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Alcohol Purchasing in Supermarkets - UK - October 2010

This is the first time that Mintel has produced a separate report looking at consumer behaviour surrounding and attitudes towards purchasing alcohol at supermarkets.

  • The prospect of minimum pricing solicits a powerful response from consumers, with seven in ten believing that raising the cost of alcohol at the supermarket would penalise standard drinkers. This is despite the majority admitting it would have little or no effect on their alcohol purchasing.
  • Consumers spend an average amount of £12 per week at the supermarket, translating into £624 a year, although almost one quarter spend £5 or less per week, indicating that a binge drinking culture in Britain may not be as widespread as the media suggests.
  • A third of consumers are influenced in their choice of supermarket based on who has the best offers of alcohol, a testament to the success of alcohol as a potential loss leader.
  • While consumers in general are strongly engaged with discounting, with four fifths having bought alcohol on promotion in the past 12 months, the over-45s, who are the key demographic for in-home drinking, are the least likely to buy alcohol on promotion.
  • While raising the price of alcohol in supermarkets would close the gap between the on- and off-trade, it would have little impact on driving consumers back to the pub, as only 11% of consumers agree that higher prices at the supermarket would make them drink in pubs more often.
  • Wine is the most popular drink bought from the supermarket by three quarters of consumers in the past 12 months, highlighting it as a compromise option between the sexes and featuring in six out of the top ten brands by advertising spend.

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Table of contents

  1. Issues in the Market

      • Key themes
        • Definition
          • Abbreviations
          • Future Opportunities

              • Guiding the errant young ones
                • Get a taste of this
                • Market in Brief

                  • Switch to in-home
                    • Wine dominates at the supermarket
                      • Discounting blamed for binge culture
                        • Minimum pricing faces opposition
                          • And would not necessarily help the on-trade
                          • Market Environment

                            • Key points
                              • Drinking in decline
                                • Figure 1: Trends in alcohol consumption, 2006-10
                              • Switching to in-home
                                • Figure 2: Frequency of alcohol consumption (in home, out of home and all (in or out of home)), 2010
                              • Tesco dominates the in-home market
                                • Figure 3: Supermarkets share of alcohol sales vs share of all groceries 52 w/e 12 July 2009
                              • On-trade continues to suffer
                                • Figure 4: Statements on drinking habits, 2006-10
                              • Where duty is still an issue
                                • Figure 5: Duty increase, by alchol type, 2003-10
                              • Demographic changes will further fuel the shift
                                  • Figure 6: Index of statements on drinking habits, by gender, age, and socio-economic group (100=average), August 2010
                              • Legislative Factors Affecting Supermarkets

                                • Key points
                                  • The Scottish look to lead the way
                                    • Could the rest of the UK follow?
                                      • Changes to licensing laws
                                        • Supermarkets keen to show responsibility
                                          • Key views on minimum/alternative pricing
                                          • Competitive Context

                                            • Key points
                                              • On-trade under pressure
                                                • Figure 7: Percentage of people who bought alcohol from various outlets in the last year, 2000-09
                                              • Off-licences and independents
                                                • Booze cruises can no longer compete
                                                  • Online goes from strength to strength
                                                    • Figure 8: Online alcoholic beverage retail market, 2005-15
                                                    • Figure 9: Average unique users per month for online supermarkets, May 2009-August 2010
                                                • Who’s Innovating?

                                                  • Key points
                                                    • Wine advisers
                                                      • Utilising mobile technology
                                                        • US turns to vending
                                                        • Brand Communication and Promotion

                                                          • Key points
                                                            • Supermarkets continue above-the-line investment
                                                              • Figure 10: Advertising spend by leading supermarkets on alcoholic drinks, 2005-10*
                                                            • Tesco leads the way
                                                              • Figure 11: Share of spend on above-the-line advertisiing on alcoholic drinks, by supermarket, 2008-09
                                                            • Wine has prominence
                                                              • Figure 12: Top ten brands advertised by select leading supermarkets on alcoholic drinks, 2008-10*
                                                          • Consumer Usage – How Much Do They Spend and On What?

                                                            • Key points
                                                              • Weekly spend is marginal for most
                                                                • Figure 13: Expenditure on alcohol at the supermarket in a typical week, August 2010
                                                              • A small group spend £20 plus
                                                                  • Figure 14: Index of those spending £19 or less and £20 or more at the supermarket in a typical week, by gender, age, socio-economic group and supermarket used (100 = average), August 2010
                                                                • Wine and beer dominate supermarket choice
                                                                  • Figure 15: Types of alcohol bought from the supermarket in the last 12 months, august 2010
                                                                • Wine and beer drinkers
                                                                  • Figure 16: Index of wine drinkers compared to beer, by gender, age, socio-economic group and supermarket used (100 = average), August 2010
                                                                • Occasional drinks
                                                                  • Choice differs by age
                                                                    • Figure 17: Types of alcohol drunk in the last 12 months, by age, August 2010
                                                                • Consumer Usage – Which Discounts Appeal the Most?

                                                                  • Key points
                                                                    • Consumers look to discounts
                                                                      • Alcopops top promotions
                                                                        • Older consumers aren’t as interested in promotions
                                                                            • Figure 19: Net difference of promotions/discounting of alcohol taken advantage of at supermarkets in the last 12 months, under-45s versus over-45s, August 2010
                                                                          • The rich and poor both like a bargain
                                                                          • Consumer Attitudes Towards Discounting

                                                                            • Key points
                                                                              • Are discounts really a loss leader?
                                                                                • Figure 20: Index of any agree on statement ‘I sometimes choose which supermarket to shop at based on who has the best offers on alcohol’, by supermarket used, (average = 100) August 2010
                                                                              • Affordability
                                                                                • Figure 21: Attitudes towards purchasing alcohol at supermarkets, August 2010
                                                                              • Brand loyalty
                                                                                • Figure 22: Index of any agree with attitudes towards purchasing alcohol at supermarkets, by age, (average = 100), August 2010
                                                                              • Stocking up
                                                                                • Consumer confusion
                                                                                  • Discounts fuelling binge buying/drinking?
                                                                                    • A British problem
                                                                                      • Pre-loading gets the blame
                                                                                        • Perception that the home is a more responsible venue?
                                                                                        • Consumer Attitudes Towards Minimum Pricing

                                                                                          • Key points
                                                                                            • A costly endeavour
                                                                                              • The effect on binge drinking
                                                                                                • Minimum pricing wouldn’t necessarily help pubs
                                                                                                  • Anti-nanny state
                                                                                                    • Most consumers say it wouldn’t affect their behaviour
                                                                                                      • Consumers unlikely to drink less overall
                                                                                                        • Or trade down to cheaper brands
                                                                                                        • Consumer Targeting Opportunities

                                                                                                          • Key points
                                                                                                              • Figure 29: Consumer clusters for alcohol purchasing in supermarkets, August 2010
                                                                                                            • Moderates (29%)
                                                                                                              • Pro minimum pricing (32%)
                                                                                                                • Price driven (27%)
                                                                                                                  • Discount driven (12%)
                                                                                                                  • Appendix – Market Environment

                                                                                                                      • Figure 30: Trends in alcohol consumption, 2006-10
                                                                                                                      • Figure 31: GDP, PDI, consumer expenditure and savings, at constant 2010 prices, 2005-15
                                                                                                                      • Figure 32: Trends in consumption of alcoholic drinks two to three times a week or more, by alcoholic drink, 2006-10
                                                                                                                      • Figure 33: Drinking occasions in home for beer/lager/ale/cider, by demographics, 2010
                                                                                                                      • Figure 34: Drinking occasions in home for beer/lager/ale/cider, by demographics, 2010
                                                                                                                      • Figure 35: Trends in the age structure of the UK population, 2005-15
                                                                                                                      • Figure 36: Forecast adult population trends, by socio-economic group, 2005-15
                                                                                                                  • Appendix – Brand Communication and Promotion

                                                                                                                      • Figure 37: Advertising spend by leading supermarkets on alcoholic drinks, 2005-10*
                                                                                                                  • Appendix – Consumer Usage – How Much Do They Spend and On What?

                                                                                                                      • Figure 38: Weekly spend on alcohol at the supermarket, August 2010
                                                                                                                      • Figure 39: Weekly amount spent on alcohol at supermarkets, by demographics, August 2010
                                                                                                                      • Figure 40: Brand repertoire of alcoholic drinks, by age group, 2009
                                                                                                                  • Appendix – Consumer Usage – Which Discounts Appeal the Most?

                                                                                                                      • Figure 41: Types of alcohol bought from the supermarkets in the last 12 months, by promotions/discounting of alcohol taken advantage of at supermarkets in the last 12 months, August 2010
                                                                                                                      • Figure 42: Promotions/discounting of alcohol taken advantage of at supermarkets in the last 12 months, by demographics, August 2010
                                                                                                                  • Appendix – Consumer Attitudes Towards Discounting

                                                                                                                      • Figure 43: Attitudes towards purchasing alcohol at supermarkets, by demographics, August 2010
                                                                                                                      • Figure 44: Most popular money spent on alcohol at supermarkets in a week, by demographics, August 2010
                                                                                                                      • Figure 45: Next most popular money spent on alcohol at supermarkets in a week, by demographics, August 2010
                                                                                                                      • Figure 46: Attitudes towards purchasing alcohol at supermarkets, by demographics, August 2010
                                                                                                                      • Figure 47: Attitudes towards purchasing alcohol at supermarkets, by demographics, August 2010
                                                                                                                      • Figure 48: Attitudes towards purchasing alcohol at supermarkets, by demographics, August 2010
                                                                                                                  • Appendix – Consumer Attitudes Towards Minimum Pricing

                                                                                                                      • Figure 49: Statements on minimum pricing of alcohol at supermarkets, by promotions/discounting of alcohol taken advantage of at supermarkets in the last 12 months, August 2010
                                                                                                                      • Figure 50: Statement on minimum pricing of alcohol at supermarkets, by demographics, August 2010
                                                                                                                  • Appendix – Consumer Targeting Opportunities

                                                                                                                      • Figure 51: Target groups, by demographics, August 2010

                                                                                                                  Companies Covered

                                                                                                                  • Aldi Stores Ltd (UK & Ireland)
                                                                                                                  • Asda Group Ltd
                                                                                                                  • British Beer and Pub Association
                                                                                                                  • British Market Research Bureau (BMRB)
                                                                                                                  • British Medical Association (BMA)
                                                                                                                  • Co-operative Group
                                                                                                                  • Competition Commission
                                                                                                                  • Department of Health
                                                                                                                  • Diageo UK
                                                                                                                  • J. Sainsbury
                                                                                                                  • Kantar Media
                                                                                                                  • Lidl (UK)
                                                                                                                  • Lion Nathan Wine
                                                                                                                  • Marks & Spencer
                                                                                                                  • Mitchells & Butlers Plc
                                                                                                                  • Molson Coors Brewing Company
                                                                                                                  • Oddbins Ltd
                                                                                                                  • Society of Independent Brewers
                                                                                                                  • Tesco Plc
                                                                                                                  • The Portman Group
                                                                                                                  • The Royal College of Physicians
                                                                                                                  • Victoria Wine Co Ltd
                                                                                                                  • Waitrose
                                                                                                                  • Wm Morrison Supermarkets

                                                                                                                  Alcohol Purchasing in Supermarkets - UK - October 2010

                                                                                                                  £1,995.00 (Excl.Tax)