Sauvignon and Slurpees? 7-Eleven launches in-house brand of wine

7-eleven-launches-in-house-brand-of-wineOn Wednesday, 7-Eleven (SVNDY) released its first in-house brand. This market segment, which has generally been dominated by grocery store brands like Walmart's (WMT) "President's Choice" or Whole Foods' (WFMI) "365 Everyday Value" lines, tends to focus on simple foods with mass appeal foods. However, for its first offering, 7-Eleven decided to raise the bar: It's going for wine.

The chain's new line, Yosemite Roads, will open with two basic offerings: a "fresh and zesty" chardonnay "with notes of apricot, peach and honey," and a "full-bodied cabernet sauvignon with juicy plum overtones." The 750-milliliter bottles will retail for approximately $3.99 apiece, and will be available in most of the company's 15,000 convenience stores, as well as Denny's restaurants, Shell Garden grocery stores, and several retail outlets in Japan.
While many of 7-Eleven's customers might have expected its initial self-branding effort to focus on the chain's iconic chili cheese dogs or similar fare, the move into wines plays to the company's strengths. Since 7-Eleven began selling mainstream (read: non-fortified) wines in the 1990's, fermented grape juice has become a large part of its business; today, it accounts for yearly revenues of approximately $46 million in the United States and $127 worldwide. What's more, 7-Eleven's sales of value-priced wines have exploded over the past few months as customers have sought wallet-friendly replacements for more expensive tipples.

This trend has proven particularly lucrative for Trader Joe's, whose "Two Buck Chuck" and other super-cheap offerings have enjoyed massive popularity. Ironically, it appears that 7-Eleven's flagship brand, Yosemite Roads, was initially sold through Trader Joe's, at least according to Winebork, a website that reviewed the wine in 2002.

Although Yosemite Roads has presumably changed over the last seven years, its developer, John Willumson, has remained the same. Formerly operations manager at the Robert Mondavi Winery, Willumson now works with the Wine Group, the world's third-largest wine company. In addition to Yosemite Road, the company owns a host of well-known brands, including Franzia, Almaden, Inglenook, Paul Masson, Mogen David, Corbett Canyon and Glen Ellen.

In a clever move, 7-Eleven will initially release Yosemite Roads for only a limited time. In addition to allowing the chain to test the waters with its new brand, this will also inspire curious wine enthusiasts to swallow their scorn, lest they miss the chance to try what is sure to be an interesting curiosity, if nothing else.
Read Full Story


DJIA 24,404.48 -301.87 -1.22%
NASDAQ 7,020.36 -136.87 -1.91%
NIKKEI 225 20,622.91 -96.42 -0.47%
DAX 11,090.11 -46.09 -0.41%
HANG SENG 27,005.45 -191.09 -0.70%
USD (per EUR) 1.14 0.00 0.00%
JPY (per USD) 109.38 0.03 0.03%
GBP (per USD) 1.30 0.00 -0.01%
USD (per CHF) 1.00 0.00 0.03%