Customization + Variety = The Future of Truckstop Beverage Sales

From traditional and craft sodas to coconut water to energy drinks, today’s consumers have more choices than ever when selecting a beverage, and the number of drinks competing for cooler space is expected to grow.

“As the food service continues to grow, the beverage companies are going to keep introducing new products,” said Stephanie Kowitz, director of shopper insights for Coca-Cola.

The good news for the travel plaza industry is that their customers are buying those beverages. Kowitz said 64 percent of inside sales at truckstops and travel plazas include the purchase of a beverage, and three beverage categories—carbonated soft drinks, energy and water—deliver over 70 percent of the volume of beverage sales.

While there is a lot of potential within the category, travel plazas are most often limited by their cooler space, which means they need to be sure they stock the right products.

To help make space in their coolers, Darren Schulte, vice president of membership for NATSO, suggests operators look at the number of sizes they offer and said it isn’t necessary to offer every available option.

When determining what size to stock, Kowitz said larger immediate consumption package sizes, such as one liter, are an advantage for truckstop retailers over convenience stores.

Sean Flynn, general manager of Flynn’s Truck Plaza, has tried to cut down on the number of facings he gives one product. “Every soda company wants as many facings of their best-selling product as possible. That doesn’t help us sell, but it just looks good,” he said. “If guy wants a Coke 20 ounce, he is going to get the Coke 20 ounce and you don’t have to have 10 facings of it.”

Flynn said that he has found grouping like items together—such as colas with other colas—makes more sense for the consumer. Flynn has been able to maximize cooler space so he could dedicate one door to local, craft sodas, which is appealing to locals and travelers alike.

“We have gone to a local bottler, Polar Beverages. They have some local flavors—a birch beer, Cape Cod cranberry dry seltzer—that you don’t see other places,” Flynn said.

Flynn said it is fun for customers to try new flavors and he hopes they find something that will bring them in again. “If you find something unique you can’t get at a large chain, that is a benefit,” he said.

To help determine the best product mix, Schulte suggests operators look at their local demographic. “Every travel center is different, but sometimes travel center owners or operators, because they’re on the interstate, can forget they have a strong local presence and forget to consider what the local trends or flavors are,” Schulte said.

In addition to craft sodas, craft beers are one way to tap into the local flavor. Schulte said, “There might be a particular craft beer in your market that really does well and why wouldn’t you want to offer that and make that part of what you’re known for?”

Michael Ouimet, president of Ouimet Resources, which operates travel center restaurants in 11 states and provides consulting work, has one location that features 100 types of beer and displays 99 bottles of beer on the wall. “We display them by the bottle and you can pick six for one price,” he said. “It is a point of difference.”

Broadway Flying J Travel Plazas dedicated one door in its 15-door cooler at one Montana location to local craft beers, which has resonated with a range of customers. “We’re on the road to West Yellowstone, and we have a lot of tourists who try the craft beers,” said Damon Borden, a manager at Broadway Flying J. “Even the locals know you can get it at our store and come back and get it.”

Broadway Flying J sells the craft beers by the six-pack and in 24-ounce bottles and has placed special signage on the door. What’s more, staff has taken time to visit the local breweries, so they can answer any questions customers have about the beers.

While the craft beers are popular, the top-selling drinks at Broadway Flying J Travel Plazas are energy drinks, which are selling even better than water, Borden said. “Monster is our top seller, even greater than Red Bull,” he said.

Flynn has also found success with Bawls Guarana, an energy drink. “There was no distributor around here, but we bought pallets from the manufacturer and kept them in our warehouse. We had people driving down from a state away to get it,” he said.

Flynn is also having success with canned iced coffees and coconut water. Americans are now buying around $400 million in coconut water annually, according to the research group Euromonitor.

Kowitz said tea sales “are exploding,” and the National Restaurant Association listed specialty iced tea as a top trend in 2015.

Iced coffees and teas are the fastest growing beverage segments Borden sees. “We sell as much in the winter as in the summer. That Gen X customer is moving away from coffee in general and is looking for iced coffees and smoothies and iced teas,” he said.

While SKU count is important, Schulte said the ability to customize is a priority. “One of the growing trends is customization of your fountain drinks, like the Coca-Cola Freestyle machine,” Schulte said. “There are dozens of flavors on that machine, but I think there are 30,000 different combinations you could come up with. That is what customization is. That makes sense versus having every soda under the sun in your cooler.”

During The NATSO Show 2015, J.T. McMahan, sales director for Coca-Cola, told attendees, “Customization is king.”

Kowitz said creating easy food and beverage bundles can help spur beverage sales and meet customers’ needs. “Thirty-nine percent of food service shoppers say the availability of combination offers is important to their location decision,” Kowitz said. “Combination bundles are most important for midmorning snacks, lunch and mid-afternoon snacks.”

Operators may want to tap into marketing that encourages customers to make a purchase for now and for later, such as signage that shows a fountain drink bundled with a bottled beverage.

While gas and diesel is the most influential item that determines when and where a customer stops, the most impulse purchases are candy, gum, mints, salty snacks, carbonated soft drinks and candy. 

/// Read Twelve Travel Plaza Customer Insights from Coca-Cola and Seven Ways Truckstop and Travel Plaza Operators Can Spur Inside Sales for more beverage retail insight from Coca-Cola.

Photo Credit: Flynn’s Truck Plaza

This article originally ran in Stop Watch magazine. Stop Watch provides in-depth content to assist NATSO members in improving their travel plaza business operations. The magazine is mailed to NATSO members bimonthly. If you are a member and not receiving Stop Watch, submit a request to be added to the mailing list. Not a member? Join today or submit a request to receive additional information.