711 drinks-led pubs closed in the past 12 months

By Nicholas Robinson contact

- Last updated on GMT

Premiumise that: better quality drinks are driving trade
Premiumise that: better quality drinks are driving trade
Mainstream drinks-led pubs, of which 711 have closed in the past 12 months, are driving down the overall healthy performance of the spirits category, new figures claim.

As well as a worrying amount of drinks-led pubs closing, 385 circuit bars and 330 café bars shut up shop in the last year, according to William Grant & Sons' 2017 Market Report.

Innovation and trends:

  • Pre-batched no longer means boring: ​For some, pre-batched cocktails take away from the experience of being in a bar – the theatre of the serve – which has led to the rise in bars opting for pre-batched ingredients instead. In this way, the consumer still gets the rich, theatrical experience they are looking for, while allowing for excellent speed of service from the bar.
  • Ingredients get even more unusual:​ With outlets vying for consumers’ attention and looking for new ways to disrupt in the on-trade, there has been a rise in bars turning to unusual ingredients to provide consumers with social currency.
  • Thought-provoking menu maps:​ As consumers increasingly seek out the unusual, bars are placing as much of a focus on the menu as they are on the drink itself. From the world’s first augmented reality menu at City Social to menus developed around artistic movements, this trend is reinventing the way people look at the humble menu.

Such venues did not appeal to modern consumers looking for more premium experiences, and who are responsible for driving the dramatic growth of spirits in the on-trade.

However, The British Beer & Pub Association told The Morning Advertiser ​the figures were higher than theirs, but lower than other estimates.

"Our latest estimate of 12 pub closures per week in 2016 – based on our member survey – but lower than the CGA 2016, which claimed 23 closures per week," it said.

'Dynamics of the pub market' 

"A number of pubs closed temporarily last year to enable investment – 693 in our member survey alone – reflecting the level of investment being undertaken to respond to the dynamics of the pub market."

The spirits market in the on-trade is now worth £6bn – up 3.1% – and is the second largest drinks category in the segment.

Premium spirits are outgrowing volume sales and smaller niche categories, such as premium gin, spice rum and malt whisky, continue to drive consumer interest, according to the report, which was launched in London yesterday (13 July).

More than half (65%) of the on-trade spirits category is made up of vodka, liqueurs and speciality drinks, gin and blended whisky.

Sales growth is being driven mainly by gin (+86.8m), spice/flavoured rum (+38.3m), non-cream liqueurs (+34.5m) and American whiskey (+16.5m).

Main driver of growth

The strong figures place the on-trade as the main driver of category growth, which is double that of the off-trade (+1.5%).

Total premium spirits, across all categories, are worth over £1.2bn (+9%) and account for 11.7% of the spirits market.

William Grant & Sons marketing director Gary Keogh, said: “Consumer behaviour and habits have continued to evolve in this time of uncertainty, but there remains an element of consistency with the trends identified in our previous reports.

“More than ever, brands need to have a point of view, share their values, and reach heightened expectations to meet consumer needs.”

The report also acknowledged the decline of alcohol consumption, but pointed out that when consumers do choose to drink they opt for a better quality serve.

Related topics: Spirits & Cocktails, Spirits

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