Convenience store sales of non-alcoholic beverages were up 6.6 percent for the first quarter of 2016, according to Wells Fargo Securities’ latest “Beverage Buzz” report, which polls retailers representing 15,000 convenience stores across the country.
Wells Fargo analyst Bonnie Herzog, who authored the report, pointed to solid performances from non-carbonated beverages, sports drinks and energy drinks. As in recent reports, she credited lower gas prices and “premiumization trends” as the reason behind strong C-store beverage sales.
While February’s “Beverage Buzz” survey reported that Monster had moved past “transition issues” related to the company’s move to the Coca-Cola Company’s distribution system, the first quarter of 2016 saw Monster sales growth soften to 8.2 percent, compared to 10 percent for the fourth quarter last year. Still, Herzog noted, retailers expect to see Monster outperform the energy category this year with double digit sales growth. Some pointed to a possible launch of an enhanced water product from Monster as having a big impact on sales later this year.
Coca-Cola’s sales were up an impressive 5.4 percent for the period, compared to 2.9 percent for the fourth quarter of 2015. Herzog attributed the growth to strong performances from Smartwater and the company’s flagship cola. She said retailers expect continued strong sales from Coke heading into the summer season, with the company’s “Share a Song” campaign and marketing for the 2016 Summer Olympics driving growth.
Retailers were also bullish on PepsiCo, with some calling it “the most innovative beverage company.” The company’s C-store sales were up 4.6 percent for the period thanks to Gatorade, Starbucks drinks, and “aggressive” pricing initiatives. Similar to their expectations for Coca-Cola, retailers predict a big summer ahead, pointing to brand Pepsi’s upcoming “PepsiMoji” marketing campaign.
Lastly, Dr Pepper Snapple Group was up 5.4 percent, driven by Dr Pepper, Snapple Straight Up Tea and BodyArmor, which retailers reported being particularly enthusiastic about, saying the sports drink brand “could explode.”