Quick Stats

Quick Stats

    You are here

    Soaring With Shots

    C-stores are on a high with the power beverage of the moment -- concentrated doses of caffeine, B vitamins and amino acids in little plastic bottles.

    By Renee M. Covino, Convenience Store News

    Selling energy shots is no shot in the dark for c-stores. Although they are expensive -- averaging $1.50 an ounce -- and reportedly "medicinal" tasting, energy shots successfully occupy prime real estate on many a c-store front counter these days. The category that many say has spun off of the momentum of the energy drink segment is now generating $470 million in c-store channel sales and growing, according to the most recent industry research.

    Convenience stores are definitely the most popular purchase location for energy shots -- more than half of respondents who buy them (55 percent) reported buying them at c-stores, according to Mintel, a market research firm in Chicago, in its recent category study, "Energy Drinks and Energy Shots, U.S. -- July 2009."

    "C-stores, because they sell the most single-serving packs, are also valuable for encouraging trial by new consumers," said Carl Sperber, communications director for Living Essentials, maker of the far-and-away leader in the category, 5-Hour Energy, with more than 70 percent of the channel's category sales. The brand is turning five years old this year, but many c-store chains have much more recently seen a sales spike.

    "For the past year now, this has been a growing category," stated Kelly Nelms, a buyer/merchandiser for Bonham, Texas-based Kwik Chek with 31 stores. "We had energy shots for longer than that, but didn't really start pushing them until around 18 months ago."

    Regarding the brands, he said: "5-Hour is by far, No. 1. No one else even comes close to them. But we try to keep six or seven different brand offerings. We're mostly carrying the direct-store distribution offerings -- Monster, Full Throttle and Red Bull just came out with theirs. I think you need that name-brand recognition."

    "We're required to carry a certain amount of energy shots from Coke and Pepsi -- Monster and Red Bull," explained Walter Ryan, director of marketing for K&G Stores Inc., based in Littleton, Colo., with 113 stores. "But of course if you don't have 5-Hour, you're out of the business."

    Ryan noticed that some of the allure of the category "has actually worn off already." He said: "We still do a fair amount of business in it, but we're hoping the fact that Monster recently lowered its price to $1.99 will get some things going again."

    The average price per shot is currently $3.01, according to the latest industry research, and Ryan was selling Monster at $2.99 before the promotion began almost two months ago.

    Nelms is selling all brands at $3.99, or mix and match two for $6. "I'm in rural America, so I'm not in price competition like they are in the big cities," he reasoned.

    There also could be a seasonal influence to the energy shot business. One 7-Eleven store, located just off of the University of Maryland campus, was named on of the company's top U.S. sellers of energy shots, in a recent New York Times article. The store's owner, Million Mekonen, told The Times sales spiked during finals this past May, when the convenience store sold close to 400 shots in a week to its most devoted consumers: students cramming for exams or partying into the night. Construction workers and truck drivers were also mentioned as being heavy users in the category.

    "There's also a fitness aspect to it. We get a lot of customers who work out and play sports buying energy shots," explained Ryan. "It's a destination category. They're looking for a little stamina when they know they're going to be doing something outdoors or participating in a sport."

    Kwik Chek is in the process of giving the category an extra "cold" boost -- it is testing offering the shots in two small refrigerated coolers on the counter.

    "I've talked to my energy shot customers and some told me that once they've had one cold, that's the way they prefer it," said Nelms. "It's still too early to tell, but I'm doing a test to see if it increases sales."

    By Renee M. Covino, Convenience Store News
    • About Renee M. Covino Contributing Editor Renée M. Covino is a veteran researcher, editor and writer with more than 30 years of experience in the mass retail sector. Her articles and columns have appeared online and in print for dozens of industry trade magazines, newsletters, metro newspapers, Fortune 500 company reports and college textbooks. Covino is a self-named “store connoisseur” who not only writes about retail, but happily supports it.
    • About

    Related Content

    Related Content