Diageo is a global leader in beverage alcohol with an outstanding collection of brands across spirits and beer – a business built on the principles and foundations laid by the giants of the industry.
James Cragg, Head of eCommerce GB & Ireland at Diageo spoke to Wholesale Manager.
Which are Diageo’s biggest drinks brands on ecommerce wholesale platforms and apps?
Overall there is no discernible difference between sales in depot versus online. Our top performing lines tend to be the likes of our leading brands – Smirnoff, Gordons, Captain Morgan, Bells and Guinness. With the majority of ecommerce orders being from convenience retailers, the 70cl price marked packs perform particularly well.
How many of your B2B shoppers buy on line at the moment from wholesale websites?
Over the last few years we’ve seen a steady increase in the number of shoppers purchasing online. Unsurprisingly, the uptake within delivered wholesale is much higher than depot led – with around three times the number favouring online and some Delivered Wholesalers moving completely online.
What proportion of wholesale buyers of your products browse available drink products on smartphones or tablets? What proportion of these visits generate transactions?
Mobile is becoming increasingly important with App purchases accounting for around 10-20% of online sales, depending on the wholesaler. Many wholesale Apps have integrated barcode scanners which allow the user to scan the barcodes of products as and when they need restocking – this simple function allows a convenience retailer to walk around their store and fill their basket at unprecedented speed.
How are you working with wholesalers to help them develop this part of their business?
We work closely with wholesalers to understand how we can help them. Ultimately our goal is the same as theirs, we want to increase sales and drive people online – to do this sometimes we offer online-only prices or special deals to help encourage the move across.
Our first step when working with a wholesaler is to do an online audit of their existing ecommerce site, using four pillars – Reach, Ease, Inspiration and Education – as a checklist to ensure that the website is working to its full potential.
We then present a report to them, identify any potential issues or areas for improvement, before working with them to improve it.
What kinds of businesses buy alcoholic drinks and other drinks products on wholesale websites?
In terms of our experience, it is off-trade customers, like independents and symbol group retailers, who use wholesale websites to purchase their stock, as well as the on-trade with pubs, bars and restaurants. Trade Shoppers require regular stock on a weekly basis and often repeat purchase, which is easily done online.
How much do these customers spend on average per wholesale digital drinks order? How fast are wholesale sector digital orders of drinks growing?
The wholesale sector is continually changing, and we are now finding that more and more orders are being made online. Wholesale eCommerce platforms offer flexibility vs in depot experiences, coupled with the fact that 98% of delivered retailers are mainly placing orders online1 as they search for a more convenient shopping experience. Interestingly, many of our trade shoppers are completing their larger weekly shops online, while impulse buys where stock needs to be topped up tend to happen in depot. Overall, we have seen a substantial shift to digital orders and only expect this to grow.
What are the reasons why more ecommerce visits don’t generate transactions? What do you do about abandoned carts?
We like to think about Wholesale as Omni Channel we know that retailers and licensees will use wholesale websites as a research tool but may not actually purchase through this channel. Our customers will visit these websites to find out more about the products they require, as well as seeking out the best price or deal for them. Therefore, it is no surprise that some carts do not generate sales in some instances. Even if our customers don’t make a purchase in one instance, they will often return to the website or depot after they have done their research, so this is not something we are concerned about as such. We’ve actually seen large in depot uplifts off the back of digital activations.
What kind of sales promotions work best on wholesale websites?
Price is one of the most important factors, so we find that price promotions are one of the best ways to entice our customers. We always try to run seasonal deals at key calendar events in the year, including sporting events such as the Rugby World Cup, or key trading times like Christmas when demand is high. Category messaging is also incredibly important to assist outlets with their range and provide advice on best practice when it comes to display techniques.
What trends and opportunities are emerging that customers can take advantage of?
It is not only the wholesale landscape which is changing, but also the way customers now consume alcohol. We have seen a real shift towards low and no choices in the market, including our recently launched Gordon’s Ultra Low Gin & Tonic flavoured drinks. Our customers should continue to profit from these new opportunities in the market by stocking product to respond to consumer demand.
Do you see there ever being completely dark wholesale depots?
Absolutely, in fact these already exist. Dark depots are the future for some parts of wholesale and I’m sure we’ll see many more of these appearing as more people move over to shopping online.