Hot-beverage programs excelling in coffee and moving beyond.
The biggest drivers of hot drinks at Knoxville, Tenn.-based Pilot Flying J’s convenience stores are the premium blend house coffees and 100% Colombian coffee.
“Premium coffees in general are becoming an expectation,” says Whitman Harson, senior category manager for the 650-unit chain. “Customers are getting smarter every year. We are particularly sensitive to drivers, and we place a strong emphasis on ensuring that our coffee is of the highest quality.”
Pilot Flying J’s hot-beverage program “is a very important driver for us,” he says. The category is led by coffee and cappuccino, though tea and hot-chocolate sales are strong.
“Hot beverage is driving both new business and product interest,” Harson says. “We have experienced an influx of new customers that have heard about our premium coffee selections, as well as current customers coming back more frequently as a result of their satisfaction with our hot beverages.”
Landmark Industries, based in Houston, offers specialty coffees such as Dakota Roast, Colombian and French vanilla in each of its store, in addition to a seasonal LTO. Toasted cinnamon nut and hazelnut are also offered in some locations.
Stores that are offering five or six different coffee blends are mainly newer—built in the past three years, says Sonny Talje, Landmark’s category manager for foodservice.
“Different blends in these spacious locations are showing strong sales since they appeal to all genders and ages,” he says. “Customers feel safe walking in well-lighted stores early in the morning to choose the flavor and condiments they crave with affordable prices rather than going to a fast-food drive-thru.”
The coffee is sold under Landmark’s Roasted Bean Coffee Company brand, which helps perceptions, says Talje: “It’s good to have your own name so customers associate it with you.”
David Morris, managing consultant for Packaged Facts, Rockville, Md., agrees. “The image of private label has come a long way, to the point that it can compete head to head with brand names associated with higher quality,” Morris says. “Rolling out a high-quality, own-branded coffee product can help move a convenience store chain’s foodservice program to the forefront of its marketing strategy. It just better deliver on quality.”
Specialty coffees may bring in more customers, but they don’t necessarily bring in more revenue.
“All cappuccino flavors are running lower margins due to us offering these expensive products at the same price as regular coffee,” Talje says. “Offering all hot beverages at the same price is attractive to our customers.”