6 Ways to Boost Alcohol Sales

The alcohol landscape has shifted significantly during COVID. With fewer restaurants and bars open, Americans are not spending their drinking time (or dollars) in social situations, but rather imbibing at home. "Our data shows that shoppers have shifted their consumption to in-home occasions, and that creates a huge opportunity for independent grocery retailers to use creative marketing and merchandising tactics to capture additional sales and profits," says Holly Stauder, Anheuser-Busch's IGA Red Oval representative.

Just as independent retailers have adapted to capture the food dollars from closed restaurants during COVID, they can adapt to capture alcohol sales lost from those restaurants and bars—especially in the beer category. According to Stauder, the key to increased alcohol sales is understanding how shopper behavior around alcohol has changed during COVID, and updating your selling tactics to fit new shopper needs. 

Read on to see how retailers across the country can use their independent flexibility to meet the opportunity for increased alcohol sales head on. 

Adapt Your Selection 

Stock larger sizes

Just as shoppers are seeking bigger sizes of packaged goods, they’re looking for larger packs of alcohol. According to Nielsen, “Many consumers are trading up to larger pack sizes in their off-premise purchases. For wine and spirits in particular, there has been unprecedented demand for larger pack sizes far beyond the norm.” Full cases of beer (24 and 30-packs) sales have risen over 20 percent during the pandemic, and boxed wine and 1.75-liter spirits sales are both up significantly as well.

"Shoppers have adjusted to the idea of sheltering in place, and the beer category continues to see a consistent increase in shopper base and focus on large packs," says Stauder.

Focus on innovation

As the monotony of yet another week at home continues, now is the time to excite shoppers with new product innovations from both trusted, established brands and new local producers. Besides bringing a fresh set of products to the alcohol department, IRI data predicts this approach will benefit sales. "We're projecting the beer category to retain about 72 percent of 2020's $2.2 billion growth, coming from the Above Core segments (think: Michelob Ultra, craft, imports, seltzers)," Stauder says.

Those hard seltzers like Bud Light Seltzer, which are included in the beer category, continue to be on-trend with 2020 summer sales up nearly 33 percent from 2019, according to Nielsen reports. And with Americans less active due to staying at home, healthier options like low-calorie beer and hard seltzers are expected to trend upward. Many local breweries have jumped on the low-calorie beer trend, offering craft brews with lower ABVs and therefore fewer calories, so sprinkle some of those packs into your assortment to peak shopper interest.

To encourage trying new items, some stores offer a build-your-own-6-pack option. While the 6-pack option deviates from the current trend of purchasing in larger quantities, it does provide shoppers with the option to find new favorites. Kishman's IGA in Minerva, Ohio recently started offering the option to build a 6-pack of seltzers, and so far the feedback has been positive, with several shoppers singing praises that they don't have to buy flavors they dislike and can stock up on the flavors they love. 

Highlight Your Selections with Visual Merchandising

Feature local favorites 

Shoppers have been shifting their preferences toward local offerings for years, and that preference has strengthened throughout the pandemic. According to a National Retail Foundation survey, 49 percent of consumers have made purchases specifically to support a local small business during the pandemic. Help shoppers eager to support local breweries, wineries, and distilleries by calling attention to those products through IGA’s Local Equals Fresh signage. 

“We’ve done a lot of work with local craft beer, which is obviously very trendy, and we’ve been able to differentiate those sets through the signage,” says Russ Greenlaw, VP of Sales and Operations at Adams’ Hometown Markets, with 15 locations across the Northeast. Greenlaw says that the stores only use the custom signage on products that serve as differentiators for the store. “The shopper will hopefully recognize that we’re different here.” It seems to be working. Greenlaw says they are currently up 38 percent in beer, driven by craft sales.  

Adams Hometown Markets customized their signage to promote their craft brew selection.

Cross-merchandise alcohol with other items

When setting up an end cap in the alcohol department, retailers and store managers must consider cross merchandising opportunities. “What items from other departments would pair well with this beer?” This summer, Bud Light Seltzer and fruit already appeared in the same basket on 23 percent of all trips, according to Numerator Insights Grocery data (YTD 6/14/20). That same data found that when Bud Light Seltzer and fruit are in the same basket, the basket is worth $135, bringing an incremental $63 per purchase addition. 

Using this data, retailers can bring fruit from the produce department into an alcohol department display with Bud Light Seltzer to encourage adding a citrus wedge or strawberries to their beverage, and set up a Bud Light Seltzer display in the produce department near the fruit. Similarly, retailers can bring pickles and spices into a display with Bloody Mary mix and vodka (make at least one of those items local and shoppers will be especially enticed!). 

Pair with meal solutions

With cooking fatigue at an all time high and shoppers hungry for new recipes, retailers are offering meal solutions to attract shoppers online and retain them in-store. According to data from Kantar shared by Anheuser-Busch, 51 percent of beer is consumed during meals, which gives retailers the opportunity to create cross-category displays for shoppers to quickly find a beverage that pairs well with their meal. 

“The Family Meals Made Easy! campaign was created exactly for this reason—we’re creating a meal solution destination within the store, and part of that solution is in beverages,” says IGA Marketing Specialist Megan Drazer. In-store, the campaign uses unique signage in a POP kit to capture shopper attention and educate them on recommended pairings. Retailers can use these recipes to create end cap displays for a one-two punch of beverage pairings and meal solutions. 

A Family Meals Made Easy! end cap features Michelob Ultra beer.

Offer gift ideas

As Valentine’s Day approaches, consumers are still weary of shopping at multiple stores for gifts. As one of the only places shoppers still visit in-person, grocery stores can become a gift destination by creating a merchandising display for Valentine’s Day gifts that include wines, rosé ciders, bakery items like cookies or cupcakes, and premium chocolates. 

With the ability to pivot quickly and adapt to new consumer behavior, independent retailers are uniquely positioned to serve changing shopper needs. When it comes to alcohol sales, tweaking the selection and updating visual merchandising displays will make a big impact on sales. By focusing on shopper favorites, local producers, and special occasion pairings, retailers show shoppers that they are here for their needs, no matter the occasion.