As with many industries, the past year has had a profound impact on beer, wine and spirits. The rise of premium products and a fragmented market have been shaping the industry for years, but COVID-19 completely changed the game. Alcohol consumption among adults over 30 increased during the pandemic, but the setting in which it was consumed quickly shifted from public to private settings. Stay-at-home ordinances and mask requirements were imposed all across the U.S. and as a result, at-home consumption increased while on-premise consumption decreased.
With vaccinations on the rise and cases on the decline in the U.S, many bars and restaurants will be reopening this summer. The number of people consuming onsite will likely increase, but some people who were introduced to ecommerce alcohol sales for the first time will continue to embrace that model. Many alcohol brands, some for the first time, are developing packaging designed to be consumed at a variety of locations. Regardless of where alcohol is enjoyed this summer and beyond, brands need to consider the location, packaging design and materials to stand out in the ever-changing beverage industry. Packaging partners from concept to delivery have the expertise needed to help brands navigate this complex and competitive landscape.
According to a Nielsen study, while in-store alcohol sales saw a bump of 21%, online sales experienced a 234% increase during 2020. This translated into greater demand for larger pack sizes and e-commerce friendly packaging. As a return to relative normalcy is now within view, beer, wine and spirits brands need to anticipate where consumers will be consuming products to make the most informed packaging decisions. Brands should consider the behavior of their target audience — whether they are likely to stay home or embrace reopening — and identify a packaging partner who understands the nuance of specific channel needs. For example, the material and design requirements for bottles on the shelf at a retail store or in a bar look very different than what is needed for e-commerce.
After determining where the product will be consumed, packaging experts can advise beer, wine and spirits brands on the most effective design to attract, engage and connect with those consumers. For example, a hot trend in beverage packaging is customization. An example of this is when alcohol brands create bottles with specific designs to show support, such as a rainbow, in backing LGBTQ Pride Month. Not only does this support an important cause, but it encourages consumers to purchase bottles in celebration of the month. Fourth of July is another holiday that has warranted customization from many alcohol brands. For example, in 2020, a popular vodka brand took advantage of the surge in popularity of hard seltzer and released a ‘Red, White & Berry’ flavor. In response to growth in the premium alcohol product category, some companies may find it advantageous to extend the premium experience of its packaging to deliver a personalized experience for their customers. New technologies such as 3D scanning and printing make it easier than ever before. However, custom packaging may not be right for every brand. For emerging brands on tighter budgets, even a few small, but impactful changes like refreshing a label for a new collection can create a connection with consumers. Experts in packaging can evaluate and analyze a variety of design needs to help producers meet their business goals.
As COVID-19 affected both manufacturers and worldwide shipping, automation has helped companies do more with less. When packaging partners include automation in their distribution, it accelerates the time to market for products. Because of the increase in demand from glass manufacturers, it has left them wanting to ship glass in bulk to move inventory as quickly as possible. Therefore, packaging partners that can automate from pallet to case packs or point of purchase packaging has accelerated the supply chain. It has added benefits of helping wine, beer and spirits companies to ship direct to the consumer with gift packs and e-commerce packaging.
Another important element to consider when choosing packaging is the material. In addition to cost efficiency, brands should consider that consumers are increasingly prioritizing sustainability in decision-making, and younger generations in particular are apt to support companies that align with their values. As a result, prioritizing sustainable materials could increase profit in the long run. No matter the end goal, a packaging partner with a material-neutral approach can help brands determine options that best align with their goals. Partners with a network of suppliers can access a variety of materials, which provides brands with a unique opportunity to explore options in the market. Glass and aluminum are a couple of examples of rigid materials that promote sustainability goals and protecting the product. Aluminum cans, for example, have a smaller lifetime carbon footprint than you might expect, and therefore some brands may consider it to be the best choice. After determining the material, there are many other components to consider, including bottle-neck sleeves, tamper-evident seals, corks, screw caps and bar-top stoppers. And, finally, there are many options for exterior packaging which is the branded box and/or bag. All of these items combine to create an individual brand story and consumer experience.
As bars, restaurants and tasting rooms begin to reopen with increased capacity, alcohol brands will have to reevaluate where their products are being consumed to determine which design and materials are the best fit for each channel. Challenging times often create innovation. This is an opportunity to provide value to customers and develop loyalty. By partnering with packaging experts who understand the industry and use a vast supplier network to choose the right packaging, brands can stand out in a crowded market, whether it’s in a bar, on a shelf or sitting on the customer’s doorstep.