Younger consumers continue to drive the drink trends in the on-trade. Demand for spirits and RTDs continues to boom based on 4-week CGA data leading up to the end of May. This suggests that younger consumers – who are still more likely to be out regularly in the on-trade and have a strong preference for cocktails – continue to drive the latest drinking trends. While RTDs have shown significant growth in volume (+14.3%) and value (+41.2%) compared to the same period in 2019, the category only makes up a 1% share of on-trade drinks. Spirits are up 13.8% in volume and 22.1% in value, now making up an impressive 45% of drinks value sales in May 2022 vs. a 39% share in 2019. This is driven by young consumers opting for drink serves they couldn’t easily make at home in lockdown (draught beer, interesting cocktails). Wine remains the largest casualty in the alcoholic drinks sector with volumes still down by -23.9% and sales value down by -16.3% as some older consumers – whose drink of choice is often wine – have reduced visits to the on-trade, 28% of those aged over 45 did not visit a pub, bar or restaurant during the three months leading up to May versus 15% of those under 45.
Contact PROOF Insight for more information on the latest category trends in the on-trade. Source: CGA, PROOF Insight POURtraits research May 2022 |
Live music, bowling and other entertainment boosts on-trade footfall. Live music company GigRealm has reported a 385% rise in the number of live music events being held within hospitality businesses since the start of 2022. Operators are diversifying their offering to cater for experience-seeking consumers, with 74% of consumers in Gigrealm’s hospitality research survey stating they have gone drinking to see live music. It’s not just music that is drawing consumers out of the home; bowling alley operator Ten Entertainment Group has reported that like-for-like sales are up 30% in the year to May 2022 vs 2019. According to chief executive Graham Blackwell, this is driven by increased footfall rather than price rises, with the company focusing on offering “great value-for-money experiences” to get more customers through the door. Some operators have been getting creative with events to drive footfall throughout the day; Greene King pubs are putting on breakfast events and even sausage eating contests, as well as “Expensable lunches” with accredited training sessions in partnership with Enterprise Nation in selected central London venues. What’s clear is that consumers are demanding more from their on-trade experiences, and many operators are stepping up to meet those needs. Source: PROOF Insight POURtraits research, GigRealm, Propel, The FT |
Hospitality trade bodies welcome proposed VAT cut. The UK Government is considering a temporary reduction in the VAT rate from 20% to 17.5% to help curb the current rate of inflation and ease tax bills. With reportedly half of the UK’s hospitality businesses operating on reduced hours and only one in three making a profit as the cost-of-living squeeze and rising cost pressures mount; the cut has been described by UK Hospitality Chief Exec, Katie Nicholls OBE as a “significant & positive step” to supporting businesses. The proposal was also described by trade body the British Beer & Pubs Association as “extremely welcome” to “incentivising investment” in one of the most highly taxed and regulated sectors in the UK, while the British Institute of Innkeeping made further calls for financial help and relief measures for many of their members, whom they described as “incredibly fragile” after “two years of closures and disruption” to assist with spiralling inflation that is now a barrier to profitability. VAT rates were previously cut in July 2020 for hospitality businesses in response to the pandemic, to 5% for food and non-alcoholic beverages sold for on-premise consumption, sleeping accommodation and for visitor & cultural attractions. An extension for the sector saw a 12.5% rate in place from October 21st 2021. The current pre-pandemic VAT level of 20% was reintroduced in April this year. Source: The Morning Advertiser, The Times |
Investments, Mergers & Acquisitions:
Sources: Langton Capital, Big Hospitality, Propel, Morning Advertiser |
Product Launches & Campaigns:
Sources: Langton Capital, Beverage daily, BigHospitality, Morning Advertiser |