Maxxium UK, distrubutor of brands such as Famous Grouse, The Macallan, Jim Beam, Courvoisier, Bols and Sourz, is launching “a comprehensive category vision to accelerate spirits sales growth over the next five years across the on- and off-trade.”
Backed by findings from what the company claims is its largest-ever category research project, Maxxium has developed A Winning Mixx to “unlock the full potential of spirits”. It has identified an incremental £942m sales growth opportunity achievable by 2020, an increase of 10% to the category which is currently worth £9.3bn [Nielsen 52 w/e 30.01.16 and CGA 26.12.15].
This framework for growth applies across the trade with a £75m opportunity in symbols and independent retail and a £585m opportunity in the on-trade.
Over the past year, the company has invested over £1m in consumer and shopper research and analysis. More than 7,000 adults, including spirits and non-spirits alcohol drinkers were surveyed, focusing on their purchasing behaviour in restaurants, bars and retail outlets and their attitudes towards alcohol, specifically spirits. The research identified barriers to purchase, such as taste, strength, poor knowledge on making drinks and issues with trial, all of which Maxxium believes can be removed, in order to substantially increase sales.
Maxxium’s research identified six growth drivers to generate the incremental income. These are: Discovery: recruiting non-spirits drinkers to the category; Adventure: encouraging confident drinkers to trade up and all spirits drinkers to broaden their repertoire; Refreshment: rightsizing spirits’ share of occasions where refreshment is the motivation; Sharing: rightsizing spirits’ share of occasions where socialising is the motivation; Perfect experience: ensuring every serve in-home or at-bar is perfect; Positive spirits: educating and building the understanding of spirits.
Research also shows that currently only 61% of UK households purchase spirits, of which 35% buy only once a year and that the UK spirits’ share of alcohol serves lags behind the US at 22% versus 34%, both of which signal room for growth.
Maxxium is currently developing a range of “growth enablers“ which will help customers achieve their share of A Winning Mixx. These include creating solutions to purchase barriers, as well as impactful PoS to grow spirits drinking occasions.
Maxxium UK’s MD, Mark Riley, said: “As a major UK spirits distributor, we have the responsibility to invest in and evolve this exciting category. A Winning Mixx presents a sustainable sales growth opportunity across the spirits industry, born out of a compilation of unrivalled insight, collaboration and passion. Interest in premium spirits is at an all-time high and we look forward to turning our category vision into reality as we embark on a journey with customers to unlock future spirits growth.”
Further information on the growth enablers will be announced in the coming months, but they can be summarised thus:
- Easy to buy: Address the barriers to purchase in the on- and off-trade channels
- Right for the channel: Address the specific needs of different channels, ensuring a tailored approach is applied for each.
- Optimise promotions: Establish how to maximise return on promotions by analysing effective price points and mechanics.
- The connected customer: Rise to meet the evolving needs of the ‘connected customer’ as technology makes the purchase decision increasingly more informed.