Beverage Dynamics

Beverage Dynamics March-April 2014

Beverage Dynamics is the largest national business magazine devoted exclusively to the needs of off-premise beverage alcohol retailers, from single liquor stores to big box chains, through coverage of the latest trends in wine, beer and spirits.

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6 Beverage Dynamics • March/April 2014 Executive Vice President and Group Publisher Charles Forman Tel: 845-262-1041 Fax: 845-445-6674 email: Editor-in-Chief Richard Brandes Tel: 212-353-3832 Fax: 212-353-8214 email: Contributing Editors Dan Berger Harriet Lembeck Melissa Niksic F. Paul Pacult Robert Plotkin Michael Sherer Senior Regional Sales Manager Bruce Kostic Tel: (203) 855-6499, ext. 215 Senior Regional Sales Manager Mark Marcon Tel: (248) 761-6231 Senior Regional Sales Manager Debbie Rittenberg Tel: (215) 860-0306 Art Director Adam Lane Production Manager Cherri Perschmann Tel: (763) 383-4400, ext. 2425 Senior Research Analyst Adam Rogers LIST RENTAL MeritDirect, Jim Scova email: Tel: (914) 368-1012 REPRINTS Circulation and Audience Development Manager Debra Welter email: Sr VP/Audience Development Joanne Juda-Prainito Sr VP/Finance & Operations Gerald Winkel VP/Beverage Group Amy Collins VP/Operations & Production Barb Hammer Senior Art Director Dodi Vessels RETAILER EDITORIAL ADVISORY BOARD Charles Bailes III ABC Fine Wine & Spirits, Orlando,FL Ralph Bondon Berbiglia's, Kansas City, MO David Breitstein Duke of Bourbon, Canoga Park, CA Jim Shpall Applejack Liquors, Wheat Ridge, CO Hal Gershman Happy Harry's Bottle Shop, Grand Forks, ND Ron Junge Brown Derby Stores, Springfi eld, MO Ted Farrell Haskell's, Minneapolis, MN Burt Notarius Premier Liquors, Kemmore, NY Charles Sonnenberg Frugal MacDoogal's, Nashville, TN Beverage Dynamics is published by Specialty Information Media Editorial and executive offi ces at 17 High St., 2nd Fl., Norwalk, CT 06851 Telephone: (203) 855-8499 Fax: (203) 855-9446 E-mail: Editor's NOTE NUMBERS ON THE BRAIN FOR THOSE OF YOU who like to read about actual consumption statistics, trends and what brands are outperforming their category counterparts, this is the issue for you. For nearly two decades now, Beverage Dynamics has been publishing its annual Growth Brands feature that identifi es the fastest-growing wine and spirits in the beverage alcohol industry. Much credit must be given to our hardworking research staff, which provides the data. So let's talk numbers. As I note in our Growth Brands story (see page 24), "U.S. distilled spirits sales volume in 2013 rose to an estimated 210.6 million 9-liter cases, notching a 2.4% gain versus 2012. That represents a sales volume bump of nearly 5 million 9-liter cases over 2012. Importantly, overall spirits retail revenue growth (the combined dollar total of off- and on-premise sales) also increased in 2013, by 4.2% to $75.82 billion, a gain of more than $3 billion over 2012. The higher percentage gain in spirits revenue (versus spirits sales volume) underlines the ongoing trend of recent years: the dynamic sales activity among premium-priced and above-premium-priced spirits products." Our Growth Brands feature, of course, drills down to actual brand performance, which often, but not always, refl ects the overall trends in the industry. It's a similar story in the wine segment. Total U.S. wine sales volume increased by an estimated 2.2% in 2013, to approximately 326.0 million 9-liter cases. This represents a sales volume gain of more than 6.8 million 9-liter cases versus 2012 totals. And similar to spirits, the move toward high-end purchases continued in the wine segment, evidenced by the segment's 3.6% revenue increase in 2013, to just under $30 billion. Another key industry-wide dynamic is how retailers are increasingly using new technologies to enhance their businesses. Maximum Beverage, in West Hartford, CT, seems to be at the forefront of this trend (see page 14). For example, the operation has about 20 electronic sensors placed around the store. "With these sensors, we track how many people come into the store, whether they turn left or right, which displays and end-caps they stop at and how long they stay there," says owner Brian Whitney. "We have real intelligence on what our shoppers are doing in our monthly report. If they walk in front of an end- cap, we can tell if they walk by or stop, and how long they stop there and if they pick up a bottle from the shelf." Just as impressive are the more than 30 large, touch-screen LED monitors atop various wine and spirits end-caps that provide customers with a wide array of product information, food pairings, recipes, etc. They also obviously serve the store as valuable merchandising tools. Still, all these electronic bells and whistles – which cost more than $300,000 to install – are in the service of one goal: to make the customer's shopping experience more pleasurable and rewarding, and to ultimately increase Maximum's revenue. So far, it seems to be working. Richard Brandes Editor-in-Chief

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