Why E-commerce still promises so much for Beverage Alcohol

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Author: Joe Bates

E-commerce alcohol sales are no longer experiencing the heights that were hit during Covid lockdowns, but online retailers and brands still predict a bright digital future.

The global spike in e-commerce alcohol sales during the pandemic has subsided, forcing brands and e-tailers to work harder to tempt sales from consumers no longer forced to stay at home.

In 2020, according to IWSR Drinks Market Analysis, alcohol e-commerce soared nearly 43% in 16 focus markets, including China, the US, Germany, the UK and France. Now, the research firm expects the widespread reopening of the on-premise channel, coupled with the cost of living crisis, to dampen consumer demand.

Post-pandemic reset

Certainly, many drinks companies have seen a post-pandemic reset. “We experienced sales uplift of over 1,200% during the pandemic, but this came crashing back down to earth during 2021, as we started to see the on-trade reopening and people returning to offices,” recalls Crawford Sinclair, commercial director at Innis & Gunn. The Scottish brewer has invested heavily in its website and online store, allowing it to go direct-to-consumer (D2C) with the help of a specialist third-party fulfilment logistics partner.

In a similar vein, the MD of UK-based Lanique Rose Petal Liqueur, Kieran Gandhi, tells Global Drinks Intel: “We saw 300% growth year on year during lockdown, which has now returned to pre-pandemic levels of growth, with a slight increase compared to previous rates of sale due to our brand’s growth in the last two years. We work with Amazon as our main e-commerce route-to-market, although we also work with specialist e-drink retailers like the Craft Gin Club, who provide brilliant marketing that helps with brand awareness and advocacy.”

Back in the beer category, Carlsberg Marston’s Brewing Co senior e-commerce manager Ellie Price reveals that the San Miguel brand has experienced a significant drop in online sales in the UK post-Covid lockdowns, and its share versus bricks-and-mortar retail is gradually dropping from its 30% high.

“The challenge within this is partially due to the loss of younger shoppers in the channel, as they are now switching their spend more frequently and world beers tend to over-index with the younger demographic,” she says. “Given the channel dynamics we are seeing currently, our business in the UK has to be tunnel-visioned in its approach to growth in the years ahead. Our strategy is focused on excellent retailer partnerships, ensuring investment counts and real focus on our digital shelf set-up. Our growth will come from landing a strategy so that we’re focused on prioritisation through our brands, formats and retailers.”

This article was initially published in the April issue of Global Drinks Intel magazine. For details on how to subscribe click here.