By: Marina Velez
Listen to the official consumer insights podcast HERE
Consumer needs are the driving force behind every purchase decision. The more effective a product/brand/service is at detecting these needs and offering products or services that meet them, the more sales it will have. Consumers increasingly want brands and products that align with their lifestyle, interests, and cultural identity. That’s why consumer insights are invaluable for businesses across various industries. They provide a deep understanding of consumer behavior, preferences, and needs, which can be leveraged to make informed decisions and drive overall business success.
The beverage industry is one of several industries with high exposure to changing trends, micro-trends, and local/regional trends. Consumer insights are especially valuable in the beverage alcohol industry, which includes wine, beer, and spirits. Beverage alcohol suppliers, brands, and retailers that already heavily rely on consumer insights know this. But for those that are not yet using the power of consumer insights, what’s the big deal?
Well, consumer insights provide the understanding and interpretation of customer data, behaviors, and feedback, obtained by conducting research amongst your consumers, into conclusions that can be used to improve product development and customer support and ultimately increase your revenue. Consumer insights are findings about how consumers think, behave, or feel. They provide a glimpse into consumers’ viewpoints and how their attitudes affect what they do (i.e., what they purchase, what they say about your brand, where they shop, etc.).
Tracking consumer insights helps identify alcohol category usage, product needs, identify emerging trends in flavors or cocktail preferences, and exactly how receptive consumers are to innovation. For instance, insights might reveal a growing interest in mezcal tequila, explore opportunities for alcohol in non-alcohol categories (e.g., alcohol-flavored candy or food) or evaluate the appeal of different beverage concepts. You can dive deeper and evaluate consumer lifestyle drivers such as wellness trends, that have been driving the success of low-alcohol products. This information can guide the development of new products to meet consumer demands. Beverage alcohol companies can use consumer insights to determine how their brand is perceived in the market. Are consumers associating their brand with quality, affordability, luxury, or a specific lifestyle? As an example, a key takeaway from research of younger consumers shows they prefer new and unique flavors, ingredients, and experiences from their alcoholic beverages. And they also want high-quality beverages. This understanding is vital for informing branding and marketing strategies.
Consumer insights assist suppliers and brands in developing a 360-degree perspective of the customer to understand performance at a category/brand level which encompasses tracking category usage, brand awareness/recognition and the success of advertising and marketing efforts. Educating consumers about the products they offer can be a key part of marketing for beverage alcohol companies. Data insights can help identify the information consumers seek and the best channels for delivering that information.
Other key performance measures consumer data can identify are past/current/future brand purchasing behaviors and probing for the ‘whys’ and assessing brand connections through attribute ratings and value/quality perceptions. Gathering feedback from consumers can help identify quality issues early. Companies can use insights to address any concerns and maintain product quality.
Determining where and how consumers purchase alcoholic beverages is crucial. Insights can guide decisions about distribution channels, store placement, and promotions within retail environments. Beverage alcohol retailers can also utilize consumer insights from assessing what brands to carry at specific locations, establishing optimal shelf placement with brands to developing effective in-store marketing efforts, such as strategic scheduling of tastings to drive traffic.
Consumer insights can inform pricing strategies by revealing what price points consumers are willing to pay for different types of alcoholic beverages. This can help shape the development of future premium products or the ability and extent to take price increases while helping companies set competitive prices and maximize profitability. Guidance on labeling, packaging, and design choices can be driven by insights that lead to an understanding of which label designs or packaging resonate with consumers and can help a brand stand out on the shelf and attract attention.
Comprehending market demand, analyzing how the supplier or retailer influences purchasing decisions along the customer journey, and a competitor comparison highlighting what consumers like or dislike about products can be used to refine or improve offerings and help a supplier or retailer qualify its marketing ideas and business direction using consumer insights to ensure a successful decision-making process.
The level of detail consumer survey responses can be analyzed by is extensive and ranges from basic demographics such as gender, age groups, race, and household income to generational breakdowns, geographic location, and by custom defined segments -- such as existing/new/returning customers or brand loyalists. Beverage alcohol preferences can vary by season and region. Insights can help companies anticipate and capitalize on these trends, such as the demand for certain beverages during holidays or in specific geographical areas.
Understanding the U.S. drinker’s habits, preferences, and shopping behavior is paramount to reaching them to build brands for the long-term. As an example of how the Beverage Information Group is using insights, The IMBIBE Consumer Insights Report*--collected from over 2,000 beverage alcohol consumers--helps industry suppliers, distributors, and retailers better understand who American drinkers are, how and when they consume alcohol, and what drives their purchases. The report analyzes six distinct consumer segments and how they interact with the overall beverage alcohol category.
According to the IMBIBE, the casual drinker is the largest consumer segment, drinking the occasional glass of wine, beer, or cocktail while relaxing or enjoying a meal, but also the lightest spending group per individual. By comparison, the Affluent Urban segment is the smallest group of drinkers, but the most engaged and adventurous consumer of beverage alcohol. They drink across categories, enjoying premium beers, fine wines, and cocktails both on- and off-premise. They live in cities and tend to have higher income than the other segments. IMBIBE provides similar in-depth insights into the other four consumer segments, enabling suppliers, brands, and retailers to understand their various audiences and customers. These learnings can assist industry players in making informed business decisions about ideal product features, pricing models, and inform marketing campaign strategies to increase sales and market share.
Companies that prioritize consumer insights are more likely to create products that resonate with their audience and build strong, lasting relationships with their customers. By staying attuned to consumer preferences, behaviors, and expectations, companies in this sector can adapt and thrive in a dynamic and competitive market.
Listen to the official consumer insights podcast HERE
*IMBIBE Consumer Insights report provides an in-depth examination of beverage alcohol drinking behaviors in the United States. This proprietary study provides a comprehensive understanding of consumer alcohol consumption across six unique consumer segments in the distilled spirits, wine and beer categories for Retail and On-premise channels. Each of the segments or ‘personas’ has unique drinking and shopping behaviors. To purchase IMBIBE visit our store at Industry Reports – EPG Specialty Information Store