By Chris Tyas, Chief Strategy Officer, Impero
Why beverage alcohol brand owners should pivot from Gen Z consumers to the ‘Dinks’?
The consumer move towards ‘extreme indulgence’ has become the latest manifestation of a premium lifestyle. In spite of feeling the squeeze of rising living costs, consumers are still seeking solace in treating themselves to small luxuries.
“If I can’t afford a house,” one of our team recently said, “then I’m going to bloody well treat myself to some little luxuries.”
Almost every FMCG category has been affected by this trend. Although 56% of UK consumers admit to feeling financially worse off compared to a year ago [according to research by NielsenIQ], they aren’t necessarily cutting back on their spending across the board.
A new demographic known as the ‘Dinks’ [Double Income No Kids] is at the forefront of this unwavering quest for indulgence. Companies such as UK multiple retailer Marks & Spencer, for example, are capitalising on this trend by launching products that cater to the indulgent cravings of these consumers. The operator recently introduced a range of summer drinks to its M&S Cafés that includes a Percy Pig Frappé [Percy Pig sweets have been a favourite in the UK for over 30 years]. The drink is made from berries & vanilla and topped with whipped cream, Percy Pig sprinkles and a little Percy Piglet sweet. It’s bright pink, screams ‘Insta’ appeal and is very decadent.
M&S has ramped up its special offering each year, increasing its emphasis on indulgence. However, the underlying driver behind this need for treats extends beyond this. It’s part of a larger trend that presents an opportunity for brand-building. The proliferation of premium experiences in every life stage stems from a desire to discover new things.
The true measure of a premium brand lies not in its price tag, but in the time and effort required to participate. While many consumers are able to afford a Percy Pig Frappé, it’s the consumer perception that adding sprinkles [and finishing it off with a sweet] elevates one to true, super-fan status.
This is precisely why M&S has expanded its Percy Pig-themed offerings to include nail care, stocking fillers, biscuits and ice lollies. By constantly surprising consumers, the company builds anticipation and fosters a sense of discovery, which in turn drives equity and sales of the brand’s core product.
Traditionally, beverage alcohol brands often miss the mark when it comes to understanding the purpose of collaborations and NPD that can drive discovery. Rather than committing to a continuous effort to remain culturally relevant, they often opt for one-off campaigns, while the real strategy behind discovery is to constantly drive anticipation.
To truly grasp the concept of premiumisation, I have three pieces of advice:
1. Embrace a strategy that breaks conventions and creates a feeling of discovery
Don’t confine yourself to a traditional brand strategy document. Instead, focus on achieving perfect results rather than a perfect process. Allocate more resources to breaking the rules rather than adhering to them.
2. Remember that premiumisation is not solely determined by price
Premiumisation is about the investment of time and energy required for someone to engage with your brand. Don’t mistake high-end design aesthetics for making a premium brand. Moreover, if your goal is to enter the realm of culture and drive premiumisation, avoid maintaining absolute mental and physical availability.
Mass availability may undermine the perception of your brand being premium.
3. Indulgence is merely the current manifestation of premiumisation
However, it’s a fiercely competitive space that demands attention. The best way to stand out is by leveraging your core brand equity to drive distinction.
The rise of extreme indulgence as a premium lifestyle choice is driven by a wider trend of seeking new experiences. Consumers – even in the face of financial constraints – are willing to treat themselves to small luxuries. The key for brands is to understand that premiumisation is not solely defined by price, but rather by the time and energy investment.
By continuously surprising and delighting consumers, brands can build anticipation and create a sense of discovery, ultimately driving their own distinction and equity in the market.