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Pernod Ricard research suggests retailers should focus on premium sales in run up to Christmas

Published:  03 October, 2016

Pernod Ricard is urging retailers to tap into key moments that new research suggests can drive premium sales this Christmas, building value without resort to heavy discounting

Pernod Ricard is urging retailers to tap into key moments that new research suggests can drive premium uplift this Christmas, building value sales without unnecessary heavy discounting.

This follows fresh consumer research confirming that shoppers are willing to trade up at Christmas, also identifying "multiple moments" in the run up to and over the festive period during which consumers will spend more on premium drinks, offering retailers the chance to maximise higher spend sales.

The research revealed that while premium spirits sales grew by +9% volume and +6% value during Christmas 2015, against total spirits growth of +4.5% volume and +2.7% value, heavy promotions on nine of the top 10 performing spirits brands - often on 1 litre bottles - actually saw prices drop by an average of -£1.17 compared with the yearly average.

"Spirits prices declined last Christmas for the first time in three years," said Chris Ellis, commercial director, Pernod Ricard UK.

"With premium spirits out-performing the market and accounting for more than £1 of every £3 spent during the festive season, discounting premium spirits is clearly a huge missed opportunity."

The research suggested that consumers do not need the incentive of discounting as they are already willing and financially prepared to treat themselves to special purchases and also to splash out when it comes to gifting.

While this may sound like an obvious assertion, the dip in prices over the 2015 Christmas trading period reveals that retailers are potentially under-cutting their own premium sales.

"We would encourage retailers to reappraise the role that premium spirits can play in growing value and create a special moment for both shoppers - who enter the store with a premium mind-set - and the category this Christmas," said Ellis.

The "moments" identified as opportunities include: Christmas Dinner Moments, inspiring customers to trade up to higher end wines; Christmas Get Together Moments, for premium social wines and spirits; Christmas Wrapping Moments, for trusted premium brands; Christmas Cocktail Moments, for hero brands; and Christmas Giving Moments, offering popular brands and miniatures in seasonal gift packaging.

By tapping into premium sales, says Pernod Ricard, especially during these key moments, retailers can avoid undervaluing seasonal returns for the drinks category, while delivering what the customer wants.

The company will be focusing on its key brands this Christmas, including Absolut, Brancott Estate, Campo Viejo, Chivas Regal, G.H. Mumm, Havana Club, Jacob's Creek, Jameson, Malibu, Martell, Perrier-Jouët and The Glenlivet.