Tracking liquor shopper behaviour is key to staying ahead in 2021

David ShukriMarch 2021 | By David Shukri

Whichever way you look at it, 2020 was a remarkable year. We’ve experienced things many of us would never have predicted and, as a result, some aspects of everyday life may have changed for good.

So where does that leave off-premise liquor? What’s been the impact on shopper behaviour, and what does that mean for category strategies?

Nipping out for a drink at the local pub or club was one of those ‘take it for granted’ things that got turned upside down last year. Yet as was often the case during 2020, the pandemic was both boon and bane. Bane for the on-premise sector, all but mothballed for a fair chunk of the year and still trying to redefine its position in a post-COVID world, but a boon for the off-premise.

Data from the Australian Bureau of Statistics backed up phenomenal growth figures posted by many major retailers. In the three months to November 2020, sales from liquor stores were on average 28% up versus the same period a year before. Without doubt, stonking performance!

So, it’s clear to see what happened. The question we love to answer at Shopper Intelligence is “why?” Why did shoppers do what they did in your category? Why was their behaviour different in one retailer compared to another? Why does this matter to your strategy?

Comparing shopper behaviour in September last year with the same period a year earlier reveals several fascinating shifts that could have a material impact on your category strategy.

Decisions moving in-store

There’s more impulse buying in off-premise liquor today than there was 12 months ago. One in four purchases is now decided upon only once a shopper is in-store. Things like shelf layout, signage and secondary displays all have a bigger role to play than in 2019.

This is in stark contrast with the trend in the grocery channel. Here we saw more pre-store planning as shoppers looked to minimise the time they spent in grocery stores.

Of course, the change was not uniform across all categories and retailers. The wine department recorded the biggest shift in decision-making while inside the store. At a category level, it was champagne shoppers whose behaviour changed most year-on-year.

Most retailers followed the same trend. 13% fewer Aldi shoppers are now fixed on their category choice coming in to store and are more likely to be persuaded by in-store activity. Dan Murphy’s shoppers registered an 8% shift. By contrast, Bottlemart now sees 12% more planning before entering the store.

Planned purchases
% change in PLANNING category purchase vs pre-COVID

The key action now is to review your marketing spend. Getting the balance right between pre-store and in-store activity is crucial. You may need to boost investment at the shelf or in displays to help trigger purchases. If you’re working with a retailer such as Bottlemart, dial-up pre-store activity such as advertising or couponing.

Same day occasions on the rise

Just as more buying decisions are being made inside the store, buying to consume the same day has also risen. In other words, we haven’t seen in liquor the same stocking up tendencies as evolved in grocery last year. The shift is significant and most pronounced in spirits and wine.

Bought for today
% change in BOUGHT FOR TODAY vs pre-COVID

Purchases linked to specific occasions are on the rise as well. This isn’t that surprising given the move away from on-premise consumption but some of the specifics are interesting. Buying to drink with a meal is the biggest growth occasion. RTD and spirits categories have benefited the most from this change. Indeed, the same two departments are also in growth when it comes to relaxing at-home occasions.

So how can you leverage these changes? Well, with more in-home drinking comes more demand for variety and new ideas. There is a big opportunity here to create new associations and new habits. Position your products to meet those immediate needs and make sure they’re visible in-store.

Market separates on price

One consequence of the pandemic we saw last year in the grocery channel was a “polarisation” on price. In certain categories, shoppers are more willing to pay a bit more for higher quality. In others, the opposite is true with value products and ranges gaining traction.

The same polarisation is in evidence in liquor. More shoppers are now prepared to consider unfamiliar low-price brands. At the same time, there’s been a smaller but still significant increase in those willing to pay a bit more.

On the value side of the equation, beer categories saw the greatest threat. In premium, cider and RTDs have the biggest trade-up opportunity.

This dynamic will be vital to address in 2021. Beyond beer, other segments in other categories will come under pressure. Define the role your brands play and be ready to articulate their contribution. Be prepared to review range, space, and pricing to focus more on value.

Where a trade-up opportunity exists, get your shopper targeting right. Make the link back to those growth occasions and short-term consumption needs.

In a world of uncertainty, change is probably the one thing we can rely on the most in 2021. Keeping shoppers at the heart of your decision-making will help you stay ahead of the curve and the changes that are yet to come.

Find out how our liquor shopper research can help you >>

This article was written by David Shukri, originally published in National Liquor News and posted here with permission.