With restaurants and bars closed for months due to the pandemic and recently opened with diminished capacity, more consumers are quenching their thirsts by purchasing ready-to-drink alcoholic and non-alcoholic beverages at retail outlets, including convenience stores.
From hard seltzer and craft beer to kombucha and ready-to-drink (RTD) cold-brew coffee, the c-store packaged beverage category has seen some stellar sales lifts in 2020.
The RTD cappuccino and iced coffee segment was up 3.5% at convenience stores for the 52 weeks ending Oct. 4, 2020, according to Market Advantage TSV; IRI Liquid Data. For the same period, refrigerated juices were up 3.5%. Bottled water fell 4.1%, while energy drinks were up 2.6%, and sports drinks rose 6.4%.
In alcoholic beverages, hard seltzer — such as Truly, White Claw and Corona — is the major up-and-comer at Cubby’s and Fast Break convenience stores.
Hard seltzers are taking up more space in the beer cave, and sales are increasing exponentially, according to De Lone Wilson, president of Cubby’s, which has 36 stores in Nebraska, Iowa and South Dakota. Oliver Herting, beverage category manager for Fast Break, a chain of 31 stores in rural Oregon and northern California, noted that hard seltzer is his fastest-growing item and one he projects will have year-round appeal.
Herting noted that the challenge is keeping up with consumer demand for hard seltzers without taking up too much display space.
“Flavored malt beverages — which includes hard seltzers and beers — have continued to grow impressively, with the largest issue facing the segment being out-of-stock issues,” said Carolyn Lemoine, director of alcohol research for the Beverage Marketing Corp., a New York-based industry consulting, research and advisory services firm. “Perhaps because of these issues or perhaps due to cooling weather, growth has slowed recently from triple digits to double digits, but they are still a driving force in the malt category.”
While total beer dollar sales are down overall because of the restrictions of on-premise (restaurants, bars and craft tasting rooms) sales, they have spiked at off-premise locations like c-stores. Year-to-date off-premise dollar sales have increased 12.5%, Lemoine quoted.
When it comes to beer, craft varieties continue to be “hot sellers” in urban markets for Cubby’s, while “in the middle of corn country” the preference is still Busch Light. At Fast Break, many customers have transitioned to major brands’ big packs to stock up at home.
Hispanic-label beers such as Corona, Modelo, Pacifico and Tecate are usually big sellers for Fast Break, but the segment has faced out-of-stock issues given the pandemic, Herting said. Value and domestic brands like Bud, Coors, Hurricane and Steel Reserve are still…