In Lockdown: Social distancing, not drinking alone
The coronavirus new reality has changed many things, among them the way we live some simple social events. For example, have you had a balcony aperitif? Listening to your neighbor playing music, making a toast with your friend through your cell phone screen, or even going to a virtual party with live dj are now common actions unthinkable only a couple of months ago. This transformation left no stone unturned, including the alcoholic beverage industry.
Quick to adapt
One of the first companies to see virus impact on their business was AB Inbev, notably on Corona. The brand experienced a moment called infodemia: people started believing that the brand had connection with the virus carrying the same name. YouGov identified an increase in internet searches for the “Corona Beer Virus” and the “Beer Virus” in February, and also that intention to buy Corona beer was at its lowest level in the last two years. The survey also evaluated the buzz score, which measures how favorably consumers consider a brand: Corona had dropped significantly between early January and late February.
At the same time, the fact that the brand and virus had the same name did not go unnoticed on social platforms, and people found creative ways to have fun with the moment. Nevertheless, the brand claims that the disinformation that circulates has nothing to do with the sales drop, as consumer sentiment remains strong.
Other brands have begun to position themselves as helpers, finding ways to collaborate using their own resources: alcohol, after all, has sanitizing properties. One of the first groups in the alcoholic sector to position itself was the Brazilian brewer AmBev which, according to data from SocialBakers, was the brand with the most interactions on Facebook and Instagram during February until March 21, with the announcement that it would use its production lines to make 500,000 hand sanitizer bottles for local hospitals and the cities most affected by COVID-19.
And over time, this has been one of the main social actions that the alcohol industry has taken: transforming its core product into hand sanitizer. In the USA alone there are over 700 distilleries distributed all over the country that are producing hand sanitizer as a support to help the population face the crisis. Similar steps have been taken by companies all over the world, from Scotland to Italy.
These companies understood that there was an important role in adapting in some way with this emergency, and this genuine effort has a positive effect on people’s perception: 65% of people agreed that how a brand responds to the pandemic will significantly impact their likelihood to buy from it in the future (Edelman, 2020).
The need to be (emotionally) connected
The social routine, a key part of people’s daily lives, has undergone a drastic change, especially considering meetings with friends, happy hours and social activities in general.
The new rules of coexistence and distance from our social daily life excluded one of the main human needs, the direct and face-to-face social relations, which is affecting people’s self-esteem. As we can better understand in Maslow’s Pyramid and its hierarchy, today we are living a moment of dramatic shift in the fulfilment of our needs, from the most basic as food, hygiene and sleeping through to the Safety needs, such as health which is being meticulously changed and adapted to this transition. To maintain our health, we are constrained to reframe our Love and belonging needs. Today our physical connections and friendship relations in the concrete social context are minimal.
People are, however, looking for ways to adapt to social distancing and have creatively developed innovative ideas of sharing moments of connection and fun, even with their physical limitations.
Balcony meetings are spreading all over the world as an alternative to connecting with each other IRL. In an improvised and casual way, messages and especially musical concerts are happening all over to bring some joy and motivate people. Over time these events have spread on social platforms and have become increasingly popular.
And speaking of social platforms, these have had a boost due to the new forms of meetings with friends and family.
The Zoom platform, for example, had an incredible increase in searches during the beginning of the lockdown. The daily number of Zoom users increased to more than 200 million in March, up from a previous maximum of 10 million, explains CEO Eric Yuan.
Therefore, to better understand about virtual meetings, a global study conducted by We are Social through social listening, from March to April 20, found that virtual Happy Hours have two main motivations:
- Connecting: the desire to talk to friends, relatives, colleagues or even participate in musical events online, influencers and djs in live-streaming.
- Supporting or assisting a needy service in this period: bars and restaurants that organize Happy Hours to ask for donations and support Hospitals, also to support Food Service industry workers and bartenders in times of crisis.
Self-Quarantine drinks & snacks
We know it’s much more fun to drink with friends; being at a bar with company is not possible in our circumstances, so now many people are organizing virtual bar meetings to get together. The aperitif at the time of the coronavirus becomes the video aperitif and it is often shared on social platforms.
This virtual aperitif moment seems to be one of the main supporters of the sense of connection, one of the needs that Maslow explains as relevant for people to feel satisfied and motivated. This new way of drinking with friends has become our new bar at home, people are preparing cocktails, side dishes, snacks, to remember meetings “like we used to in the old days”. There are a variety of blogs and content that advise on how to prepare your virtual happy hour, from the best platform to the subject planning.
Brands have not failed to notice the importance of participating in these moments by presenting initiatives such as exclusive concerts, live streams with influencers and exclusive online venues of the brand itself.
The state of being at home has also increased interest in recipes not only for food but also for drinks, it has grown around the world in the last 30 days, especially on YouTube. At this time, brands, local brands, cooking blogs, influencers and also restaurants are proposing recipes to prepare original appetizers at the moment of the virtual aperitif.
The cocktails recipes are really creative, inspired by being at home, often carrying the fun names of the drinks referring to the current situation.
This same in-house study indicated that to relax and chill, as well as to pamper themselves, people seemed to prefer wine amongst all the alcoholic beverages: often it is accompanied by a book, music, food on the side. In virtual moments, on the other hand, wine is also very present, but beer and cocktails seem to be the most appreciated according to online mentions.
And if you thought the parties had been left out, Chinese e-commerce company Jingdong with Taihe Music Group and several other global alcoholic beverage brands created an Online-Clubbing experience. Once a week, Jingdong will host a three-hour party for one of TMG’s signed DJs on its JD Live streaming platform.
Each day, new initiatives emerge that are promoting the virtual meeting as a way of escape from self-isolation, trying to supply social life close to what there was before the lockdown.
Don’t forget your old friend
As we mentioned before, mixologists, bartenders and local bars are professionals who have always been relevant in the alcohol sector and have been directly affected by the lockdown. In light of this, if the people are resorting to virtual appetizers, local bars are looking at finding an alternative to bring the “nostalgic” sensation of being in a bar with friends.
In Milan, the local Balthazar Cafè offers a virtual aperitif by Instagram. However, on behalf of “paying the bill”, they are invited to make a donation to a local hospital in cause of the health emergency.
Not only bars and pubs are trying alternative ways to stay connected with their traditional audience, but alcoholic brands can’t let the sales chain be harmed, after all, despite the delicate moment, the bar is one of the brands’ main points of contact with the consumer.
Therefore, initiatives to support the trade are emerging every day as long as the lockdown remains and thus sustains the local business, for example, Guinness has announced that it will donate €1.5 million fund to help support bar staff and the elderly in light of the coronavirus public health crisis. Also Budweiser, Heinekein, Aviator (just to name a few) are developing options to help bars and restaurants to recover while they are closed during the lockdown. The social actions involve crowdfunding platforms converted to future alcohol consumption, gift cards and even percentual of product sales.
Online sales and alcohol consumption
Alcohol beverages are, in some markets, the fastest growing category during this lockdown, a fact that isn’t totally unexpected, once bars, pubs and restaurants are closed for this period.
In Italy, for example, recently released Nielsen’s data confirm that the lockdown is responsible for the sale growth – in physical stores – of “home made” aperitif categorie, such as frozen pizza (+46%), wine (+12%), alcoholic beers (+11%), chips (+26%).
In the UK, alcohol sales in supermarkets and corner shops jumped by 22% in March, with the “stock effect”, according to Kantar, but not enough to balance the overall sales of alcoholic beverage companies. Guinness and Smirnoff owner Diageo, for example, said that containment measures were “having a significant impact” on its performance.
In the United States, according to Nielsen, alcohol sales reached 55% by the end of the week of March 21. Spirits such as tequila, gin and pre-mixed drinks led sales, reaching 75% more compared to the same period the year before. Wines in second position with 66% and beers with 42%. Like other markets, online sales also had a surprising growth with 243%.
”The summary of this quarantine is: alcohol”
In a survey conducted by GlobalWebIndex with 17 countries at the end of March, 10% of people say they are buying more alcohol online. Among the generations that buy the most, Millenials are ahead with 11%. In addition, the highest income group is most likely to be increasing their online purchases, which has been responsible for the increase in alcohol and entertainment items.
This is confirmed in the figures experienced by some alcohol delivery services, like Drizly’s: the ecommerce platform increased by 500% YoY, and consumers are spending 50% more than usual on their alcohol purchases.
The main question is: are people consuming more at home? This is surely true in some markets, but we don’t know exactly for how long, as Kantar’s research director, Kiti Soininen, says: “While there was an early increase in retail sales of alcoholic drinks, this consumer mindset suggests that overall, the lockdown will hit the alcoholic drinks market. A lot of that volume will just be completely lost from the market… [It] makes sense because food is a necessity, while alcohol is discretionary.“
From transition to new reality
At a global level, all industries have been impacted in different ways by the lockdown, some more, others less. The alcoholic beverages sector may have seen an increase in sales on certain channels, but lost on others, such as bars and restaurants. The online retailers have gained great relevance as a purchase preference by consumers, and consumers find new forms of consumption, from the bar to virtual spaces, and adapt the style of appetizers, happy hours and even parties.
With this scenario in mind, the questions brands should address are: Are we responding to the consumer’s needs? What are the barriers that affect consumption? And what about the future?
Some possible answers:
- Be prepared for transition periods. Understand and act on how the brand can be useful for the society at this any given time: use your capabilities and adapt your product-service.
- Understand “new normal” consumer behaviours. We don’t know exactly what these will be like, but in the meantime brands can (safely?) assume people will spend significant parts of their time at home. Keep studying and react accordingly, taking inspiration (for instance) from Jack Daniel’s teaching how to make Tennessee Coffee at home via their Instagram content.
- Keep digital branding experiences active. It has been a long period of isolation in which people got used to virtual encounters, so it is likely that this experience will continue for some time: Brewdog’s virtual bar and Beavertown’s virtual events are unlikely the last of this kind.
- Keep being useful to people and businesses. Virtual happy hours are the alternative to bars and pubs: do not forget them, bars and restaurants will need support when they reopen, so it’s time to strengthen ties with local businesses. Think about #paynoweatlater: the initiative offers vouchers online which people can pay now to support local restaurants, bars and cafes and redeem upon reopening.
- The Coronavirus pandemic is stressing the whole industry but also creating new spaces, value these new digital paths. Continue strengthening relationships with ecommerces, delivery services and new purchase formats that have emerged. Online sales platform such as Nio Cocktails saw orders and sales increase as people increasingly look for ways to have cocktails at home: try and understand how to work with these new realities.