Home' Convenience and Impulse Retailing : October 2009 Contents October 2009 | C&I | www.c-store.com.au
AT A GLANCE
• The rise of the large can format
is a major trend in the energy
drink world ... and all the
indicators are that things are just
going to keep getting bigger.
• According to P&C Nielsen
Scantrack data, energy drinks
now have a 23% share of total
beverages in the convenience
and impulse channel and this is
up +2.4 share points versus a
• The arrival of 60ML concentrated
versions of the leading energy
drinks presents enormous
opportunities for C&I operators
as these products will engage
new consumers, create new
consumption occasions, and
deliver incremental business.
• Energy drinks have become an
every day consumed drink and
may soon take over carbonated
beverages as the number one
selling beverage category.
as visibility builds consumer awareness.
Within the energy category, consumers
actively seek out an energy product, and
their shopping behaviour is driven by
convenience, so they want to spend as
little time as possible in store.
Frucor says that clear category signage
showing the location of the energy
section is the best way of directing
the flow of shoppers to the door, and
shopper research shows that green is the
category colour and this must be visible
on all display and POS materials.
"Beyond the use of traditional point-
of-sale material such as fridge stickers,
posters, floor decals etcetera, the
next steps for in-store visibility and
activation will shift towards more semi/
permanent POS such as stands and
'leech' units that can be used particularly
for ambient multi-pack displays," said
Frucor's Ms Gilbert. "These also allow us
to incorporate suitable cross category
items such as confectionery and salty
snacks into the same display -- which is
also a huge driver of sales."
Coca-Cola which produces the Mother
energy drink brand agrees that in-store
communications are critically important,
as energy drinks are often bought on
"We use in-store communications to
help build awareness, encourage trial
and drive decision-making at point-of-
purchase," said Coca-Cola South Pacific
PR Director, Kelly Brooks.
increased success of Mother, many of
our customers are keen to take on more
in-store consumer promotions over and
above the normal displays, and these
have been eye-catching and well-received
... and have helped drive sales."
space provided to energy drinks more
accurately reflects the sales generated.
"In order to expand the range of energy
products on offer, it is obviously crucial
that retailers expand the amount of
chilled space allowed for the category,"
said Ms Gilbert.
"In the majority of
retailers, energy currently operates out
of one door only, and if new products
are to continue to drive growth and add
incremental value to the category, then it
is absolutely necessary that the category
be expanded into two doors."
Another giant of the energy category,
Red Bull, couldn't agree more. Trade
Marketing Manager -- Off Premise, David
Kehoe, says at least one fridge door in
four should be allocated to energy drinks
to ensure sales are not lost.
"Energy drinks just don't get adequate
space and this results in costly out-of-
stocks," he said. "Some 52% of 'triggers
to buy' of the Red Bull brand come
from walking past the product, which
highlights the impulse opportunity it
Mr Kehoe says the best way to increase
the chances of incremental purchases is
to make the highly impulsive product
available in multiple hotspots, such as
in the main and impulse fridges, and in
Visibility builds consumer
"Studies also prove that Red Bull
available chilled at the register can
achieve increases in sales of over 100%,"
"People are always working
hard and playing hard, which are the
occasions when Red Bull is consumed."
In-store displays, including shelf and
off-location opportunities, are then very
important, particularly for new products
“In order to expand the range of energy products
on offer, it is obviously crucial that retailers
expand the amount of chilled space allowed for
the category,” Jenny Gilbert, Frucor.
READy TO DRINk sEGmENT mARkET VA L uE % shARE
Total Soft Drinks
Total Energy Drinks
Total Sports Drinks
Total Flavoured Milk Total Juice/Drinks
Nielsen data reveals that energy drinks
is now the second largest drinks segment
in the impulse channel, behind soft drinks
... and it's catching up fast. Oh, and it's
a product that can be consumed all year
around, so there are not the significant
'seasonal peaks' that you see with many
other beverage brands.
The secret to energy's success then is not
really hard to find. As every convenience
and impulse operator is only too aware,
people are continuing to live increasingly
busy lives and, as they try to fit more and
more into their days, they desire more and
more of an energy hit to get them through.
Put simply, energy drinks are the right
product at the right time.
Frucor, which produces one of the clear
market leaders in energy drinks, V, says
the shift in energy's share of the market
is also driven by several other factors.
These include an increasing number of
consumers buying into the category; an
increasing overall spend due to consumers
trading up to larger pack formats; and also a
greater focus from the retailer perspective,
with additional shelf space and also more
focus on promotional activity.
As a highly impulsive product, energy
drinks of course appeal to the typical
P&C consumer who is busy, driving, or
generally 'on the go'. Indeed, some 90%
of energy drinks are typically consumed
very soon after purchase. They are also a
product that people want at all times of
day and night. Convenience and impulse
outlets are then ideally placed to cash in
on the meteoric rise of energy drinks ... a
fact seemingly borne out by the statistics.
According to P&C Nielsen Scantrack
data, energy drinks now have a 23% share
of total beverages in the convenience and
impulse channel and this is up +2.4 share
points versus a year ago. But could C&I
outlets be doing more?
Opportunities for Convenience
A look at relative growth of the energy
category in the different channels makes
for interesting reading and, perhaps,
gives convenience and impulse operators
a sobering insight into the opportunities
that could be passing them by. In grocery,
energy drinks have shown +35.5% growth
in the past year, as opposed to +19.7% in
P&C, and +18.6% in route.
While it may easily be assumed that
it is multi-packs driving this far more
significant grocery growth, the opposite
is actually true with single format
products driving the greatest proportion
"This is driven most significantly by
larger format (500ml+ cans) which have
achieved a significant increase in space
and ranging in grocery by being ranged
in impulse chillers at front of store near
the checkout," said Frucor's Category
Manager -- Energy, Jenny Gilbert.
Focus on shelf space
Frucor believes convenience and impulse
retailers can do still more to ensure the
Frucor, which produces one of
the clear market leaders in energy
drinks, V, says retailers need to
expand the amount of chilled space
allowed for the category - if new
products are to continue to drive
growth and add incremental value to
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