Retailers Jey Sivapalan and Bart Dalla-Mura have stores in very different areas and with very different customers, yet hot beverages are a crucial category for both of them. We joined Jacobs Douwe Egberts at Jey and Bart’s stores to help redesign their hot beverage displays and share expert advice on merchandising the stores’ coffees, teas and hot chocolates more effectively.
THE EXPERT
CIGDEM LETTIERI
Category Development Manager, Jacobs Douwe Egberts
FOCUS ON
JEY SIVAPALAN
1 Stop Convenience, Store (Go Local), Derby
“Our customers look for value, so products with a low price per cup are very popular. We have a lot of competition nearby, so we need to be competitive on price while stocking what people are looking for. It’s important that we offer different price ranges, from value to premium. Our coffee sales are doing well so far, especially the bigger pack sizes, but we’re not really sure how to grow sales in the category.”
Cigdem says
“Around 26 billon cups of coffee are consumed at home each year, making it vital for shops in residential areas to make the most of the category. Tastes are changing when it comes to hot drinks, with shoppers looking for quality as much as value. Jey has a good range, but we’ll add lines to inspire customers to trade up. We’ll also rearrange the fixture, grouping related products together, applying clear segmentation and introducing a layout that increases in price per cup, recognising that pricing is at Jey’s sole discretion.”
ACTION PLAN
Block merchandising: We grouped related products – for instance, all coffees together, and sugars next to sweeteners – to help shoppers easily find what they need
Highlight top sellers: We added big-selling brands like Kenco, who have a 19% value share in instant coffee. This will widen the shopper reach and help customers notice the section
Prioritise premium: We have rearranged the coffee fixture around ‘price per cup’, putting the premium lines at the top of the display to encourage trading up, recognising that pricing is at retailer’s sole discretion
FOCUS ON
BART DALLA-MURA
Tysoe Village Stores, Warwickshire
CHALLENGES
“My store caters to affluent shoppers and those looking for value. I have to cater to all these different needs, as well as offering niche products. Hot beverages are an important category for me, but I don’t have elastic shelves, so deciding what to stock is a challenge. Customers come here to do their weekly shop, so if I’m missing some of those niche products, I’ll miss the sale.”
Cigdem says
“Twenty-four million UK households buy coffee, meaning whoever your customers are, it’s important to get your hot beverage range right. Bart has a good selection of hot beverages, covering premium and value-added lines. We’ll rearrange his fixture, putting coffee at the top instead of hot chocolate. We’ll also introduce some more specialist products, to attract customers who are looking for more premium coffee products.”
ACTION PLAN
Specialist ranges: We added machine pods and capsules, as these will resonate well with more affluent shoppers looking for specialist products
Coffee focus: We moved coffee to the top shelves – replacing hot chocolate – as it is responsible for most sales and should increase shopper spend
Secondary siting: We put cappuccino and latte sticks on a separate promotional unit close to the till to encourage impulse buys
JACOBS DOUWE EGBERTS’ TIPS FOR YOUR STORE
Getting hot beverages right is vital for driving sales and boosting basket spend
1
Block merchandise related categories and product groups together on each shelf
2
Coffee is the biggest category within hot beverages – make sure your fixture reflects this
3
Offer shoppers choice by stocking premium and value options
4
Encourage impulse purchases with secondary sitings near your tills
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