In 2010 the US market for alcoholic drinks in pouches for home freezing and consumption was valued at US$12m. By the end of 2012 it had increased to US$200m and in 2015 it is estimated to be worth US$500m, that’s a CAGR of over 110%. More remarkable still is the evidence that shows that 50% of those sales are by consumers who buy the pouch products in addition to their purchase of other alcoholic beverages evidencing genuinely additional revenue streams for retailers.
In 2014, the UK market for these products showed a 3-fold increase on the prior year, creating a market worth £14m per annum, and latest forecasts point to a market worth £30m by the end of 2016. That is a CAGR of over 56% which seems plausible when compared to the growth experienced in the USA. There are few, if any, better growth opportunities for retailers to benefit from additional profitable revenues.
Nielsen states that women buy alcoholic pouch drinks in above average quantities, with surveyed convenience outlets reporting 75% of purchases by women and 25% by men. It is also forecast that demand will increase for products that offer a premium experience characterised by authentic natural flavours and ingredients – a trend more broadly observed in spirit based categories.
Two significant consumption trends have been identified in the UK market for 18 to 34-year-olds:
- Over half of 18 to 34 year old women now choose to celebrate special occasions with a BIG-NIGHT-IN event;
- Whilst this demographic are the largest consumers of alcohol outside of the home, most now ‘pre-load’ i.e. consume alcoholic drinks in the home prior to going on a night out.
In both cases the home event is organised at the last minute using social media and messaging apps. Attendees each buy and bring a beverage contribution for consumption by the group attending the host’s home, with most buying their contribution en-route to the event. The on-the-go convenience of pouch products and their resistance to breakage is part of their attraction vs. bottled products for in-home consumption and gifting. The fact that the purchase of products is typically en-route to a home event suggests that in order to capitalise on this demand, retailers should wherever possible offer freezer pouch drinks ready-frozen as well as ambient for subsequent home freezing.
The evidence that 50% of home-freeze pouches are bought by people in addition to their other alcohol purchases, points to the benefit of till/check-out merchandising to encourage impulse purchase by consumers as a fun addition to their regular purchases. Based on evidence of average spend per transaction on freezer pouches, there is an opportunity to secure around £1.25 of net new profitable revenue per basket when a consumer purchases a freezer pouch drink product.
Due in part to the gifting trend (people buying alcoholic products to gift to the host of a home-based event), and also a halo effect of the broader ‘adultisation’ of frozen food categories, freezer pouch drinks are no longer a summer-only market. Retailers are increasingly linking pouch sales to public holiday events e.g. Easter, Christmas and May/August bank holidays; to consumption events e.g. BBQ; Picnic or house party; and, to known consumption times e.g. Friday evenings. New hanging display formats such as clip-strips allow freezer pouch drinks to be displayed without competing for shelf space with traditional bottled alcohol products easing their introduction and allowing retailers to experiment with display locations much more easily.
Icycl takes freezer pouch convenience to the next level
Unlike established freezer pouch drink products which are two-portion freeze and squeeze packs that are decanted into glass for consumption, Icycl is a single-serve, handheld format that is consumed direct from the pouch. This additional convenience of this format should not be under-estimated as it enables adults to buy Icycl direct from the freezer for immediate consumption for example whilst waiting for a train, standing in the bus queue or in the garden following a long week at work – no squeezing, no glassware and no washing-up!
Unlike all other freezer pouch drinks, Icycl is available for a ‘Big Night In’ and a ‘Big Night Out’ as it is available in bars, nightclubs and music venues as well as for home consumption. This dual channel strategy is building brand loyalty by ensuring that Icycl is associated with ALL memorable moments with friends whether in the home, at the beach, during a BBQ at a picnic OR at live music event, at a favourite nightclub or at a music festival. Enabling customers to consume an Icycl before they go out and while they are out ensures that the brand is becoming part of people’s lives in a way that other freezer pouch drinks never will.
Due to its single serve stick format Icycl offers retailers much better use of shelf space. A shelf-display carton displaying 36 Icycls takes the shelf space required for just 9x250ml pouches or 4 75cl bottles of wine, more than doubling the value per square centimetre. This advantage is further enhanced for display at the check-out where Icycl’s small size and display density is even more advantageous.
Icycl is ideal for gifting, in its 3 pack format, it is intrinsically sociable allowing 3 people to have their own Icycl, and is a format that can be easily carried, wrapped or gift bagged. Together with its truly delicious natural fruit flavours and a higher 6.4% ABV of vodka, Icycl is regarded by consumers as a premium product, capitalising on the rising demand from consumers for a premium experience. Since November 2015 Icycl has been sold by Fenwick’s in the North of England where sales have been dominated by women buying Icycl as a gift for their 18 to 34 year old friends or family members. To date sales volumes have far exceeded expectations while Icycl has also delivered premium retail margins. This evidence, plus Icycl’s Top50 status for Firebox.com during November and December 2014 demonstrate that it offers retailers year-round revenue potential.
For more information about Icycl download the Icycl Technical Data Sheet, or register your interest in becoming an Icycl stockist online.