Report reveals digital’s untapped potential in the drinks industry

By Staff reporter

- Last updated on GMT

Digital potential: The Alchemist is rolling out an Augmented Reality (AR) cocktail menu. Pic:getty/arkD
Digital potential: The Alchemist is rolling out an Augmented Reality (AR) cocktail menu. Pic:getty/arkD

Related tags: Digital marketing

While most drinks businesses cite digital as being integral to their business, most feel like they're behind the curve and that the industry as a whole lags behind others, according to a new report.

The report by strategic consultancy Rewrite Digital was published after researching the views of drinks industry professionals in the first quarter of 2019.

80% of those surveyed said digital is a key element of their business or integral to everything they do. Jon Reay, Founder & CEO of Rewrite Digital, remarked “Recognition that digital plays such an important role in drinks businesses is an encouraging signal for future growth. However, the report highlights a sizeable gap between acknowledging value and following through to realise it.”

Make a business case for digital 

Most felt like their drinks business is ‘behind the curve’ in digital and that the industry as a whole lags behind others. Furthermore, Rewrite Digital’s industry average for digital maturity and effectiveness suggests drink businesses are in fact even further behind than they think, signalling the need for greater awareness of the full breadth of opportunities in digital and how fast it’s changing.

Leandro Cabrini, Founder & CEO of Wild Yeast Media, a social media and digital marketing agency specialising in wine, comments: “The wine industry in particular refuses to adapt, maintaining that everything is (and should be) the way it was 20, 30, 50, 100 years ago.”

Reaching new audiences and increasing brand interactions were ranked as the greatest benefits of digital. Cost and lack of dedicated resource were cited as the top barriers.

Indeed, the cost of digital and widely held view that it doesn’t contribute to cost savings is limiting deeper commitment from budget holders. “More needs to be done to clarify the full commercial opportunities of digital to ignite further investment”​, insists Reay.

Howard Davies, co-founder at Salcombe Distilling Co. (Devon, UK), agrees: “My advice for digital suppliers: give a tangible business case, bring it back to sales”.

Not everyone is holding back on spend and innovation in digital though. Jenny McPhee, Head of Brand at The Alchemist, says: “We’re always trying to stay ahead of competitors and find new ways to make the guest journey more streamlined and enjoyable”​ as the bar and restaurant chain looks to roll out its Augmented Reality (AR) cocktail menu to all its UK venues.

Direct-to-consumer (D2C), personalisation and smarter use of data - including automation and machine learning - were seen by drinks professionals as top focus areas for the year ahead, with advances in the food industry being inspiration for many.

While D2C is usually referred to in terms of e-commerce, it’s also about nurturing the direct relationship with buyers and drinkers, engaging them with much more regular interaction than purchasing alone. Leading brands are realising the benefits of such D2C engagement with digital at the heart.

The State of Digital in Drinks 2019 Report​ concludes that digital has the potential to play a much more significant role for drinks businesses, helping to accelerate brand growth as well as bringing greater operational efficiencies. Commoditisation and an increasingly powerful business case will put today’s innovations more in reach of every drinks brand.

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