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| Oil Watch |
Cooler Pioneers
By TAMMY MASTROBERTE
MARCH
01, 2004 -- Last year
the cooler door overflowed with innovation, and new flavors
and product lines hit the shelves at a rapid and constant
pace. Fresh concepts, flavors and designs seemed to be
everywhere, and so far this year, the beverage bonanza doesn't
show any signs of slowing down.
The energy drink craze, for example, is still going
strong. "I still see a multitude of new introductions in the
energy drink category, and it's not dying down yet," said Dan
Dolgner, vice president of marketing at Family Express Corp.,
a 43-store chain based in Valparaiso, Ind. "Red Bull is still
number one and has been able to hold its own with only two
SKUs. While other companies are coming out with new sizes and
flavors to create more volume, Red Bull has maintained with
two options. I think energy drinks as a whole will hold their
own this year, and will slow down in 2005."
The low-carb revolution even spread to beer. Many
retailers are enthusiastic about potential profit
opportunities and are redesigning their sets to incorporate
these new products.
"The entries
into the low-carb segment are something we are excited about,"
said Bob Trullender, director of operations at Kwik King Food
Stores Inc., a 49-store chain based in Ocala, Fla. "I spent 13
years in the beer business and I think the low-carb beer is a
viable category."
Family Express
also grabbed some of the current low-carb excitement by
testing an entire low-carb snack section, and is beginning to
incorporate this concept into the cooler. "We carry the Atkins
shakes, and will soon be adding the Slim Fast low-carb drinks
and the
Arizona no-carb iced
teas," said Dolgner. "We are trying to capitalize on the
evolution of the low-carb lifestyle. I compare it to what we
saw 10 years ago with cholesterol — the rage is gone now, but
everyone is a little more conscious of it, and I think that
will happen with low-carb."
On
the flip side of new trends, some categories are not so likely
to stick around this year, such as flavored and enhanced
water, according to Dolgner. While bottled water itself has
seen a steady growth, which is expected to continue this year,
the flavored waters disappointed many retailers and well as
manufacturers.
"Flavored water
has not been what everyone thought it would be," said Dolgner.
"None of the lines have made a stand and I'm concerned about
sales related to the number of SKUs required to have an
offering and satisfy customers because there has not been a
single flavor that really stood out among the rest."
Teas Take Off
With new products already rolling in, the packaged
beverage category looks promising for summer. And one category
with a lot of activity is tea. "I think teas are going to do
well this year," said Dolg-ner. "I think people perceive teas
as being more healthful, and there are a lot of new findings
going on with the tea segment."
Fuze Beverage LLC introduced ready-to-drink White
Tea packed with vitamins, antioxidants, polyphenols and folic
acid. Available in an 18-ounce bottle, it has a suggested
retail price of $1.49 for c-stores. The company plans to
follow the introduction with a reformulated and newly packaged
Green Tea offering.
Capitalizing
on both the healthy and low-carb segment, Arizona Beverages
added two no-carb flavored green teas to its lineup. White
Cranberry Apple and Blueberry rolled out in the end of October
and the company is just beginning to expand its
distribution.
"The CSD category
continues to remain flat, and I think consumers are looking
for a new offering," noted Dolgner. "This year I think teas
will see a surge in sales. Our own stores have seen good
growth in teas, and I believe the category is gaining more of
a following."
The Healthy
Beverage Company also went the low-carb route with its Diet
Steaz Sparkling Green Tea. In addition, the company launched
an entire diet line of green tea soda in January, which is
being marketed as a low-carb dietary supplement. The company
plans to introduce a 10-ounce, slim-line can in time for the
summer.
Healthy Options
Low-carb products are a priority for
many manufacturers and retailers, but it also seems beverages
deemed "healthy" are making a splash this year.
Yogurt smoothies have made their way
into convenience stores, providing a "grab-n-go option for
yogurt without a spoon," according to Jim Brown, senior
business development manager at The Dannon Co. Inc. The
company launched its first year of national marketing for its
Frusion smoothie line, available in a 10-ounce size with six
flavors.
For those more concerned
about weight control, the company also has a Lite-n-Fit
smoothie option. "This was introduced to grocery stores last
April, but was only available as a four-pack," said Brown.
"Now we are offering it in c-stores as a 7-ounce single- serve
products."
Pepsi is also
expanding its line of packaged beverages into the healthy
segment. Through Pepsi-Cola North America's bottling system,
an introduction of Tropicana juice drinks hit the shelves in
February. "We want to give people more non-soft drink
options," said Dave DeCecco, spokesman for Pepsi.
"Pepsi is aggressively establishing
a DSD position for the Tropicana line and is delivering to
c-stores in this format," said Dolgner. "What this is going to
do for them in the long run is give them two well-established
lines for DSD — both refrigerated and shelf-stable, and I
think that will position them for great growth."
Beverage giant Coca-Cola released a
new diet soda — Diet Coke with Lime — complete with
lime-colored packaging to announce the flavor. It is available
in multi-pack cans and 8-ounce bottles as well as 20-ounce and
2-liter bottles. The company is also reformulating and
repackaging Diet Coke with Lemon to correspond with the
lime-flavored offering.
"We
decided to carry all the new flavors because Coke has been
successful in the past when they introduced newcomers," said
Dolgner. "I think we will see more flavors coming out from
both Coke and Pepsi this year."
Also in the soda category, Jones Soda Company
launched its Chocolate Fudge Soda to the Midwest and Eastern
regions. The flavor idea came from a request by Panera Bread
Company who wanted to sell it during their Chocolate Festival.
"Chocolate soda does quite well
and when we tested it with Panera it was incredible," said
Jennifer Cue, COO at Jones Soda. "We got a lot of calls from
our customers asking why they couldn't get it anywhere else so
we decided to launch it in stores." The company also plans to
introduce a sugar-free version around April 2004.
Reinventing Beer
With the success of Anheuser-Busch's Michelob
Ultra, many beer manufacturers are launching new low-carb
lines, and other malt beverage companies are redesigning their
image.
Golden, Colo.-based Coors
Brewing Co. just introduced Aspen Edge, a premium low-carb
beer available in six- and 12-pack bottles. The initial launch
will be throughout 10 states, but a nationwide offering is
expected before the end of 2004, according to the company. The
launch will be supported by a full-media campaign, including
point-of-sale signage and merchandise to enhance the new
product's visibility.
A new
low-carb, citrus-flavored malt beverage with cranberry also
just hit the market this March and is a result of a
partnership between Miller Brewing Co. and SKYY Spirits. SKYY
Sport malt beverage has 160 calories with only 15 grams of
carbs per serving, which is half the carbs in most other
flavored malt beverages, the company reported.
United States Beverage has
repackaged and rebranded its Seagrams Coolers line as Seagrams
Cooler Escapes. New flavors include Green Apple AppleLicious
and Mango Passion Paradise Punch.
"We are shifting to a more standard beer-bottle
shape and away from the current cooler bottle," said Peter
Gyimesi, vice president of marketing, ready-to-drink beverages
at U.S. Beverage.
According to
Gyimesi, the company found that consumers wanted a fresher
look that would allow them to fit in instead of stand out in
social situations. "We think it will appeal to a younger
market. In quantitative research we found that the bottle and
graphics changes increased purchase comfort from 55 to 72
percent."
Between the beer, the
teas and the smoothies, c-store coolers should see a
profitable year
| | |
 Cooler Pioneers
|
March 01, 2004 -- New
beverages enter the cooler as retailers prepare
for summer sales
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Generally Speaking
|
March 01, 2004 -- Selling a variety of general merchandise
draws customers and yields high margins.
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