Warm product vs. cold. Premium vs. craft. Single-serve vs. multipack.
These are among the growing challenges of setting a beer cooler in a convenience store at a time when the beer consumer and the beer industry itself is evolving. The average beer distributor has seen its SKU range explode from fewer than 200 to almost 1,000 over the past 15 to 20 years, according to importer Heineken USA, and retailers are trying to find a home for these SKUs.
But every challenge is also an opportunity. And in this case, secondary placement may be the solution.
“We always try to have at least one warm display at all times,” says Austin Martin, vice president of sales and marketing for Mapco, Brentwood, Tenn. “It has to be something unique. It could be a premium domestic at a price we know no one can beat, or it could be a craft beer. We don’t put anything on the floor that won’t turn.”
Mapco’s standard beer set is varied, offering multiple entry points:
- Four cooler doors of beer with one door devoted entirely to single bottles of craft beer in a build-your-own six-pack set. The remaining three doors are stocked with 16- and 24-ounce singles and six-packs.
- A nearby beer-cave entrance leads behind the cold vault and is stocked with six-, 12- and 24-packs for the stock-up customer.
- A rack of warm 24-ounce bottles of craft beers might be included just outside the cold vault, depending on the season.
- A growler tap featuring six spigots might round out the offer, depending on licensing opportunities and the community.
As the category shifts and expands, the chain aims to keep the beer cooler fresh.
“We align ourselves with breweries that have built up a base. We allow the flexibility for them to rotate in new SKUs as they change their offering, while maintaining their main brews,” Martin says.
This multipronged strategy stands in sharp contrast to the once-typical philosophy of secondary placement, which just a decade ago meant ice barrels full of single-serve cans near the checkout and a display of warm 12-packs on the floor. The former is time-consuming and difficult to execute, while the latter eats up floor space and ignores the idea that c-store customers want their beer cold.
Instead, as craft beer has grown in importance in c-stores and beyond, it also has forced a revolution in secondary placement.
“Warm displays can be an impressive part of a beer display, but that isn’t what sells,” says Joe Vonder Haar, a retired Anheuser-Busch executive who has built a second career out of embracing secondary placement of beer in convenience stores.
“We think there’s a huge opportunity for impulse buys and for secondary cold placement [of beer],” Vonder Haar says of his St. Louis-based iSee Store Innovations, which develops and sells secondary-placement merchandisers.
“Convenience stores are not built for variety. They’re driven by big brands and single-serve, something I can drink right now,” he says. “So the question is: How do you take four doors of beer and be a variety stop?”
Window Dressing
Retailer E.J. Pope & Sons has gotten that message and does most of its secondary beer display within the cold vault or beer cave itself, keeping the product cold while also creating incremental space for new products without sacrificing facings of known sellers, says category manager Gray Sloan.
“We utilize floor space in our beer caves for secondary placement of promotional items, like 18-packs and suitcases (24- and 30-packs), along with craft racks featuring local/popular craft beers,” he says of the Mount Olive, N.C.-based company’s Handy Mart chain.
“Suction-cup racks have also proven to be successful in our cooler doors for promoting singles or new items,” Sloan says.
Vonder Haar’s company has likewise found success on the door, having cut its teeth with products such as the iSee Apex DisplayLoc Modular Merchandiser, a 10-count single-serve suction-cup rack with a flexible joint that can be positioned in numerous ways to best fit the cooler door.
“That’s a good way to tie multipacks back to single-serve,” Vonder Haar says. “It’s useful in merchandising new products, getting them in front of consumers, without sacrificing space on the cold-vault shelf until you know if that product is going to sell in your store.”
Another conventional tactic getting the boot these days: stacking six-packs of an import, craft or superpremium beer next to a warm display of domestic premium 12-packs.
“That’s the grocery-[store] approach,” Vonder Haar says. “We know the majority of beer bought in a c-store is going to be consumed within an hour; the convenience shopper isn’t looking for warm product.”
“C-store consumers have the highest occurrence of ‘tunnel vision’ shopping vs. any other class of trade,” meaning they go straight to the product they want rather than taking time to explore, says Jennifer Dohm, spokesperson for Chicago-based Constellation Brands. These shoppers “are not as likely to notice secondary merchandising,” she says.
But retailers can use this to their advantage, Dohm says.
“The focus should not be on how to squeeze more in, but rather to focus on allocating space to the right [brands and SKUs that] will add incrementally to the category,” she says. “A sophisticated assortment process can help ensure that a retailer offers the right mix to satisfy each occasion need and stays in front of macro trends while not overinvesting in duplication or items that do not drive incremental value.”
When secondary placement is used, it should come in the form of “positive interruption,” Vonder Haar says. The placement “needs to be something that makes it clear this is something new or a special deal.” This goes back to marketing 101: bold signage and a clear value proposition.
Martin of Mapco finds twofer promotions among the most successful in Mapco stores, but says emphatically, “We won’t put it on the floor unless it has something unique or special about it.”
In general, product merchandising is a matter of retailers and suppliers working together for a common cause, says Ike Anyanwu, channel director convenience for Heineken USA, White Plains, N.Y.
“It’s more than simply selling in SKUs, displays and features,” he says. “The evolution of the retailer-supplier relationship calls for both to be engaged and focus on similar success criteria.
“It’s not a destination but a guided journey that both need to be a part of. The success of both parties depends on it.”
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