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GB on-trade spirits sales fall 14.3%
CGA by NIQ has revealed that in the three months leading to mid-May, spirits sales in Great Britain’s on-trade dropped by 14.3% as consumers lessen their alcohol intake.
The 14.3% figure has accelerated from the 10.8% drop the GB on-trade faced in the full 12 months leading to mid-May 2024.
CGA cited the cost-of-living crisis, shifting attitudes, and consumer habits towards alcohol as the main reasons for the current declines. In addition, longer serves (which are said to be more affordable and more ‘sessionable’) are also working against the category.
Phillip Montgomery, CGA client services director UK and Ireland, said: “There’s no doubt that spirits have been by far the toughest category of 2024 in the on-premise, with big consumer trends like cost focus, earlier visits and moderation all damaging it.
“Value perceptions are more important than ever, and suppliers and venues urgently need to find ways to change them to stop the leaking of share to beer, wine and cocktails. Range and pricing ladders need to appeal to consumers who are feeling the pinch, and improving serves is a quick and easy way to add value.
“By understanding people’s changing needs, suppliers can navigate this tricky landscape and craft consumer strategies that attract people back to spirits from other categories.”
CGA has presented five ways in which venues can bounce back and see positive revenue from spirits, including targeting ‘segment hotspots’ such as Tequila, rum and spiced brands, and targeting standard price points. For example, the average price of a standard gin and mixer (£6.32/US$8.16) is 7.7% higher than a glass of wine (£5.87/US$7.58), and 32.8% above a standard pint of beer (£4.76/US$6.15).
CGA noted that for this reason, the number of consumers drinking spirits with mixers has fallen.
In addition, all-round value (with quality, serve, and all-round experiences factored in), proving the right range and pricing ladders, and earlier time windows to reach younger age groups (such as happy hour being 7-8pm rather than 8-9pm) were also noted as ways to lift spirits sales.
However, the issue is not isolated to Great Britain, with the spirits category found to be in a challenging period globally.
CGA found that global on-trade spirits volumes declined by 7.6% in the year to January 2024. Meanwhile in Australia, volume sales of spirits in the on-trade fell by 8.1% in the 12 months to 26 March 2024.
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