The alcohol industry is thousands of years old, standing the test of time through generations. People still enjoy sipping alcoholic beverages in their local pub, or enjoying a drink with their evening meal, much like our ancestors before us. And while the ritual of enjoying a tipple hasn’t changed much, the alcohol business itself is constantly evolving.
Until very recently, most alcohol brands have relied on physical sales to skyrocket their profits, whether that be through the pub trade, convenience store supplies, or supermarket business.
Today, the landscape is changing.
Let’s take a look at what’s happening to this age-old industry, and how the future looks for many alcohol businesses.
The Impact of the Pandemic on the Alcohol Business
In March 2020, the world changed forever. Like every industry, the alcohol trade was shaken by a series of national lockdowns which saw consumers confined to their homes and physical bars closed for business.
While some predictions may have been worrying for the industry, the impact of Coronavirus was surprisingly astonishing. Since the start of the pandemic, alcohol sales saw triple-digit growth in online retail sales with a 234% jump. These unprecedented figures speak for both consumer demand for alcohol and the impact that an online pivot had on the business.
Consumer behaviour changed rapidly in response to the pandemic. Physical parties became Zoom hangouts, bar trips became garden sips, and dining out became, well, dining in. In order to appeal to new consumer behaviours and shopping methods, the alcohol industry was forced to move from the traditional to the new.
How Businesses Are Selling Alcohol Online
Even before the pandemic, businesses were selling alcohol online through large retailers and boutique stores. However, it’s thanks to brands adapting to eCommerce routes that alcohol sales reached such immense heights during lockdown.
A recent survey found a 24% increase in the amount of adults adopting online shopping since the start of the pandemic, suggesting that alcohol’s key target market was also adapting to the digital landscape.
Brands and businesses have used a range of techniques to ensure the success of their online pursuits, continuing to deliver alcoholic drinks to their target customers.
· The Growth of Media Advertising
Alcohol brands have always been well-known for their eccentric and memorable adverts on TV, but the business really took things to the next level during the pandemic through social media marketing.
According to Zenith, alcohol brands increased their spending on digital media from 21% in 2019 to 24% in 2020, effectively reaching a demographic that had moved from the physical world to an online existence.
Bold ads and innovative social media campaigns have appeared everywhere, on new and legacy platforms such as:
It’s clear that the alcohol industry began to invest more time and effort into reaching digital consumers during our time indoors. While this came in response to the pandemic, it doesn’t appear as if the trend will be going anywhere anytime soon.
· Global Safeguards for Alcohol Sales Online
When shopping online, there are no real restrictions in place to ensure consumers are buying age-appropriate products. That’s where the new global safeguard comes into play.
In response to the huge rise in online alcohol sales, a new global alliance has been formed revealing five global safeguarding measures to combat harmful drinking. Covering the entire purchasing journey for alcoholic beverages sold via eCommerce, the rules have been put in place to make sure orders don’t get into the hands of the wrong people.
· Licenses For Selling Alcohol Online
As well as the risk of selling alcohol to underaged or heavily intoxicated consumers, there’s also the dilemma of licensing which many online businesses are facing. For beverage companies to sell alcohol online, they have to follow strict licensing rules set out by their country of origin in order to sell legally and successfully.
If you’re an alcohol business looking to expand your sales online, be sure to check out licensing rules for your specific location before beginning the process.
The Future of Alcohol Sales
While it’s expected that physical sales will make a comeback in a post-pandemic world, there’s no doubt that online alcohol sales are here to stay. With more and more people doing their shopping on the web, it’s likely that people will continue to purchase alcohol far into the future for at-home or commercial use.
Apps and instant delivery services may be on the rise, but it’s traditional eCommerce stores and supermarket retailers who are set to reign supreme when it comes to dominating online alcohol sales. In the US alone, nearly half of online alcohol purchasers have ordered from a supermarket website or app, compared to only a third who have used an immediate delivery service.
For global distributors, the hospitality industry and expert mixologists, the online option is becoming the increasingly obvious choice. Since prices are the same (or often cheaper) than physical stores, and delivery costs are minimal compared to a physical supplier, it’s no wonder more and more commercial companies are turning to the online space.
We hope you enjoyed this read about the future of the alcohol business. Whether brands like it or not, it seems that the online alcohol landscape isn’t going anywhere.
If you’re looking for exciting, innovative and high-quality alcohol for your bar or need supplies for global distribution, Babco Europe is the leading alcohol company for you.
To browse our products or get in touch for a chat, visit our website today.