Britain! A nation of Booze-hounds, binge drinkers and bottomless ‘bubbly’… at least that’s how many of my university friends from across the pond might have described our humble little island a few years ago!
Perhaps sometimes we are guilty of viewing ourselves this way too. Conjure for me an image of the average British get-together, something like the football of the last few weeks (let’s all commiserate together). No doubt a litany of pint glasses and/or half-full wine bottles are a part of that picture.
The British typically like a drink (or two) is what I’m saying!
As this year comes to an end, however, I want to put a question mark at the end of that sentence. See, as a writer for trade press I am blessed with a neverending barrage of statistics: sales figures, POS data, you name it…
… There’s an interesting trend emerging, and this year seems to have been a major tipping point. Or rather, in 2022 we have seen a significant increase in a trend that began during the pandemic. (One day, we’ll stop talking about the pandemic, I promise… just not today!)
Would it surprise you to hear that alcohol sales nationally have been on the decline? Not a steady, gradual downward trend either, but a steep spiral downward.
Up until 2020, the dreaded year that seemed to never end, alcohol sales and profits were increasing year-to-year, peaking in 2020 at £26.8bn across the sector in the UK. However, during the pandemic, those sales started to trend downwards, first to £25bn in 2021, and now in Q4 2022 sitting at £23bn.
This is not to say that alcoholic beverages don’t still hold a significant portion of the market share. However, the decline over the last two years has been faster than the growth in the previous two. Something in our collective habits is changing!
This by itself is interesting, but more interesting is what’s filling the void. – Tobacco!
Back in 2017, Tobacco products held a £19.8bn share of the market. In 2022, that market share has reached nearly £25bn. If you’ve been paying attention, you’ll have noticed that that is £2bn higher than alcohol products this year.
I can feel you all moving towards what might seem to be the obvious answer: yes, prices have gone up! Inflation has seen alcohol prices increase by averages between 6-9% depending on your drink of choice. However, the evidence doesn’t seem to suggest that tobacco products have soared in popularity as a result of being the more affordable vice. Rather, tobacco products have seen an average increase in price much greater than their liquid counterparts, with a pack of 20 cigarettes seeing a roughly 11% increase in price.
It should be pointed out at this point that, bizarrely, home-grown alcohols like British wines and Scotch Whiskey have seen a small, albeit fairly negligible, decrease in their average price; around 1-2%.
It may be that we have to leave it to the philosophers to determine why the British consumer has chosen to make a victim of its lungs as opposed to its liver. As retailers, however, we have to be conscious of these changing trends. Should we begin to look at expanding our tobacco (and vaping, let’s not forget) offerings as their consumption increases and alcohol sales go down? Equally, is it time for us to look at expanding our alcohol-free offerings?
Plenty of beverage companies are doing just this, creating cheaper, alcohol-free alternative versions of our favourite tipples. Recently, famously traditionalist Guinness even got in on the action with their ‘Guinness 0’ 4-packs. Plenty of spirits, particularly Gins, are jumping on the bandwagon too as they see the wind blowing in an increasingly teetotal direction.
2023 will be an interesting and telling year for this, no doubt. As we (hopefully) begin to leave the pandemic and lockdowns in distant memory, perhaps these scales will begin to balance again… perhaps not. Either way, it’s something that our community of independent retailers need to keep an eye on!
Have you seen these trends manifesting in your stores?
Let us know at info@c-talk.co.uk
