Updated October 3, 2024
As CEO of upstate New York’s largest beer distributor, Jeff Vukelic boasts over 100 years of family success in the spirits trade. After his recent acquisition of Minogue's Beverage Centers, Jeff was eager to expand the model and try new things, and my client, Andy Heck of Alpin Haus, recommended me to him.
Minogue’s four 50-year-old stores had grown stale. Despite some initial changes, sales remained lackluster, consumer preferences shifted, and the Bud Light controversy presented additional challenges. After Jeff acquired the chain, he continued doing what they had done for years and didn't want to continue doing it: "I wanted customers to come in and feel, 'Wow, I can't get this anywhere else.'"
In our initial consultation, Jeff prioritized gaining customer insights to transform the shops’ outdated business model into one primed for growth through implementing inventive strategies.
I aimed to deliver new insights plus concrete solutions to captivate customers.
This case study chronicles my strategic business makeover of Minogue’s beverage centers as they transitioned to the new name BEVS. Join me as we review the challenges and critical insights that guided my recommendations and the outcomes after implementation.
1. Observations:
When you entered, Minogue's interior looked like a beer warehouse, with pallets on the floor and beer stacked high. You couldn't see anything. The signage was unclear, and it wasn't easy to find things because everything was organized by who made it rather than by the flavor. Instead of being able to locate your favorite IPA or stout easily, you had to hunt around based on the brewery. It made shopping a confusing chore rather than an enjoyable browse to discover new beers you might like.
All the aisles went straight, like a grocery store, and shoppers would walk down an aisle, get what they needed, and walk straight back out. The store layout didn't encourage people to walk around and browse the whole store, resulting in missed opportunities to discover new tastes.
Exteriors
The exterior of the stores looked like basic maintenance had been missing for years.
- Parking lots were dated with stanchions too low for modern SUVs; some posed safety hazards
- Exterior signage had faded, both on monument signs and in window decals
- Building upkeep was lacking for gutters, awnings, lighting, and overgrown shrubbery
Interiors
The bold blue used throughout created a cold and dingy appearance. The lighting was lacking, and the whole interior lacked appeal for women and younger-generation shoppers.
- Arranged like grocery stores with long aisles and a "get in, get out" feel
- Products organized by manufacturer rather than flavor profile or taste
- Directionality for shopper navigation, insufficient lighting, mismatched paint
Counters
- Cluttered with multiple signs stacked upon each other
- Cigarette fixtures outdated by a decade or more
Staff
- Greeted but did not actively engage shoppers
- More attention spent on stocking than speaking to customers
Growler Stations
- The once-popular growler trend had run its course
Operations
- Antiquated POS system with limited reporting for managers
- No online ordering capabilities or customer loyalty program in place
- Website not professionally done: lacked events/marketing info
Merchandising
- Counters overcrowded with clearance items, lottery signage, and machines
- Orphaned beers bagged as "Mystery Bags" for $4.99
- Lack of unique themes or areas of discovery
Overall, the stores had no distinct personalities, and outdated aesthetics were more in line with grocers than specialty beverage retailers. Significant opportunities existed to captivate customers with strategic upgrades.
2. The Plan
It should be worth the trip if it will be an extra stop for patrons.
From the curb appeal of a re-striped parking lot using a beer bottle motif to a completely revamped store layout where shoppers can easily locate what they want, we would move on to merchandising. We would encourage customers to add on through strategic product placement and compelling displays and unify by style rather than brand, with signage to group beers together. This flies in the face of most beverage centers which are grouped by brand to be easier to stock. Within that framework, the higher margin items would be featured at the navel level and lower at the floor level.
When I presented the plan to Jeff, he turned to me and said, “I have hope again.” Now we had to deliver.
3. Implementation Design & Layout Overhaul
The most critical change was the entire store footprint.
Moving this much product proved tricky with heavy, fixed StoreFlex shelving in place with beverages in glass bottles. It required us to close and use 20 workers to move all the products manually. The job took one day to move and several more to refine. In addition, we:
- Stripped unused areas and repurposed space
- Doubled lighting for a brighter aesthetic
- Added a fresh coat of clean white paint over the cold blue
- Added the color Georgian brick on the trim around walls to direct eyes downward
- Used that same color behind counters to ground & warm
Major Changes:
‣ New floorplan to optimize shopper flow
‣ Lighting overhaul for a fresher ambiance
‣ Strategic paint colors to improve aesthetics
‣ Addition of architectural elements to direct attention like beer keg chandeliers
Modernizing Operations & Technology
To bring BEVS into the 21st century, we would add a cloud-based POS and inventory management system to empower modern conveniences like:
‣ Online ordering
‣ Customer loyalty programs
‣ Robust inventory tracking
However, integrating new tech hit snags:
• No easy data migration from outdated systems
• Missing product categories/details required manual entry
• Brewers using identical SKUs on seasonals complicated organization
• Inventory scope for four stores equated complex onboarding
Still, the vital foundation is now in place to optimize operations. With 800+ beer and other beverage SKUs, accurate tracking will be possible for the first time.
Consumer-facing perks like online ordering and loyalty rewards will soon delight shoppers with tech-forward convenience.
To energize longtime shoppers used to the same old aisles, we integrated interactive Tokinomo shelf robots, with three vocals each for:
● Bud Light
● White Claw
● Northway
The motion-activated audio guides add fun, surprise & delight.
The overhaul tackled layout, aesthetics, and technology to turn dated stores into vibrant retail hotspots. But moving heavy inventory without fully closing wasn't easy! With manpower and grit, we transformed the space and only closed the stores for a day at a time.
4. Training and Development
The original General Manager quit soon after starting the project, and the stores went without for several months. A new training program has begun, and once we get the POS fully implemented, BEVS will start more specific training on customer service and becoming certified in brewing and other areas.
The online ordering caught several vendors off guard, and we encouraged them to move all their ordering via API.
Employee Engagement:
• Encourage employees to engage proactively with customers rather than waiting behind counters.
5. Results and Impact
"Our headcount is up. We're attracting new shoppers, and our sales are up. I'm thrilled. Now our customers can say, 'Not only can I go to a grocery store, but I can make that extra stop at Bev's because they have variety, the beverages that I need that I can't get anywhere else, in a better environment. I think the redesign is so cool. I just loved working with you so much. You really were the best part. " said Jeff Vukelic.
• Sales Performance: While retailers are still dealing with the fallout from Bud Light last year, sales are improving, and specific areas like snacks have also seen a 30% increase in sales.
• Customer Feedback: “I haven't been in here in a while, but what a great change! They actually have beers grouped by style. That's awesome. Most places are just grouped by brand. You are then forced to wander around, trying to find the style. Today, I was looking for Imperial Stouts. A whole row of Porters, Stouts, and Barley Wines - from all makers!!!! Finally. I know it's easier just to put everything from one maker in the same area, but then I have to look everywhere for what is available in a certain style. They have done it right. Thanks, wish others would follow their lead.” R. Baker
Takeaways for Retailers
• Store Layout Matters: An intentional floorplan determines where shoppers flow and linger, impacting their purchase. Change can improve dwell time and sales.
• Tech Works Wonders: The right integration of systems and tech, from AI and cloud software to interactive robots, drives shoppers’ excitement and modern experiences.
• Branding Influences Aesthetic: Style, color, music, and lighting dictate feeling and vibes. Fresh branding aesthetics make people eager to be in your space.
• Seize Upon Seasonality: Changing displays to highlight timely offerings tailored to weather, events, and occasions sparks interest and encourages trial.
• Hyper Target Your Stock: Carefully curate SKUs to feature unique finds and the latest trends to position your operation as the go-to authority for all things beverage.
The bottom line is that the physical and digital environment you create for shoppers shapes their path to purchase. To start the process of having the Retail Doctor perform a makeover of your business, click below.