Monday, January 10, 2011

Walgreens is Back in Beer – Big Flats 1901 Priced to Move.

America’s largest liquor retailer? Used to be Walgreens. Its alcoholic beverage sections accounted for close to 10% of the chain’s sales and the inventory included beer. Then, in the mid-1990s, booze was phased out, mainly for inventory reasons: too many SKUs for the retailers’ managers and employees to handle.

Starting about a year ago, though, Walgreens’ second thoughts began to resolve themselves. And this past June Fox News (among others) reported:

The nation's largest retail drugstore by store count has reintroduced a limited beer and wine selection in about 3,100 of its roughly 7,500 stores. The drugstore has plans to stock the alcohol in about 5,000 stores by the end of 2010.

Wine began to show up on the Walgreens shelves in this part of the country. Maybe the move was also driven by increased competition from CVS, which offered wines from that chain’s appearance in Houston.

Now there’s…beer. Here! And there and everywhere.

The displays went up here right after New Year’s and what’s being sold is a private label brew called Big Flats 1901. It appears to be a national rollout; blogger Jake Parillo, for example, spotted it in downtown Elmhurst, IL.

From Houston, let me offer a closer look. The beer’s trip to market is modestly complex but that’s not so unusual today. Winery Exchange out of California created the brand for Walgreens. The packager describes itself as the “leading corporate brand beer supplier for premium quality beers from the USA, Latin America, and Holland.” It is, in fact, a creator for retailers; some of its beers have been award-winners.

Next comes Winery Exchange’s partner in creation: Genesee Brewing Company in New York, a long-lived brewer with 400+ employees. Not only does Genesee brew its own brands, including its famous Cream Ale; it contract-brews like crazy. Maryland’s Hook and Ladder Brewing company and Dundee Brewing in New York have their beer recipes executed by Genesee.

I’ve already purchased the “premium American lager” and posted a review. The price point/taste combo can’t be beat. But it is merely okay beer, not great beer. The brand story is weak: “big flats” supposedly describe river flatboats which don’t appear on the label.

At this time, it’s all price. The wines and (now) beers don’t appear on the Walgreens website but they are in this week’s sale flyer, and that includes the Big Flats 1901.

I can’t see “America’s drugstore” making a big push for its new brew. Maybe the drugstore chain will report on how it goes. I hope so. Marketers learn their world one brand at a time – at least I often do. Following the progress of Walgreens, Winery Exchange and Genesee could be instructive and tasty, too.

NOTE: Thank you to Walgreens Store 5536 in Houston.

No comments: