Opinion: Thirsty for growth

John Whittaker, head of marketing for Savanta, on navigating category management in the UK drinks sector...

Despite the continued cost-of-living pressures, summer 2023 represents a huge opportunity for the drinks industry. Research by Savanta with UK consumers showed that 78% say that, with Covid firmly in the rearview mirror, it will be easier to go out and socialise this summer. Here’s how brands can leverage key market trends and succeed in this environment.

Normalised moderation
Savanta’s BrandVue data shows growing adoption of low/no alcohol spirits, wines and especially beer and cider over the last 12 months, with 17% of drinkers buying at least one low/no alcohol product in the last four weeks. While low/no alcoholic drinks appeal to consumers across the board, they are becoming more common among males, 18-24 year olds, ABC1s and non-white British drinkers, providing the opportunity for the sector to bring in an increasingly diverse set of consumers.

With the growth in low/no alcohol, players in the sector will need to think about ranging and merchandising on and off-trade. Understanding motivation will help support decisions around innovation and layout for the category to maximise category/brand sales. 

Creating occasions and experiences
Covid has had a significant impact on social habits, leading to the growing importance for drinkers of ‘consumption moments’. Recent Savanta research shows that 39% of drinkers make a bit more effort when staying in or entertaining at home, making cocktails, trying new and different drinks and so on, with younger drinkers most likely to make an event of staying in (56% among 18 to 34s).

To really ‘own’ occasions, brands need to ensure their executions stand out and engage with their target audience at point-of-sale.

Exploring new tastes, flavours and formats
In the context of the cost-of-living crisis, the need to engage people with enticing, new and different drink choices will continue to be important. Further insights from our research also reveal that cocktails are one of the big beneficiaries, with over 15% of the UK population buying a cocktail in summer 2022, and category growth being driven, in particular, by younger drinkers.

Although drinkers are craving new choices, the current trading environment means new product development is under even more pressure to hit home quickly. We are increasingly being asked by our clients to help them shape the path for their products, ensuring that they truly understand when and how they can impact decisions on the path to purchase.

Adding value by adding values
Consumers are increasingly looking for companies that align with their values, especially around sustainability. This is especially true for younger consumers. A recent Savanta survey with gen z found that around 17% of 16 to 24 year olds say that “being an ethical company” is what they value the most from a brand. Although it is fair to say that our data also shows that idealistic attitudes are not always reflected in actual buying behaviour, recent examples show the risks for brands of ignoring the values of their consumers.

With increasingly informed consumers, brands need to ensure that they have their finger on the pulse of what is most important to their target market.

You may also be interested in…