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Premium alcohol brands endanger bottom line


Premium alcohol brands endanger bottom line


A report has found rough economic times have had a ‘keeping up with the Joneses’ effect on Australian’s drinking behaviour.

Consumers are opting for quality over quantity when their choices are on show says Datamonitor’s report, ‘The Future of Wine/Spirits/Beer, Cider and Flavored Alcoholic Beverages Series: capitalising on new opportunities and preferences’.

When drinking in bars or restaurants people are choosing less of premium brands rather than trading down. When at home however, the report claims consumers are drinking cheaper alcohol.

“It is typical keeping up with the Joneses behaviour just exaggerated during the recession. In a significant number of cases people are actually trading-up, so rather than drinking two or three bottles of house wine with a meal, they’re splurging on one top-end bottle” said Richard Parker, senior consumer insights analyst, Datamonitor.

“Although people are sticking with quality, they are drinking less impacting on the bottom-line of the industry. Companies that have introduced offers and cut their prices will struggle to maintain a reputation for being a premium product.”

“As a result people will start to trade-up to new products and experiment. Therefore, we can expect to see those products that have spent money on innovation do well in the near future.”

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