Alcohol Promotions in the UK: Regulations, Risks, and Safeguards
The UK has a complex regulatory framework governing alcohol promotions to ensure responsible marketing and prevent excessive consumption. For businesses like Loyal, which aims to offer payment-linked loyalty schemes with alcohol-related discounts, understanding these rules is essential. Below is a methodical breakdown of the regulatory context, guiding principles, permissible activities, potential risks, and mitigation strategies.
Applicable Regulations
Alcohol Duty Changes (Effective February 1, 2025)
Alcohol duty rates will be calculated based on the alcohol by volume (ABV) of the product in 0.1% increments. For example:
A 75cl bottle of wine at 11% ABV incurs a duty of £2.44 A 75cl bottle of wine at 13% ABV incurs a duty of £2.88 This change adds complexity for merchants running alcohol-related promotions, especially when discounts may affect profit margins post-duty.
Minimum Unit Pricing (MUP)
MUP is currently in place in Scotland and Wales, with Northern Ireland expected to follow. It sets a legal floor price for alcohol based on strength and volume. England does not currently apply MUP, but this could change.
CAP Code (Section 18)
Promotional content for alcohol must:
Not encourage excessive or rapid consumption Avoid suggesting alcohol is key to social or sexual success Loyalty Scheme Restrictions
In Northern Ireland, loyalty schemes that allow users to collect or redeem points for alcohol are prohibited and can incur fines of up to £5,000. In England, loyalty-based alcohol offers are allowed but must comply with strict age verification and advertising rules. Advertising Standards
Promotions must not be placed in media where more than 25% of the audience is under 18. Advertisements must not glamorise excessive consumption or irresponsible behaviour. Core Principles
Alcohol marketing and promotion must:
Discourage binge or rapid drinking Prioritise public health and safety Be transparent, fair, and non-deceptive Never target or appeal to minors Respect region-specific pricing laws (e.g., MUP) What's Prohibited
Unlimited alcohol for a fixed price (e.g., bottomless brunches) Promotions that encourage drinking large quantities quickly Volume-based rewards (e.g., drink more to win) Redemptions for alcohol in Northern Ireland loyalty schemes Advertising in youth-targeted spaces or events Alcohol pricing below MUP in applicable regions Pouring alcohol directly into customers' mouths What's Permissible
Discount Offers
Flat discounts like "£10 off a bottle of wine" or "Pay for 2, get the 3rd free" are permitted if: They do not result in alcohol being sold below the legal MUP Time-Limited Promotions
Happy Hour offers are allowed in England (e.g., 2-for-1 from 5–7PM), as long as they don’t encourage bingeing. Tiered Loyalty Discounts
Always-on benefits like 5–15% off are acceptable if not exclusively tied to alcohol and comply with CAP Code rules. BOGO (Buy One Get One Free) Offers
Permissible in England if limited to one-time use and not part of ongoing promotions. BOGO (Buy One Get One Free) promotions for alcohol are not allowed in Scotland and Wales. In Scotland, the Alcohol Scotland Act bans "irresponsible" drinks promotions by retailers, including buy-one-get-one-free and multi-buy discounts on alcohol. This ban has been in effect since October 2011. Meal Deals
Offers combining alcohol with food (e.g., “£10 off wine with any main”) are generally acceptable and widely used. Loyal's Alcohol Promotions (Single Use Only)
Loyal structures its offers to meet regulatory guidelines through capped, non-repeatable redemptions:
5–50% Off Any Alcoholic Drink – Limited to one use per customer Buy 1 Get 1 Free – Available once per user Pay for 2, Get the 3rd Free – Redeemable a single time Happy Hour: 2-for-1 Drinks – During set times only, one-time redemption £10 Off a Bottle of Wine – Single-use offer, MUP-compliant Loyalty-Based Discounts (Tiered, Always-On)
Loyalty rewards earned through spending, not volume of alcohol purchased:
These apply across full orders (food and drink), ensuring balanced use and preventing alcohol-centric incentives.
Risks for Loyal
Regulatory Violations: Breaching MUP rules or Northern Ireland loyalty bans could lead to fines or legal action Reputational Damage: If a promotion is interpreted as promoting binge drinking Underage Access: Digital promotions may inadvertently reach minors if targeting fails Operational Complexity: New ABV-based duty rules add cost and calculation challenges for merchants Mitigation Strategies and Safeguards
One-Time Use Caps: All alcohol-related discounts are single-use per user Prominent Age Disclaimer: All alcohol-related offers must clearly state "Only available to those over 18 years of age" Disclaimers & Responsible Messaging: Include “Drink Responsibly” in all offers and avoid incentivising fast consumption Clear Time Windows: Limit promotions like Happy Hour to well-defined, low-risk hours Avoid unlimited consumption: Alcohol-based promotions should always specify a measurement or time period to avoid unlimited or irresponsible drinking Merchant Education: Provide onboarding, templates, and tools for safe promotion structuring Compliance Monitoring: Regular audits and legal reviews of active campaigns to maintain standards By embedding these principles and controls into its platform, Loyal ensures that merchants can offer attractive alcohol-related promotions while remaining fully compliant with UK law and best practices in responsible marketing.
