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Are Gen Z and Millennials in South Africa targets for alcohol companies?

Updated: Sep 14

Alcohol brands looking into tapping the Gen Z and Millennial market, should look into their product delivery/ occasions that would boost their sales.

Despite how tenuous the state of the world remains, in some ways, life is starting to snap back into pre-pandemic normalcy in many African countries. Gen Z and Millennials represent a huge opportunity for alcohol brands given its size was the consumer segment that was hit the hardest during the pandemic. South Africa went through several lockdowns and as a result, in-home consumption rose during the pandemic.

Consumer habits of Gen Z and Millennials were disrupted because of the pandemic and brands need to understand how their lives have been impacted by the pandemic and how they are adapting to the new normal. Brands need to re-engage – with keen importance to Gen Zers and Millennials, a promising target demographic for alcohol consumption.

Covid19 is no longer a threat to South Africans

Over the past two years, consumers habits have changed in response to the pandemic. For alcohol brands, the question is how have these changes impacted their categories? The Kasi Fear Index, a measure of consumer fear of the pandemic provides insights on how fear drives consumer habits and purchase decisions. The index ranges from +0.20 to -0.20. An index level close to 0.20 means fear is high as more consumers are overly concerned about the virus while an index level close to -0.20 means fear is low as less/no consumers are concerned about the virus. This measure is an effective tool for monitoring consumer behavior during major events.

In the beginning of the pandemic, the fear index of South Africans was quite low though it rose steadily over the pandemic recording its highest in October 2020 at 0.1048 (26% of South Africans were very concerned about the virus). As 2020 came to an end, the fear index dropped to flat (0.0043) then rose again in mid 2021 (0.0580) when the country was hit with a 22% increase in Covid positivity rate; at the time 51% of South Africans were very concerned about the virus. Interestingly, as the year came to an end the fear dropped as the positivity rate at the time decreased, only 16% were very concerned about the virus. As 2022 starts, we see that South Africans’ fear of the pandemic has come down significantly as the country looks into a return to a new normal.

The pandemic changed lifestyle habits for Gen Zers and Millennials

Fear drives consumer behavior and habits. From mid 2021, the country started easing some of the restrictions that were brought about by the pandemic. Across the pandemic period (mid 2021 to early 2022) lifestyle and daily routine of South Africans changed based on how the Covid wave / positivity rate was impacting on their behavior.

In July 2021, majority of South Africans had their daily habits changed (86%), as the fear index decreased in October 2021, a fewer number of South Africans (65%) had their daily habits changed. In February 2022 as the fear dropped further, an even lower number (41%) had their daily habits changed. On the other hand, those who did not experience any lifestyle change increased significantly from 5% to 14% in February 2022. Additionally, those whose lives had returned to normal improved from 7% to 14% during the period.

This highlights the fact that consumers are returning to pre-pandemic habits. What is the impact of this return to normal on occasions/ places of purchase for alcohol beverages?

Out of home consumption picking up fast towards the new normal

With the country adopting a new normal, certain lifestyle changes brought about by the pandemic have been dropped. When the pandemic started, South Africans kept their families in self- isolation by keeping their children from school, working from home, avoiding restaurants, postponing travels, avoiding social gatherings in public places and public transport. With the new normal; self-isolation is practiced less, children have gone back to school, travelling has grown significantly, South Africans plan and attend public gatherings and pubic transportation has resumed. This has had an impact on the out of home consumption.

In July 2021, in-home consumption was highest at 38%, followed by 27% in October as the holiday season begun. In February 2022, there is a drop by 12%. Consequently, out of home consumption has increased from July 2021 to February 2022 (63%-85%).

This highlights the fact that out of home consumption is regaining momentum in this consumer segment. For many, things feel eerily normal – going out to the pub, seeing family and friends which brings about a positive return of the alcohol industry. Alcohol brands looking into tapping the Gen Z and Millennial market, should look into their product delivery/ occasions that would boost their sales.

Our data intelligence platform can help you track these trends in consumer behaviors in Africa over time. This provides you with valuable insights that can help you or your business make fast data-driven decisions.

Contact our team today to explore how our consumer intelligence can empower your decision-making process. Win with confidence with Kasi insights

#Alcohol #SouthAfrica #GenZ #Millenials #Pandemic #Africa #Insight #Kasiinsight


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