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Ecommerce sales surge but fail to make up for on-trade losses

Published:  22 April, 2020

Ecommerce sales of beer, wine and spirits (BWS) in the UK surged 50% (volume) in the first week of lockdown compared to the same period last year, while sales through the off-trade were up 20%, according to new IWSR snapshot research. 

The growth potential of ecommerce in the UK, however, is constrained by “capacity issues and catering to the surge in demand”, especially within general grocery ecommerce which leads in the UK, according to the report, which was released today covering 10 drinks markets across the globe.

The on-trade closure in the UK has meant 40% of UK trade has been removed from the market, stated the report.

While the temporary element of panic buying and out-of-stock situations in the off-trade, as has been seen across all 10 markets surveyed, is subsiding in most markets, the ecommerce channel has helped most businesses "maintain growth potential", said Mark Meek, CEO at IWSR. 

However, the upswing in ecommerce sales, coupled with consumer stockpiling through the retail channel, has “so far failed to make up for the vast losses in the on-trade caused by the enforced closure of bars and restaurants around the world”, he added. 

The report also found that ecommerce is increasingly joined by new arrivals to 'direct to consumer' in the UK, including craft producers looking to compensate for the closure of taprooms and visitor centres, with this sector expected to take a big hit from the impact of Covid-19.  

In addition, the research showed early signs that some UK consumers may become conscious of over-indulging in alcohol at home and may resort to “some degree of moderation”, be that lowering frequency, swapping to lower abs drinks or introducing some no/low solutions to their product mix.

The IWSR Covid-19 Market Impact Snapshot series is a bi-weekly report that assesses the ongoing situation across key markets including Argentina, China, France, Germany, India, Italy, South Africa, Spain, the UK and the US.

Earlier this week, small independent breweries across the UK recorded an average 82% drop in beers sales across the UK since the outbreak of Covid-19. 

 




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