COORS DISPLAYS CONFIDENCE IN ZIMA PROFITS

GOLDEN, Colo. -- Coors Brewing Co. here has mounted a campaign to gain in-store displays for its Zima malt beverage year-round-without laying out any trade moneys.The crux of the proposal, now being presented to supermarkets and package stores nationwide by Zima sales reps, is that their product delivers incremental sales and profits when it is displayed alongside beer. And it does so, the company

GOLDEN, Colo. -- Coors Brewing Co. here has mounted a campaign to gain in-store displays for its Zima malt beverage year-round-without laying out any trade moneys.

The crux of the proposal, now being presented to supermarkets and package stores nationwide by Zima sales reps, is that their product delivers incremental sales and profits when it is displayed alongside beer. And it does so, the company claims, without cannibalizing a drop of beer sales.

A study of national Nielsen household panel data indicated that sales of Zima are "entirely incremental" to sales of beer, both in the supermarket and other channels, said Glenn Knippenberg, brand director for Zima.

"This was the best news I'd ever seen. It became perfectly obvious where the strength was at retail for this product," he said.

To draw store traffic, most retailers "practically give away beer," at low margins while paying for advertising, Knippenberg said. But while retailers make "about a quarter" on a case of beer, they enjoy a $5.00 margin on a case of Zima.

"Knowing that, and seeing the impact Zima has on the beer buyers, it was a slam dunk. It said put up a display of Coors or Bud or Miller. Let that beer brand generate the traffic, this will generate profits," Knippenberg said.

To encourage retailers to adopt the display strategy, Zima is now offering them an expandable wing unit that can be nestled into either side of an endcap. It is not, however, offering any price deals.

"There is absolutely no reason to discount this product," Knippenberg said. "We have tested it. Going from $4.99 a six-pack to $3.99 didn't create any lift, it just left $4 per case on the table."

The molded display unit is designed to last a full year in normal use. It holds from 10 to 30 cases of Zima, and the company will provide nine changeable header cards during the year with seasonal themes.

"My expectations are that a retailer that sees and understands this information will insist on a wing display 52 weeks out of the year. This thing makes money while you sleep," he said.