Thirst aid

What a summer the warmest, driest and sunniest since 2006. According to figures from the Met Office, from June 1 to August 28, we basked in 588 hours of sunshine making it the seventh sunniest summer since records began in 1929. Such sunshine is, of course, good news for the soft drinks’ manufacturers and retailers.

Litmus multiple forecourt data for the 13 weeks to August 11 reveals a big uplift in sales, with total soft drinks growing at 13%. All of the sub categories saw growth, but the top performers were fruit drinks (+31%), fruit juice (+24%) and water (+22%).

Christina Medford, head of category development at Danone Waters UK & Ireland, describes bottled water as a big success story for 2013, particularly during the summer months.

"At a macro level the category has been very buoyant due to a shift in behaviour as people are consuming more plain water," she explains, "and more people are adding flavoured and juicy water drinks to their repertoire as they move towards lighter and healthier options. This trend can also be seen in forecourts where juicy water drinks have grown by 25%, driven by Volvic Juiced, which has seen sales growth of 85% over the same period versus last year (Litmus).

"Of course, part of the increase was also due to the fantastic weather we had from July onwards, as the forecourt channel is ideally suited to capitalise on impulse purchasing. Bottled water drinks are affected much more acutely by temperature than other kinds of soft drinks, and water sales grew at more than twice the rate of energy drinks during the hot weather this summer."

Another water brand that’s performed well recently is Saka. Its ’big hitters’ in terms of sales through forecourts have been the 500ml sports cap multi-pack and the 330ml sports cap multi-pack, which have both achieved well above sales targets through the summer period. Saka has been working with forecourt retailers on their merchandising and has found that displays outside, near the entrance to the shop, greatly increased the volume of sales both from the display and also from within the shop. Nevid Ahmed, director of distributor Navson, says: "It was very interesting to see that consumers purchased Saka from within the forecourt shop having walked past the promotional display at the door. This form of merchandising obviously influenced purchasing decisions albeit not necessarily directly from the display unit itself."

Bring in the new

New products add interest to any category and they’re particularly successful in the soft drinks arena where there seem to be new ones all the time. Danone’s Medford confirms that new products have also proven to be effective sales drivers as 80% of new Volvic Touch of tropical fruits flavour sales have been incremental split between both completely new shoppers and existing shoppers adding the product to their existing repertoire (Dunnhumby data).

It’s all well and good having new lines but just how and where are retailers meant to find space for them?

Dave Turner, trade communications manager at Coca-Cola Enterprises (CCE), says: "We would recommend that retailers use epos, where possible, to understand their best sellers in soft drinks and adapt their range accordingly.

"It is also good sense to take a flexible approach in your chillers and on-shelf to allow for any new products or limited-edition launches that may appeal to your customer base. New products and flavours have particularly driven the growth of the energy drinks segment, so retailers could benefit from staying up-to-date on what new products are becoming available in the market."

Medford recommends that retailers place new lines and flavours in prime locations, such as at eye level in the main chiller, and again in the chiller space near to the checkout to capitalise on impulse purchase.

"You could exercise an ’active sell’ by asking staff to mention the product and any promotions available to customers. Bottled water drinks can also be displayed outside the chiller, as our research has found that 58% of consumers are happy to drink it at room temperature."

One brand to consider stocking is Sunmagic, the 100% pure fruit juice, smoothie and juice drink, which will be more high profile thanks to new listings in 420 Tesco petrol stations and 950 WH Smiths outlets nationally.

Brand manager, Razin Ali, says: "We are delighted to be increasing our presence in the high street, travel and forecourt sectors.

"We are also extremely pleased that Tesco has chosen to merchandise our juices on their off-fixture displays right in front of the till points."

He reports that sales for the brand are up 24% year-on-year from January to June, with June showing its second highest month of sales ever.

Further support for Sunmagic comes from its partnership with new film Turbo, which will be released on October 18.

From DreamWorks Animation, the studio behind Shrek and Madagascar, Turbo is described as a high-velocity 3D comedy about an underdog snail who miraculously attains the power of super-speed. The partnership will be promoted on-pack plus there will be an on-pack competition for consumers to win a trip to Abu Dhabi.

Meanwhile, the latest products to join the range are Sunmagic orange & mango juice drink, apple & elderflower juice drink and summer delight, a summer fruits-flavoured juice drink. The drinks come in 500ml PET bottles and are available in both price-marked and non price-marked formats. The price-marked packs carry an introductory 79p price for a limited period, after which they will be marked at 99p per bottle.

The latest flavour to join the Lucozade Energy line up is strawberry, which manufacturer GlaxoSmithKline hopes will build on the recent success of Lucozade Energy pink lemonade and Caribbean crush.

Specifically developed for the impulse channel, the strawberry-based flavour is a first for the sports and energy category and is expected to drive penetration among current consumers. The drink is available in a 95p price-marked pack.

Roxana Parvizi, senior brand manager for Lucozade Energy, says: "Our new strawberry flavour has been selected by our consumers as the most interesting flavour that is not in our current range. Strawberry as a flavour has mass appeal across all drink flavour segments and by listening to our audience the new launch will target current energy shoppers, drive penetration with a flavour that has a high appeal and strong purchase intent. The new addition to the £389m Lucozade Energy range will disrupt shoppers and encourage impulse purchasing."

No Fear brand manager, Neal Haworth, agrees that the main trend driving the energy drinks market is the ever-expanding range of flavours available: "In the past year there has been an explosion of flavours in the energy drinks market in a bid to meet consumer demand and attract potential customers who don’t currently buy energy drinks because of their taste," he says.

"The market has gone from 100% functional for an immediate boost, to a requirement for a fruity taste which No Fear has expanded into with its new variants motherload, tropical storm and blue storm with blue storm generating the highest rate of sale among flavoured energy drinks across the market." But he says that the original flavour is still a must-stock variant.

He adds that the market is also changing to incorporate older drinkers, which could see a shift away from the single-serve larger cans that currently dominate the youth market. "When No Fear launched, it was specifically made re-sealable so that the drink can be consumed over a period of time and not just in one go.

He says it’s therefore important that No Fear is displayed in store at a level where customers can clearly see the re-sealable end. "This is unique to No Fear and a key selling point of the product, but if the drink is placed on the top shelf it may be missed by potential consumers."

Finally, Nigel Paine, commercial director impulse at Britvic, says retailers should not forget the importance of different formats: "It is increasingly important for convenience stores to provide a range that caters for the many consumption occasions, and therefore offering a variety of formats is becoming more essential."

The latest format from CCE is a slimline 250ml can for Coca-Cola, Diet Coke and Coke Zero.

The company says pressures on disposable income have contributed to a fall in convenience shoppers buying immediate consumption soft drinks over the past three years so the smaller pack has been introduced to bring them back into the category by offering greater affordability and increased choice.

As such, the 250ml format comes in a plain can or a 45p price-marked pack. CCE reckons the new packs will provide retailers with an incremental sales opportunity.

Shopper needs

Wes McKenna, director, cold channel at CCE, says: "One of the key platforms for unlocking the vast growth potential of the soft drinks category is the introduction of packs that respond to shopper needs. With the introduction across the Coca-Cola portfolio of these eye-catching new slimline cans, we aim to deliver more choice, greater affordability and alternative pack sizes to consumers who are on-the-go."

He recommends retailers stock the new 250ml range alongside 330ml and 500ml Coca-Cola formats, as trials demonstrated a 26% uplift in Coke volume (Incite research) when all three formats were stocked together.

"This will complement their existing range and provide greater choice and affordability for their shoppers. Retailers could consider secondary displays of the new 250ml to drive trial."

Price-marked success

Price-marked packs are fuelling impressive growth in the soft drinks category as consumers look for ways to spend less without trading down. So says Adrian Troy, head of marketing at AG Barr. "Price marked packs are growing in importance as they clearly indicate value for shoppers, and therefore represent an important profit opportunity for forecourts," he says. The company’s brands, including Irn-Bru, KA, Rubicon, Barr and Rockstar, are all available in price-marked packs throughout the year.
The impact of price-marking was clearly demonstrated in a recent leading retailer study carried out by AG Barr, when the Rockstar range was moved from unprice-marked packs to 99p price-marked packs.
This resulted in an 800% uplift in rate of sale for Rockstar and, importantly, this growth was incremental as the overall energy category in this retailer actually grew at the same time (Litmus data).
"This trial clearly demonstrates that price-marking is a winning strategy for retailers. It drives footfall and rate of sale, builds shopper loyalty and, when managed correctly, is a proven way to drive incremental category growth," says Troy.

Winning Ways

Cross-category promotions 67% of snacks and soft drinks are consumed together, but only 13% are sold together. Snacks could be positioned next to a chiller.
Great meal deals to tap into the different mealtime occasions throughout the day (breakfast, lunch, dinner and snack meal replacement). Cross-category deals and promotions are a great way to give shoppers suggestions and potentially up-sell mealtime solutions.
Make them visible 49% of people don’t see soft drinks when they are in a convenience store, therefore it helps to have the main chiller in a high-traffic area, as 56% of shoppers buy soft drinks when they do see the fixture.
Serve it cold 86% of consumers say they want their soft drinks to be chilled, with 53% going as far as saying they’d pay more for a soft drink if it was cold. As so many soft drinks are drunk immediately, it makes sense to keep them chilled
Source: Britvic

Brand News

Boost launched orange & mango flavour in a 500ml can earlier this year and it’s been so popular that it’s now available in a 250ml size. Boost’s sales director, Al Gunn, says: "New flavours are still a growing trend in energy drinks but, as with all our products, we research what consumers really want so that retailers can be confident when choosing Boost that our products will sell for them, with a great profit margin too."
The J2O Kitty is a reward ’fund’ designed to offer consumers prizes and cash to enhance their get-togethers with family and friends. The campaign includes thousands of chances to win money-off-their-shop with each J2O purchase. In addition, an on-pack promotion linked to on-going Facebook activity rewards shoppers with everything they need to make their get-togethers even better.
Britvic has launched smaller case sizes for J2O, Pepsi and 7UP 5-600ml. Moving from 24-count, these are now all available in 12-count cases enabling retailers to purchase a significantly wider range of flavours in order to extend the choice they offer shoppers.
Alibi’s latest blend uses the natural immunity defence ingredient Wellmune Beta glucan, which is supported by nine clinical studies and over $300m-worth of research. As such, it is the only European health drink to have incorporated Wellmune to date. It is available in lightly sparkling citrus and superfruit pomegranate flavours.
Shloer has teamed up with Palmer and Harvey for a cross-brand promotion which gives consumers the opportunity to purchase a tube of Pringles and 75cl bottle of Shloer (rrp £2.29) for just £3. The deal is targeted at the ’big night in’ occasion and will run during October to coincide with the new series of X-Factor and Strictly Come Dancing, where friends and family tend to get together. POS is available from Palmer and Harvey to highlight and promote the offer in store.
No Fear is sponsoring Dave Newsham in the British Touring Car championship the ’fans’ favourite’ driver of 2012 for the 2013 season. There will be product placement at all interviews and media events, car branding in a prominent position, uniform and helmet branding plus the car will be at a number of events throughout the season.
Saka has recently changed the sports cap on the 500ml bottle to an ’easy-open’ version and also given the water clearer labelling. The brand is the official exclusive water partner of Barclays Premiership’s Fulham FC, Aviva Premiership’s London Irish RFC and British Athletics.
Britvic Soft Drinks and PepsiCo UK have introduced new 49p price-marked-pack (PMP) of 330ml cans of Pepsi, Pepsi Max and Diet Pepsi. These are available exclusively in wholesale depots. The new 49p PMPs bring the Pepsi range in line with the existing 49p PMPs across the fruit carbonate cans range, which includes 7UP and Tango.