Tips to Sell More Single-Serve Beer

It’s difficult to put a number on just how much single-serve beer packages are growing in convenience stores and beyond; IRI, Nielsen and other services don’t typically break down scan data by package size. But most retailers say it’s an indispensable package to drive their beer fortunes higher.

Immediate consumption is one key reason for singles’ growth, as most consumers drink the package within an hour of purchase, according to industry data. Sampling new imported or craft beers and flavored malt beverages (FMBs) is another bona fide role of single cans and bottles within the c-store beer vault.

As a result, retailers are doubling down on single-package beers and FMBs, with a growing number expanding their portfolio by carving out more real estate in the cold vault.

What follows are several insights from retailers, consultants and suppliers around the single-beer merchandising conversation.

There is a strong correlation binding single sales for trial to six-pack trade-up, according to Brian Grotewiel, director of marketing for Midwest Petroleum Corp., Manchester, Mo. The company’s 51-store Zephyr Xpress c-store chain offers a “Buy Me, Try Me” promotion that flourished across his retail network, he told Customers who bought a six-pack of a participating beer brand in the promotion were entitled to a single beer or FMB for less than $2—discounted from a price point of around $2.50. Same-store single sales grew 3.5% in 2017—propelled by promotion results, which registered a 5% increase in six-pack sales during its cycle.

On-premise channels, once the domain of new beer brands or line-extension launches, now give way to off-premise channels such as c-stores, according to Joe Vonder Haar, CEO and managing partner of iSee Store Solutions, St. Louis. “As millennial influences enter the equation, neighborhood c-stores are the venue for debuting new offerings. Make the offer simple—simple communication and shelf organization that’s easy to execute,” said Vonder Haar, whose company supports retailers in showcasing single packages with innovations such as the iSee Apex Modular Displayloc System.

Ike Anyanwu, channel director of small format for White Plains, N.Y.-based Heineken USA, said that as retailers reconfigure space to derive the most from the burgeoning single trend, SKU rationalization is “indeed a growing concern. Retailers can benefit from allocating a portion of their cooler space to performing packs that ultimately speak to the shopper’s consumption occasion. The remaining smaller portion (of space) should be allocated to newer packs/brands that are innovative, that satisfy an unmet shopper need, and/or that close retailer gaps in offerings,” Anyanwu said. One of Heineken USA’s newest releases is Amstel Xlight, an imported light beer available in 24-ounce cans, among other package sizes.

Anyanwu also said “changing shopper expectations” are manifesting across all store categories, and beer is no exception. “Traditionally, single-serve [beer] has been the primary pack for [the c-store] channel. Today, the format of stores has transformed this channel into a shopping mission.” The mission has placed an emphasis on multipack purchase, and a growing number of c-store operators are getting into the game by aligning price points with liquor, mass merchandisers and supermarkets.

On how to properly right-size the percentage of singles to the rest of the mix, Anyanwu said Heineken is “having continued conversations with retailers revolving around which SKUs make business sense given their shopper and their propensity to purchase.” He said Heineken’s c-store category director is a big proponent of staying one step ahead of the trend line. The trend these days? “Premium and value (beer) segments are declining, and the high-end is driving all the growth,” he said.

Pat Determan, owner of Lyons Filling Station in Clinton, Iowa, is well-versed in beer merchandising. He was a former regional beer distributor for a major brewer before becoming a c-store operator. Determan, who activates very few promotions because singles are such a high-velocity package motivated by sampling, said his eastern Iowa customer base has taken a liking to one new single can: John Daly’s Grip It & Sip.

New offerings filling the pipeline add more options and opportunities for operators. Recently rolled out, Arnold Palmer Spiked Half & Half is a joint venture between MillerCoors and AriZona Beverages. The noncarbonated blend of iced tea and lemonade made with real juice and select teas has an ABV of 5%. It is available in 24-ounce cans and 12-ounce slim cans.

There’s some science to category management decision-making and then there’s simple observation. Randy Morton, owner of Morton’s c-store, Hallettsville, Texas, cracks the code of single-serve buying trends in reviewing surveillance film of customers and their nuanced approach to selection. “I see who is buying a craft single and if they opt to trade up to a six-pack size. I study the camera to also see where people are looking and then make (positioning) adjustments,” Morton said.

“The challenge is balancing the consumer desire for innovation across segments without compromising key volume items,” said Jennifer McCauley-Topor, brand director for Seagram’s Escapes, in discussing SKU rationalization solutions. Seagram’s Escapes Spiked Calypso Colada recently joined the lineup in a 23.5-ounce single-serve can. With an 8% ABV, it is available for an SRP range of $2.50 to $2.99.

Suction cup racks are an overwhelming favorite of suppliers introducing new single-serve products in the cold vault. They “remain the top driver of additional impulse sales in convenience,” said McCauley-Topor. “In addition, retailer-specific consumer programs are often successful.”