Tip Top Proper Cocktails’ Expansion Strategy through Trader Joe’s
Tip Top Proper Cocktails, a trendy canned cocktail brand, identified Trader Joe’s as an ideal partner to broaden its audience reach. The spirits company believed that Trader Joe’s strong reputation for offering specialty products alongside curated brands could help Tip Top build its brand. However, Tip Top faced challenges in understanding how best to connect with Trader Joe’s customer base.
Navigating the Grocery Industry’s Emerging Brand Trend
Tip Top’s experience working with Trader Joe’s mirrors a broader trend where grocery retailers are collaborating with emerging brands to capture consumer interest. This process is complex for producers, as they navigate a competitive landscape to gain influence and shelf space.
Adjusting Product Strategy to Suit Trader Joe’s Market
Initially, Tip Top launched eight-serving multi-packs priced between $35 and $40, targeting customers who typically spend that amount on bottles of whiskey, gin, or rum. However, the grocer suggested placing the product in the ready-to-drink section, where such pricing was too high. Tip Top pivoted to offering four 100-milliliter cans at a more affordable $18 to $20 range, which resonated better with shoppers, according to Neal Cohen, Tip Top’s co-founder and chief brand officer. He noted that this price aligned well with the equivalent of buying a bottle of wine in terms of servings and cost.
Challenges for Niche Brands in Trader Joe’s Private Label Landscape
Smaller brands like Tip Top face additional hurdles when entering Trader Joe’s ecosystem, as the grocer frequently uses partnerships with niche vendors to gauge customer interest before potentially launching similar products under its own private label. John Clear, a senior director at consulting firm Alvarez & Marsal, pointed out that nearly 70% of Trader Joe’s products are private label, making it challenging for outside brands to secure lasting shelf space.
Tip Top’s Strategy with Trader Joe’s Unique Audience
Despite the challenge, Tip Top pursued a relationship with Trader Joe’s because of its reputation for attracting adventurous shoppers willing to try new products. Cohen acknowledged that Trader Joe’s might emulate successful products but believed the collaboration could still be beneficial for his brand.
A Trader Joe’s spokesperson commented that any product seeking shelf space undergoes a rigorous tasting panel review to ensure it meets the grocer’s quality and value standards. Products that pass are incorporated into the Trader Joe’s “shopping adventure,” further amplifying their appeal to consumers.
Leveraging the Canned Cocktail Boom in Grocery Stores
Tip Top’s push into grocery stores aligns with the growing popularity of canned cocktails. Neal Cohen emphasized that success in this channel is crucial to Tip Top’s growth, as it helps the brand reach consumers not only in specialty stores but also during routine grocery shopping.
Currently, Tip Top’s products are available in Trader Joe’s locations across 11 states, with most stores carrying only two of the brand’s varieties. In addition to Trader Joe’s, Tip Top partners with other grocers like Whole Foods Market, Gelson’s Markets, and Pavilions, while also selling online and through retailers like Total Wine & More and ABC Fine Wine & Spirits.
Exploring New Retail Strategies and Impulse Buying Opportunities
Tip Top is testing the potential of selling its products individually in refrigerated cases near checkouts to capture impulse buyers. Cohen observed that Trader Joe’s often displays Tip Top’s four-packs alongside singles near checkout lines, a location known for driving impulse purchases, similar to their success with chocolates and mints.
Trader Joe’s and the “Treasure Hunt” Experience
Clear noted that Trader Joe’s focus on private labels and niche products complements smaller brands like Tip Top. The grocer’s “treasure hunt” shopping experience encourages customers to explore new and unique products, making it an appealing environment for brands looking to expand their reach.
The “Trader Joe’s halo effect” allows brands like Tip Top to benefit from the perception that their product is part of Trader Joe’s carefully curated selection, helping them grow within the grocery sector without the need for national brand recognition.