Drink Tank

Drink suppliers must 'innovate or die'

By Emily Hawkins contact

- Last updated on GMT

Saturated market: the landscape of new drink products is competitive and brands must keep up according to Jonny Jones, director of client services at CGA
Saturated market: the landscape of new drink products is competitive and brands must keep up according to Jonny Jones, director of client services at CGA

Related tags: Drinks

Drink producers must innovate with new drinks to ensure they are stocked in the on-trade as the market becomes saturated with fresh products, according to Jonny Jones, director of client services at CGA.

At The Morning Advertiser’s​ inaugural Drink Tank event, Jones outlined conclusions from the organisation’s research into the price and range of drinks in the on-trade.

He revealed that there have been around 70 new brands launched per week in the past 12 months - 3,675 in total.

However, despite new product development he claimed it was surprising that the average outlet has only increased its drinks range by 4 or 5 products in the last year.

Jones put this down to a “churn” of stock, with venues constantly reassessing and replacing unloved products with more exciting replacements. In the last year, the average outlet has removed 23 brands and added 27 new ones, he explained. 

“For suppliers it is innovate or die. We need to make sure we are delivering on that consumer demand for discovery."

Customer loyalty 

This churn means that almost a quarter of drinks products stocked in the average outlet have been newly listed in the last 12 months.

“It gives suppliers loads to go at in terms of new listings,” he said. 

However Jones added: “Loyalty is really difficult to achieve at the moment,” explaining that ensuring drinks ranges resonate with hyper-local preferences and nuances was key to encouraging repeat visits.

Securing repeat visits was the number one marketing focus for operators in 2019, according to CGA research.

Blindly following

Jones told audience members: “I think a more scientific approach to pricing strategy is required and to understand the consumer behind that.”

Just 22% of business leaders rated their pricing as market leading with CGA analysis revealing that many operators were hardly keeping up with inflation on drink prices.

“We really need to be looking at price in more detail and making sure we are optimising those strategies," Jones added.

“We need to be more considered [with stock], not just follow the key trends blindly - adding more gins to the bar when that's not necessarily what the consumer wants."

He reiterated that operators should “put the consumer at the heart of the decision making process”. 

Related topics: Marketing

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