Table of Contents
Issues in the Market
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- Key themes
- Definition
- Abbreviations
Future Opportunities
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- Short-term pain for long-term gain?
- But it’s not just about the money
- Adding value is the key to longer-term growth
Market in Brief
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- On-trade alcohol sales growing, but declining in real terms
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- Figure 1: Trends in sales of on- and off-trade alcohol, at constant 2005 prices, 1998-2009
- Beer dominant but wine has been the major growth area
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- Figure 2: Sales of on-trade alcohol, by type of alcohol, 2009
- Panoply of pressures affecting on-trade
- Deep discounting in off-trade provokes emotions
- Recession piles on further misery
- Fighting against the tide?
Internal Market Environment
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- Key points
- Pub closures climb as recession, smoking ban and supply tie overwhelms
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- Figure 3: Net pub closures in the UK, 2005-09
- Beer sales, backbone of the pub, on the wane
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- Figure 4: Trends in the pattern of beer volume sales, by channel, 1999-2009
- Figure 5: Trends in the percentage distribution of beer volume sales, by channel, 1999-2009
- Rising costs harm on-trade competitiveness
- On- vs off-trade price trends
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- Figure 6: Trends in all prices versus those of alcoholic drinks, by channel, 2004-09
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- Figure 7: Trends in beer and cider prices, 2008 and 2009
- Figure 8: Trends in real ale and lager prices, by type of pub, 2008 and 2009
- The ties that bind?
- Increased overheads pile on pressure…
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- Figure 9: Trends in the price of food versus all items, 2004-09
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- Figure 10: Trends in the price of gas and electricity* for non-domestic customers, 2004-09
- …while smoking ban doesn’t help
- Duty calls
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- Figure 11: Trends in levels of alcohol duty, 2004-09
- Competition from in-home drinking
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- Figure 12: Trends in where alcohol is drunk, 2004-08
- ‘Home as the hub’
- 24-hour licensing – help or hindrance?
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- Figure 13: 24-hour licences issued, 2007 and 2008
- Binge drinking and alcohol-related disorder
- Pre-loading
- Combined effect is to reduce appeal of on-trade outlets
Broader Market Environment
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- Key points
- Consumer confidence very weak but showing signs of recovery
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- Figure 14: GfK NOP Consumer Confidence index, May 2008-May 2009
- Disposable incomes and spending under pressure
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- Figure 15: Trends in personal disposable income and consumer expenditure, at constant 2004 prices, 2004-14
- Younger and middle-aged key to on-trade drinking
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- Figure 16: Trends in drinking out of home two or three times a week, by age, 2004-08
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- Figure 17: Structure of the UK 18+ population, by age, 2004-14
- Growth in affluent groups could boost on-trade drinking
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- Figure 18: Changes in socio-economic group amongst the UK 18+ population, 2004-09 and 2009-14
Market Size
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- Key points
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- Figure 19: UK total household expenditure on on-trade alcoholic drinks, 1998-2009
- Figure 20: UK on-trade alcoholic drinks household expenditure, at current and constant prices, 1998-2009
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- Figure 21: Spending per household on on-trade alcoholic drinks (£ per household in the UK at current prices), 1998-2009
- Beer loses its fizz
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- Figure 22: UK household expenditure on beer for out-of-home drinking, 1998-2009
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- Figure 23: UK household expenditure on beer for out-of-home drinking and share of total out-of-home spend, 1998-2009
- Wine hits a plateau
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- Figure 24: UK household expenditure on wine, cider and perry for out-of-home drinking, 1998-2009
- Figure 25: UK household expenditure on wine for out-of-home drinking and share of total out-of-home spend, 1998-2009
- Spirits growth falters
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- Figure 26: UK household expenditure on spirits* for out-of-home drinking, 1998-2009
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- Figure 27: UK household expenditure on spirits for out-of-home drinking and share of total out-of-home spend, 1998-2009
The Impact of the Recession on On-trade Drinking
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- Key points
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- Figure 28: Annualised growth in real alcoholic drinks spend for out-of-home drinking compared to total real household expenditure, Q1 1985-Q1 2009
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- Figure 29: Share of total household expenditure taken by alcohol for out-of-home drinking (real terms), Q1 1984-Q1 2009
- Figure 30: Items being cut back on in the recession, February 2009
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- Figure 31: How the amount of drinking out of home has changed in the past 12 months, April 2009
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- Figure 32: Net percentage decline in out-of-home drinking by adults in the past 12 months, by age and lifestage, April 2009
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- Figure 33: Net percentage decline in out-of-home drinking by adults in the past 12 months, by socio-economic and ACORN group, April 2009
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- Figure 34: Net percentage decline in out-of-home drinking by adults in the past 12 months, by detailed lifestage, April 2009
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- Figure 35: Consumer switching behaviour between drinking at home and drinking out of home, April 2009
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- Figure 36: Annualised rate of growth in consumer spending on alcohol in the on-trade, by type, Q1 2005-Q1 2009
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- Figure 37: Change in out-of-home alcohol consumption in the past 12 months, by types of alcohol usually drunk, April 2009
- How do recessionary cutbacks manifest themselves?
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- Figure 38: Impact of recession on pub visiting, April 2009
- Majority are unaffected
- Going less often…
- …eating out less…
- …and pre-loading…
- …but not trading down
The Consumer – Competitive Context
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- Key points
- What do people drink out of home?
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- Figure 39: Types of alcohol, by where drink alcohol, 2008
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- Figure 40: Trends in penetration of drinks consumed elsewhere, 2004-08
- Young prefer lighter drinks
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- Figure 41: Popular out-of-home drinks among under-35s, 2008
- Middle-aged have middle-of-the-road tastes
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- Figure 42: Popular out-of-home drinks among 35-54-year-olds, 2008
- Older drinkers are more traditional in their tastes
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- Figure 43: Popular out-of-home drinks among over-55s, 2008
- Long-term trends highlight emergence of wine as an on-trade sector
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- Figure 44: Share of on-trade alcohol market, by broad sector, at current prices, 1963-2009
Who Drinks in the On-trade?
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- Key points
- On- versus off-trade drinking
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- Figure 45: Trends for drinking alcohol out of home versus in home, 2004-08
- On-trade drinkers
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- Figure 46: Penetration of on-trade drinking, by gender, age and lifestage, 2008
- Figure 47: Penetration of on-trade drinking, by socio-economic group and Mintel’s Special Groups, 2008
- Who are the most valuable on-trade drinkers?
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- Figure 48: Ten most valuable consumer groups for on-trade drinking of alcohol according to VII, by demographic group, 2008
How do Consumers Feel About Drinking Out of Home?
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- Key points
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- Figure 49: Attitudes towards drinking alcohol out of home, April 2009
- How do recent changes in out-of-home consumption affect attitudes?
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- Figure 50: Attitudes towards drinking out of home, by change in out-of-home alcohol consumption in the past 12 months, April 2009
- How do attitudes differ by the type of alcohol consumed?
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- Figure 51: Attitudes towards drinking out of home, by types of alcohol usually drink, April 2009
- How do people feel about drinking out compared to in-home drinking?
- What defines a good local pub?
- What attracts people to a particular pub?
- What might encourage people to drink out more often?
Targeting Opportunities
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- Key points
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- Figure 52: Marketing targets based on attitudes towards on-trade drinking, April 2009
- Indifferent (46% of drinkers) reign supreme
- New Breed (23% of drinkers) need the right environment
- Squeezed (18% of drinkers) feel the pinch
- Pub food charms Value Diners (13% of drinkers)
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- Figure 53: Attitudes towards out-of-home alcohol consumption over the past 12 months, by target group, April 2009
- Squeezed most likely to have cut back on-trade drinking
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- Figure 54: Change in out-of-home alcohol consumption in the past 12 months, by target group, April 2009
Appendix – Impact of the Recession on On-Trade Drinking
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- Figure 55: Impact of recession on pub visiting, by demographics, April 2009
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Appendix – Competitive Context
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- Figure 56: Elsewhere drinkers, by demographics, by weight of usage, 2008
- Figure 57: Types of alcohol drunk elsewhere, by demographics, 2008
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- Figure 58: Types of alcohol drunk elsewhere, by demographics, 2008
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Appendix – How do Consumers Feel About Drinking Out of Home?
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- Figure 59: Most popular attitudes towards drinking alcohol out of home, by demographics, April 2009
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- Figure 60: Next most popular attitudes towards drinking alcohol out of home, by demographics, April 2009
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Appendix – Targeting Opportunities
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- Figure 61: Target groups, by demographics, April 2009
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