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    7-Eleven Set to Launch Private-Label Beer

    Premium Import Santiago Cerveza De Oro targets young adults.

    DALLAS -- 7-Eleven Inc., operator of 5,800 convenience stores in the North America, said it would introduce its private-label Santiago Cerveza De Oro beer later this month. The new premium import beer will sell for a suggested retail price of $5.99 a six-pack.

    Beer is a $70 billion industry in America, roughly split between on- and off-premise sales, with take-home sales weighing in a little heavier. In 2002, beer and wine sales alone represented 11 percent of 7-Eleven stores' merchandise sales. Beer sales this year are showing a 5 percent gain at 7-Eleven, outpacing industry growth. Of that gain, imports are up around 10 percent this year, on top of a 12 percent increase in 2002.

    "Sales of imports rank second in our overall beer business with Corona and Heineken topping the list," said Suzanne McDonald, category manager for beer and wine at 7-Eleven, Inc.

    It's an idea that has been brewing at 7-Eleven for more than two years. Rather than compete with domestic mega-brand beers, which have always been hot sellers at 7-Eleven, the company made a decision to carve a niche in the import beer business, one of the fastest growing in the industry. Retail information data gathered at stores identified these growth trends, which allowed the company to approach distributors, and brewers with a plan about the type of draft it wanted produced.

    7-Eleven beverage executives teamed with Latin Brew Sales Company, the U.S. sales and marketing arm of Cerveceria La Constancia, to explore the idea of offering customers a premium import. The product development team headed south of the border to create the new product including flavor profile, product name, appearance, and packaging.

    Imported from El Salvador, Santiago Cerveza De Oro is brewed by Cerveceria La Constancia. Cerveceria La Constancia is a wholly owned, independently operated subsidiary of BevCo, which is in a joint venture with London-based SAB Miller, the parent company of Miller Brewing Company.

    "Our goal was to develop an import beer you could drink with or without a lime," McDonald said. "In our informal taste tests, Santiago Cerveza De Oro was judged to be just that -- smooth, light and refreshing."

    The product is targeted to appeal to young adults, ages 21 to 27 because of their receptiveness to new products and brands. "While major brands dominate product categories, our customers have a fascination with new products," McDonald said. "Their initial purchase is typically a result of the 'newness' factor. If we meet or exceed their expectations for quality, then they'll keep coming back."

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