New product launches expected to buoy Monster and the energy segment.
Wells Fargo recently conducted a survey of beverage retailers representing tens of thousands of c-store locations across the country to get a sense of beverage trends during the recent Labor Day holiday, which concludes the peak beverage summer selling season.
Survey results indicated that c-store beverage sales growth was up ~4% for Labor Day 2014 vs. ~3.5% for Labor Day 2013.
The largest contributors of this growth were: (1) successful product and package innovation from Coca Cola and Pepsi, (2) improved trends in the energy category, and (3) improved traffic and increased basket sizes of purchases in c-stores, Wells Fargo noted.
What’s more, so far in Q3 total beverage sales are up +4%. Wells Fargo analysts predict Monster to return to +10% growth in Sept given new product launches.
Based on feedback from its retailer contacts, Wells Fargo noted that promotional activity was soft in the c-store channel this Labor Day, which one retailer attributed to the fact that “Coca-Cola, Pepsi and Dr Pepper Snapple have had to invest lower on holidays due to pricing they gave to Walmart on 12 pack cans.”