You won’t have a fully successful summer without perfecting your soft drinks offer. Chris Dillon looks at five things you can do to get ready for the rise in demand.
1. Clear out slow sellers
Your soft drinks chiller should be one of the hardest-working areas of your store this summer. Every inch of it needs to be as profitable as possible.
By using your EPoS data and looking at sales reports from last summer, you will be able to work out which lines you should drop and which brands need more facings.
Adrian Troy, AG Barr marketing director, says: “Create your own core range from sales data of the top 20 lines in each sub-category rather than the national picture. This will tailor your range to local tastes.”
Shoppers that come to your store looking for a soft drink this summer will likely want to grab a well-known, refreshing drink to quickly cool off, so major brands should make up the bulk of your offer. Mark Sterratt, head of market, strategy & planning at Lucozade Ribena Suntory, says: “By focusing on well-known brands, retailers can ensure they are offering a recognised and trusted option.”
Give your bestsellers the space they space they deserve, says Rich Fisher, category development manager at Red Bull. “The top five soft drinks brands should be allocated 50-60% of soft drinks space,” he adds.
Once you have cleared slow sellers, consider replacing them with sectors that aren’t given enough attention in convenience stores. Rita Evora, category manager at Danone Waters, says smaller segments like fruit juice & smoothies, mixers and adult soft drinks tend to be under-represented in smaller convenience stores.
New products should also take the places of dead lines, as these are likely to be backed by supplier campaigns. Amy Burgess, trade communications manager at Coca-Cola European Partners, says: “It’s important to look to bestsellers that are backed by marketing investments as this can encourage consumers to seek out products.”
2. Expand your range of water
All soft drink sectors see a sales increase in warmer weather, but water steals the show. In convenience, sales increase by 40% over the summer.
Burgess says: “Bottled water is one of the fastest-growing soft drinks sectors, up by 10.1% over the past year.”
Shoppers looking for healthier alternatives are driving the trend. The benefits of water to wellbeing and productivity have been well documented and sales are booming as a result.
Silika Shellie, head of category & shopper development at Nestlé Waters, says the average person in the UK consumes 44 litres of bottled water per year. “Bottled water accounts for 18% of sales in convenience so should be given substantial space within the chiller,” she says.
To make more money from water, make sure you have three price levels in your range. Stock entry level brands like Nestlé Pure Life, then local options like Buxton or Highland Spring, and then international premium brands like S.Pellegrino if there is demand. It’s important to offer both still and sparkling options.
Harj Dhasee, owner of Mickleton Village Store (Nisa) in Gloucestershire, says: “In summer we have three shelves of water so we only have to restock once a day, in the morning. If we only have one shelf we’d have to restock during the day too.”
If you cannot dedicate that much space to water, you should keep an eye on the weather and restock ahead of busy times. Carol Saunders, head of customer marketing for Highland Spring Group, says: “Top up the fixture after the morning and lunchtime rush. Retailers should also keep up to date with weather forecasts and ensure popular summer drinks are in stock when the sun is shining.”
3. Stock low-sugar soft drinks
Consumer demand for healthier choices means that no soft drink range is complete without low- and no-sugar soft drinks.
Trystan Farnworth, convenience & impulse commercial director at Britvic, says: “With the health trend continuing to gain momentum, and convenience under-trading in no- and low-sugar soft drinks, retailers should see this as a major opportunity.”
This sector is a massive growth opportunity for savvy independent retailers and summer is the time to maximise sales. Lucozade Ribena Suntory’s Mark Sterratt says: “Low- and no-sugar flavours in particular see a sharp uplift in the warmer months, benefiting from an average 29% uplift in July.” Boost’s Simon Gray agrees. “Sugar-free energy drink sales are growing 47% year on year,” he explains.
Soft drink manufacturers are focusing attention in this area when it comes to new products and campaigns. CCEP’s Amy Burgess recommends retailers constantly review their soft drinks range as manufacturers launch new lighter options to meet this demand.
Suppliers are increasingly working on creating products that combine the flavour of the original product, with a no-sugar recipe to make them more appealing to shoppers. “Consumers are not prepared to compromise on taste,” says AG Barr’s Adrian Troy says.”
4. Get the right balance in your energy drinks
As shoppers get more active in summer, energy drinks will become more important to them to give them the boost they need to take on the warmer weather.
“Despite slowing sales within the soft drinks market, energy is a vital category. This high value, sought-after sub category is key to the success of soft drinks performance,” says Boost’s Simon Gray.
CCEP’s Amy Burgess agrees. “Energy is the bestselling soft drinks sector for independents,” she says.
AG Barr says big cans are leading the growth in the category as shoppers perceive them to give the most value, so retailers should stock a good range of them to meet demand.
It’s important to get the balance right in your energy drink range. It can be easy to get caught up in stocking as many flavours as possible, but too much choice and slow sellers will confuse customers and take up valuable selling space. Red Bull’s Rich Fisher says within energy, core varieties and different sizes are under-represented on shelf while flavours are often overrepresented. “Core sellers represent 34.7% of sales while occupying 13.8% on shelf. Flavours account for 40.3% of sales, yet currently receive 48.2% of space on shelf,” he explains.
Core functional energy drinks are also important because they can encourage shoppers to trade up from water, spending more in the process.
Lucozade Sport is aiming to get people active this summer with its ‘made to move’ campaign, which included a partnership with the London marathon last month. “Lucozade Sport Orange 500ml is a must-stock product for any retailer wanting to trade up water shoppers to maximise spend,” says Sterratt.
5. Don't forget sharing packs
Although most of your soft drink sales will come from single impulse bottles in summer, take-home packs are not to be forgotten.
Troy says: “Take-home products remain important for convenience retailers as they encourage footfall and shopper loyalty.”
Convenience stores can stand out from the competition by stocking a range of take-home packs in the chiller, particularly on warm Fridays and Saturdays when shoppers could decide to have impromptu gatherings in the evening.
Highland Spring’s Carol Saunders says: “As barbecues are often spontaneous it’s important to keep a core range of large, single bottles always available in the chiller.”
The amount of focus you put on take-home packs depends on your location. Nestlé Waters’ Silika Shellie says: “Take your size and location into consideration. One litre and 1.5l bottles are ideal for stores located near residential areas to meet the demand for family consumption at home.