Liquor bounces back: Anticipated alcohol consumption post lockdown on Trade Intelligence

Liquor stores nationally are witnessing enormous queues and hefty sales as lockdown Level 3 marks a lifting of the ban on alcohol sales. However, the market is expected to witness a shift in the consumers' alcohol-buying behaviour as they settle into Level 3. Borderless Access, therefore, conducted a study to understand this change in behaviour and how it might impact the alcohol industry.

Consumers anticipate buying more spirits than pre-lockdown

However, we see a spike in spirits purchase post-lockdown, with consumers anticipating drinking these multiple times per week – much more than before. One hypothesis is that this could be a result of people wanting to make their money (and alcohol impact) stretch further – hence choosing spirits over other options.

Online alcohol sales expected to boom

We expect a dramatic increase in online sales, even in the liquor category, post-lockdown. Having naturally pivoted towards digital shopping during this period, consumers plan to purchase every alcohol category online more than they did previously. Bottle stores, as the primary go-to for alcohol purchase, will be bearing the brunt of this, but will nonetheless remain firmly in the lead ahead of other buying options.

Beer drinkers to purchase 20% more beer than they did before

Over half of beer drinkers naturally had to reduce their consumption during the lockdown as the product became more and more scarce. The majority are likely to increase their consumption by up to 20% now that beer is readily available again. Wine saw an even more dramatic decline in usage during the lockdown, while spirits usage declined somewhat less than other categories. Again this may be linked to the fact that spirits bottles are in general for multi-use serving as opposed to a category like beer, which comes in a single-use serving.

Home-brewed alcohol a poor substitute for shop-bought alternatives

Not surprisingly, home-brewed alcohol did not see the decline that the other categories did, during the hard lockdown. Now that other options are readily available again, this category returns to being the least favoured by most consumers.

Brand and category loyalty is low and can be swayed by price

Only a quarter of drinkers remain heavily brand or category loyal as lockdown eases. Half the drinking population may be persuaded to switch either brand or category, with price being the major factor that could drive this. Taste is the second most relevant factor driving potential switches, followed by easy availability – which is key at the moment as consumers queue to restock their alcohol supplies.

Like every retail sector, the liquor industry is permanently changed

Covid-19 and its resultant global lockdown have impacted on every industry globally, particularly on consumer behaviour in retail categories. The South African alcohol industry was impacted strongly by its two-month shutdown but as we see, is bouncing back in no uncertain terms. The post-lockdown leapfrogging of online retail, in general, is a national and global trend as digitisation is embraced across sectors, both nationally and globally.