There were 73 chains representing 11,000 stores and $1.5 billion in beer sales to participate in the CSD Brand Preference Study. As expected, the beer companies made an impression with retailers, 62% of whom said they had viewed at least three sales presentations in last 60 days.
Surprisingly, 16%, or 12 key decision makers, reported no presentations from beer suppliers in the previous two months. This means there is a significant opportunity for beer companies to push new products and promotions and gain a greater share of cooler space at major retail chains.
Beer is the third-largest in-store category accounting for 12.2% of in-store sales, according to the NACS 2007 State of the Industry report. With the exception of stores in states like New Jersey, Oregon and Pennsylvania that do not permit the sale of beer in the stores, c-stores have always been a speedy alternative to beer distributors for consumers to pick up a cold six-pack. Fortunately for convenience store operators, customers and their tastes change, increasing the opportunity to grow sales by capitalizing on trends.
A lot of the increase in import and craft beverage sales can be credited to the changing population of both the country and the c-store. For example, ethnic brews, everything from fruit-infused to Anheuser-Busch’s Chelada, which combines Budweiser or Bud Light with Clamato juice, are aimed at the country’s growing Hispanic consumer base.
That trend is found both in urban and suburban markets, said Mark Carter, director of operations for Gordy Fuels, which operates four TigerMart Stores in Maryland.
"There are a lot of permanent Mexican citizens living in our area and they often gravitate towards Mexican beer," said Carter. "Beers like Corona, Modello and Dos Equis have been selling in tremendous amounts."
Gordy Fuels has become something of a powerhouse in the beer category after building its trademark "Beer Caves" in its stores. A typical Beer Cave consists of massive, walk-in coolers designed to provide a haven for the beer lover. Because of the girth of its beer and malt beverage program, stores are able to experiment with new beverages as they become available, but are still prudent with its approach.
"When we’re deciding whether to stock a new beer product, we look heavily on the marketing that’s backing it," said Carter. "We usually favor products that have national marketing campaigns. If they have that, we’ll try it out with six-pack units, and if they sell, we’ll begin stocking bigger packs."
The reason for this decision comes from the stores’ main audience for craft and premium beers, which have also been enjoying high sales. Carter credits the success of this segment to the youthful, image-oriented, casual beer drinkers.
"Typically, domestics still sell well among the crowds who are just looking for a big case of beer to throw back," Carter said. "The more premium beers we stock, like Samuel Adams and Guinness, are typically purchased by younger, trendier customers who have a little more money to spend. They’re also much more casual about their consumption, usually buying the smaller packages."
The image that goes along with the above-premium segment is also an important sales driver.
"A lot of the customers pick up these beverages because it gives off a certain impression," said Carter. "They may buy it for taste, but they also buy it for that status or perception associated with purchasing a premium product."