The Dispensed Drink Evolution

Hot, cold and frozen beverage offerings at c-stores are adapting to meet the times

By Renée M. Covino

HAVE YOU HUNG a “Welcome Back” sign above your coffee bar, fountain drink station, and frozen slushie machines? These areas may have been hard-hit for many convenience stores that suspended self-serve beverages to prevent the spread of the novel coronavirus last year, but the time is ripe for renewal.

“Dispensed beverages are a valued offering to our customers. It continues to represent a healthy portion of overall transactions,” said Jim Rastetter, category manager of hot and cold dispensed beverage at Richmond, Va.-based GPM Investments LLC. The wholly owned subsidiary of Arko Corp. has grown through acquisitions to roughly 2,950 locations comprised of approximately 1,350 company-operated stores and 1,600 dealer sites spread across 33 states and Washington, D.C.

“We must adapt by staying engaged with customer expectations in this area,” he told Convenience Store News. “We expect 2021 to be an exciting year for dispensed beverages, and we are ready to welcome consumers back into the category.”

Clean Sweep

One of the greatest customer expectations now is a sanitary beverage bar across the board, according to Rastetter. “Having a standard procedure in dispensed beverage program areas that is visible to customers is the greatest way to instill confidence,” he advised. “Routine monitoring and cleaning of the beverage bar is critical.”

This includes wiping down surfaces, keeping equipment in good working order, and keeping areas clear of clutter — together, they are the best way to prevent contamination.

“The presentation of the program and cleanliness of these stations will continue to be paramount past COVID,” echoed Emily Wood Bowron, vice president of strategic marketing for Moody, Ala.-based Red Diamond Coffee & Tea.

Other ways she sees the category evolving are providing single-serve condiment options, such as single-shot creamers and individual sugar sticks or packets; and offering an even greater variety of choices.

“Variety and options are taking a frontseat more than ever,” Wood Bowron said. “Customers want to get exactly what they want, how they want it, when they want it, so capitalizing on customizable options is not only great for customer engagement, but it also will help promote repeat visits.”

Customers expect diversification and choice at dispensed beverage stations and coffee bars, added Rastetter. Offering engaging limited-time offers and unique flavors is important, and so is the shift from cubed ice to nugget or chewy ice. “Consumers have begun to expect this popular ice when pouring a drink,” he relayed.

When it comes to trending flavors, c-stores should look to partner with suppliers that have their finger on the pulse of what’s coming in and what’s going out. “Passionfruit may be on the rise right now as we head into summer, but that doesn’t mean it will be popular into the months of cooler weather,” Wood Bowron cautioned.

Meeting customer demand for dispensed beverages these days may also mean having a choice of flavored iced teas at 10 a.m. and a fresh coffee option at 3 p.m. Making sure all dispensed beverages in the program are always fresh and of a high quality will engender trust and continued exploration outside of standard dayparts, according to Wood Bowron. “Breakfast, in particular, has become an all-day event, and consumers still look for healthier alternatives to soda,” she noted.

Rastetter agrees that dispensed beverages should be treated as an all-day program by c-store operators. “Cold and frozen beverages continue to have strong sales during lunchtime and into the evening,” he reported, pointing out that offering fresh coffee all day is easier than ever with the introduction of bean to cup. “These programs are easy for c-stores to execute and complement many of the snack items we sell.”

Don’t Touch

The fewer steps a customer must take to mix the perfect beverage, the better.

“Instead of just offering a regular and a decaf coffee with multiple syrups, consider adding a flavored coffee like hazelnut and another limited offering to the lineup, so customers touch fewer surfaces and deal with fewer handles and levers to create a flavored beverage,” Wood Bowron offered. In tandem with the demand for a high cleanliness level, touchless and contact-free technology is on the rise and more available from varying machine suppliers.

For instance, Coca-Cola Freestyle launched a “pour by phone” contactless experience powered by Amazon Web Services. A series of signals and steps take place in the cloud, verifying that each phone is connected to the right machine, with only in-stock beverages shown as flavor options. Pours then start and stop with the touch of a button on the phone screen, resulting in a “magical experience for the user,” according to a company spokesperson. By the end of 2020, all U.S. Freestyle machines were equipped with this touchless technology.

Follett Products LLC recently introduced the Touchless SensorSAFE Dispensing Kit for its ice and water dispensers. Available for both new and existing countertop and freestanding dispensers, the kit can be easily installed by connecting its wire harness to the control board and attaching the new lid, according to the company.

Similarly, Lancer Worldwide introduced an accessory line called The L-Guard System, developed to ensure hygienic protection throughout the beverage dispensing experience. Valve Guard was unveiled as the first product in the line, designed to retrofit easily with existing Lancer Worldwide machines and intended to protect the valves, levers and dispensed beverages from contamination throughout frequent daily use. No tools are needed; the guard slips around the outside of the dispenser housing, and attaches to a foam adhesive backed tab.

The Rules for Renewal

Industry experts say these are key factors for the rebirth of dispensed beverages:

• Standardized sanitary procedures; • Single-serve condiments; • A contactless drink selection experience through interface or phone; • Touchless technology in water, ice and lid dispensers; • Valve guards/shields that fit over existing machines; • All-day programs, including fresh coffee; • A wide flavor assortment, including limited-time offers; • Additional blends in place of syrups; • Sustainable coffee blends; • Offering nugget or chewy ice; • Frozen flavor mashup menu; • All plastic cups, eliminating foam; • Hologram displays above machines to generate excitement; and • A more premium experience overall.

And to keep beverage container lids safe and sanitized while being stored, Lid Boss enables customers to wave their hand in front of the unit's motion sensor to dispense a single lid. This provides less opportunity for germ transmission and a greater sense of security, according to the company. Lid Boss also cuts down on discarded lid costs for operators, with a footprint that is just eight inches wide.

Unfreezing Potential

In the frozen beverage arena, “connected” machine technology has proven useful during the pandemic. Salt Lake City-based category supplier Frazil/Freezing Point LLC launched a connected internet-ofthings machine that allows the company to remotely monitor/confirm that its frozen beverage machines at retail are on, working and full.

“These questions were critical to answer during the pandemic. This technology really helped many of our chain accounts actively monitor their category in realtime and ensure that they were compliant with local demands,” CEO Kyle Freebairn told CSNews.

Because some municipalities mandated that dispensed beverages should be paused temporarily, the connectedchain capability allowed retailers to see on their dashboard which machines were, in fact, on or off, helping them ensure local compliance.

“And then once restrictions were lifted, the connected machine technology helped ensure that the stores brought all their machines back online, so as not to miss any sales,” Freebairn explained. “With so many other demands that were pushed onto category managers, Frazil’s connected machine technology helped push a lot of the category management responsibilities onto the Frazil team, so retailers could respond to other demands and have the confidence that their slush program was actively working.”

The technology also makes certain that sales are maximized, and that a consistent experience is offered across all stores. “The program is helping to drive sales improvements during a time when every sales dollar is critical,” he said.

Frazil is additionally using its technology platform “Fraznet” to generate automatic notifications around category improvements that are available — down to the specific store level around cup assortment options, flavor rotation options, and other operational considerations the store could implement to drive further sales improvements.

Beyond technology enhancements, quality is what is driving frozen beverage segment growth, according to Freebairn. “The most important aspect for c-stores is to provide a slush product/program that is a premium experience; that draws people back into the store because they can’t get it anywhere else,” he said. “Now is the time to focus on quality and providing a frozen beverage experience that is second to none.”

Frazil has started to add hologram displays above its machines to draw attention to this high-profit category. “We’ve seen significant sales improvements with this unique marketing approach, which consumers love and are instantly drawn to,” Freebairn relayed.

Another customer draw is what he refers to as “flavor mashups,” such as Tangerango, which he describes as a tangerine flavor with a hint of mango. “The complex and nuanced flavor profiles delight consumers and give a much more satisfying and refreshing experience that keeps them coming back,” he noted.

A Frazil mixing menu has been launched to increase the experiential aspect of this evolving category. “What we saw is that consumers like to mix their own custom flavors based on the Frazil flavors that are available in their local store,” Freebairn said.

As a result, the company put some of those flavor combinations into its mixing menu, and also adjusted its store locator to help consumers find those stores that are carrying the flavors they want to try to mix.

“This helps make the category even more fun and exciting,” said Freebairn. CSN

“We expect 2021 to be an exciting year for dispensed beverages, and we are ready to welcome consumers back into the category.”

— Jim Rastetter, GPM Investments LLC