The impact of technological advances and the rise of digital channels is now unmistakably evident across alcoholic drinks. One promising consequence is an increasingly personalised consumer experience, facilitated by tailored communication and customised drinks. And that can take many guises.
Successful digital strategies will usually either provide practical advantages or enhance the sense of aspirational appeal. Personalisation can prove effective in both cases, and has potentially far-reaching implications for sales, loyalty, and brand perceptions.
Simplifying the search
As a key example, artificial intelligence (AI) appears set to revolutionise the production process, and the opportunities also extend into consumer-facing applications. Through AI, product recommendations can be individually tailored based on purchasing patterns or quizzes on preferences. Too much choice can seem overwhelming, and starting with a limited, highly relevant selection of options can simplify the shopping process for consumers, encouraging return visits to a platform.
2023 global on-trade alcoholic drinks volumes stand 10% below pre-pandemic (2019) levels – the future is ultimately tilted towards the off-trade
Source: Euromonitor International
AI-powered chatbots can answer questions, suggest products, and share mixology or food pairing ideas, resulting in a more intuitive shopping process that seeks to mirror the natural conversations that take place in-store. As drinking decisions continue to move away from the confines of category boundaries and consider a more diverse range of options (through the still-developing no/low alcohol sector, for instance), guidance and suggestions may gain greater appreciation.
Adding value with premiumisation under pressure
A key consumer motivation for using online channels is the ability to quickly find the right product at the best price. However, that is just one of the areas of opportunity.
Premiumisation remains very much alive in alcoholic drinks, but is under pressure as persistent cost of living concerns weigh on consumer minds. Adding value is more important than ever, and digital channels offer innovative ways for brand owners and retailers to connect with consumers on a personal level.
Personalisation as a value-add strategy is not a new idea. Fairly established examples can be found, including the option to customise text or photos on the labels of some spirits bottles.
But now, emerging technology is ushering in additional pathways for brand outreach. While virtual experiences will not replace real life, immersive digital engagement benefits from a broad geographic reach and can leave a memorable impression by evoking feelings of personal involvement.
49% of global consumers value online virtual experiences
Source: Euromonitor’s Voice of the Consumer: Lifestyles Survey, fielded January to February 2024
Augmented and virtual reality blur the lines between the physical and virtual worlds and can bring brand stories to life and create a talking point. Taking another approach, providing access to extra digital content through QR codes enables brand owners to speak directly to those keen to gain a more in-depth understanding. That content can illustrate sustainable production strategies, promote artistic partnerships, offer cocktail recipes, and much more.
Are customised drinks the future?
So far, the “personalisation” discussed here has focused on tailoring the approach to communication and the purchase process. The next level is customising the actual liquids.
Countertop home brewing or mixology devices have significant hurdles to overcome – notably the fact that price points are often deemed high. However, advances in technology combined with enduring at-home socialising trends suggests uptake may increase in the future. In these systems, drinks can often be tailored to personal tastes, with the range of variable attributes on the rise.
Customisation also holds promise in the on-trade – to a certain extent. A starting point can be seen in drinks menus that offer the same cocktail either with or without alcohol. AI-powered cocktail makers (or “robot bartenders”) offer extensive customisation possibilities, and also an appealing sense of novelty, efficiency advantages and, in some cases, a partial solution to staffing challenges.
Taking personalisation (and digitalisation) too far risks becoming off-putting in an industry with an innate emphasis on tradition. It will be important to strike the right balance to avoid detracting from perceptions of heritage and authenticity, the creativity involved in product and packaging design, or the all-important element of human interaction. Still, personalisation is just getting started in alcoholic drinks. The full potential is yet to be uncorked.
Learn more about channel shifts in our report, Where Consumers Shop for Alcoholic Drinks.