HOLIDAY SPIRIT

BARBARA MURRAY

Retailers are looking to holiday promotions to spur on the biggest time of the year for wine and spirits, if not for beer, which sells best during the summer.

"The holidays provide a major opportunity. Obviously, consumption is up then. People have company, and they also buy wine as gifts," said Scott Silverman, specialty buyer for Rice Epicurean Markets, Houston. Also, when shoppers have wine in the basket, they tend to spend more on other items, too, he added.

Dave Burkemeier, manager of the Schnucks On The Plaza store in St. Louis, looks forward to the annual release of Beaujolais Nouveau, which always falls on the third Thursday of November, to kick off the holiday selling season. "It does go well with turkey, but it's more the uniqueness of the wine," that excites people, he told SN. "In more recent years, it's been getting more popular. The French claim it's bigger over here." Signage will alert shoppers to the new Beaujolais in his stores.

Tim Norland, buyer of spirits, wine and beer at all Byerly's and Lunds stores, St. Paul, Minn., and designer of four separate-entrance alcohol beverage shops operated by the chain, said holiday promotions begin each year with a Fall Sale on wine.

Just as with Halloween candy, shoppers are encouraged to buy wine early in the hope that they will use it up and need more later. Or, that they will try several bottles, find something they like and come back for a case for their holiday entertaining.

Where state law allows, retailers try to participate in the majority of the manufacturers' tie-ins and mail-in rebates, since these draw business.

"They help," said Patti Councill, spokeswoman for A&P, Montvale, N.J., noting one by Grolsch, a premium imported beer, that is offering a dollar off on a bagged snack item. "We also do a lot of theme advertising and point of sale," Councill said, adding that all the manufacturers do a nice job on their POS materials, which are provided by the wholesalers.

Recognizing that wine is a profit center in the store, retailers such as A&P, ShopRite, Wegmans, Hy-Vee and Lunds/Byerly's have opened separate wine and liquor stores to take that to the next level.

Some chains, primarily on the West Coast, have added wine stewards to their staff, but whether this expert help actually draws customers in depends not only on the demographics of the area, but also the competition that exists there. The role of the wine steward is to help the consumer choose from among an array of wines that can be overwhelming, to help him or her decide on a style of wine in a certain price range.

A&P has a wine steward in its Fort Lee, N.J., Food Emporium store, but it also has wine stewards in its 30 freestanding liquor or wine stores, which are in Connecticut and New Jersey. "Ironically, if you have a lot of volume in a department, you could have both [a wine steward and a department manager]. You can let that one person concentrate on the wine, and let the others worry about the spirits and the beer, which could be 40% of the sales of the department. You really need the volume to support the wine steward," Councill said.

Byerly's 1,200- to 1,300-square-foot store in Plymouth, Minn., is called The Wine Market, even though it has one wall of spirits and eight doors of chilled beer. Sixty percent to 70% of the business is in wine, Norland said. The staff does a lot of hand-selling, emphasizing wines to go with food. In spirits, white goods sell best, he said, with vodka far outselling anything else.

There has been no drop-off in entertaining, he finds, despite a recent NPDFoodworld survey that claims people don't want to bother. "Weekends are really good for me," Norland said, adding that even in a down economy, people are still buying wines. "People are realizing more and more, and with our help, how much food and wine enhance each other." A&P agreed that there has been an ongoing increase in home entertaining. "On-premise businesses are still getting hurt a little bit, and that would tend to help us," said Councill. "We are optimistic."

For the holidays, many say that people shop price. "Everybody sells exactly the same product and you have to be competitive," said Norland. Displays help, such as the "large wine presence" customers see when they enter his store. Price is certainly significant, but an off-shelf display and service adds a lot, also, said Councill from A&P.

Silverman, of Rice Epicurean Markets, noted that in the fourth quarter, distributors are trying to make their numbers, and there are deals to be had, "if you wait long enough."

Supermarket sales tracked by Information Resources Inc., Chicago, show that, indeed, the fourth quarter of 2001 was the biggest in the wine and spirits/liquor categories, while for beer, ale and alcoholic cider, it was the 13 weeks ended July 8, 2001, same as the biggest season for pre-mixed cocktails and coolers.

U. S. supermarket wine sales for the 13 weeks ended Jan. 6 were $1.1 billion, or 31.8% of the 52-week dollar sales, as of the same date. For spirits and liquor, the last quarter totaled $485 million, or 31.1% of the year. In beer, the last quarter was $1.7 billion, or 24.6% of the year, while the best quarter, spring/summer, was nearly $2 billion, or 27.9% of the year's dollar sales.

Beer sales are more evenly divided, though, than sales in the other alcohol categories: 20.9% for the first quarter; 27.9% for the second; 26.6% in the third; and 24.6% in the fourth. Wine ranges from 23% in the first and second to nearly 31% in the fourth; pre-mixed cocktails and coolers range from 18.5% in the first quarter to 32.1% in the second, with lower sales in the Oct. 7 and Jan. 6 periods.

Manufacturers tend to line up food partners to build promotions that tie in wine or beer with a complementary product, such as cheese and crackers. "We build recipes, use the calendar, put together pamphlets and offer high-value coupons," said Steve Sprinkle, vice president, global chain accounts, for E. & J. Gallo Winery, Hayward, Calif.

He said the best holiday promotion is a comprehensive occasion-based selling program. "Wine buyers, the consumers, are buying for an occasion, for entertaining or going to someone's house, and they are valuable shoppers. They spend about 75% more when they have wine in the basket.

"So, one of the big opportunities that we see is building these occasion-based programs, pairing the wine with key perimeter and Center Store food items. Don't figure they will also buy cheese and crackers, but lead them to it." Olives, pasta and sauce, as well as cheese, will carry coupons worth about $13 in some customer-specific programs this season, he told SN. Gallo even has a partnership with Miller Brewing this year, with a $5 mail-in rebate, on the theory that when people give a party, they buy beer as well as wine.

All the majors do this, said A&P's Councill, but it could be a regional promotion using unique items. "We are certainly seeing more of that; it's just a matter of where you can do it. We sometimes move wine near the meat department or the pasta section, if we can get the space, and depending on regulations in the state," she said.

"We sell a complete line of bar accessories. It's generally more profitable than the wine, spirits and beer, because it's not nearly as price sensitive," Councill said.

Lunds' and Byerly's associates encourage customers to invest in nice glassware and a good corkscrew to enhance the wine-drinking experience. Norland told SN he sells a lot of Reidel crystal, which ranges from $26 to about $75 a stem.

"And it makes a huge difference. You can take a $6 bottle of wine and make it taste like a $12 bottle of wine," Norland said.

Halloween is big on the beer side, and all the major brewers have some sort of merchandising help. Miller's Halloween promotions include a supermarket program all through October, featuring a coupon for DiGiorno frozen pizza, along with all kinds of display materials.

As for the new malt beverages, Norland said it's a little hard to say how they are doing, since his store doesn't have much space, but he said Mike's Hard Lemonade is doing well, as is Doc Otis, owned by Budweiser.

"That category is still fairly new," Councill concurred. "We can see that it is seasonal in the warm months, like beer, and it seems to promote well around the holidays, too, similar to the beer holiday sales patterns." None of the malt manufacturers has sent anything geared to Halloween. "I would bet next year they will," said Councill.

Sometimes the wholesaler embellishes the materials, such as last Thanksgiving when some employees of Wright Distributing, New Braunfels, Texas, even built deer blinds in the rural stores that went along with the beer displays. Wright supplies H-E-B, Wal-Mart, Albertsons, Randall's, some Brookshire Bros. stores and others, according to Sandy Kibby, vice president.

Floor space is an issue with beer. At the holidays, many retailers want to use their floor space for toys and big items, "so we have to really compete for the floor space, starting about Thanksgiving," said Kibby, a Miller distributor. Another wholesaler, Jeff Vukelic, who supplies Anheuser-Busch products to the Buffalo, N.Y., and Niagara Falls areas, said you always have to negotiate for floor space.

"We try to get the best spot in front of the cooler," said Vukelic, executive vice president of Try-It Distributing, Lancaster, N.Y. "For the most part, when it's on ad, you can get the display. You can be a little bit more creative in Tops [Tops Friendly Markets, Williamsville, N.Y., one of his accounts]. You can go a little larger, to tie in with themes, like sports, like hockey and tailgate, and a lot is tied in with other brands, like Hormel hams or turkeys. A-B has promotional links and their actual packaging is geared toward Christmas."

Right now he is running a Buffalo Bills tie-in with Tops Friendly Markets, and is anticipating a good holiday season. "We've had a record summer. On [last] 9/11 we got hurt a little bit, but in the off-premise, we picked up," he told SN.

Some independent operators said they don't go out of their way to promote beer, in view of the danger of selling to underage drinkers. Harry Jansen, for one, owner of a ShopRite store in Hauppauge, N.Y., said that although he promotes beer in accordance with the ShopRite weekly ad, he doesn't approve of giant stacks of cases.

"I saw a stack of beer that they were building in a promotional aisle, and it said 'Back to School' on the other side, and I said 'Get it out of here!"' Jansen told SN.

"We even provide booklets that help the retailers card, driver-ID programs that show what every state's license looks like, to help prevent underage sales," Vukelic said.