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On-premise Alcohol Trends - US - September 2017

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
Alcohol sales experience continued growth
Figure 1: Total US sales and fan chart of on-premise alcohol sales, at current prices, 2012-22
The issues
A third of consumers are at home relaxers
Figure 2: On-premise alcohol attitudes, June 2017
On-premise beer consumption drops
Figure 3: Total on-premise market volume consumption per capita, beer, 2011-20
Regular wine drinkers are brand agnostic
Figure 4: Drink brand loyalty: beer and wine, among drink type drinkers, any brand loyalty, June 2017
The opportunities
Mood dictates what drinks consumers order
Figure 5: Drinking behaviors, by gender and age, June 2017
An occasion for every drink…
Figure 6: Correspondence analysis – Drinking occasions, June 2017
And a drink for every venue
Figure 7: Venue appeal, by wine type drinkers, indexed against all AFH drinkers, June 2017
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Falling volume offset by premium drinks
Interest in traveling benefits the alcohol industry
Rising median age could impact the market
MARKET SIZE AND FORECAST
On-premise sales pass the $100 billion mark
Figure 8: Total US sales and fan chart of on-premise alcohol sales, at current prices, 2012-22
Figure 9: Total US sales and forecast of on-premise alcohol sales, at current prices, 2012-22
MARKET BREAKDOWN
Consumers are ordering fewer but more expensive drinks
Figure 10: Total on-premise market volume consumption per capita, beer, 2011-20
Figure 11: Total on-premise market volume consumption per capita, spirits and wine/sparkling wine, 2011-20
Light beer is quickly losing market share
Figure 12: Share of total US volume sales of beer, by segment, 2010 and 2015 (est)
Table wine represents 90% of all wine sold
Figure 13: US volume sales of wine, by segment, 2011-21
Irish and other imported whiskey experience strong growth
Figure 14: US volume sales of whiskey, 2011-16
Rum and gin lose white spirit market share
Figure 15: US volume sales and forecast of white spirits, volume share, by segment, 2011-21
Figure 16: US volume sales and forecast of white spirits, by segment, 2011-21
MARKET PERSPECTIVE
Wine brands embrace the versatility of sparkling wine
Brands spike one of the fastest growing non-alcoholic beverages
Figure 17: Alcoholic beverages purchase intent score, July 2016-July 2017
Alcohol mixers allow for cocktails at home
Figure 18: Total US retail sales and forecast of alcoholic beverage mixers, at current prices, 2012-22
MARKET FACTORS 
The median age climbs up
Figure 19: Median age of total US population, 1995-2016
Ride sharing an unintended boon for bars
Figure 20: Lyft email, “Ride safe this Memorial Day with Budweiser and RESQWATER Proactive Recovery”
Pack your bags, Americans are going on vacation
Figure 21: Expenditures on US tourism-related goods and services, by segment, at current prices, 2014 and 2016
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Latin flavors and boozy brunches provide opportunity for bars
Non-alcoholic drinks become a stand-in for the real thing
Growing interest in travel leads to better hotel bars
WHAT’S WORKING?
Bars look south of the border for inspiration
Spiked shakes tap into fun/nostalgia
Figure 22: Alcoholic milkshakes from Public House in Chicago
Sparkling wine and wine cocktails expand the occasions for wine
Figure 23: Sangria LTOs and new menu items at casual dining chains
Millennials associate brunch with alcohol
Figure 24: Brunch option interest, by generation, May 2017
Figure 25: Breakfast/brunch cocktail examples
Floral cocktails spring up on menus
Figure 26: Floral-flavored cocktails on menus
WHAT’S STRUGGLING?
A sobering future?
Figure 27: Mocktail examples
Restaurants are removing big beer brands from menus
Figure 28: Change in incidence of top 20 beer brands on menus, Q2 2015-Q2 2017
On-premise wine needs to connect with younger consumers
Figure 29: Median age of on-premise wine vs Champagne/sparkling wine drinkers
Figure 30: Wine behavior by age, August 2016
Gin lacks brand loyalists
Figure 31: US volume sales and forecast of gin, 2011-21
WHAT’S NEXT?
Don’t be afraid of fat
Figure 32: Fat used in cocktails
The slushy reinvented
Hotels leverage local alcohol offerings
Bars/restaurants focus on the entire experience
Retailers blur on and off premise
MINTEL MENU INSIGHTS ANALYSIS
Pale ales and “cloudy” beers trend while light beer goes flat
Figure 33: Change in incidence of top 20 beer types, Q2 2015-Q2 2017
Beer gets fruitful
Figure 34: Fastest growing fruit beer flavors, Q2 2015-Q2 2017
Wines experience strong menu growth
Figure 35: Change in incidence of top 10 wine types, Q2 2015-Q2 2017
Red wines
Figure 36: Change in incidence of top 10 red wine types, Q2 2015-Q2 2017
White wines
Figure 37: Change in incidence of top 10 white wine types, Q2 2015-Q2 2017
Sparkling wines
Figure 38: Change in incidence of top Champagne/sparkling wine types, Q2 2015-Q2 2017
Craft cocktails continue to dominate the industry
Figure 39: Change in incidence of top 15 cocktails, Q2 2015-Q2 2017
Sour cocktails give way to flower and ginger flavors
Figure 40: Change in the incidence of the top 20 ingredient flavors used in cocktails, Q2 2017-Q2 2017
Figure 41: Change in the incidence of top 10 fruit ingredient flavors used in cocktails, Q2 2015-Q2 2017
Whiskey cocktails grow in popularity driven by bourbon
Figure 42: Change in incidence of spirits as an ingredient in a menued cocktail, Q2 2015-Q2 2017
Figure 43: Change in incidence of whiskey as an ingredient in a menued cocktail, Q2 2015-Q2 2017
Fruit-flavored liqueurs decline
Figure 44: Change in incidence of liqueurs as an ingredient in a menued cocktail, top 20 liqueurs, Q2 2015-Q2 2017
THE CONSUMER – WHAT YOU NEED TO KNOW 
Drinkers have venue preferences
NCD and imported beer have brand loyalists
Mood and occasions determine what drinks consumers order
ALCOHOL CONSUMED ON PREMISE
Beer is the most consumed alcoholic beverage on premise
Figure 45: Alcohol consumed on premise, June 2017
Millennials are the primary consumers of all drinks
Figure 46: Alcohol consumed on premise, by generation, June 2017
Figure 47: Alcohol consumed on premise, by Millennial age, June 2017
Women and men have very different drinking preferences
Figure 48: Alcohol consumed on premise, by gender and age, June 2017
Opportunity for craft beer brands to connect with Hispanics
Figure 49: Alcohol consumed on premise, by Hispanic origin, June 2017
Black consumers are infrequent AFH drinkers
Figure 50: Alcohol consumed on premise, by race, June 2017
Cool cocktails appeal to social media users
Figure 51: Alcohol consumed on premise, by alcohol attitudes, June 2017
Non-switchers are loyal to non-craft domestic beer
Figure 52: Alcohol consumed on premise, by switching segmentation, June 2017
VENUE APPEAL
Consumers are most interested in restaurant bars
Figure 53: Venue appeal, June 2017
Millennials find a variety of venues appealing
Figure 54: Venue appeal, by generation, June 2017
More experiential venues may appeal to women
Figure 55: Venue appeal, by gender, June 2017
Figure 56: Venue appeal, by gender and age, June 2017
Nightclubs popular among Hispanic consumers
Figure 57: Venue appeal, by race/ethnicity, June 2017
Venue preferences vary by drinker types
Craft beer drinkers prefer less-noisy establishments
Figure 58: Venue appeal, indexed against all AFH drinkers, by beer type drinkers, June 2017
Venues can capitalize on the popularity of sparkling wine
Figure 59: Venue appeal, by wine type drinkers, June 2017
Large cross-over for craft drinkers
Figure 60: Venue appeal, by select spirit type drinkers, June 2017
Energy seekers are club-goers
Figure 61: Venue appeal, by alcohol attitudes, June 2017
Drink switchers are also open minded when it comes to venues
Figure 62: Venue appeal, by switching segmentation, June 2017
DRINK BRAND LOYALTY: BEER AND WINE
Consumers are loyal to non-craft and imported beer brands
Figure 63: Drink brand loyalty: Beer and wine, among drink type drinkers, June 2017
Older consumers have their beer preferences
Figure 64: Drink brand loyalty: Beer and wine, among drink type drinkers by age, “any loyalty,” June 2017
DRINK BRAND LOYALTY: SPIRITS
Whiskey drinkers are the most brand loyal
Figure 65: Drink brand loyalty: Spirits, rebased among drinkers, June 2017
DRINKING BEHAVIORS
Drink choice is highly mood dependent
Figure 66: Drinking behaviors, June 2017
Many consumers don’t switch drinks
Figure 67: Switching behaviors, June 2017
Women may respond to occasion-based promotions
Figure 68: Drinking behaviors, by gender, June 2017
Figure 69: Drinking behaviors, by gender and age, June 2017
Millennials are experimental drinkers
Figure 70: Drinking behaviors, by generation, June 2017
Figure 71: Switching behaviors, by generation, June 2017
NCD beer drinkers are most likely to be non-switchers
Figure 72: Switching behaviors, by beer type drinkers, June 2017
DRINKING OCCASIONS BY DRINK TYPE
Methodology
Consumers chose drinks for specific occasions
Figure 73: Correspondence analysis – Drinking occasions, June 2017
Figure 74: Drinking occasions by drink type, June 2017
Beverage drinking occasions vary by demographics
Figure 75: Drinking occasions – Any beer, by age, June 2017
DRINKING OCCASIONS: ANY DRINK TYPE
Drinking tends to center around meals and celebrations
Figure 76: Drinking occasions, any drink, June 2017
Millennials are more likely to drink across occasions
Figure 77: Drinking occasions, any drink, by generation, June 2017
At home relaxers will indulge on certain occasions
Figure 78: Drinking occasions, any drink, by alcohol attitudes, June 2017
ON-PREMISE ALCOHOL ATTITUDES
A third of consumers prefer a relaxing drink at home
Figure 79: On-premise alcohol attitudes, June 2017
Younger women utilize ride sharing services
Figure 80: On-premise alcohol attitudes, by gender and age, June 2017
Boomers prefer to drink at home
Figure 81: On-premise alcohol attitudes, by generation, June 2017
Those in cities are most motivated by social media
Figure 82: On-premise alcohol attitudes, by area, June 2017
Switchers experiment on premise
Figure 83: On-premise alcohol attitudes, by switcher segmentation, June 2017
Craft cocktail drinkers enjoy experimenting
Figure 84: On-premise alcohol attitudes, by drink type drinkers, June 2017
BEHAVIORAL/ATTITUDINAL DRINKER DEMOGRAPHIC PROFILES
Demographic profile: Switching behaviors
Figure 85: Switcher segmentation profile, index against all AFH drinkers
Demographic profile: Energy seekers, connected social media users, and at home relaxers
Figure 86: Alcohol attitudes profile, index against all AFH drinkers,
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumption data: Mintel Market Sizes
Consumer survey data
Consumer qualitative research
Mintel Menu Insights
Abbreviations and terms
Abbreviations
Terms
APPENDIX – THE CONSUMER
Figure 87: Median HH income, by race and Hispanic origin of householder, 2015
APPENDIX – THE MARKET 
Figure 88: Total US sales and forecast of on-premise alcohol, at inflation-adjusted prices, 2012-22

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