Total convenience channel sales for major categories grew at just 0.4 percent in the four week period ending March 23, underperforming all other channels according to an analysis of Nielsen scanner data by Wells Fargo Securities.
In a recap of current Nielsen sales figures, Bonnie Herzog, managing director of equity research at Wells Fargo, said a 5.6 percent increase in total c-store pricing for major categories likely led to a 4.9 percent drop in volume, leading to sales declines in carbonated soft drinks (CSD), beer, and cigarettes. Meanwhile, energy drinks and salty snacks saw muted growth.
Total CSD sales declined 1.3 percent in dollar sales for the four week period, according to the report, compared to a 1 percent decline in the 12 week period. Average unit prices rose 6.7 percent in the four week period, while unit sales dropped 7.5 percent. The category grew 3.6 percent across all channels in the same period.
Within CSDs, only category leader The Coca-Cola Company (TCCC) reported an increase in dollar sales at 2 percent (versus 1.9 percent for the 12 week period) with total unit sales down 4.9 percent. Staying in the category, PepsiCo sales fell 3.5 percent, driven by an 8.6 percent decline in unit sales. Keurig Dr Pepper (KDP) dropped 1.7 percent for the month and was down 0.1 percent for the 12 week, experiencing an 8.4 percent unit sales dip.
Energy drinks, including coffee and tea-based products, reported overall growth for the four week period at a 6.1 percent increase in dollar sales and a slight 0.1 drop in unit sales. The category saw 9 percent dollar sales growth for the 12 week period and 2.8 percent growth in unit sales. However, the category still underperformed in the convenience channel, reporting 8.1 percent growth in all channels in the same period.
Despite the positive results for energy overall, category leader Monster Energy reported a 5.4 percent dollar sales dropped and a 12 percent unit sales decline (compared to respective 0.8 percent growth and 6.7 percent decline for the 12 week period). Bang, though still relatively small — reporting $345 million in c-store dollar sales for the 52 week period compared to Monster’s $3.8 billion and Red Bull’s $3.1 billion — saw dollar sales growth of 748.3 percent in the four week period, and 807.6 percent in the 12 week.
In a separate analysis released on Tuesday, Wells Fargo Securities analyst Bonnie Herzog noted Monster has struggled to maintain sales and volume growth over the past five to six weeks, in part due to a 6.3 percent pricing increase impacting volume sales (down 8.3 percent in the four week period) and increased competition from Red Bull and the fast growing fitness energy brand Bang.
Red Bull reported a 7.3 percent increase in dollar sales in the four week period and a 4.4 percent increase in unit sales, compared to 8.5 percent dollar sales growth and 4.1 percent unit sales growth in the 12 week. Rockstar continued its ongoing decline, down 13.7 percent in dollar sales and 16.8 percent in unit sales for the four week period.
Sports drink dollar sales were up 5.1 percent in the four week period, an improvement over 4.2 percent growth in the 12 week. PepsiCo reported a 4.6 percent drop in dollar sales, while TCCC saw a 1.5 percent increase.
Dollar sales for shelf stable juice declined 5.7 percent in the four week period, with The Coca-Cola Company reporting a 21.4 percent decline. KDP reported 1.1 percent growth and private label sales were up 18.8 percent.
Despite the weak month, the National Association of Convenience Stores (NACS) reported today that the convenience channel saw record food and merchandise sales in 2018, with in-store sales up 2.2 percent to $242.2 billion. Packaged beverages grew 15.3 percent for the year.