As we move into 2024, CGA expects the downturn in visit frequency and spend in the New Zealand On Premise to stick around, as eating and drinking out continues to compete for a smaller share of discretionary wallet.
While we do note that, overall, more consumers are visiting less and spending less in the On Premise, there is a cohort of consumers seemingly unaffected and telling us they are visiting more frequently and spend more when out (around ¼ of consumers), suggesting pockets of enhanced opportunity to target these with a tailored offer.
In the short and medium term, consumers will continue to be more selective in their choice of venues, and alike in the retail space, will be more consciously looking for food and drinks promotions.
In fact, when asked what would prompt them to visit more frequently, the top two responses were food deals and promotions and drinks deals and promotions, highlighting the value-seeking nature of consumers.
In response to visiting the on-premise less, some consumers are increasing their at-home drinking frequency, notable uplifts in at-home occasion frequency include boozy brunches and themed nights, as consumers begin to get creative to replicate experiences typically only the on-premise could offer.
Despite this, there are obvious things difficult to replicate at-home, when asked what these were, the most prominent answers were atmosphere/ambiance (34%) and variety of drinks (31%), proving key attributes to reinforce when selling the value of on-premise experiences for consumers. Interestingly, for those younger consumers (18-34), quality and taste of drinks resonated more.
The shift towards cost-saving and the risk-averse nature of consumers will continue to trickle through to the choices they make regarding drinks categories and brands. With ‘good value’ ranking first when consumers were asked which factor is more important to you than 12 months ago, followed by ‘quality’, ‘trustworthy’ and ‘my go-to’.
The opportunity for trial and experimentation will likely be reduced in the short term, with a greater emphasis on the familiarity of brands, which will likely impact certain categories more than others (craft beer, cocktails etc).
With recruiting, retaining, and training staff still a challenge in the hospitality industry, venues must continue to be mindful of how their staff are contributing to the overall experiences of consumers.
In facts, behind quality of food (78%), consumers stated quality of service from staff/bartenders as the second most important factor in providing a good experience (50%).
While satisfaction levels on the whole are high in regard to customer service (78%), there is greater room for improvement in the likes of mixology/brand stories staff provide, both areas suppliers/brand owners can actively support. Notable innovations in the sector aimed at improving speed and consistency of service include cocktails on tap, with successes in the UK and Australia, we expect to see these continue, with more launches and greater distribution in 2024.
While visibility of draught cocktails in venues is still low with consumers (30%), we see appetite for trial, but barriers by way of consumer education and costs/value understanding.
To learn more about consumer perceptions and interactions with the On Premise in 2024, get in touch with James Phillips at James.Phillips@nielseniq.com, or download more information and examples of the data and insights included in CGA’s Pulse+ subscription here.
Originally published in The Shout NZ
