The Drinks Business 5th Annual Conference took place yesterday; a series of lively conference panels offering invaluable insight into the future of the drinks industry and how drinks brands can identify, engage and build relationships relevant to the consumerâs new digital world.
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To set the scene, what do we know about the current status of the drinks industry? 2010 saw growth in sales for the premium spirits category, at the cost of super-premium; there has been a marked increase in the number of small distilleries and micro-brewers (all catering to a more âdiscerningâ consumer); China is the most buoyant market, driving profits within the premium sector, and is set to drive value within foreign markets (Chinese visitors to the UK will double by 2015), meaning that Chinese tastes will need to become a primary concern; the West has reached its watermark for luxury goods (the term everyday luxury is now associated with conspicuous consumption), with growth shifting East and South; drinks companies will continue to consolidate in response to the âget bigger or get outâ threat; drinkers increasingly value government guidelines towards controlled drinking, and legislation will develop on a global scale, resulting in reduced volume.
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Clearly this is a simplified overview of the ongoing challenges and opportunities faced by the drinks industry. So how can spirit brands achieve cut-through amongst their target audience in a saturated and competitive market? It is not a case of throwing out the old, and well established methods will continue to work. But it would be unwise not to consider opportunities provided by the internet to understand and engage with the consumer mindset.
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Certainly, the statistics in favour of engaging the digital world are compelling. There exist 24.5 million Facebook users in the UK alone, each with an average dwell time of 55 minutes per day, and whilst 24% of people currently use a smartphone, this figure is set to reach 75% in the next few years. Over 40% of people surf the internet whilst watching TV, and 90% of online consumers trust recommendations from people they donât know. All this, combined with the fact that print media is allocating less and less space to drinks columns, clearly indicates thereâs a new way to communicate with our audience, which we cannot afford not to be a part of. Weâre moving into a brave new world for the drinks industry and are just beginning to understand the ânewâ consumer, leading to endless possibilities for savvy PRs and marketeers. Now all we have to think about is the ânew newâ consumerâ¦
