COVID-19 forced the world into a kind of lockdown that was previously unthinkable. And with retail outlets closed for weeks in many countries around the world, there has been a seismic shift to online retail.
Millions of people have been turning to e-commerce sites to get through the pandemic, and this has changed the face of retail. It’s also changed the way people buy wine. The question now is whether online sales will continue to grow as the crisis passes and lockdown measures are eased around the world.
How do online wine sales compare with 2019?
The sudden severity of the virus caught many unaware, and some retailers were simply not equipped to deal with the increase in online sales. But the scale of the online sales increase is difficult to understand without some figures for context. Let’s take the US as an example.
Data from Nielsen shows that online sales of alcohol increased five-fold in April 2020, compared with figures from April 2019. It’s a similar story all around the world, with analysts predicting that the growth will continue regardless of retail outlets reopening as consumers become more comfortable with the concept.
There is also evidence to show that what people are buying has changed during the pandemic, as well as how they’re buying it. Customers appear to be purchasing higher amounts of lower-priced wines and spirits, and fewer cellaring wines. As more people have been cooking at home and drinking more often, this behavioural change has translated to online sales figures. That’s not to say that fine wine collectors aren’t buying too, as they look to restock their collection as an investment during a troubling economic time.
Changes in consumer behaviour and buying choices
As well as the shift to ‘value buying’, that is buying cheaper ‘everyday’ drinks, there has been a surge in the quantity being bought during lockdown. This applies to everyday wine and spirits, but also to vintage and fine wines. Collectors of fine wines from all around the world are still looking out for that perfect unique or rare bottle to buy when it becomes available.
One wine merchant reports that while the initial weeks of lockdown were relatively steady with online traffic comparable to 2019, the increase in online sales really began in April. The number of online users increased 40% between April 2019 and April 2020.
Consumer buying behaviour by country
Wine-searcher, a global wine price comparison site has seen an increase in online traffic of 33%. This is a level usually only seen at key retail periods, such as Christmas or New Year. The site has split the traffic growth into regions, which gives a good indication of consumer behaviour in different countries.
Wine searches in India, for example, increased by 138%. Growth in the US measures at a 42% increase, Italy at 40%, the UK 38% and Germany 36%. Online wine searches did decrease in a few countries, notably a 7% fall in France and 29% in China.
In terms of the type of wine being searched for online during lockdown, rose is the most popular. An increase of 47% in rose searches compared with the same time period in 2019, with white wine up by 34%, red wine up 33% and sparkling wines increasing by 31%. Dessert wine, which is generally the least searched for wine online, increased by 22% in website searches.
Will online wine sales continue to rise after the pandemic?
How long can this level of online sales growth in the wine and spirits market continue? Is it likely that consumers will be more comfortable post-pandemic buying wine online, while before lockdown they preferred going to retail outlets? The length of the lockdown and the continuing uncertainty surrounding exactly how safe it is to be visiting shops and public places, is likely to see this buying behaviour continue for the foreseeable future.
As a sector, retail has suffered greatly during the lockdown, but there could be a silver lining for online wine retailers. As time goes on, consumers will continue to be more and more comfortable buying wine online, and there is a high possibility that many won’t revert back to brick and mortar buying afterwards.
Buying wine online could well become the new normal for a far wider consumer demographic than before COVID-19 caused such an unprecedented situation. Rare and fine wine sellers are looking for new ways to get their products in the hands of collectors, and we can expect to see a broader range of online wine sellers. With restaurants closed, premium brands need to focus on online sales in ways they haven’t had to before, which will continue to encourage consumers to buy online due to the sheer variety they can find.