G1 Group doubles category revenues in one year thanks to a new approach across estate
OVER the last two years, Glasgow-based G1 Group has been making changes to the way it sells energy drinks – resulting in the bars and clubs firm doubling sales in the past 12 months.
David Tracey, G1’s director of brands and standards, said the company, which has more than 40 outlets throughout Scotland, based its new approach on customer research as well as a close working relationship with energy drinks firm Red Bull.
“Over the last couple of years we’ve taken a new direction; we recognised what the research was telling us in that our customers were looking for a premium energy brand and are willing to pay for it,” said Tracey.
For us it’s all about adding value, it’s about everything to a high quality standard.
“So we’ve had a transition to get to this point. It wasn’t overnight, but at the same time we gradually ensured that we were promoting Red Bull as the first choice of energy brand and we were making sure that the price point was appropriate for that.
“It was a balance between percentage margin, pounds and pence margin, and visibility of the brand.”
When it comes to energy drinks, Tracey said clarity in pricing is key for a category that has often confused consumers at the bar.
“We’re making sure our customers know we sell Red Bull so merchandising is really important, but also what price they’ll pay for that product,” he said.
“The history of Red Bull is that if you ask for vodka Red Bull you could get a vodka energy [alternative brand], you could get a dash of Red Bull, you could get half a can, you could get a full can, and pricing will vary.”
To avoid any confusion for customers, staff across the G1 estate have been encouraged to deliver Red Bull’s suggested perfect serve at the bar – which includes a full can.
Tracey said the approach has worked for the company.
“For us as a business it’s all about adding value, it’s about [doing] everything to a high quality standard that’s consistent,” said Tracey.
“A bugbear of mine is consistency.
“For us it’s about a tall glass, filled with ice, garnished if appropriate.
“I believe if you don’t get a full can you’re being short changed.
“I wouldn’t sell half a can of an alternative soft drink.
“It’s the strong visual branding of getting your glass with your drink and can.
I believe if you don’t get a full can of Red Bull you’re being short changed.
“If it’s slapped together then it doesn’t have the presentation and the premium value that would make someone willing to pay that little bit more.”
With Red Bull positioned as a premium serve across the G1 estate, Tracey said it was important to bring the price banding in line with similar products across categories.
“Red Bull is a premium product, people are willing to pay a premium price so for us we put it alongside premium beer [in price], packaged and draught,” said Tracey.
And although prices may vary from outlet to outlet and between different Red Bull serves, Tracey suggested the key is being up front with customers.
“Make it visible, taking out the risk and fear [for the customer] of not knowing if this is going to cost £2.50 or £5.50,” said Tracey.
Red Bull is actively promoted across a number of G1 outlets, according to Tracey, with “core territory” outlets such as Kushion, Social and Viper in Glasgow and Cabaret Voltaire in Edinburgh all promoting the Red Bull brand and pricing to customers.
Tracey highlighted a light box sign in Viper, in particular, as a stand-out example, with pricing for a vodka and Red Bull positioned prominently alongside a range of messages in the student-focused club.
Looking ahead, Tracey said the introduction of Red Bull Red, Silver and Blue shows the category is growing in the on-trade.
“What Red Bull have done is keep the brand name but extended the flavours,” said Tracey.
“I think it’s given Red Bull a bigger presence. It’s allowed us to have a wider range without introducing more brands.”
With the introduction of Red Bull’s variants boosting sales of the energy brand by 15%, according to Tracey, G1 now aims to introduce the brand to more venues in the group’s estate.
