In the wake of COVID-19, coffee shops have had to pivot to survive. Smaller coffee brands have shifted focus to bean sales and subscription services. Big name chains are seeing significant closures – Dunkin Donuts announced that it is closing 800 US locations. Starbucks announced the impending closure of 400 locations over the next 18 months, and shifting focus to curbside pick-up, drive-thru, mobile-order locations and wholesale with third parties.
Early on, the pandemic created a surge in bulk buying and sent more traffic to wholesale club stores like Costco, Sam’s Club and BJ’s. These stores are major vehicles for once café-oriented brands like Starbucks and Dunkin, and as such, they should be putting a real effort into presentation. Much like outlet stores, merchandising in big box stores is extremely functional. Coffee brands compete in a market where deals and brand loyalty are the highest priorities and, now with the threat of COVID, swiftness of the visit.
It’s easy to neglect the club store environment, but there is real opportunity here to pull ahead of the pack. When merchandise planning, coffee brands should keep the following in mind:
Adjacencies are important.
In the pandemic, consumers are looking to spend less time indoors. The person who used to linger and did not mind roaming does not have the time for it now. Making sure the coffee accoutrement, such as creamers sugars, etc. are nearby is key to customer satisfaction and increased basket size.
If you can, get an endcap.
Endcaps grab shoppers who otherwise wouldn’t go into the aisle and provide easy access to those in a hurry to grab-and-go without entering every aisle.
Create a strong and cohesive brand block using packaging and shelf signage.
Too often, individual SKUs and product variants look too disparate, making it more difficult for shoppers to quickly identify the brand as a whole. Make sure individual variants can be easily identified but still work together to form a strong color block.
Don’t be afraid to incorporate some of the tactics that would be implemented at a café.
A small perpendicular sign allows shoppers to spot their brand quickly from the aisle entrance.
Give people a chance to sample.
Bulk shoppers are understandably hesitant to try something new and risk being stuck with 100 K-cups of a flavor they don’t like. They’ve been burned before, but not again. In the absence of samples tables – largely eliminated in stores for safety reasons – incorporate an add-on sample of a new flavor.