As Off-trade Channel Director for Pernod Ricard UK, Chris Shead’s attention has been focussed on Christmas for longer than he’d care to mention, and he believes c-stores are missing a trick when it comes to premium wine and spirits.
How is Pernod Ricard aproaching Christmas?
We’re still banging on about premium, but with very good reason. It might be the space that we operate in for the most part, but we’ve been saying for a long time that premium is a huge opportunity and we’re now beginning to see that.
Can you give us some numbers?
Well, in impulse last year at Christmas premium sales grew +2% and premium wines by +2.7%, but in grocery they grew +5%, so we feel there is a market not being fully exploited in convenience.
Why is that?
Some could argue that perhaps premium products just don’t fit as well in impulse, but 50% of all wine bought at Christmas in convenience is premium (more than £6.50). In mults it’s less than 30%, so convenience is very well-placed. Think about it; people shop there because it’s convenient and they’re will to pay for that. Christmas is about ‘on show’ occasions, where people are visiting friends or having friends over; on those occasions they’re more likely to buy premium. Trading up is a natural consequence of the occasion.
Are retailers actually doing enough here?
There’s a bit of a lag between c-stores and mults. We want to see c-stores get their fair share of this market. The channel needs to work on its range, especially in those 12 weeks before Christmas. A lot of convenience retailers believe the default is to have a decent standard range at lower-end prices because they are driven to show that they can compete on price. They don’t see premium as part of that solution, but the unintended consequence is that they miss out on shoppers who intend to buy premium.
How can they cater for both?
There needs to be more balance. In some stores premium may not work, but most stores with footfall, a mixed demographic, a car park; they can benefit from premium wine and spirits. It’s perceived as high risk because shoppers don’t ask for it but by stocking it shoppers will reappraise your store.
How can c-stores make the most of gifting?
This is a huge opportunity for c-stores, especially as we get closer to Christmas. Retailers need to engage with it – especially on Champagne and dark spirits, which tend to be more popular as gifts.
How will you be engaging with the channel?
We’ve got our field sales team and we’ll be doing activations in wholesale, as well as speaking to trade media, so there’s a three-pronged approach to communicating her message.
Any secret tips for retailers?
They’re well placed to manipulate shopper behaviour. If a shop gets into the festive spirit they can change a shopper’s behaviour from transactional to browsing mode. It might be painful but it really does work. If you go into a multiple at Christmas there are songs, festive aisles, point of sale; it’s all there for a reason. Impulse doesn’t do that enough.
Can harnessing premium be pushed all year?
There’s no reason why not. There are a number of occasions where premium lines can do well all year round. Retailers may be put off by the investment but if they become known for premium products shoppers will seek them out.
FACTfile
Chris Shead is Off-trade Channel Director for Pernod Ricard UK, part of one of the world’s largest drinks companies with brands including Chivas Regal, Havana Club and Absolut.