Proportionally, more UK consumers are buying alcohol online than in any other market in Europe. The growth is being driven by six key factors and the opportunities for liquor brands are set to continue, according to a new report – How alcohol brands can tap the ecommerce opportunity – from global ecommerce analytics firm Profitero, in conjunction with Nielsen.
“No doubt about it, the demand for adult beverages online is increasing. Already, there’s a large opportunity for brands and it’s growing at pace,” explains Profitero SVP of global strategy Keith Anderson, the report’s author. “Many signs point to a consumer clearly ready to shop for alcohol online and sales growth via the web is inevitable.”
Already, 21% of consumers in the UK have bought alcohol online – the highest proportion in Europe, and third only to China and Japan in the world – according to the new report. Globally, only 8% of consumers (across the 60 countries surveyed), have bought alcohol online. Currently, this makes alcoholic beverages one of the least-shopped categories in ecommerce, but one with tremendous potential.
In the report, Profitero identifies six factors that will drive future online alcohol sales:
1. Continued migration from in-store to online shopping
Consumers are becoming increasingly comfortable using the internet as their “go-to” shopping source – not only to buy products, but also conduct research, check prices, read reviews and more. Online grocery is gaining traction due in part to the expansion of retailer click-and-collect and home delivery services, not to mention Amazon’s growing grocery penetration.
2. Emergence of online alcohol models
In recent years, a host of online alcohol platforms have come on board, transforming the way consumers can shop for, and order, alcohol.
3. Online attributes that favour alcohol buying
Many attributes of online shopping bode well for alcohol: convenience, ease of click-and-collect and home delivery models, price competition between retailers, the ability to compare products, and consumer access to an “endless aisle” of products, particularly wine.
4. Finding challenger brands online
Online sales are being propelled by the growth of challenger brands, such as craft beers, which come online at breakneck speed. Craft beers often have a larger-than-life digital presence and offer a unique experiential component sought by millennials and other affluent consumers. Beer aficionados around the world are happy to scour the web in search of the latest specialty brew.
5. Millions of millennials can now drink
Millennials – the tech-savvy generation who’ve grown up with the internet, smartphones and mobile apps – are all now comfortably of legal drinking age and have huge collective spending power. They’ll want to buy alcohol in the same way they buy other products – online.
6. Event-driven online alcohol sales
Mixing big events, like the World Cup and Eurovision, with alcohol isn’t new. But more recently, a host of drink-worthy “events” driven largely by TV and social media have emerged, such as talent show finals, awards shows and red-carpet events.
Anderson again: “Retailers, brands and technology companies are exploring and experimenting with a host of online platforms and delivery mechanisms to make buying alcohol online easier. Liquor brands have plenty of opportunity to influence shopper behaviour and engage with online retailers and technology platforms.”