Hard times for hospitality
The hospitality sector was hit hard during the pandemic, with national and local lockdowns affecting trading and how consumers spent their leisure time. Without sales from pubs, bars, festivals and events, the global alcohol industry is set to see a decline of around 8% in 2020, according to forecasts from IWSR Drinks Market Analysis.
During lockdown, UK drinking habits shifted from out-of-home consumption to at-home, and alcohol brands had to accelerate their digital strategies to find new ways to engage with consumers.
Leading alcohol brands have shown a lot of creativity with their marketing initiatives to encourage brand loyalty and introduce products to new audiences.
Some launched virtual pubs, interactive quizzes, curated virtual festivals and ran cocktail making classes, all in an attempt to reach consumers in their homes. Several beer and wine brands also ran guided tasting sessions and released special lockdown editions of popular products.
Other brands carried out product sampling campaigns during lockdown to raise brand awareness and increase sales. Featuring samples in food subscription boxes and reaching out to essential workers were popular choices, enabling brands to target the right consumers with at-home drink options.
As UK consumers had to trade nights out at the pub for evenings at home, sales of alcoholic beverages from supermarkets, convenience stores and ecommerce increased. It is estimated that retail value sales of alcohol will grow 16% year-over-year, which is the fastest growth rate seen for at least a decade.
This shift in consumer behaviour has also opened up opportunities to grow the alcohol market in 2021. As many consumers are spending more of their disposable income on alcohol and treating themselves to more high-end offerings, premium spirits and ready to drink (RTD) options have seen an increase in sales.
Retail and ecommerce sales have become a critical lifeline for alcohol companies, especially with demand for more exciting and adventurous beverage options to ease the monotony of lockdown.
Times are changing
Two trends in the alcoholic beverage market could set the industry in good stead for recovery in 2021. Hard seltzers have hit the UK market after fast adoption in the US. Hard seltzers are cans of ‘spiked’ sparkling water, aimed at more health-conscious drinkers and advertised as being lower in sugars and calories. Hard seltzers have been a huge hit in the US amongst the 'clean-living' generation, who look for hangover-free drinks.
This year the low/alcohol-free drinks market has also expanded, with many consumers making conscious efforts to consume less alcohol. Several major brands have released low volume or alcohol-free beers, wines, and spirits to their product lines. Retail sales of low/alcohol-free drinks increased by 30% to £188m after the first UK lockdown, as consumers had an increased focus on health and wellbeing.
Looking to the future
Alcohol brands will have to continue to adapt to life post-lockdown and follow emerging market trends to succeed in 2021. As social drinking may take its time to return to pre-pandemic normality, at-home drinking habits may continue for the foreseeable future.
With the upcoming festive season and vaccine news on the horizon, let's hope that the hospitality industry will also start to see signs of recovery soon. We’ll drink to that!
Do you want to reach consumers with your alcohol brand? Get in touch with our team today on 020 3974 7458 or email@example.com to discuss our range of sampling solutions.