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.
Issue link: http://read.dmtmag.com/i/705687
Ready-to-Drink Products www.beveragedynamics.com July/August 2016• Beverage Dynamics 37 boomed a few years ago, the category has seen a recent dra- matic drop in sales. "Consumers now prefer to blend their own fl avors to make a bar-quality cocktail," Mehra says. "Premium RTD products have a leg-up on fl avored spirits since they provide convenience and ease of use. In addition, we are seeing a trend of consumers using quality RTDs that are made with real fruit as mixers in creative cocktails." INCREASING SALES Retailers interested in increasing sales on ready to drink products should offer them in the cold box, as well as display them in that section. "That's the space where people shop for convenience," Eason says. Pacheco's advice is to display it con- veniently for the customer, close to the register or where it has the most visibility. Cross-merchandising is extremely import- ant, too. "Retailers need to be creative when cross-merchandising RTDs with other products," Pacheco says. "They must be forward thinking, envision- ing what their customers will be looking for in order to capture sales of RTD products. With careful planning, retailers can cap- ture some great sales." Latitude Beverage Company has found that the best way to increase sales and build a fan base for any new product (espe- cially a RTD product), is to sample. "Without knowing what something tastes like, many con- sumers are less likely to purchase, so there's no better way to increase sales of RTD products than to have consumers taste it themselves," Mehra says. "Retailers should also position RTDs in prominent locations during summer months, as it will create more excitement and curiosity surrounding the product, leading to impulse purchases." Kick also suggests making products look "fun" and putting the consumer in that mindset defi nitely plays a part in increasing sales. DOWN THE ROAD Growing demand for more sophisticated fl avors throughout the category is prompting a new wave of product innovation. According to Mehra, there is a consumer shift towards prod- ucts that are small-batch and handmade, so he anticipates seeing more craft distilleries bottling premium RTD cocktails. "Based on our sales for Mija Sangria - 18,000 cases our fi rst year and projected 50,000 cases this year - we anticipate seeing more growth in the coming years," Mehra says. Others agree that the future for RTD prod- ucts continues to look promising. Eason says new, interesting fl avor profi les are coming, as well as improved and alter- native packaging. "Look at the new and different la- bels in wine and beer," Eason says. "To stay relevant the category must move that way. RTDs have been be- hind the times." Kick believes there will always be some sort of interest in ready-to-drink products, but it will constantly evolve. "People might want drinks that are portable versus cocktails pre- pared for the home," Kick says. "People might want plas- tic versus glass containers. As society changes, suppliers need to listen and make adjustments." Pacheco also sees this category continuing to grow, as the Millennial generation reaches legal drinking age. "Convenience in packaging and quality formulation of product is critical to this gen- eration," Pacheco says. "The Millennials are socially and digitally connected, which provides instantaneous opportunity for sales of convenient, RTD brands. As long as the products meet or exceed the consumer's expectations in taste profi le, sales will continue to soar. Everyone wins." BD MAURA KELLER is a Minneapolis-based writer and editor. She writes for dozens of publications on a variety of business-related topics. When not writing, Maura serves as executive director of the literacy nonprofi t, Read Indeed. Sangria has seen double-digit growth in recent years, with the top four brands growing 43 percent between 2010 and 2013.