Liquor Marketing Group has reported 21 quarters of consecutive growth with CEO Gavin Saunders at the helm for all of them.
Mr Saunders had just returned from an LMG Members conference on Hamilton Island with 540 retailer and supplier delegates when the Drinks Association spoke with him.
“LMG has been able to deliver results well ahead of the market over the past three years. It was wonderful to have all the retailers back in the one place to showcase the results that have been achieved,” he said.
He said that the growth is the result of the business focusing on its members and driving sales performance, pouring 73 per cent of its revenue into direct support for members, including marketing, price support, retail store enhancements and many other, all designed to enhance their operations and drive foot traffic.
“The decision was made in 2016 to realise and demonstrate the benefits of being a membership owned group and part of that meant increasing the proportion of revenue that we invested with a focus of growing our member businesses. It was based on the business principle that if we invest more, we get more customers, we get more sales, we invest more back into our member businesses. It becomes a self-fulfilling prophecy for growth,” Mr Saunders explained.
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Acquisitions & Executive Team
Other areas of investment includes the recent acquisition of Zen Global – Adelaide based data and digital marketing business - which will run the backend of LMG’s new loyalty program set to launch in 2023.
Mr Saunders has also been busy growing his executive team.
In 2021, Jonathan Harrison was appointed CFO. Earlier this year Andrew Moss joined as Chief Information Officer and Jeremy Turnham joined as Head of Category. Mr Saunders says Mr Turnham’s professional history in the supplier world at Lion brings valuable perspective to the table.
“Having that perspective, his considered approach and structural understanding of both the supplier and retail worlds is a real asset for us,” he said.
LMG’s new appointments join a well-established senior management team, including Damien Page, General Manager Merchandise & Marketing (9 years’ service), David Gyte, Head of Digital Marketing (16 years’ service), Frank Palumbo, General Manager Retail Sales & Member Services (9 years’ service).
E-commerce
E-commerce has been a focus for the business since 2016 which certainly placed LMG in good stead when the pandemic landed.
This was recognised in the Advantage Engagement Program which saw LMG place first for its ability to clearly articulate e-commerce and digital strategy in 2022.
Mr Saunders says that before COVID, just 40 of its stores were online, taking an average of $50K in sales per month. Today, there are 204 stores trading online with ecommerce now counting for 3.5 per cent of LMG’s sales. LMG’s online basket is more than double the value of the one in-store: $90 online vs $43 in-store.
LMG’s online presence is intended to be an extension of LMG’s local bottle stores.
“The online environment is where we can champion our stores and their unique range of products for e-commerce purchase or for research before consumers visit their local to stock up,” he says.
LMG’s research shows that along with e-commerce sales, over 30 per cent of its consumers first do research online before making a purchase in-store. One of the priorities for e-commerce these past couple of years has been to showcase the full range that each store offers online. One of the foundations of the LMG e-commerce business model is that the pricing and range at each individual store remains just that: local.
Each store is connected to provide their own range and pricing online and extra online promotions are funded by LMG. So, when LMG runs national and state-based e-commerce promotional activity, these are fully funded by the business; ie: the retailers do not wear the cost of the price drop for e-commerce promotions.
Partnership with Australian Venue Co
In addition to the acquisitions, growing executive team and gains in e-commerce, LMG also recently won a tender with Australian Venue Co to adapt 25 of its sites to LMG banner stores.
Mr Saunders says that LMG and AVC share a commitment to their local communities and customers, and that this shared vision is a large reason that LMG won the tender.
Mr Saunders said: “Both AVC and LMG are steadfast in our commitment to creating exceptional, local customer experiences and delivering excellence at scale.”
AVC became a member of LMG in 2022 and are enjoying strong performance post store conversions and refresh.
History
Liquor Marketing Group (LMG) is an independent retail group which provides services to its members, including marketing, promotions, buying benefits, e-commerce platform, data, insights and retail support. Established in 1977, alongside its banner group ‘Bottlemart’, LMG was created by a group of 400 NSW hoteliers and has grown to become one of Australia’s leading alcohol marketing groups, representing more than 1,400 independent retailers.
LMG operates and support several independent retail banner groups, including Bottlemart, Sip’nSave, Harry Brown and Thirsty Camel in WA.
Mr Saunders says that while it is an extensive network to work with and keep engaged, the guiding principle for the business is simple:
“There are numerous stakeholders to work and collaborate with but the focus for us is that if we win the customer, everybody wins. And that keeps everybody happy.”
