Six trends in out of home eating and drinking

CGA’s experts used last week’s Future of Finance Conference to unveil a host of up-to-the-minute insights into a fast-changing market. Here our just six of them.
Peter Martin, CGA

1. Stable frequency in eating out

Amid so many concerns about saturation, rising input costs, Brexit and more, it is easy to forget that eating and drinking out remains hugely popular, especially among young adults. CGA vice president Peter Martin pointed to BrandTrack research from April that indicates 61% of 18 to 24 year-olds and 62% of 25 to 34 year-olds eat out at least weekly—figures that are virtually identical to those from five years ago. It shows that although frequency hasn’t increased much, consumers’ appetite for restaurants remains strong.

2. Rapid brand churn

The Conference presented figures from CGA’s Outlet Index that reveal massive change in the numbers and types of licensed premises in Britain. Around 19,300 sites have closed since 2012, but more than 17,600 new ones have opened in the same time, and 8,300 more have changed segment or tenure. This shows how changes in consumers’ behaviour are driving a fast turnover of brands, said Peter Martin. “The churn in this market has been phenomenal, and it continues.”

3. Variability from town to town

Karl Chessell, CGA

No two towns are the same, suggested CGA’s business unit director Karl Chessell at Future of Finance—a lesson that some fast-growing brands have learned to their cost. CGA data shows that licensed premises in Morecambe have fallen by 15% in five years, for example, but risen by 25% in Chorlton. CGA’s consumer segmentation tools can help operators to get to the heart of these different markets. “Understanding at a local level… can really help you see how to tailor your offer to your audience,” Chessell said.

4. A blurring of the lines in venues

Eating-out has diversified way beyond high street restaurants, Karl Chessell added. Quality and choice now extends to pop-ups, street food, festivals and much more, with boundaries between them fading fast. But wherever they eat, consumers demand a great and genuine occasion. “People want authenticity,” he said.

Fiona Speakman, CGA

5. Lower quantity but higher quality in drinks

A Future of Finance session from CGA client director Fiona Speakman spotlighted the premiumisation trend in drinking-out. CGA’s On Premise Measurement service shows that while the volume of drink sales in the on-trade has fallen by 2.3% in the last year, the value of sales has risen by 0.9%. In other words, people are drinking less but are prepared to pay more for a high-quality beer, wine, spirit, cocktail or soft drink. “UK consumers are willing to pay more… there’s a shift towards premiumisation,” Speakman said.

6. Value for experience as well as value for money

While consumers are embracing premium options, value remains a crucial driver, Fiona Speakman said. Discounts and deals can play a part in that, and 15% of consumers on CGA’s BrandTrack panel say vouchers are important when choosing where to eat out. But while they can boost footfall, vouchers need to be handled carefully to protect brand equity. And a cheap price isn’t enough to drive loyalty, she pointed out: the experience of the eating-out occasion counts for much more. “Consumers still expect great value for experience… so any special offer needs to be high quality.”

CGA Future of Finance was hosted in partnership with BarclaycardCoffer Corporate LeisureCPL OnlineFourthRSM, and Zonal

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