With one million more Australians expected to spend the festive season at home this year due to COVID-19 restrictions, Coles is predicting record Christmas liquor sales.
“We think this will be the biggest Christmas ever by far, given the circumstances – it will be a lot better than Easter, ” Coles Chief Executive Officer Steven Cain told The Australian Financial Review.
Cain also recently told Australian’s Global Food Forum that many shoppers were buying more premium products as they ‘treated themselves’.
“We are seeing a lot of treat types of stuff whether its champagne, whether its cheeses, flowers, all of those things are going very well,” he said.
“So whilst people, can’t be eating out and whilst people can’t travel or go abroad they are looking after themselves at home.’’
IRI reported in August that the total Sparkling category, inclusive of Champagne, had experienced nearly 5% value growth for the last 12 months, with growth accelerating greatly in the last few months. For the quarter ending May 31, the category saw 9.4% growth compared to last year.
Champagne was driving the growth, with value up more than 13% for the quarter compared to last year. It’s a trend that is expected to continue in the lead up to the festive season.
Liquorland, First Choice Liquor Market and Vintage Cellars have also tailored their Christmas ranges to target customers who are increasingly supporting local breweries, wineries and distilleries and choosing low alcohol beverages.
Coles celebrates bumper year
Liquor sales revenue was $3,308 million on a statutory basis for Coles Group in the 2020 financial year, an increase of 3.2% from the prior year.
On a retail basis sales revenue was $3,308 million, an increase of 8% for the year with comparable sales growth of 7.3%.
Liquor experienced a trading uplift driven by COVID-19 in the latter part of the year from increased in-home consumption following government-imposed restrictions on hotels, pubs, clubs and licensed venue operators.
“A plan to simplify and refocus the Coles Liquor operating model was accelerated by COVID-19, providing an opportunity to fast-track clearance activity for slow moving and deleted stock,” Coles revealed in its Annual Report.
“The closure of on-premise venues as a result of COVID-19 also provided the opportunity to support and engage with local suppliers, with over 300 new ‘local’ product lines launched during the fourth quarter.
“Targeted investment in online platforms, capacity and customer experience across all three banners supported strong online sales growth of 40% for the year. For the fourth
quarter, online sales increased in excess of 70% driven, in part, by changing customer preferences towards online shopping alternatives during COVID-19.”
Online growth a new Coles KPI
Coles said it will take into account online sales growth in determining bonuses for senior executives moving forward.
“This shift demonstrates the importance of growth in the online channel to achieving our strategic goals,” Richard Freudenstein, the chairman of Coles’ people and culture committee, said in the annual report.