Spirits Summit

How are visits to the on-trade changing?

By Stuart Stone contact

- Last updated on GMT

Changing experiences: Tom Mallett from Kantar World Panel discussed the evolution of on-trade and off-trade alcohol consumption
Changing experiences: Tom Mallett from Kantar World Panel discussed the evolution of on-trade and off-trade alcohol consumption
Kantar World Panel consumer insight director Tom Mallett discussed ways in which the on-trade can compete with the £13.29bn off-trade at The Morning Advertiser’s Spirit Summit at The Yard in Shoreditch, London.

Using data from Kantar’s purchase panel, which examines 30,000 UK household’s grocery shopping, and its online Alcovision survey comprising 30,000 on- and off-trade consumers, Mallett delved into increasingly strong off-trade alcohol sales.

‘As a nation we’re loving spirits more and more’​ 

Off the back of increased engagement with shoppers, through in-store theatre, such as menu cards, on how to create the perfect serve, encouraging shoppers to trade up, as well as spirits' increased presence in both everyday drinking and special occasions in the home, Mallett stated: “alcohol in general is performing really really strongly and spirits are driving that growth” 

According to Kantar data, £68m worth of spirit growth was being driven by consumers switching from other categories, most commonly wine, with £190m coming from additional spend by existing spirit shoppers. 

Gin is ‘the big story’

According to Mallett, 10% more households are buying gin versus five years ago meaning that almost a quarter of UK households are currently buying gin in the off-trade.

Mallett puts this down to reasons such as strong and varied innovation in the category – largely in the form of pink gin – faster gin sales growth among younger consumers, as well as the encroaching of gin on a range of drinking occasions. For example, gin is increasingly consumed to both kickstart a night out, traditionally an occasion when more vodka was drunk, as well as round off an evening – an occasion usually involving whisky.

Off trade challenges​ 

According to Kantar data, more adults than ever are choosing not to drink – with 5.4m now claiming to be alcohol free versus 4m in 2013.

Moreover, Mallett highlights that respondants to Kantar surveys highlighted 30m more occasions when people considered staying at home for an occasion than in 2010. 

“What’s to say in five years time we won’t be saying to Amazon’s Alexa ‘Alexa, make me a cocktail’,” says Mallett. 

Reasons to be cheerful

Despite the growth of the off-trade, Mallett highlights that there are several channels through which the on-trade can fight back.

He firstly highlights “spirit resilience”, revealing that spirits as a category have gained share in the on trade even though alcohol on the whole has lost share.

Moreover, out-of-home food purchases among Millennials, Generation X and Baby Boomers are all driven by enjoyment according to Kantar figures. This is regarded as more important than health and practicality and hints that consumers are still on the lookout for unique experiences above all else.

Other key motives behind alcohol consumption out-of-home include ‘bonding with others’ and ‘to have a break’, which over-index as responses. 

The importance of experience is echoed in the fact that 1.3m drinkers consider price less when they go out, meaning that they seek experiences and are happy to pay for them, according to Mallett. 

“No one has a favourite place to drink at home or in the garden, says Mallet, highlighting that consumers visit to the on-trade for evocative locations.

The ‘perfect serve’ is a key contributing factor to on-trade experiences according to Mallett. “Cocktails represent a real point of difference and opportunity in the on-trade. If we’re getting a perfect serve from our coffee, we absolutely need to be getting one from the on-trade when we’re spending £7, £8 or £9”

On trade experiences are changing

Mallett highlighted several key ways in which visits to the on-trade were changing. 

Firstly, the fact that there were 120m dinner parties in the home last year – with 11m more featuring spirits than in 2013 – demonstrates that larger groups are not socialising in the on-trade as much. “These dinner party occasions are bringing larger groups that were socialising in the on-trade back into the off-trade. The way we’re socialising in the on-trade is changing.”

Mallett highlighted that Kantar data showed half of on-trade occasions now feature two adults, with intimate occasions becoming increasingly prevalent, for example revelaling that there were 17.5m more dating occasions featuring alcohol in 2018 vs 2010, with spirits present in 1/3 of these.

On-trade visits are also starting earlier, according to Kantar data, with 52% of occasions now start before 8pm, an increase from 43% in 2014. “We’re going out earlier and coming home earlier” says Mallett, “so it’s more important to capture consumers at the start of their visit”

Moreover, nine out of 10 occasions in the on-trade only feature one establishment, meaning that venues that can offer all-in-one solutions and keep consumers entertained in the same place will become more important. 

The Spirits Summit, now in its fifth year, was powered by The Morning Advertiser in association with sponsors Diageo, Pernod Ricard, Warner Edward, Slingsby Gin, Starward and London Cocktail Week

Related topics: Spirits & Cocktails

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