Home' Convenience and Impulse Retailing : February 2010 Contents February 2010 | C&I | www.c-store.com.au
Schweppes, the manufacturer and
distributor of Gatorade, says that in contrast
to grocery purchases, typical sports drinks
consumers in the convenience channel are
male (66%), aged 26-44 years and working full
So what can be done to boost sports
drink sales in convenience? Coca-Cola which
produces the popular Powerade brand is in
"With more competition in the hydration
category, one of the challenges is remaining
competitive from a relevance perspective and
a pricing perspective," said Michael Garnett,
Powerade Brand Manager.
"That means giving consumers enough of
a reason to pay a premium for the category
in this competitive climate, and ensuring
promotional calendar/bench prices are kept
at competitive levels both within sports and
versus other hydration categories."
He says that the average price point
for sports drinks in convenience is $3.40
compared with $2.90 in grocery ... and that this
has got to have an effect on sales.
"However, growth may come from existing
users buying and consuming more, and
by focusing on differentiating sports from
other categories, largely via its sporting
and functional credentials that the other
categories lack," he said.
"The sports drink category needs to focus
on the core strength of hydrating before,
during and after exercise."
Coca-Cola believes that this will strongly
differentiate sports drinks from both the energy
and sport supplements category, neither of
which, it says, focus on the specialised athletic
need for fast and effective hydration to benefit
sports performance. And that could mean
Schweppes, which is responsible for
Gatorade, points to the success of the grocery
channel, which has seen category growth of
9.5% (Nielsen MAT to 31/10/09), as evidence
of the opportunities that remain to implement
strategies to achieve category growth through
"Each channel is important because they
each play a different role to satisfy the needs
of our consumers," Glenn Ellul, Marketing
Activation Manager -- Gatorade, said.
Driving the sports drinks
"Grocery plays an important role in achieving
category scale and getting sports drinks
into the home whereas the convenience
and impulse channel ensure the product
is available when a sports drinker needs
it most -- on the way to or from training or
He identifies three key ways that
convenience and impulse retailers can drive
the sports category to achieve maximum
Firstly, he says, retailers should look to
increase their range, both in terms of facings
and of flavours.
"It may seem like an obvious statement but
many retailers are 'under-facing' sport which
limits the category's opportunity for growth,"
he said. "Stocking a variety of flavours will give
consumers greater reason to buy more, and
so allocating incremental facings/space to
flavours will increase sales."
He says that increasing the touch points in
store can also have a dramatic impact. While
we know that some 80% of sports drink sales
in convenience come from the chiller, that also
means that a not insubstantial 20% of those
sales do not come from the fridge.
"A clever strategy is to off-locate sports
drinks near other complementary products
which can increase your consumers' weight
of purchase," he said. "The best adjacencies
we see though our data are: front counter; hot
of having most of the space for their own
brands effectively locks smaller operations
out. Staminade then doesn't really have any
impulse channel business except for those
customers purchasing from Campbell's Cash
"However, we would certainly love to have
more business in this segment through
experienced and reliable distributors who
can deliver on customer service," said Mr
"Sports drinks have suffered slightly in
the last couple of years from the explosion
of energy drinks but the fact that electrolyte
sports drinks actually deliver a proven benefit
for people who exercise regularly will ensure
the category performs well into the future."
Staminade's target market is anyone doing
some exercise either at elite or even casual
level, both males and females. Mr Robey
says the company is 100% Australian owned
food counter; or the food-to-go fridge."
Finally, Mr Ellul urges retailers to take part
in promotions and he points to a recent study
undertaken by Schweppes which found that
46% of consumers really responded positively
to a 'two for the price of one' promotion as
proof of their effectiveness.
"The main reason for this being that they
could 'buy one for now and one for later'," Mr
Steric Trading, which is responsible for
Staminade, says it doesn't currently have the
manpower or market share dominance to
have much impact through any other channels
except for supermarkets.
Staminade's Lance Robey says some
of the larger manufacturer's fridge policy
and although it is up against a couple of the
largest drink manufacturers in the world it is
a premium-priced category that can generate
On show, cold & well presented
"The product is consumed quickly so it is not
a take home purchase," he said. "The product
needs to be on show, cold and well presented."
The brand's best sellers include: Staminade
330gr Powder and the Staminade 600ml sports
drink in Lemon Lime, Berry, Orange and Blue.
AT A GLANCE
• In contrast to grocery purchases,
typical sports drinks consumers
in the convenience channel are
male (66%), aged 26-44 years and
working full time (74%).
• Together energy and sports drinks
comprise 25% of impulse beverages
sales in convenience ... and impulse
beverages represent a whopping
21% of merchandise sales, and have
enjoyed year on year growth of
• The latest Nielsen data for sports
drinks also shows that while 50%
of volume sales is through grocery,
38% is through route, and 12% is
• Sports drink consumers respond
highly positively to promotions such
as t wo for the price of one offers.
Staminade has tweaked its flavour profiles to ensure it is delivering satisfaction to consumers, while the introduction of a
new bottle and label has also had a positive impact on sales.
The latest Nielsen data for sports drinks also
shows that while approximately 50% of volume
sales is through grocery, 38% is through route,
and 12% is through convenience.
• Value growth of Sports/Energy
drinks is quite strong (12.1%),
surpassing the Total Beverages
category (7.6%) and the total
• The category has no Private
Label presence, being dominated
by key brands (V, Red Bull &
Powerade). Other brands have
retained low shares, or come
and go based on fad.
• Mother s relaunch was
successful with its new taste
formulation a winner with
consumers, making it in 2009 to
the 4thlargest brand, ahead of
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