Spirit brands looking into tapping the Gen Z and Millennial market, should look into their distribution and advertising channels.
Gen Z and Millennials represent a huge opportunity for spirit brands, they currently dominate the alcohol industry. To win over the next big faction of ‘spirit consumers’, brands need to embrace what makes Gen Z and Millennials unique: their ability to adapt to change.
Spirits are up for grabs in the alcohol industry. As more consumers return to regular alcohol consumption, spirit brands need to re-engage their channels — with a particular eye toward Gen Z and Millennials, a new but quickly growing target demographic for spirits.
Beer maintains a strong showing since the pandemic while Whisky showed the strongest growth
Over the past two years, consumers habits have changed in response to the pandemic. For alcohol brands the question is how have these changes impacted their category? Kasi retail category demand index, a measure of consumer demand for retail category provides insights on how consumer habits impacted demand for alcohol beverages. The index ranges from + 0.25 to -0.25. An index level close to 0.25 means demand is high as more consumers are looking to purchase while an index level close to -0.25 means demand is low. This measure is an effective tool for demand planning.
When the pandemic started the demand for alcohol beverage was 0.11 and it was mostly driven by beer at 0.162. The demand for beer was strong at the beginning of the pandemic (0.162) then dipped at the mid of 2021 (0.089) before rebounding ahead of the 2021 holiday season (0.12).
Within the spirits category, demand for whisky was the lowest (0.023) at the beginning of the pandemic and rose steadily through the pandemic to (0.088) by the end of 2021. From 2020 to 2021, Beer demand fluctuated but remained the strongest amongst the alcoholic beverages while demand for Whisky rose consistently over the same period.
All but Baby Boomers are driving Beer demand while Gen X and Baby Boomers are contributing to the increase in Whisky demand
Across various age-groups, Gen Z, Millennials and Gen X are driving beer demand. The leading generation in beer consumption is Millennials with an average demand level of 0.149, followed by Gen Z at 0.127, Gen X at 0.127 and Baby Boomers are lagging at 0.050. The main category drivers for beer among these age groups are price, quality and convenience of the product.
Though the demand for whisky is slightly lower than that of beer, the category is picking up across the younger age groups – Millennials and Gen Z. Gen Xers are the leading whisky consumers with an average demand of 0.123, followed closely by Baby Boomers at 0.119, Millennials at 0.099 and Gen Zers at 0.096.
To tap into the younger generations, spirit brands need to look into ways for example category drivers like price, quality and convenience of their products that would ensure they get to these markets. There is an opportunity for spirit brands to capture market share from beer if they implement the right strategy.
Spirit brands should rethink their distribution channels to continue winning over Millennials and Gen Z
Currently, Millennials and Gen Z contribute to a little over 60% of the Ivorian population. Making them the largest demographic for spirit consumption. Hence, it is wise for spirit brands to take advantage and leverage this market in order to win big.
In an era where we expect e-commerce to be taking a lead in product distribution especially in the younger generations, 93% of millennials in Ivory Coast believe in in-store shopping. Out of the 93% - 34% believe in shopping at the neighborhood grocer, 29% at the modern supermarket, 14% at the outdoor market and 12% in specialists stores. The situation is almost similar for Gen Zers who 90% believe in in-store shopping. Out of the 90% - 47% believe in shopping at the neighborhood grocer, 29% at the modern supermarket, 16% at the outdoor market and 2% in the specialist stores.
Arguably, e-commerce still has a long way to go in as much as spirit distribution is concerned - only 7% of millennials and 10% of Gen Zers have adopted it.
For this consumer segment that tends to be digital savvy; during the pandemic, traditional media still thrived. Millennials rank Newspapers/ Magazine ads first while Gen Z rank TV ads first. This simply highlights the fact that local media was popular among these generations during the time. With the easing of the pandemic restrictions and return to the new normal, will this return to traditional media trend continue?
Spirit brands looking into tapping the Gen Z and Millennial market, should look into their distribution and advertising channels.
In a fragmented retail market, it is critical for spirit brands to improve distribution, advertising and be creative to ensure their brands are available at the preferred place of purchase and occasions.
Our data intelligence platform can help you track these trends in consumer behaviors in Africa over time. This provides you with valuable insights that can help you or your business make fast data-driven decisions.
Contact our team today to explore how our consumer intelligence can empower your decision-making process. Win with confidence with Kasi insights https://www.kasiinsight.com/thehub
Opmerkingen