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CGA’s exclusive On Premise Measurement data indicates that total liquid volumes were down 16.1% in November and December compared to the last two months of 2019. However, this marks a marginal gain versus the 17.3% drop over the second half of 2021, and as concerns about COVID-19 infections reduce, consumer confidence levels are expected to rise further and drive On Premise sales closer to pre-pandemic levels.
A major reason for the atypical holiday season in the On Premise was the government-imposed closure of nightclubs, particularly affecting American whiskey performance, down 28% by volume in November and December 2021 vs 2019 and losing 2,4% of its share of total spirits.
However, the move away from late-night drinking led some consumers to switch to food-led channels during daytimes. Bars and bar-restaurants both increased their market share of liquid volumes by 1%, and restaurants by 0.6% compared to the final two months of 2019. Despite the late-night restrictions, 61% of consumers planned to visit the On Premise over the festive period as the demand to continue celebrations with friends and family was not subdued. With more normal trading conditions returning, suppliers and operators can expect a resurgence for nightclubs and late-night bars this Christmas, as people make up for lost time in their favourite venues.
The festive season remains an important period of the year for spirits in which typically vodka and whisk(e)y both significantly outperform the market during this time as consumers switch into these categories, pre-pandemic trends show, with the latter being a category in which consumers are likely to trade up during the festive period. Above Whisk(e)y, sparkling wines, cocktails, still wines and finally craft beer tops are the most frequently traded up, which provides operators with a clear direction on premiumisation opportunities for later this year. In addition to this, for suppliers, it’s key to understand how the sales mix within drinks categories is driven by occasion and channel, as the pandemic caused shifts in consumer drink preferences.
COVID-19 disruption caused On Premise challenges as international visitors were restricted from entering the country and domestic travel declined, with research suggesting these challenges were more notable in the Southeast region, as consumers in Paris and other parts of the Ile-de-France cancelled their usual skiing trips. The Southeast lost 1.4% of its share of spirits volumes in November and December, while Ile-de-France gained 1.9% as residents stayed close to home. Beer and cider lost 1.3% of market share in the Southeast.
These patterns reversed the sales trends normally seen late in the year in France. In 2019, the Southeast increased its share of spirits volumes by 5.1 percentage points between July-to-August and November-to-December—but in 2021 the switch was only 3.4 percentage points, with share moving to Paris. However, with no restrictions likely this winter, businesses can expect drinks sales to follow Parisians back to the skiing slopes.
Suppliers and operators planning for the festive period must look to combine recent changes in consumer dynamics and drinks choice, with the trends seen in the most up-to-date category and sub-category performance in order to successfully plan their strategies to make the most of what is anticipated to be a bumper Christmas opportunity this year.
Graeme Loudon, CGA managing director EMEA, said: “It has been a difficult two years for France’s On Premise, but sales are now recovering as consumers head back out. Suppliers and operators should be able to look ahead to Christmas with the confidence that some usual trading patterns will resume—and that means a much more positive season for nightclubs and skiing holiday destinations in particular.
The pandemic has triggered some subtle but significant changes in spirits preferences, with the vodka market particularly buoyant. We can expect whiskey to bounce back this year, but not all drinking habits will return to pre-COVID-19 norms. With more shifts likely, suppliers will have to remain right on top of consumers’ preferences and stay agile in their sales and marketing planning this Christmas.”
CGA’s in-depth market measurement and consumer research provides deep insights into trends and opportunities in the On Premise. Data and expert analysis can help suppliers and operators position brands, grow share and encourage trial, trade-up and loyalty among consumers. To learn more about CGA’s research capabilities, contact Graeme Loudon at graeme.loudon@cgastrategy.com.
