The food and alcoholic beverage industry has seen a surge in technological advancements in recent years, and these trends are expected to continue well into 2023 and beyond. Digital strategy from digital systems and data insights to artificial intelligence (AI), technology is transforming the way companies operate, making them more efficient and better able to meet the needs of customers. In this article, we’ll explore some of the biggest innovation trends in the alcoholic beverage industry and provide examples of companies that are leveraging technology to gain market share and improve customer satisfaction.
Digital Systems Strategy
One of the biggest trends in the alcoholic beverage industry is the adoption of digital systems. These systems allow companies to streamline their operations, reduce costs, and improve the customer experience. For example, digital point-of-sale (POS) systems enable companies to track sales, inventory, and customer preferences in real-time, giving them the insights they need to make data-driven decisions. This data can be used to optimize pricing, promotions, and product offerings, making it easier for companies to cater to the changing needs of customers.
One example of a company that has leveraged digital systems to gain market share is Total Wine & More. The company uses digital POS systems to track customer purchases and preferences, allowing them to make personalized recommendations and promotions. Total Wine & More has also developed a mobile app that allows customers to browse their inventory, order online, and even schedule deliveries, Buy Online Pickup in Store (BOPIS) and Curbside pickup.
Pernod Ricard has invested in technology that helps customer trying to understand more about the origin of the products and ingredients and fighting counterfeit products. Their ‘connected’ QR-coded bottles are being rolled out across its entire portfolio “
Traceability is “critical” to consumers in terms of supply chain tracking, the group’s CEO Alexandre Ricard said, adding that “being able to trace a bottle and make sure it is a true authentic product is important, especially in some emerging markets where you have counterfeit issues”
In the fight against counterfeiting, big players in the drinks industry are gaining a competitive edge with the use of connected bottles and QR codes. Not only does this technology help to combat counterfeiting, but it also provides a modern platform for accessing detailed nutritional content. By simply scanning the product with your smart device, you can easily access the information you need, rather than struggling to read it on a back label where nutritional information is not regulatory-driven.
Recently, the also added gamification to the mix where Malibu bottles now incorporate NFC tags embedded into the neck sleeve of each bottle. When tapped with an Android or Apple NFC-enabled smartphone, consumers will be able to access a ‘shake your coconuts’ game and win prizes, watch video recipes, and download exclusive Malibu-related content.
Another trend in the alcoholic beverage industry is the use of data insights to drive decision-making. By analyzing customer data, companies can better understand their preferences and behavior, allowing them to develop targeted marketing campaigns and personalized promotions. For example, companies can use data insights to identify which products are most popular among certain demographic groups, allowing them to optimize their product offerings.
One company that has leveraged data insights to improve customer satisfaction is Heineken. The company developed an app that allows customers to customize their beer order based on their preferences. The app uses data insights to recommend beer styles and flavors that are likely to appeal to the customer, making the ordering process more personalized and efficient.
They even designed their Heineken Silver beer for the metaverse:
“Our new virtual beer, Heineken® Silver is an ironic joke. It is a self-aware idea that pokes fun at us and many other brands that are jumping into the metaverse with products that are best enjoyed in the real world. For now, you can’t taste pixels and bytes. ”
— Bram Westenbrink, Global Head Heineken Brand
Artificial intelligence (AI) is also becoming increasingly prevalent in the alcoholic beverage industry. Companies are using AI to automate processes, analyze data, and make better decisions. For example, AI-powered chatbots can assist customers with their orders and provide recommendations based on their preferences. Additionally, companies are using AI to optimize supply chain operations and improve inventory management.
One company that has leveraged AI to gain market share is Diageo. The company developed an AI-powered chatbot that can provide customers with personalized recommendations and promotions. The chatbot also uses data insights to identify trends in customer preferences, allowing Diageo to optimize its product
Mackmyra Whisky, a Swedish distillery, joined forces with Microsoft and Fourkind, a Finnish tech firm, to create the world’s first AI-generated whisky. By leveraging customer feedback data and running it against Mackmyra’s recipes, they were able to generate thousands of new recipes. The master blender, Angela D’Orazio, then used her expertise to handpick the winning flavor combinations. The algorithm learned from her feedback and identified the best recipes, which were then refined further. Finally, D’Orazio made the ultimate decision and selected the winning recipe, which was then produced.
E-commerce and Alcoholic Delivery Services
The COVID-19 pandemic has accelerated the adoption of e-commerce and alcoholic delivery services like Drizly.com.
The Uber acquisition of Drizly represented a cataclysmic moment for alcoholic beverage e-commerce. Despite being a massive market (more than $300 billion), alcohol is one of the last categories to meaningfully come online. These services allow customers to order alcoholic beverages online and have them delivered to their doorstep, making it easier and safer to purchase alcohol during and post the pandemic. Companies that have already established a strong online presence have been able to adapt more quickly to the shift towards e-commerce.
One example of a company that has leveraged e-commerce to gain market share is Wine.com. The company saw a surge in demand for online orders during the pandemic, prompting them to invest in their e-commerce capabilities. Wine.com used data insights to optimize their product offerings and marketing campaigns, leading to a significant increase in sales.
IWSR projected that the value of the Direct-to-Consumer (D2C) channel will grow by almost US$3 billion between 2019 and 2024, at a value CAGR rate of 24% (2019 – 2024).
The Bottom Line
In conclusion, the alcoholic beverage industry is experiencing a wave of technological innovation, with digital systems, data insights, and AI leading the way. Companies that are able to leverage these technologies to improve customer satisfaction and gain market share are likely to thrive in the years ahead. Additionally, e-commerce and alcoholic delivery services are expected to become even more prevalent, providing customers with new
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