Summer is just around the corner and restocking regularly is especially important during this period to give soft drink sales a boost. BetterRetailing looks at how retailers can use soft drinks to create their own summer.
Retailer views
- “When it comes to water, I noticed people were buying all the different flavours last summer, so it’s important to get them in. Slushies are great – they can cost 11p and sell for £1.”
Raaj Chandarana,
Premier Tara’s News, High Wycombe, Bucks.
- We’re changing the planogram we use for our soft drinks and increasing our promotions on water. We’re also going to get a slush machine, which we haven’t tried before.”
Azeem Khan, Excel Forecourt, Bradford.
- “We’re by the sea and get a lot of tourists. I have three walls dedicated to chillers and they’re larger than the nearby multiples. To make sure I’m competitive with prices I’ll be heading to the nearby Tesco and Morrisons to make sure I’m competing.”
Sivalimgan Prakesh, Sandyback Garage, Lancashire.
Be ready for the sunshine
As the temperature increases so do sales of soft drinks. Summer is fast approaching and retailers that create engaging displays, keep well stocked to meet demand and offer competitive prices will succeed in the coming months.
“Chilled availability is the key driver for soft drinks sales, particularly between April and August,” says Adrian Troy, head of marketing at AG Barr.
In hotter weather customers will want to be able to dive into a store, grab a drink quickly and go. “Front of store impulse chiller placement is key to driving impulse sales, especially during the warmer months,” says Guiseppe Vullo, brand manager for Grace Foods.
Keeping drinks chilled in the summer doesn’t just increase sales in terms of volume; it could even allow you to sell the product at a higher price. Nigel Paine, out-of-home commercial director at Britvic, says 86% of consumers want their soft drinks to be chilled. He says: “Fifty-three per cent go as far to say they’d pay more for a soft drink if it was cold.”
But chilled drinks don’t just keep your customers refreshed, they can even boost perception of a store in general. “Consumers perceive chilled as fresher, and by implication healthier, than ambient, which is reflected in the increasing number of chilled drinks sold,” says James Logan, commercial director for Refresco Gerber.
Ambient soft drinks, particularly carbonated drinks, appeal to consumers less during warm weather. Retailers report sales remain strong, but there’s no question that chilled drinks are the stars of the show. “Impulse purchases of chilled drinks increase considerably in the summer months, and as a result, retailers in all channels need to ensure there is plenty of chilled availability,” says Maurice Newton, sales & marketing director at CBL Drinks.
Summer means barbecues, parties and picnics, which means retailers should stock soft drinks that cater for special occasions. Simon Harrison, wholesale sales director at Coca-Cola Enterprises, says: “Adult soft drinks, such as Appletiser, are great for a special occasion, and its premium packaging can help drive sales. This gives consumers a chance to trade up to a premium soft drink.”
But summer allows for much more opportunity than that. Many retailers are buying iced slush machines to be a bit more creative with their range.
Offering retailers margins of around 77%, slushie manufacturer Snowshock says its machines come with enough syrup to make your money back on the purchase. The company is also preparing
to grow the customer base further by tapping into health conscious consumers with a slush drink that offers one of your five-a-day.
Refresh your range
Keeping chilled is all well and good, but which flavours and sub-categories you offer will have a huge effect on sales. Retailers such as IAA award-winner Raaj Chandarana and Azeem Khan, who we spoke to for our retailer panel, say summer is all about water and they’re not wrong. Water is a must stock as it’s the fastest-growing category, up 9.8% in volume year on year in contrast to overall soft drink sales of 0.2%.
Within soft drinks, different and exciting flavours are those that engage customers best. Exotic flavours have seen a rapid growth in recent years as consumers seek new, authentic flavours.
“Mango flavour drinks are now outselling apple by 18%, while within juices, exotic flavours have grown the category by 17% in the last two years,” says AG Barr’s Adrian Troy.
As summer approaches, customers with ambitions to enter marathons or get bikini ready are looking for any product that can give them a boost.
Once you have your range planned out, selling them in a format that works is the final ingredient to successful summer sales. Britvic’s Nigel Paine says: “Price-marked packs offer great appeal to shoppers and present a significant sales opportunity for independent retailers.” Britvic Soft Drinks offers 49p PMPs in cases of 24x330ml cans across its carbonates and fruit carbonates range, such as Pepsi, 7Up and Tango.
In the last issue of Retail Express, we proved that PMPs allow retailers to outstep the multiples, and Lucozade’s 79p PMP range across its Lucozade Sport and Energy drinks was among the ones that do. “PMPs help customers feel they are getting great value for money, aiding retailers in gaining trust and repeat custom,” says Georgina Thomas, category director for Lucozade Ribena Suntory.
Get beach body ready
Ed Whitehead, strategy & planning manager at Red Bull, says campaigns such as Change4Life have led to a change in perception from consumers. “In 2014, diet drinks were a key growth driver in energy,” he says. Red Bull Zero was supported in January by a ‘zero excuses’ campaign that focussed on New Year’s resolutions.
Shopper desire for healthier drinks has also helped coconut water benefit from huge growth and paved the way for aloe vera drinks. Giles Brook, CEO of Vita Coco Europe, says: “We continue to see an increase in consumers turning to 100% natural beverages, specifically parents scrutinising what drinks they are giving their children.”
The health benefits of aloe vera in its natural format are well known,” says Grace Foods’ Guiseppe Vullo.
“We believe that ready-to drink aloe vera has as much potential as coconut water in the UK.” Grace Aloe Vera Refresh is available in 500ml bottles in Original, Strawberry and Mango, RRP £1.49 in outers of 12.
Despite changing attitudes, soft drinks are here to stay. “No one could have escaped the ongoing negative media focus on the sugar content of some soft drinks, yet 75% of consumers believe that fruit juices and smoothies can be part of a healthy diet,” says Razin Ali, Sunmagic brand manager. This implies that positive elements such as juices contributing to consumers’ five-a-day and the ‘naturalness’ of the sugar, outweigh the possible adverse effects for many people.
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