UK: Spirits sector sees on-going polarisation between premium and value - research
Premium spirits continue to perform well as people shop less, but look for quality
Polarisation between premium and value spirits in the UK is continuing, while convenience store and online shopping is soaring for the sector, a new report has revealed.
The First Drinks Market Report 2012 said this polarisation was reflected by premium retailers outperforming the market, while figures show 60% of UK housholds visited a discounter last year.
"We know people are shopping less, so there is a polarising towards the premium end and the discount end," said Una McCullough, First Drinks' marketing director, at the launch of the report in Central London yesterday (12 July).
She added: "The way we drink now is more sophisticated than at anytime. Cocktails have been driving growth over the last five years and that will continue in the on-trade, with a key growth opportunity for premium spirits brands."
Roy Summers, the spirits supplier's head of category management, admitted some "tertiary brands" in the wider market had been affected by this polarisation.
Due to this, Chris Mason, managing director of William Grant & Sons-owned First Brands, said the company was remaining "totally committed to building premium brands", adding, "this is at the heart of our ethos".
The report also noted that the growth of out-of-town hypermarket shopping is "waning", partly due to high fuel prices, meaning consumers are turning to their local convenience store and online.
UK online had taken off "faster than anywhere else in Europe", the report said. "This is a valuble shopping channel where consumers are spend approximately double the amount they spend in conventional channles and this will continue to grow," it added.
Meanwhile, the report also suggested online would be a key growth area for "gifting", predicting that the internet would be the key "gifting" channel by 2015. Currently the alcohol gift sector is worth GBP572m (US$885.7m), with spirits accounting for around a third of all drink purchases, the report said.
A new whiskey distillery in Ireland - the first in 47 years - is set to officially start production this week. ...
- Diageo NA head on Trump, Millennials, Bourbon
- Trump, local spirits and the IR role - The Analyst
- Interview - Loch Lomond GTR head Andre de Almeida
- Has Millennial-mania drowned out elder consumers?
- Interview - Bernstein analyst Trevor Stirling
- Beam Suntory opens global headquarters in Chicago
- Pernod Ricard offloads Domecq brandies, wines
- Molson Coors names UK & Ireland managing director
- TWE renames Blossom Hill fruit wine range
- Absolut not "sufficiently focussed" on Millennials