Cold Vault Sales Climb

“ “Because the nature of convenience stores leverages an impulse-buy mentality, it’s important for stores to stock wellknown, familiar brands that consumers can trust. known, familiar brands that consumers can trust.

— Carmen Bryan, consumer analyst for GlobalData

“Devo, an alcoholic coconut water, is one of my top sellers. That’s kind of the new trend there,” he said. On the liquor side, sales of tequilas and bourbons are surging.

Coast to Coast’s merchandising plan includes a large display of Barefoot Wine by the entrance. “We do ‘two for $9.99,’ so the immediate perception is that there is value in the store,” Hawatmeh said.

Hawatmeh is hopeful the increased sales the adult beverage category experienced in 2020 and 2021 due to COVID-19 will continue into 2022. And he has reason to be optimistic. The alcoholic beverage market in the U.S. is expected to grow by $64.01 billion between 2020-2024, expanding at a compound annual growth rate (CAGR) of nearly 5%, per Technavio, a global technology research and advisory company.

Hawatmeh advised other retailers to consider an expanded adult beverage offering, given the opportunity in the category. CSD

fast facts:

• Wine sales were nearly $1.5 billion, up 7.4%, while hard seltzer sales surpassed $1.7 billion, up 44.9% for the 52 weeks ending

Sept. 11, 2021, per NielsenIQ. • Over the past 12 months, the popularity of fruity and sweet beers has been growing at cstores, reports Datassential.

Category Management | Packaged Beverages COLD VAULTSALES CLIMB

Despite the continued out-of-stocks caused by pandemic-fueled distribution, packaged beverage sales at convenience stores are experiencing healthy sales growth.

Marilyn Odesser-Torpey • Associate Editor

The packaged beverage category at convenience stores is seeing strong sales growth in 2021, driven partly by ongoing beverage innovation, including new flavor options. Retailers are seeing increased customer demand for ready-to-drink (RTD) coffee, energy drinks and sparkling waters, as customers seek out beverages they perceive as healthier or energy-boosting.

Total RTD beverage sales increased in convenience stores by 9.1% within the latest 52 weeks ending Aug. 28, 2021, according to NielsenIQ. The heftiest growth was in the coffee category, with an 18.6% upsurge, followed by sports drinks with a 15.4% rise and fruit juice up 13.2%.

RTD tea sales grew by 1.8%, while its fermented sister segment, kombucha, increased by 6.7%.

Soft drink sales rose 4.5%, sparkling water 10.4% and coconut water 10.7%. Still water sales grew 4.5% and fruit drinks 6.6% for the same period.

CUSTOMERS DRINK UP INNOVATION

At Englefield Oil’s Duchess convenience stores, with 119 locations in Ohio and one in West Virginia, carbonated soft drink sales have demonstrated consistent growth over the past few years, mostly due to the big legacy brands continually coming out with interesting new flavors, said Nathan Arnold, director of marketing, Englefield Oil. These innovations, he said, give Duchess something to build promotions around.

“We prominently display signage to alert customers and generate interest about the new flavors,” he noted. Duchess convenience stores has seen consistent growth in carbonated soft drink sales over the past few years, and coffee sales are stronger than ever.

Coffee “is huge for us and continues to grow,” Arnold said. Sales are so strong that the company is looking for additional brands to carry.

Like soft drinks, manufacturer innovation is the key to this growth. He cited Starbucks’ introduction of coffee drinks made with almond milk.

Additions of limited-time offer options, such as pumpkin spice for fall and peppermint stick for winter, also appeal to customers.

“People go to coffee shops to get a variety of barista-made specialty drinks,” Arnold said. “With the LTOs, they can get these same beverages in our convenience stores.”

Many customers are switching to lower- or no-calorie beverages as they seek out better-for-you drinks. Over the past year, the premium still and sparkling water categories have soared at Duchess stores.

Arnold anticipates that the water categories will continue to gain momentum. He is so confi dent that he plans to expand the categories in the stores when he does his next reset and to bundle waters with food items for special promotions.

Sports drinks, always a strong category at Duchess, are also a go-to for customers who want something fl avorful that’s not soda. Even though fl avored waters are making inroads in this category, Arnold expects it to remain a robust one.

Out-of-stocks have taken a bite out of the stores’ usually dynamic energy drinks category over the past year. However, customers are purchasing more four-packs to take home instead of single units to consume right away. The RTD tea category was fl at all summer at Duchess, which Arnold attributes to outof-stocks and customers substituting fl avored waters and other beverages.

“ “People go to coffee shops to get a variety of barista-made specialty drinks. With the LTOs, they can get these same beverages in our convenience stores. convenience stores.

— Nathan Arnold, director of marketing, Englefi eld Oil