Economic gloom can’t dampen trend for trading up, suppliers say
Producers and suppliers contacted by SLTN last week said the trend for consumers to go out less often but ‘trade up’ to premium brands when they do go out remains intact.
It’s a pattern that appears to be backed up by figures from CGA Strategy, which show a 15.4% increase in the volume of luxury malts and Cognacs sold in Scotland in the year to November 2012.
Jim Grierson, on-trade sales director at Maxxium UK, which counts bourbon brands Jim Beam and Maker’s Mark, Sauza Tequila, Courvoisier Cognac and malts like The Macallan and Highland Park in its portfolio, said the shift towards premium brands presents operators with a profit-boosting opportunity.
A higher spend will be achieved on boutique spirits but operators should keep their clientele in mind when choosing products.
“Consumers are now determined to spoil themselves when they are out enjoying themselves,” he said.
“As a result of this, stocking a good range of premium brands across the key categories is very important for a successful bar.
“Using simple drinks in a simple drinks menu will definitely encourage consumers to spend more on great tasting drinks.”
Stocking a range of boutique spirits can also help bartenders start a conversation with customers.
Angus Russell of Inverarity Morton, which acquired LA Wholesale late last year, said stocking unfamiliar bottles on the gantry can spark consumer interest in spirits.
“Obviously a higher spend will be achieved when offering a boutique range but operators should keep in mind their clientele whilst choosing a new product,” he said.
“For an extreme example, a bottle of XO Cognac you fell in love with on holiday would likely be a dust gatherer in your typical working man’s club, however, a nice dark Jamaican rum would probably be more up their street.
“Operators should really take up offers from suppliers on staff training: knowledge is so important to staff confidence when it comes to up-selling.
“From experience, after taking staff to different product tastings, it’s clear to see which products in their categories sell more than others, as the staff do genuinely take hold and find themselves a product that they want to recommend to others.”
Roy Summers, head of category management at distributor First Drinks, agreed that well-trained and knowledgeable staff are key to boosting sales of premium spirits.
Presenting a back bar well-stocked with a good selection of premium brands across all spirits categories is also important, he said.
Meanwhile, Ian Peart, on-trade channel director for spirits at Pernod Ricard UK, urged operators to remember that the appeal of premium brands extends beyond high-end venues.
Peart highlighted CGA statistics which showed growth in premium spirits volumes across a range of different outlets, with independents seeing a rise of 3.5%, leased/tenanted outlets up 11.1% and managed pubs up 6.4%. This contrasts with a decline in the volume of standard spirits sold, down 3.5%, 4.7% and 2.5% in outlet type respectively.
“The growth of premium spirits within the various channels of the on-trade indicates that licensees must consider stocking premium spirits if they want to capitalise on the current trend of ‘trading-up’,” said Peart.
Consumers are now determined to spoil themselves when they are out.
That view is supported by Ian McLaren, head of product, training and mixology at Bacardi Brown-Forman Brands. “This presents bar owners with the opportunity to make incremental profits, however it is important to remember that consumers are looking for great experiences to go with their premium brands and so we do advise that you consider your target audience when looking at range and drinks listings,” he said.
“When it comes to premium brands it’s important to know your market, as what works in some outlets may not be right for the needs of customers in another.”
Image – Presenting a well-stocked back bar, along with some unusual brands, is key to boosting spirits sales.