Can you build drinks brands in off-trade?

Can you build drinks brands in off-trade?
Photo by Eduardo Soares / Unsplash

Yes, but...with big caveats.
I used to think not. Then I realized that the issue was not the channel, it was pricing and pace. My approach has then changed:

off-trade is seen as a big bulk but it has different segments (image and pricing).
Clear rules of engagement and expectations are key.

What do you want to get out of the channel?
1 - If you can wait and just seed in a few niche shops, better.
2 - If it is quick volume gain, it's the beginning of a painful journey.
3 - If you want to drive scale at a faster pace vs on-trade, you are entering a minefield that you can come out from, being very careful.

A few clear steps:

  • segmentation: pick one chain, first. The one in which you can negotiate a fair role and relationship.
  • recommended pricing: if there is one thing that talks about your brand, that is your price. Whilst you cannot control the shelf price (only RRP!), pushing promos and discounts most of the time, will become an expensive addiction. You don't want your brand to become their cash cow.
  • execution: don't do in off trade things that consumers wouldn't forgive you in on-trade. Treat off-trade as if it was on-trade.
    The faster volume grows, the less sustainable the growth will be. Manage expectations.