NEW YORK — Convenience-store retailers see momentum in energy drinks and hard seltzers in 2021.
Despite lingering traffic pressures from the COVID-19 pandemic, beverage trends were generally solid in the fourth quarter of 2020, according to an analysis from Goldman Sachs Managing Director Bonnie Herzog on the New York-based company’s most recent Beverage Bytes survey. The c-store retailer survey represents nearly 35,000 retail locations.
Overall, beverage sales accelerated 7% year-over-year in the fourth quarter as consumers continue to prioritize fewer trips but purchase larger baskets, Herzog said.
Click through to see other highlights of Goldman Sachs’ survey …
Energy Shows Robust Growth
Energy drinks grew 10% in c-stores, according to Goldman Sachs.
For Corona, Calif.-based Monster Beverage Corp., the maker of Monster Energy, retailers expect to see 5% growth in 2021 in the c-store channel. Innovations like the new watermelon flavor and new Reign flavors are driving this.
Monster will also gain from Bang Energy’s, Weston Fla., decision to end its distribution agreement with PepsiCo, Purchase, N.Y. Retailers indicated in the survey that Reign would likely see a lift in sales is there is any disruption to Bang.
Truly Hard Seltzer Gains Share
Retailers expect the Boston Beer Co.’s Truly to continue to gain shares in c-stores, with triple-digit growth in the fourth quarter—ahead of Mark Anthony Brand’s White Claw.
This is prompted by the launch of Truly Iced Tea hard Seltzer. About 80% of retailers surveyed said they plan on giving additional shelf and cooler space to Truly this year.
Topo Chico Hard Seltzer, made by the Coca-Cola Co., Atlanta, and distributed by Chicago-based Molson Coors, could have a delayed launch.
“Retailers expect the company to continue to broadly underperform peers, with a slight improvement in out-of-stocks not enough to offset continued share losses in 2021,” Herzog said. “[Molson Coors] might be risking overextending itself at a time when it needs to prioritize ensuring its own brands are well-stocked.”
Changes to CSDs
Retailers generally applauded Coca-Cola’s decision to cut 200 beverage brands to have a more focused portfolio. Most said it will have no impact ok Coke’s shelf and cooler space in their stores.
“A few retailers also indicated that the types of products KO is eliminating are typically not sold in c-stores, and as a result most of the effects would likely be felt in other channels,” Herzog said.
Retailers think this will enable Coca-Cola to take more ownership of their products, Herzog said.
For CSD producer Keurig Dr Pepper, Burlington, Mass. and Plano, Texas, retailers are excited about the company’s focus on low-sugar options and believe this will resonate with customers. However, some retailers also said they have yet to see anything from the company regarding their 2021 plans, Herzog said.
New PepsiCo flavors are exciting retailers—particularly Major Melon Mtn Dew and Pepsi Mango.