And, like any great partnership, it’s important to pause and reflect on what’s working and what’s not.
That’s exactly what we did recently at our ‘Diageo Live’ event, where we welcomed around 200 on-trade customers to the incredible Co-Op Live in Manchester. The mission was simple; talk openly about how we can continue to grow, together.
It’s not news to anyone that the past few years haven’t been easy for pubs and bars but what stands out is how many of our incredible customers have not just weathered these headwinds but adapted and thrived.
I’m constantly inspired by this resilience and get genuinely excited about the big opportunities ahead in hospitality.
And there are big opportunities. Today, more consumers are visiting the on-trade than in 2019[1], and they are spending more per visit too[2]. This may seem surprising in today’s economic climate but going out and spending on food and drink remains an important way Brits choose to treat themselves.
If our industry is to succeed, we must stay agile to consumer trends and laser-in where it counts. While I’ll keep an element of exclusivity to those who attended, here are a few areas we discussed that the on-trade should lean into:
The spirits opportunity
Spirits have delivered the most growth for the on-trade over the past eight years (up 26%), with premium spirits rising by an even more impressive 60%[3]. Not only do spirit drinkers visit the trade more regularly but they also spend more than other categories[4].
While it’s no secret the past two years have been tough for spirits, we see the tide turning and now is the time for licensees to ride the spirits wave.
“Where we’re especially excited about is tequila. Right now, 12.4% of cocktails in GB are tequila-based and the Margarita is in the top 10 most popular. There’s real momentum in spirits more broadly - it’s an opportunity the trade cannot miss.”
Backing cocktails
One in four consumers are opting for a cocktail when visiting an on-trade outlet, highlighting a major opportunity for venues to meet evolving expectations[5]. They’re even willing to pay up to 48% more for a cocktail versus a spirit and mixer.
As with any category, the success of cocktails hinges on nailing the brilliant basics - delivering a consistently high-quality serve that keeps guests coming back.
While there are some common barriers, like time, cost and staff training, as an industry we must work together to overcome them. Support tools like The Diageo Bar Academy and our premium pre-batched cocktails, for example, make it easier to raise the bar.
It might take a little more effort than pouring a pint but the potential payoff is clear - cocktails offer a powerful way to generate cash in the till while elevating experiences for guests.
Tapping into live sport
You didn’t think I’d get through this without mentioning the black stuff, did you? Guinness remains a huge driver of beer growth in GB, and we believe on-trade outlets can capitalize on this success through live sport.
Live sport is the only occasion growing visit frequency in the on-trade[6], highlighting a broader consumer trend that consumers are searching for experiences when out celebrating. Football is, of course, a significant driver of this, and we’re expecting to build on that energy with Guinness as we roll into next season’s English Premier League.
Seizing the moment
I’d be naïve to ignore the challenges that still face hospitality and, as a collective, we have a duty to our consumers to address these head-on.
That said, I genuinely believe this wonderful industry is set up for success and my rallying cry for outlets across the on-trade is to seize the moment.
We must learn from those outlets that have pushed themselves to get better, stayed agile to changing consumer trends, embraced the opportunities and are reaping the benefits.
Sources:
[1] Kantar Alcovision – 7-day Total Alcohol Penetration in On-Trade Ending P12 2024
[2] Kantar Alcovision – Average Serves Per Occasion/ week Total Alcohol in On-Trade Ending P12 2024
[3] CGA OPMS Data to 18/05/2024
[4] CGA OPMS Data to 18/05/2024
[5] CGA by NIQ – Diageo P2P bespoke survey July 2024
[6] CGA OPUS GB June 2024
