Big Wine company Naked Wines, owned by Fortress Investment Group, has exploited the ongoing health crisis to increase their sales revenues.
Major investments were made to increase marketing of Naked Wines’ products to push people to consume more wine at home during lockdowns and COVID-19 restrictions, ignoring the increased harm alcohol poses during the ongoing pandemic.

Naked Wines is an online wine retailer launched in the United Kingdom in 2008. In April 2015, Naked Wines was acquired by Majestic Wine for £70m. The business was subsequently rebranded as Naked, with the Majestic retail chain sold to the US firm Fortress Investment Group for £95m in 2019, according to The Guardian. The alcohol giant operates in the UK, US and Australia. It increased its base of repeat customers by 53%, to 886,000.

Naked Wines more than doubled their investments in 2019, up from £23.5 million to £50 million to get more people to buy their products. It appears the big money spent on marketing paid off. The company’s total sales increased by 68% to £340m in the year to March 29.

Most of the company’s profit comes from the United States (U.S.), where Naked Wines saw a 78% increase in revenues. Naked Wines operated in the U.S., UK and Australia and calls the U.S. their “single biggest market”, with sales of £161m, accounting for 48% of total revenues.

Also in 2021 the company plans to continue spending big to get even more people to buy their products. This is despite the known harm that alcohol causes specifically during a pandemic.

People in the United States are heavily affected by increased alcohol use during the ongoing health crisis. This rise in alcohol use and harm is driven by brands and products such as Naked Wines which heavily market alcohol use at home; online alcohol sales; and on-demand delivery of alcohol.

A recent report by the NCD Alliance and the SPECTRUM Research Consortium has exposed how Big Alcohol along with other unhealthy commodity industries turns COVID-19 into the world’s largest marketing campaign.

The report outlined four main strategies used by these industries: 

  1. Pandemic-tailored marketing campaigns and stunts,
  2. Corporate social responsibility programmes,
  3. Fostering partnerships with governments, international agencies and NGOs, and
  4. Shaping policy environments.

The consequences of this heavy marketing leading to more alcohol use is already starting to show in the U.S., with higher numbers of younger women presenting to hospitals with alcoholic liver disease. And a rise in liver cancer deaths among women.

Naked Wines said that sales in the first two months of its new financial year, April and May, were up 96%, according to The Guardian. These figures prompted the company to forecast sales of between £355m and £375m in 2021. This forecast also unleashed another spending spree on marketing of £40m to £50m to acquire new customers in 2021.

Source Website: The Guardian