Convenience Store Decisions, April 2017

CStoreDecisions ecisions com CATEGORYMANAGERS NOTEBOOK The chain operates 12 locations in Wisconsin which in the winter can be natural barrier to cold and frozen dispensed beverage sales With the new machines Magestro anticipates a big uptick in category sales when the weather begins to get warmer Cold and frozen beverages always increase for us from April through September Magestro said Because of the temperature difference in our region cold and frozen slow way down because of the cold weather I think it will be at from previous winters QSR COMPETITORS However for the upcoming summer season which is often marked by road trips and consumers on the go convenience stores also benefit from the high margins produced by salty snacks in the bag or fresh and healthy snacks in grab and go portions And where there are snacks there are cold drink purchases An advantage the c store maintains is the tremendous selection of snacks that we offer that can be bought to go with the beverage said Montgomery Though snacks provide a natural boost to c store dispensed beverage sales the channel will continue to experience pressure from quick serve restaurants QSRs which in the last few years have positioned hot and cold dispensed beverages as stand alone sales generators Their strategy has shifted from being focused on selling the protein with the accompanying drink being an ancillary sale to one that understands that drinks can be a destination driver Montgomery said An example from the hot beverage category is shown to be McDonalds emphasis on coffee To date the only QSR that has already made the change for cold dispensed drinks is Sonic Sonic Drive In in the last few years has successfully marketed itself as premium place for dispensed beverages where consumers can mix and experiment with drink combinations between its fountain drinks and slushes Currently the fast food chain is promoting half price shakes and ice slushes after 8 p m Thats not to say the c store channel isnt concocting its own beverage strategies Anymore c store channel surfers can nd popular beverage options such as Jolly Rancher Frozen Beverages Hersheys Freeze Frozen Beverages and Sour Punch Slushes Chilly coffee drinks have also gained traction in a growing number of c stores PROMOTING SODA Still carbonated soft drinks continue to generate a bulk of cold and frozen dispensed beverage sales in the c store channel For instance Atlanta based RaceTrac Petroleum offers up to 30 fountain options including Coca Cola Dr Pepper and Pepsi products plus another 18 frozen offerings The retailer also has a private label frozen beverage brand Numb Skull The c store chain has expanded upon the model of a destination with its annual promotion known as Sodapalooza Sodapalooza is RaceTracs most popular annual summer fountain and frozen marketing event Customers who purchase a reusable Sodapalooza cup receive unlimited free refills on a variety of fountain drinks teas and energy drinks at nearly 450 stores in the southeast Sodapalooza has become a favorite among RaceTrac promotions because of the timeliness of the promotion as well as the exclusive access it provides said Marianne Simpson promotions manager for RaceTrac 2016 was the fth year RaceTrac has hosted Sodapalooza Our guests are able to come into a RaceTrac like a VIP and refill their cup for free during the hottest months of the year no questions asked said Simpson Additionally in recent years the cups have included general and regionally speci c coupons that add even more value to their re llable cup e g all cups include Coca Cola coupons while Atlanta guests may have a buy one get one free Braves ticket and Orlando area guests could receive discounted Sea World tickets Finally our store teams look forward to this promotion each year we have executed it and team member engagement drives increased guest excitement While the success of the beverage campaign is measurable the planning that the annual promotion entails is demanding Its not always a guarantee that Sodapalooza will occur each year said Simpson Once a campaign ends our marketing team works closely with our fountain category team to determine if the promotion was successful from a sales and brand building perspective If our internal teams determine the years campaign was a success we will begin planning for the next years campaign in September with plans to launch in the April or May of the coming year Last years campaign ran from May 4 July 31 2016 Accompanied by clever advertising and social media campaigns the beverage promotion has been a boon to RaceTrac in terms of attracting new customers Social media is an integral part of the Sodapalooza promotion as it allows us to leverage paid and earned tactics to increase awareness and drive purchase of the cups while engaging with our guests with channel speci c activities Simpson said CSD 48 Convenience Store Decisions l April 2017 48 said in a 2016 survey that a fountain drink was their top foodservice purchase