By Tam Allenby

An increasingly multicultural and ageing population are opportunities rather than hindrances for growth in liquor retail, Pernod Ricard representatives told the ILG Study Tour to the United States.

Highlighting key census data to support his argument, State Account Manager for NSW Luke Van Staveren told ILG members gathered in New York that Australia is becoming “a nation of nations” and that “85 is the new 65”.

“In 2016, 28.2 per cent of people in Australia were born overseas. By 2050 that will be 34.6 per cent, so one in three will be born overseas and seven out of 10 will have a parent born overseas,” Van Staveren told the delegates.

“Chinese spirit consumption dwarfs all other countries; compare that to Australia, where we lean more towards the beer and wine categories. If you look at certain spirits, Cognac is around one per cent of spirit consumption in Australia but it’s about 19 per cent in China.

“These are trends you should consider when making ranging decisions and promotional opportunities.”

New Australians may also have higher liquor abstention rates, which must also be taken into account, Van Staveren said.

“When we look at the consumption of liquor, native Australians will still be the target for alcohol, representing seven out of 10 new liquor consumers.

“The untouched opportunity is to reach those non-liquor drinkers, especially migrants, who want to feel that sense of belonging on certain occasions – rather than drinking the normal, boring non-alcoholic options, they want to feel as though they’re part of the group.

“So the two parts of your business to look at are: for the current Australian drinkers, make sure you grow their average weight of purchase and increase their basket size, but [you also need] to recruit those migrants new to Australia by looking at some of their consumer or cultural consumption occasions, i.e. Chinese New Year, or Diwali.”

Van Staveren also suggested breaking down the census data into specific suburbs, in order to see where the new migrant populations in the area around your premises are actually from – and adapting your business strategy to capture these potential customers.

“The challenge is developing a consumer and commercial opportunity to strategically approach these communities,” he said.

“One way of doing that would be to look at making a key event or festival chart, to make sure your business is identifying within your own suburb the population where the influence will grow going forward.”

Co-presenter Michael Doughty, National Business Manager at Pernod Ricard Australia, focused on the ageing population, highlighting that the median age in Australia has increased to 38, and that there are 84,000 more people aged over 85 than at the last census.

“The older generation are more educated and their category knowledge is high,” explained Doughty.

“They also tend to stock up on wine – a large number hold over 25 bottles in their cellar or at home which presents an opportunity to upsell and increase basket size by selling more premium brands that they can keep.

“The older generation also drink more often than younger generations, so it’s a good opportunity for loyalty card schemes because they’ll keep coming back.

“Having said that, it’s interesting to see that their taste profile is more traditional: they like Australian and they like New Zealand wines, so the challenge for suppliers is around emerging varietals and countries, and the role they play in our stores.

“Within the white category, they like Sauvignon Blanc, they like Chardonnay, and in red wine it’s still all about Shiraz and Cab Sav.”

Deborah Jackson

Deb joined Intermedia in 2015 as Editor of National Liquor News and Deputy Editor of The Shout. Since then, she has also worked as the Editor of Beer & Brewer and the New Zealand title, World of Wine....

Leave a comment

Your email address will not be published. Required fields are marked *