Beer was one of the first alcoholic beverages to be produced by European settlers in the late 18th century, being easy to brew and a safer alternative to contaminated water sources. Since then, it has grown to become one of the most loved alcoholic beverages with consumers, playing a crucial cultural role in the context of social gatherings and sports events.
CGA’s OPUS (On Premise User Survey) data suggests it is the most popular drink in the On Premise, with 44% of consumers drinking it, compared to 40% for wine. Yet, despite the connection Aussie consumers have with beer, and it’s synonymity with Pubs (hotels), the category faces mounting challenges. Including, but not limited to, changing taste preferences among younger drinkers, the growth of other options that accommodate for similar occasions such as RTDs, Hard Seltzers & Alcoholic Ginger Beer, and price increases driven by tax rises.
To tackle these challenges effectively, it’s essential to delve into the data and examine how different generations interact with the beer category. Our OPUS research from earlier this year is a great way to do just that.
A close examination reveals that while beer still commands the largest share of consumers, penetration levels vary across generations. Gen Z, the youngest consumer group, albeit the least engaged, shows steadiness in their beer consumption habits. However, a notable drop (-7pp) is seen among 25-34-year-olds, largely driven by females in this cohort exiting the category.
Looking at it from a total category lens is not enough, and thus, unpicking the sub-categories driving penetration changes is crucial. The story is quite clear, Domestic (non-craft), is the most popular category and continues to maintain its consumer base (+2pp), while both craft (-8pp) and imported (-5pp) witness penetration declines. Craft faces the biggest challenge, witnessing a drop in consumers across all demographic groups, especially those between 35-55 (older millennials and Gen X) traditionally the heartland for the craft category.
Domestic, non-craft beers not only have a larger consumer base but are also more routinely consumed. Approximately 8 in 10 beer drinkers choose domestic beers every time or almost every time they go out. This trend is primarily attributed to the familiarity and reliability of domestic beers in providing enjoyment and relaxation.
Craft and imported beers seem to cater to more specific need states, such as treating, celebrating, and savoring. However, in an era of reduced occasions and limited disposable income, consumers often opt for the comfort and reliability of domestic beers. While price is always going to impact value equations for consumers, import and craft drinks rank the expensiveness of drinks as the biggest barrier to more frequent category consumption.
Clearly the On Premise beer market is in a state of flux, with aggressive innovations aimed at disrupting tap line ups and shifts in generational drinking habits making it more complex than ever to know how to succeed in the beer category. Regularly checking in with consumer insights and consumption trends is crucial to align to their needs, spot new opportunities, support On Premise customers and ultimately win with consumers to drive sales.
CGA by NIQ’s upcoming On Premise User Survey (OPUS) explores consumer preferences specifically in bars and restaurants, tackling path to purchase behaviours, category and brand consumption, in-outlet trends and this edition deep dives into specific hot topics such as the role of bartenders, sustainability, driving footfall and On/Off Premise dynamic.
Providing actionable learnings, the survey give brands, suppliers, and operators the opportunity to tailor strategies, ensuring successful On Premise engagement. To learn more about OPUS Australia, contact Tom Graham – Senior Manager: Client Success and Solutions at tom.graham@nielseniq.com or download more information here.
