New research from CGA has revealed that three quarters of consumers in Australia have returned to pubs, bars and restaurants following the nationwide lockdown, demonstrating a healthy consumer appetite for on-premise occasions.
Visits are down, but opportunity still knocks
Although more than half (53%) of Australian consumers say they are visiting pubs, bars and cafes less often than a year ago, CGA’s data shows that 28% say they are visiting the same, and 18% say they are going out more often. For bars and restaurants, engaging these willing consumers through strategic offers and marketing will be key, all the while emphasising safe practices to reassure anxious consumers that have reduced their visits or have yet to return. With average monthly spend down (from A$262 pre-COVID-19 to A$235), operators may benefit from trying to maximise consumer spend and duration in the venue through strategic upselling and offers.
While many core on-premise channels have taken significant hits in visits (such as restaurants, with weekly visits falling from 50% to 26%), others have seen growth. CGA’s Consumer Pulse revealed that across all core age groups, visits to local establishments has increased, with 1 in 2 consumers saying they now visit local bars, pubs and restaurants on a weekly basis.
Navigating the changing consumer dynamics
In addition to frequency of eating and drinking out, CGA’s data revealed COVID-19’s impact on drinks demographics. 1 in 2 consumers aged 55+ drink wine, however, as an at-risk group, fewer of these consumers are venturing out to on-premise spaces. As a result, the number of consumers drinking wine has fallen, creating a unique challenge for wine-led outlets.
CGA’s drinks category research also highlighted how changing occasions—including a reduction in after-work socialising, late-night drinking and celebrations from younger adults in particular—has also led to a drop in the number of drinkers choosing cocktails. A third (34%) of cocktail drinkers have chosen the category less often since returning to the on-premise, compared to only 14% who have selected cocktails more frequently. By contrast, the popularity of beer has been sustained, with more than a quarter (28%) of beer drinkers choosing it more often than before COVID-19.
With nearly 4 in 10 consumers ordering takeaway food and alcohol more frequently (or for the first time), delivery is a promising channel that can be used to fill the gaps in business caused by COVID-19.
New emphasis on value
With consumers being economically impacted by COVID-19, CGA’s survey also revealed an increasing interest in the value end of the drinks market. ‘Good value’ is now an important factor in drinks choices for 35% of consumers revisiting the market, making it the top issue ahead of ‘Australian’ (32%) and ‘High quality’ (24%). While value does not necessarily mean cheap, this suggests that the pandemic and subsequent pressure on some consumers’ spending has prompted drinkers to think more carefully about what they are getting for their cash.
Australia has a vibrant and resilient on-premise sector, but these figures show how visits and spend have been substantially altered by the pandemic,” says CGA commercial director Graeme Loudon. “As pubs, bars and restaurants adapt to the ‘new normal’ and try to encourage consumers back, it is more important than ever to understand how people’s eating and drinking out habits have evolved, and how to meet their fast-changing needs.
He added: “The months ahead will undoubtedly be challenging, but operators and suppliers that can respond nimbly to market dynamics, and tailor their strategies to both those who have and haven’t returned, can be optimistic about succeeding when pandemic pressures eventually ease. Retailers are looking for more support than ever from their suppliers, and CGA is pleased to be able to help businesses across the on-premise plan their road to recovery with clear and actionable insights.”
CGA’s ‘Consumer Pulse’ research gathered views from 500 Australian consumers in October 2020. As well as national insights, it also indicates the latest consumer attitudes in the market in Victoria and Metropolitan Melbourne.
As the on-premise continues to reopen across Australia, CGA is preparing further research to support suppliers and operators as they strategically navigate the ongoing recovery phase. For more details, email CGA commercial director Graeme Loudon at firstname.lastname@example.org.