Industry experts share their thoughts about legislation, innovation and retailing…
RETAILING: MATT SPIVEY, BWS TRADING CONTROLLER, SPAR UK
The year ahead presents a challenging landscape for convenience stores as they balance competitiveness with delivering quality service to local communities. Key pressures will stem from changes in rate relief, rising National Insurance employer contributions and a higher minimum wage.
Additionally, forthcoming Employment Rights and Tobacco & Vapes bills will introduce new complexities for the sector, while family-owned businesses face added strain with inheritance tax reforms set for April 2026, impacting succession planning.
Our strategy for 2025 builds on the strength of the Spar family network, leveraging collaboration, shared insight and strategic agility to secure growth.
This approach is evident in our evolving wine range, which aligns with shifting consumer demand. Our mid-2024 launch of a value-focused own-label wine range has been a standout success, with two further tiers launched in December. These wines offer quality and affordability – and are based on flavour profiles to make choosing wine easier for our customers.
With 40% of alcohol purchases occurring on promotion and 33% of shoppers switching brands based on deals, our focus on compelling offers will drive loyalty and volume. The year’s affordability challenges, compounded by a February duty hike, heighten the importance of maintaining value-driven pricing. At the same time, we are responding to changing preferences, such as the rising popularity of lower-alcohol and no-alcohol options and the consumption habits of younger consumers favouring lower-cost brands.
Everyday occasions such as barbecues, family gatherings and cultural events remain pivotal for boosting sales. By staying attuned to these trends, embracing innovation and offering tailored solutions, we aim to meet evolving customer expectations.
WINE: ROBIN COPESTICK, MANAGING DIRECTOR, FREIXENET COPESTICK
The biggest challenge for our business in 2025 is going to be the duty increases once the wine easement ends, as well as the regulations to do with extended producer responsibility and packaging recovery notes, for which, scarily, nobody really knows the whole detail yet. What we do know is that there are going to be increased costs on suppliers and it’s up to us, as the supply base, to work out how we recover that money from the retailer.
We are trying to get together with retailers to come up with an amicable and mutually satisfactory compromise. It will require a great deal of collaboration with them, and we can only hope that they will be fair to us and the rest of the supply base.
I think abvs will continue to come down. The new duty rates coming in from February 1 will penalise wines over 11.5% abv so there will be a benefit for those wines that are close to 12% or 12.5% to bring their abvs down. Personally, I don’t think that’s a bad thing, but I do disagree with how cumbersome the whole system is. It’s way too complicated. There’s way too much administration, and it’s too difficult for everybody to do business. But the principle of trying to make wine slightly lower in alcohol, I think it’s a good one. It’s just been handled in a very bad way.
On another note, I see a big opportunity for Prosecco – it’s still growing. Everyone thought there was a degree of fatigue but that’s not the case. Numbers are growing and consumers are still buying into Prosecco in a big way – which is a good thing for us. And back to the point about duty, Prosecco can naturally get to 10.5% abv and it has had the benefit of sparkling wine duty being changed to the same as still wine duty. All these things will make it attractive to retailers, who will promote it more and therefore more consumers will buy it.
SPIRITS: CHRIS SHEAD, OFF-TRADE CHANNEL DIRECTOR, PERNOD RICARD UK
As we look ahead to 2025, tequila is an exciting category for us and represents just 1% of total UK spirits, meaning there is a huge amount of potential for future growth.
The category is performing exceptionally well in the US – it is now the third-biggest category in that market – and we are also seeing growth in markets such as Australia and Canada, where tequila represents 4% of total spirit sales.
We believe, based on these trends and the current growth trajectory here in the UK, that it is possible to grow the category to similar levels in this market.
Last year, Altos launched its first-ever UK media campaign to challenge some of the historic preconceptions that exist about the tequila category in terms of its quality, how it is consumed and during what moments. We’ve seen these perceptions begin to change, with the Margarita now the eighth-favourite cocktail in London.
We also see the moderation trend as an exciting opportunity that will open up more occasions, more opportunity for innovation and the ability to recruit new consumers through our range of lower-abv products.
Pernod Ricard has always been in the business of premiumisation. For us, it is about choosing to drink better, not more.
STAFF RETENTION AND EDUCATION: MICHELLE BRAMPTON, CHIEF EXECUTIVE, WINE & SPIRIT EDUCATION TRUST
Consumer spending in the UK continues to be affected by economic factors, namely the cost of living, relatively high interest rates and general economic uncertainty. These have all driven many consumers to trade down to to lower-value drinks products or cut down on alcohol, and these patterns are both likely to continue well into 2025.
Moderate drinking and mindful consumption of alcohol, which are both established and growing trends, are also impacting on sales. However, many consumers who are drinking alcohol less often are opting for higher-quality products when they do. This presents retailers with an opportunity for a premium range. With the significant increase in health-conscious consumers, a rise in demand for low or no-alcohol drinks is only set to increase. Ensuring your employees are knowledgeable, so they can sell a breadth and depth of products, is key.
Employee retention will remain an ongoing challenge in 2025. Retailers will need to offer more training, development and flexible working to help attract and keep more people in the sector. WSET recently trained Asahi UK’s national sales team in our Level 1 beer qualification, enabling its employees to develop a deeper knowledge of their products and in turn engage with customers more effectively.
Finally, consumers will be looking for more diverse and international products such as craft beers, spirits and premium wines from less well-known regions. Retailers that can offer a variety of products, with knowledgeable staff who can advise customers, including about interesting food and drinks pairings, will help increase loyalty and sales
NO AND LOW ALCOHOL: LAURA WILLOUGHBY, FOUNDER, CLUB SODA
Moderation is the word on everyone’s lips. With 74% of UK adults actively cutting back on alcohol (KAM Insight), the demand for alcohol-free options is soaring. Yet, retail has been slow to catch up – until now.
The first big indication of this is the new Club Soda Collection in all Majestic stores. Greater retail presence will offer consumers a wider variety of choices, moving beyond the usual global alcohol brand extensions. This marks the most significant evolution for the sector in a decade.
The on-trade is also stepping up. Heineken 0.0 and Guinness 0.0 on draught will boost visibility in pubs and bars, paving the way for trailblazers such as Lucky Saint and Big Drop to thrive. Expect more venues to dedicate bar space to alcohol-free beer taps.
Alcohol-free wine is finally coming into its own, delivering better taste and quality than ever. Pioneers such as Noughty are setting the standard, and they’ll soon be joined by European newcomers Moderato and Zeno, offering greater variety to wine lists. Forget the days of just one red, white and sparkling – grape varieties are taking centre stage. Sparkling tea, naturally great with food, will continue to rise, often complementing or replacing dealcoholised wines on restaurant menus.
Spirits are seeing a wave of creativity, with brands such as Three Spirit, Everleaf and Botivo leading the charge in offering something new, not just mimicking traditional spirits. Functional spirits are now providing much-needed alcohol-free alternatives to traditional favourites. Smiling Wolf has unveiled a range of five options, including vodka and gin, transforming classic cocktails into mood-enhancing experiences.
2025 is shaping up to be the breakthrough year for alcohol-free drinks, bringing unmatched visibility, variety and innovation to consumers. With exciting developments across retail, hospitality and new product launches, this sector is finally getting the spotlight it deserves.
CONSUMER TRENDS: LOUISE JOOSTE, ACCOUNT DIRECTOR, KAM INSIGHT
Since 2021, KAM’s Low & No Drinking Differently report, in conjunction with Lucky Saint, has consistently shown a decline in frequency of alcohol consumption across all age groups, with active moderation now a part of everyday life. In 2024, 74% of UK adults were doing things to actively moderate their alcohol consumption and 56% want to reduce this further in 2025. We are no longer seeing significant spikes in the level of moderation across traditional moderation-led or alcohol-free occasions such as Dry January and Sober October; people are seeking to drink less all year round, using a variety of tactics, such as zebra-striping– alternating between low and no drinks and alcoholic drinks on the same drinking occasion – or drinking only lower-alcohol drinks on a single occasion.
What we can see emerging in 2025 is the mid-strength category and sessionable drinking. This looks set to shake things up a little with the idea of offering classic drinks with multiple strength options, and consumers selecting their favourite drink first and the strength second. Gen Z is leading the way with changing perceptions and understanding of the psychotropic market in the UK, with top-selling products such as CBD-infused drinks aimed at promoting overall wellness and feeding into the core reasons for moderating relevant to this key demographic.
