How Craft Brands Can Succeed in the Covid-19 Era

Craft brands have been in the spotlight across wine, beer, and spirits in recent years, with products from small producers becoming increasingly sought after over mass-marketed products. Consumers are seeking out fresh discoveries, and are increasingly prioritizing the production methods, ingredients, and stories behind craft beverages.

But the onset of Covid-19 has presented a new challenge: While consumers are increasing their home consumption and retail alcohol sales are up, most craft wine and spirits brands have not benefited. As much of the on-premise sector remains shuttered and many consumers turn to e-commerce to limit in-store purchasing, there is no salesperson or sommelier to champion small brands or encourage the consumer to try something new.

ACQUIRING NEW RETAIL PLACEMENTS

While stay-home mandates and on-premise closures have resulted in retail sales spikes — as of June 13, off-premise sales were up 26 percent year-over-year for the entire Covid-affected time period — retailers are still working to manage this unexpected business shift.

“They’re still in survival mode,” says Nicolas Palazzi, the owner of PM Spirits in New York, an importer and distributor specializing in artisanal spirits brands. “They have no energy or time to do any outreach or take sales calls. They’re reacting to demand, and that demand is for mainstream brands because that’s what people know.” In the first six to eight weeks of the pandemic, most of Palazzi’s sales through existing retail accounts were for inexpensive items.