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Pernod: Covid-19 boosts online spirits sales in UK
The acceleration of the alcohol e-commerce channel as a result of the coronavirus pandemic has resulted in a 92% boost for Pernod Ricard’s online spirits sales in the UK.
Pernod Ricard’s online spirits sales in the UK rose 92% in the year ending 30 June 2020
During an online briefing following the publication of its full-year 2020 results, Pernod Ricard UK announced that sales of its spirits in e-commerce are growing ahead of the UK market at an increase of 92% for the year ending 30 June 2020.
“We’ve been seeing for a number of years that e-commerce is particularly dynamic,” Louise Ryan, managing director of Pernod Ricard’s The Gin Hub, said after the briefing.
“I think what Covid has done is probably accelerate the pace at which consumers have shifted their purchase into the e-commerce channel. We did anticipate that e-commerce would become more important to our business and I think we are well prepared for that.”
Despite the Beefeater producer bringing updates to e-commerce forward at a faster pace, increasing sales in the sector and rising off-trade sales proved insufficient to make up for lost revenue as a result of the closure of the global on-trade due to the Covid-19 pandemic.
During its full-year results, Pernod Ricard reported a 9.5% organic sales drop after the pandemic significantly impacted its travel retail and on-trade sales.
Pernod Ricard’s standalone Gin Hub business, which includes brands such as Beefeater, Monkey 47, Malfy and Plymouth, saw its sales fall 6% during the period.
Ryan said: “We’re still down 6% [Gin Hub sales], so it’s not enough to offset declines in the on-trade. But, we are gradually beginning to see the on-trade reopen and hopefully consumers now with the health and safety measures in place will start to feel more confident about going out, and we’re seeing it happen gradually but it very much differs on a market by market basis.”
Premiumisation trend
As the Absolut Vodka owner has adapted to target consumers in the digital space, Ryan believes the at-home cocktail making and online education sessions that aimed to keep consumers engaged during lockdown could drive premiumisation once the on-trade reopens.
She said: “People want to drink great cocktails and they are researching online how to make drinks that they would have previously enjoyed in an on-trade environment.
“So we have tailored our content and our brand ambassadors have been educating consumers and teaching them great cocktails at home. I think if you fast forward to when the on-trade does reopen, consumers will still want to socialise with each other and celebrate the moments that matter to them and I think at that point what we will see is a much more educated consumer going back out into the on-trade.
“So in some markets there will be more brand calls when ordering a gin and tonic, as well as a lot more people calling for cocktails rather than a simple serve. This will be good for the long term prospects in terms of premiumisation and having a more educated consumer.”