At After Digital, we have worked with a variety of clients across a multitude of industries, gathering expert insight and honing our skill in relation to each industry. With this in mind, we have been working on a series of industry reports that allow us to offer our expert, digital marketing insight to ensure brands survive during and thrive after the current COVID-19 pandemic – in this blog, we want to give an overview of the findings from our 2020 Premium Drinks Industry Insights Report.

Over the last 6 years, our digital agency has worked with brands such as Chase Distillery, Benromach, and Gordon MacPhail; becoming specialists in the premium drinks industry. In our report (which is now available to download for free), we provide an overview of the market, examine key trends within the attractions industry, current economic considerations, and financial confidence amongst consumers. To set your business up for success, we have detailed our recommendations across three core digital channels which will help premium drinks brands drive sales over the festive period and enter 2021 in a strong position.

“The global market for alcoholic beverages is expected to increase by nearly 19 percent from 2018 to 2024.”

– Statista

Market Insights

As mentioned in the quote above, the premium drinks industry is growing and doesn’t appear to be stopping any time soon. Overall, this market is driven by increased demand for premium drinks as well as low and non-alcoholic drinks. These trends are mostly prompted by consumers' rising health concerns; translating into alcohol moderation.

Related to this desire to drink less, some consumers are looking to choose higher-quality drinks on rare occasions. This has helped to drive the quality over quantity trend, putting premium drinks in a strong position to encourage consumers to trade up when they do buy alcohol. Emphasising extra care in the production, limited edition, and superior taste proves to be crucial in marketing premium alcoholic drinks. For example, take a look at the leading reasons influencing spirits purchase choice in the United Kingdom:

graph showing leading reasons why people buy alcohol in the uk - key information for our premium drinks report

Source: Statista

Although brand loyalty and special offers are still a driving force for those purchasing alcohol; brand and quality don’t come too far behind.

In addition, special occasions and seasonal celebrations are the main reasons for purchasing premium drinks with 65% and 54% of buyers citing these respectively. Consumers' innate desire to elevate these events means that they are prepared to pay more than they might normally do. In relation to this, 50% of premium drink consumers have bought the product for someone else, with 78% of those having bought premium alcohol as a gift. If your brand has won an independent award, it’s seen as a key indicator of quality for those buying as a gift.

However, we are in a pandemic and this has decidedly had an impact on peoples’ relationships with drinking – particularly younger generations who are aware excessive drinking is linked with lessened immunity to COVID-19 and for those feeling the financial pressure due to job losses or the expectation of potential job losses. In fact, 39% of UK adults are cutting back on non-essential spending, with premium alcoholic drinks firmly in the line of fire as saving money is a key reason to moderate alcohol intake. And, 50% of consumers have stated that they are ‘uncomfortable’ visiting bars and restaurants – instead, aiming to recreate that experience at home. However, in contrast, 27% of regular premium alcoholic drinks buyers have reportedly bought more higher-priced alcoholic drinks during the coronavirus lockdown than they would normally buy. It may be worth brands leaning into marketing messages centred around home drinking and treating oneself.

So, although some consumers are drinking less and some are drinking more, it’s important to know who’s likely to be doing which – namely, who should your premium drinks brand be targeting? When it comes to advertising food and drink, particularly alcohol, people tend to assume this is the younger generation's time to shine – with binge drinking and higher alcohol consumption being more readily associated with younger audiences. However, this, in practice, tends not to be the case.

graph detailing the different drinking habits of age demographics as insight into how to approach these demographics in the After Digital premium drinks report 2020

Alcohol consumption frequency in the UK in 2019/2020, by age group

Though we go into this in more detail in our 2020 report, in short, this chart tells us:

  • Gen Zs of legal drinking age are by far the most likely to not drink at all or only once or twice a month
  • Millennials also abstain but are more likely to partake in drinking here and there during the week or month
  • Gen X prefer to drink a couple of times a week but also have a large clearance between them and the younger Millennial and Gen Z demographics when it comes to daily drinking
  • Baby boomers are a bit more contrasting, both being a demographic likely to abstain but also the most likely to drink daily

Growing up in a more digitally-focused world, Gen Z and younger millennials aren’t just thinking about health benefits, but also their online presence when it comes to low alcohol consumption. Social media has actually been a huge player in this conscious decision to drink less.

“Before social media, embarrassing behaviour, while likely gossiped about, was visually undocumented. Therefore, the embarrassed person was unlikely to have to face up to their behaviour in any meaningful way... People like to control their public image on social media since it is permanent rather than ephemeral. Embarrassing 'moments' are no longer moments, but posted in perpetuity for all to see without engaging in damage control.”

– Pamela Rutledge, Director of the Media Psychology Research Center in California

However, when advertising to these generations; health, premium quality spirits, and trending drinks are a selling point. For example, in America, the volume of Irish whiskey sold grew by 61% over the past 5 years thanks to millennials and their willingness to spend more on higher-quality alcohol. And, 80% of millennials have listed rum as a favoured drink and many spirit retailers predicted a “rum renaissance” in 2020, with rum purchases growing steadily throughout 2019; 50% of these sales being spiced or flavoured rum specifically.

However, older audiences, like Gen X and Baby Boomers, are more regular drinkers and more likely to buy into already established tastes. For example, according to a study from retailer Wine Access, Gen X bought 13% more wine than any other generation in 2018/19. In short, older audiences may be more reliable when it comes to investing in drinks and are, therefore, a ripe audience to take advantage of. However, younger audiences are more cautious, value quality, and are more likely to follow a trend when it comes around – including low and no-alcohol drinks. This knowledge is key for identifying which channels you should be relying on...

With all of this in mind, the key trends for premium drinks organisations in 2020-2021 are:

  • COVID-19 is raising concerns about alcohol and is bringing personal health to the forefront of consumer’s minds – meaning greater interest in low and no-alcohol drinks and an importance on quality ingredients
  • Lockdown has accelerated the popularity of online sales – having an efficient and strong online presence is more important than ever
  • Interest is growing in limited edition products
  • A focus on longevity and ageing for longer is becoming key in premium drinks

You can read about this industry’s key trends, economic factors, key consumers, and more in full in our 2020 Report.

photograph of chase distillery's rhubarb and bramley apple gin – a brand discussed in the After Digital premium drinks report 2020

Recommendations for the core digital channels

Digital is only going from strength to strength as time goes on and it has become a key factor across all industries – particularly during the COVID-19 pandemic. Social media in particular has seen huge levels of increased activity and engagement and this has had a knock-on effect for companies investing in their digital presence; both organically with their time and financially through digital advertising.

Research conducted by Listen First reported that engagement with alcohol brands increased by over 326% in March 2020 when compared with the previous year. It’s been the industry that’s received the highest uplift in engagement during coronavirus according to their research, which also looked at 22 other verticals including healthcare, and the conversation around beer and wine has also seen a considerable increase year-on-year; with tweets about each going up 40% and 66% respectively. Brands that have seen notable success are Guinness, Fireball Cinnamon Whisky, and Tito’s Handmade Vodka – all of whom gave a nod to the pandemic and how they were giving back and investing in the communities that support their brand. Something we delve into and explain fully in our 2020 report.

On top of the impact and rising digital trends off the back of COVID-19, we are also stepping into the 2020 festive season as this blog is written. In research released by Drinkaware, it was discovered that 61% of UK drinkers would say that they “overindulge” in alcohol during the festive season and in the US the period between Thanksgiving and New Year's Day is responsible for the largest cases of alcohol consumption. Though those stats may be published as a warning, it does illustrate how alcohol has become synonymous with the festive season; both for socialising and for gifting. Meaning, with the increased competition due to the festive season and brands scrambling for revenue after a rocky year, it’s more important than ever to be on top of your digital strategy.

So, how can this industry best harness the core digital marketing channels? Here, we want to give an overview of our 2020 report recommendations based on key learnings from our work within the premium drinks industry; which we believe will provide valuable insights and help your brand create efficient digital marketing campaigns to drive ROI.

SEO

SEO is perhaps the most underappreciated element of digital marketing; this is due to SEO taking longer than other channels such as PPC, which can achieve results very quickly. SEO is not a sprint, it is a marathon and, like running any race, the end reward is worth the effort...

Research shows that a whopping 95% of web traffic is captured by websites on page 1 of search results, that leaves only 5% of traffic for the remaining pages. So, if you are not doing so already, you should be investing in SEO with the aim of achieving position #1, 2, or 3 in organic search engine results pages (SERPs).

Our 2020 Premium Drinks Industry Insights Report covers:

Keywords & Quality Content

  • Keywords are the link between what people are searching for and the content you are providing to answer that search query. To ensure that your site ranks well organically and drives visitors to your website, it is important to understand the needs of your visitors (e.g. the language they use for the content they are searching for), in order to reach them.
  • With regards to creating content, top pages on competitor premium drinks websites often include blog publications; which signals the importance of producing high quality, well-optimised content that drives traffic in the arts and culture industry. In fact, we would strongly recommend reviewing your content strategy to include answering the questions from real searches.
  • In creating quality content there is an opportunity to set yourself apart from your competitors, this is accomplished by creating content which matches the search intent of potential customers. It is recommended that your team or incumbent agency monitor real search queries on a monthly basis and shape your content strategy around this.

Optimising performance to increase results

  • Once you have built and maintained a good ranking, this will allow you to reduce your costs in other areas, providing your efforts in SEO continue.
  • Having optimal performance on your website has a knock-on effect on your results; better performance means improving conversion rates, generating more leads, and increasing revenue.

PPC

PPC offers fast entry to the market, is measurable and provides a host of useful data which can be used to better understand your audience and can feed into all areas of your marketing activity. The beauty of this type of marketing is that you only pay when someone clicks, so there is limited budget wastage.

Across the premium drinks industry, your competitors are heavily investing in paid search which is one of the most popular digital advertising channels for retail, especially since GoogleAds introduced shopping campaigns in 2012 as a similar version to what we have today.

Our 2020 Premium Drinks Industry Insights Report covers:

  • The biggest opportunities and where we have found success when working with premium drinks brands is to implement Google Shopping.
  • Shopping is the go-to campaign format for nearly all e-commerce PPC accounts; Google Shopping has a proven track record of driving significant revenue for your business.
  • For the best results, we recommend a mix of brand, shopping, and remarketing campaigns to ensure success.

Social media

On average, people are spending almost two and a half hours on social media every day, it’s where people spend their time and it's where you should be.
Social media has become ever more popular with premium drinks brands who want to create brand awareness and aspiration digitally for a fraction of the cost of traditional marketing methods.

For example:

Ensure you're reaching the right target audience for your brand

  • Drinking is synonymous with younger people, however, it tends to be older audiences who drink more regularly
  • Knowing that will influence where and how you advertise through social media

Tell a story, be transparent, and give back

  • More than ever before, consumers buy into brands based on their ethics and values, and when they show that they give back to the community that supports them. Ensure your brand has a story to tell and causes it’s ready to support
  • Drinks brands that are supporting communities during the pandemic are receiving far more success than those staying quiet

Ensure you’re delivering what consumers want on social media: visuals, video, and authenticity

  • Permeate your social media output with that brand story
  • Think about implementing full-screen experiences
  • Maximise on video content

You can read about this industry’s core digital channels; like SEO, PPC, and social media; in full in our 2020 Report.

example of chase distillery facebook collection ad in 2018 featured in after digital's premium drinks report 2020

How can After Digital help?

Our team of experts take key learnings from our work within the premium drinks industry to provide valuable insights and create efficient digital marketing training programmes to assist our clients in driving ROI.

With over two decades of experience across a wide variety of industries, we're well-versed in working with organisations to support their online marketing and deliver tangible results.

If you would like to discuss how AD can help you reach your business goals, please contact the marketing team at After Digital via the form below!

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