondola run, especially one that leads with a universally used product like toothbrushes, a category that would normally discourage a consumer from shopping that aisle any ­further."

It must be noted, in passing, that Listerine, the best-selling mouthwash, is a J&J brand.

Throughout the retailing excursion, Pappas kept returning to health and wellness as a theme, repeatedly saying that the critical shortage of primary care physicians should serve as a wake-up call for retailers, especially as an aging population would likely respond favorably to a health and wellness emphasis in a retail ­setting.

Her final thoughts regarding Target dealt primarily with consumer activity and the willingness of the Target team members to assist shoppers. "I’m impressed that so many customers are filling their baskets," she said, "and equally impressed by the quality of service. The Target staff members appear to be sincerely interested in helping their ‘guests.’ "

Pappas’ next stop was a Walmart in the same shopping mall, a visit that engendered new enthusiasm in the J&J executive. "The in-stock position here, generally speaking, is better than what I saw at Target," she remarked, "though neither the service level nor the overall store cleanliness, in my opinion, are as good. Put another way, there are fewer staffers and more clutter here than at Target."

Several merchandising touches impressed Pappas. Looking at the store from a J&J perspective, she noted that baby products, another category where the J&J brand dominates, were double-displayed, available both in the health and beauty aisle and in the baby products section. "The smart thing Walmart has done," she said, "is home the small and large sizes in the health and beauty section and the mid-sized brands in the baby section. What locating these products within the baby aisle does, in my view, is expose new mothers to these products as soon as they leave the hospital — Walmart merchandises gift sets in this location as well — and so encourage them to build a loyalty to the products at the start of their baby-rearing years, something we believe will ultimately benefit the J&J brands."

Pappas was impressed as well with the way Walmart merchandised J&J’s Band-Aid adhesive bandages brand, noting appreciatively that the mixed-assortment SKU, a recent addition to the line that has been selling well, was prominently positioned by Walmart within the Band-Aid gondola run.

Then there were the pharmacies at both the Target and Walmart stores, in contrast, it should be noted, to the Stop & Shop supermarket, which has no pharmacy. "The pharmacy at Walmart is the more conveniently located of the two and so gives consumers easier access," she said. "The Target pharmacy counter, by contrast, provides less easy adjacencies from the health care aisles. But both counters are easily seen and well laid out, offering customers easy access to pharmacy personnel; a large, prominently signed consulting area; and separate locations for dropping off and picking up prescriptions."

Pappas was surprised that neither pharmacy was overly busy, given the department’s prominence in the store, its appealing graphics and its ease of navigation.

Pappas’ last stop on this store excursion was the Stop & Shop supermarket and, in many ways, the J&J executive felt it the most appealing of the three stores on her agenda (though she remained critical of gondola runs that sometimes provided greater visibility to high-penetration categories than those with potential for increased usage).

Pappas commented favorably on Stop & Shop’s treatment of Neutrogena, another J&J brand. "Neutrogena is a complex, multi-SKU brand," she said, "and Stop & Shop has organized and merchandised the assortment as effectively as any retailer that carries it."

"Overall," she concluded, "in terms of organization, presentation, in-stock position and completeness of assortment, I believe Stop & Shop makes the best impression on the customer. It’s unfortunate that the store doesn’t have a pharmacy counter, for I believe it would really do well in this environment."

On balance, then, Pappas accomplished much on her tour through what she believes are representative stores of three of America’s best retailers. She reassured herself that the brands for which she’s responsible are holding their own in a competitive retail environment. She came away with a positive feeling about the stores and how effectively they relate to the customer. And she reaffirmed a belief she has long held: A critical part of her job can only be accomplished at retail.