Table of Contents
Executive Summary
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- Top takeaways
- Market overview
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- Figure 1: Total US sales and forecast of foodservice alcohol, at current prices, 2015-25
- Impact of COVID-19 on foodservice alcohol
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- Figure 2: Short-, medium- and long-term impact of COVID-19 on foodservice alcohol, October 2020
- Opportunities and Challenges
- Re-emergence
- Indoor dining and drinking isn’t appealing to most
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- Figure 3: Dining and drinking comfort levels, September 17, 2020-October 5, 2020
- Sell alcohol off-premise to younger adults
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- Figure 4: Off-premise alcohol interest by location type – NET any location, by generation, July 2020
- Tiered value menus can keep cautious spenders engaged
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- Figure 5: Foodservice alcohol purchases, by household income, July 2020
- Recovery
- Long-term shifts toward off-premise alcohol sales
- Lean back into Gen Z’s sobering interests
The Market – Key Takeaways
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- Retail alcohol sales spike as foodservice alcohol tanks in 2020
- Foodservice alcohol sales suffer in recessions
- Friendlier off-premise alcohol laws are silver lining of COVID-19 crisis
Market Size and Forecast
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- Foodservice alcohol sales see a huge loss in 2020 due to COVID-19
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- Figure 6: Total US sales and forecast of foodservice alcohol, at current prices, 2015-25
- Figure 7: Total US sales and forecast of foodservice alcohol, at current prices, 2015-25
- Impact of COVID-19 on foodservice alcohol
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- Figure 8: Short-, medium- and long-term impact of COVID-19 on foodservice alcohol, October 2020
- COVID-19: US context
Market Breakdown
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- Retail alcohol sales make huge gains over foodservice in 2020
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- Figure 9: Share of US sales of alcoholic beverages, by purchase location, at current prices, 2015-20 (est)
- Spirits and wine slightly outperform beer in 2020
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- Figure 10: Total US alcohol sales, by alcohol category, at current prices, 2015-20 (est)
- Figure 11: Share of US sales of alcoholic beverages, by type of alcoholic beverage, 2015-20 (est)
Market Factors
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- COVID-19 cuts into on-premise dining, drinking
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- Figure 12: Dining and drinking comfort levels, September 17, 2020-October 5, 2020
- Laws make temporary (and permanent) allowances for off-premise alcohol sales
- Recession cuts into dining out, foodservice alcohol spend
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- Figure 13: Total US sales and estimate of on-premise alcohol, at current prices, 2007-13
- Figure 14: Recession spending behaviors – NET any rank, May 2020
- Americans are managing COVID-19 stress with alcohol
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- Figure 15: COVID-19 impact on alcohol consumption frequency, July 2020
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- Figure 16: Reasons for increased alcohol consumption, July 2020
- Gen Z diners aren’t as big of drinkers as Millennials
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- Figure 17: Reasons for not drinking alcohol when dining out, by age, May 2020
Market Opportunities
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- Alcohol subscription programs, clubs
- Virtual engagement
- Natural wines
- Functional cocktails
Companies and Brands – Key Takeaways
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- Operators pivot to off-premise alcohol to save sales
- Less-penetrated segments continue to add alcohol during pandemic
- Value-focused adult beverage menus move center stage
Company and Brand Competitive Strategies
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- Alcohol to go
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- Figure 18: Postmates email, “Get LA’s Best Cocktails With Free Delivery,” April 10, 2020
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- Figure 19: Chili’s Grill & Bar margarita to go, September 2020
- Figure 20: Red Lobster email, “Cocktails + Beer + Wine To Go!” September 18, 2020
- More restaurant segments add alcohol to boost profits
- Focus on value
The Consumer – What You Need to Know
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- Most consumers aren’t drinking foodservice alcohol because they aren’t visiting restaurants or bars
- Men, Millennials and high-income consumers are core foodservice alcohol consumers
- Appeal to core foodservice alcohol consumers with off-premise alcohol, subscription programs and virtual engagements
Foodservice and Retail Alcohol Purchases
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- The vast majority of Americans are drinking at home
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- Figure 21: Retail alcohol purchases, July 2020
- Most consumers have not drunk alcohol from a restaurant or bar as of July 2020
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- Figure 22: Foodservice alcohol purchases, July 2020
- Men drive foodservice alcohol consumption
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- Figure 23: Foodservice alcohol purchases, by gender, July 2020
- Millennials are most likely to drink foodservice alcohol during pandemic
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- Figure 24: Foodservice alcohol purchases, by generation, July 2020
- Higher-income consumers drive foodservice alcohol consumption
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- Figure 25: Foodservice alcohol purchases, by household income, July 2020
Foodservice Alcohol Purchase Barriers
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- Fewer restaurant visits due to COVID-19 is the leading consumption barrier
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- Figure 26: Foodservice alcohol purchase barriers, July 2020
Foodservice Alcohol Ordering Interest by Location Type
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- Despite pandemic, ordering alcohol for on-premise consumption is more popular than takeout or delivery
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- Figure 27: Foodservice alcohol ordering interest by location type – NET location types and NET any off premise, July 2020
- Figure 28: Foodservice alcohol ordering interest by location type – NET any off premise, July 2020
- Gen Zs and Millennials drive interest in alcohol for takeout and delivery
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- Figure 29: Off-premise alcohol interest by location type – NET location types and NET any off premise, by generation, July 2020
- Higher-income consumers also drive off-premise alcohol interest
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- Figure 30: Off-premise alcohol interest by location type – NET location types and NET any off premise, by household income, July 2020
- Men drive off-premise alcohol interest at LSRs and bars
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- Figure 31: Off-premise alcohol interest by location type – NET location types and NET any off premise, by gender, July 2020
- Urban residents also drive interest in ordering alcohol off premise
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- Figure 32: Off-premise alcohol interest by location type – NET location types and NET any off premise, by area, July 2020
Off-premise Interest by Alcohol Type
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- Beverages most popular for off premise mirror those for foodservice overall
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- Figure 33: Off-premise interest by alcohol type, July 2020
- Women drive cocktail, RTD alcohol interest off premise
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- Figure 34: Off-premise interest by alcohol type, by gender, July 2020
- Young consumers are most interested in cocktail kits, spirits off premise
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- Figure 35: Off-premise interest by alcohol type, by age, July 2020
Innovative Foodservice Alcohol Concepts
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- Three in 10 alcohol drinkers want to buy natural wines from restaurants and bars
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- Figure 36: Innovative foodservice alcohol concepts, July 2020
- Younger Millennials raise interest in tiki drinks and canned wines
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- Figure 37: Innovative foodservice alcohol concepts, by generation, July 2020
- White and Hispanic drinkers are most open to innovative alcohol options
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- Figure 38: Innovative foodservice alcohol concepts, by race and Hispanic origin, July 2020
Foodservice Alcohol Statement Agreement
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- Drive-thrus represent another off-premise alcohol opportunity
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- Figure 39: Foodservice alcohol statement agreement, July 2020
- Men miss bars more than women do
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- Figure 40: Bar Sótano’s Raspberry-Mint Mezcal cocktail, July 2020
- Figure 41: Foodservice alcohol statement agreement, by gender, July 2020
- Large-format cocktails won’t appeal to core audience
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- Figure 42: Foodservice alcohol statement agreement, by age, July 2020
Foodservice Alcohol Attitudes
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- Employees need to wear masks to appease restaurant and bar drinkers
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- Figure 43: Foodservice alcohol attitudes – NET agreement, part I, July 2020
- Figure 44: Foodservice alcohol attitudes – NET agreement, part II, July 2020
- Men want to see more beer subscription programs
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- Figure 45: Foodservice alcohol attitudes – NET agreement, by gender, July 2020
- Millennials are wary of bar safety during pandemic
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- Figure 46: Foodservice alcohol attitudes – NET agreement, by generation, July 2020
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Forecast
- Consumer survey data
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
Appendix – The Market
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- Figure 47: Total US sales and forecast of foodservice alcohol, at inflation-adjusted prices, 2015-25
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Appendix – The Consumer
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- Figure 48: COVID-19 Food & Drink Tracker, September 2020
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