Adam Withrington concludes his ready-to-drink special with a guide to getting your offer right.
In recent weeks The Publican has taken a long hard look at the RTD category; its short but eventful history, its position in the minds of both brand owners and licensees as well as its uncertain future.
Perhaps the most important factor has not been looked at - quite simply, the best way to sell RTDs in pubs.
Here we have put together some thoughts from brand owners and retailers as we try to share some best practice and hopefully find a way of making a category that, for a decade, has been in the news for all the wrong reasons more premium and responsible.
The most important thing with RTDs is to understand your market - simply chucking a load of RTDs into a fridge in the wrong kind of pub will just not work. Think about the important questions - do you have the right target audience? If so, do you know what brands they want? Are they likely to want to try new, unknown products?
It is all about understanding the category. Hopefully the last two RTD features in The Publican will have given you a real insight into the market. The only question is now what do you do with this information? If you believe the market is for you and your pub then it could be a huge benefit to your business.
And it is possible, despite what some of the more guttersnipe right-wing newspapers would have you believe, to sell RTDs successfully and still be a responsible operator.
However, if you blindly and unsuccessfully try to sell them to a non-captive audience then all you are doing is taking up valuable fridge space that would be better utilised selling something else.
For pubs that attract the right target audience (18-30s):
- Pick the right brands for your pub
Nick Arthur, head of marketing at Enterprise Inns, says that some serious thought needs to go into licensees' stocking policies: "Dedicate the right amount of space in your fridge to RTDs and pick the ones right for your market.
"Don't just be tempted by the large number of special offers that are now available - they are only there because of the declining market."
Must stock and might stock
One way to make the most of RTDs is to follow what Jason Danciger, food and drinks buyer for Laurel calls a "must stock, might stock" policy. "In terms of flavours you have your 'must stocks' and your 'might stocks'. 'Must stocks' could well be orange and cranberry. But after that, as manager or licensee, you should choose another flavour or two to suit your particular market - you should understand your local customer base better than most."
Jane Sutcliffe, European marketing manager for Smirnoff Ice at Diageo, believes that RTDs are best suited to retail on "high energy" nights. She says: "Licensees should look to stock RTDs especially on Thursday, Friday and Saturday nights [or perhaps only then]. Stock them on the high energy occasions."
To innovate or not to innovate
"The most important thing," according to Jason Danciger at Laurel, "is striking the balance between having recognisable brands that people have confidence in - such as the Smirnoff Ices and Bacardi Breezers - and brands that are less well known.
"You need innovation as well and to have something slightly different. So in our Litten Tree brand we had a lot of success with Brown Cow - in some outlets it was selling five to six cases a week, which is amazing really for that market. You need to have the comfort of brands mixed with a bit of innovation."
Jane Sutcliffe agrees that innovation, and therefore the stocking or new brands, is hugely important. "This is still a very important category with over one billion in sales and we are committed to this category. Over the last five years the drinks industry has seen 10 billion individual sales from new products. Sixty per cent of that has been driven by the RTD category, according to Mintel, so innovation works."
However, Nick Arthur from Enterprise believes that your best bet is to stick to what customers know best. Nick says: "I don't think licensees should be so tempted by these new products. You need to stick with what you know will sell. More importantly you need to think about the whole packaged drinks category. For example, Corona is flying at the moment, so maybe afford more space in your fridges for that."
Back bar fridges:
- Temperature: According to Diageo's esp (environment service and products) team many licensees are guilty of not keeping their fridges cold enough for the products they stock.
Licensees should serve RTDs at 3?C they say: "This is the correct temperature for RTDs and research shows that if your customer doesn't get a cold RTD, they will tend to avoid bottled products on the next visit."
Spencer Garner, category development manager for Diageo GB, says: "Outlets that deliver properly chilled products could sell as much as an extra case per week compared to those who don't."
Keep well stocked: Jason Danciger at Laurel says: "I find it amazing the number of places I go into where the fridges aren't full. That is your retail space - your absolutely premium selling space. You put things in there to sell, that's what it's there for. There is an element that says it should be visually attractive, so you must bear that in mind - at the end of the day this is your sales piece.
"You would never go into Sainbury's or Tesco and find two or three rungs on their shelves empty. But you do in this industry. You go into a lot of places where they get a bit busy and suddenly the shelves are empty."
Keep back of house stock chilled: Enterprise's Nick Arthur says this is a crucial issue that is not addressed by licensees. "Licensees need to stock all packaged product in a cold environment. A lot of people just leave stock under the stairs. It needs to be kept in the beer cellar or a cold store," Nick argues.
Jason Danciger agrees: "You have to invest in fridge space to make things work. Those places that are best are the ones that have cool back up stock - so they have walk-in fridges or a cool cellar where cases are kept at the right temperature. The product will taste better generally when it is cold."
He suggests one solution would be the introduction of a holding fridge: "You've got to have a system where you can easily refill the fridge with cold stock. So hopefully you can do this through a holding fridge.
"They aren't very expensive; for a couple of hundred pounds you know you have got a fridge around the corner from your bar which will allow you fill to up the back-bar fridge quickly. A back-bar fridge should look well stocked and busy with lots of choice."
What if your pub is not suited to RTDs - should you stock them or not?
The received wisdom is that you should, even if you are a committed real ale pub. Even stocking one RTD brand will give your offer some variety.
For example, walk into almost any Fuller's tenancy or branded concept and on the whole you will find some kind of RTD on sale. Companies like that do not shout about RTDs but they do appreciate that there is a market for them and so will perhaps stock a well-known brand.
If you think your pub or bar is ill-suited to RTDs perhaps you could look at trading up to something more premium? Absolut Cut, distributed by InBev UK, is (if you will excuse the dreadful pun) considered a 'cut' above the competition, and is targeted at top end bars. Maybe that would suit better?
If you still think stocking an RTD would be a bad move then trust your instincts. Back bar fridge