DISPOSABLE income – or lack thereof – is likely to be a big factor in hospitality in 2023, particularly in the early part of the year.
With the general public facing prices increasing well ahead of earnings, there’s bound to be a knock-on effect on visits to hospitality venues – and what customers buy when visiting them.
Brewers around Scotland had differing opinions on how the ongoing crisis might impact people’s beer choices in pubs and bars, with some reckoning unusual options will become more popular and others expecting customers to opt for tried and tested favourites.
But all agreed that quality – both in terms of product and service – is likely to continue to be a top priority for beer drinkers, whether they’re trying something new or enjoying a pint of ‘the usual’.
“Perfect serve is the ultimate way to promote your beer offering. It is vital in terms of value.”
“There’s no doubt the on-trade is suffering a really tough period at the moment,” said John Price, head of marketing at KBE Drinks, the company behind Kingfisher.
“After all the challenges of the pandemic, we’re only really at the beginning of the current cost of living crisis, which on the one hand is removing a lot of disposable income from consumers’ pockets which may well mean less visits to the pub, whilst on the other increasing the overheads and running costs for publicans and bar owners.
“However, it’s also reasonable to assume that the ‘less but better’ trend will continue as consumers have shown themselves to be increasingly willing to spend more when they do go out and treat themselves to better quality and authentic beer, cider and spirits options.”
Ben Lockwood, on-trade customer marketing manager at Brewdog, agreed.
Referring to CGA research, he said 43% of consumers have said they are going out less regularly than they typically would, with that figure expected to rise at the beginning of the year.
However, the research also highlighted better news, with 69% of respondents saying a visit to the on-trade is ‘the treat they most look forward to’ and 48% saying they consider it an ‘affordable treat’.
“Perfect serve is the ultimate way to promote your beer offering – it is vital in terms of value for money and justifying the higher price point, particularly when so many consumers are monitoring their spend,” said Lockwood.
“For beer that’s glassware and a great pour. Standard/unbranded glassware being used for all drinks in the category doesn’t help with elevating the experience for the guest or showcasing the quality of your craft options.”
Generally, the consensus was that customers are likely to lean even harder into the ‘less often but better’ trend that was already established before the pandemic.
This could apply equally to the number of visits and also how customers behave when they’re in premises.
Jason Clarke of Genius Brewing said he thought it likely that 2023 “will see a continuation of the trends in play since the end of lockdown, with premiumisation and healthier drinking leading the way”.
“If beer drinkers are making the investment in a trip to the pub, it’s likely they’ll want to enjoy something different and exciting compared to the supermarket-bought ‘usual’ at home,” said Clarke.
“Consumers will still look for a breadth of choice so it’s worth adding a few new products.”
“Having a good range of interesting craft beers, especially on draught, can help the experience feel like an adventurous ‘treat’.”
Moderation was also highlighted as an important trend by Neil Martin, regional on-trade sales director (east) at Tennent’s, who said the Scottish beer giant expected 2023 to mirror pandemic drinking trends “in that people might be happy to spend a little bit more on the drink they want but consume it more moderately”.
“This is reflected in a recent report from PROOF Insight which found that one in five (22%) of beer drinkers are drinking less often but treating themselves to better quality,” said Martin.
He added that, with costs so high, some operators could be tempted to ‘streamline’ their product range.
“However, consumers will still be looking for a breadth of choice so it’s worth adding a few new products and starting off with small volumes to test demand,” he said.
Clarke at Genius Brewing echoed that sentiment, warning operators against cutting their range too drastically.
“Energy costs are a massive challenge for publicans but reducing the beer range isn’t much of a solution,” he said.
“Heating and lighting costs won’t change.
“Where we may see range reduction play a part is simply in margin protection with the mega-brands able to offer volume discounts in return for font domination.
“However, this would fly in the face of the customer’s increasing desire for an interesting range of premium and craft offerings.”
