A NEW RELATIONSHIP FORMS

COVID-19 had the world replacing bar meet ups with virtual happy hours. Liquor stores were deemed an essential service business — for health and tax reasons. And cities loosened restrictions on delivering alcohol. Phase One of quarantine-lifting allowed the US to join the majority of the world in outdoor public consumption of cocktails. Will we ever be able to put it back in a pre-COVID-19 box? Likely not. A new normal will make the US a little more normal in terms of a more relaxed approach to alcohol.

GENDER EFFECT NEEDS RETHINKING

The focus on alcohol consumption opened new conversations about gender that will need to be taken into consideration. The industry has discussed lower abv in terms of women. Yet, new studies address the different ways people are affected. This was particularly noted by Binghamton  University, New York. Its study during COVID-19 revealed that women were more likely than men to handle their stress via alcohol and more quickly than men to be cognitively affected. Men were more likely to take risks while under the influence.

STOCKPILING EFFECTS

“Affordability and larger pack sizes helped sales of domestic American brands, such as Busch Light, Miller Lite and Natural Light. Budget beer boomed for two reasons: price and familiarity, according to Daniel Blake, senior director of US value brands for Anheuser-Busch. He believes shoppers were in a ‘stock up’ mode as people sheltered in place and had to limit their trips. People were also buying ‘larger and more trusted brands with an emphasis on affordability,’ he told CNN Business.”

GLOBAL REBOUND NOT UNTIL 2024

Total global alcohol consumption rose by 0.1% in volume and 3.6% in value in 2019, but has been severely hit by the shutdown of on-trade venues worldwide in 2020. IWSR said this has not been offset by upticks in alcohol retailers and e-commerce channels.

The UK and US are expected to take even longer to recover from the crisis, with pre-COVID-19 levels not expected to return until after 2024.

Brands must evolve past marketing gimmicks to survive during this market cycle. Focusing on fundamental product attributes and purpose will offer greater return as the market remains volatile for some time. This is a moment to better reflect on existing resources and partnership ecosystems. It is a time to evaluate brand meaning as new perceptions and rituals emerge to define the future of the category.

WORKING THROUGH THIS MOMENT IN TIME

The business of spirits went into 2020 with existing challenges to overcome. 

The COVID-19 crisis and Black Lives Matters protests are bringing those challenges and more acutely to light. 

But the challenges are also opening up opportunity to rethink some of the practices that have been taken for granted.

We will emerge from this moment in time with the opportunity to be wiser. 

The post-COVID world we enter should be a more informed version of the one we had already begun.

Let’s use the signals to assure we reflect a functional synchronous world. Let’s continue the smart collaborative creativity that has already begun.