Pubs will 'reinvent their mojo' to achieve future success

That’s the upbeat prediction within a new report, revealed at last week’s Future Pub conference in London, which says that pubs will continue to re-invent themselves to find a new place in society, and with it attract a new breed of customers.

The UK Pub Market Report​, produced by Allegra Foodservice, sister brand to the Publican’s Morning Advertiser​ (PMA), forecasts that the market will reach £24.2bn in value by the end of 2018 — up from £21.8bn this year. This increase in sales is set to come from around 2,000 fewer outlets as surviving pubs outperform the rest of the eating-out market.

Average turnover per pub will increase by 16% from £438,000 to £508,000 over the period.

Sweet spot​

The report recognises that the pub market had “lost its mojo” in recent years, struggling to deal with the fall in consumer spending during the recession, smoking ban and the shift in people’s drinking habits. However, consumer ‘participation’ in the pub market is increasing and performing well in comparison to other eating-out establishments.

Pubs are also in the sweet spot when it comes to attracting customers of different ages, particularly appealing to people aged 50-plus. They also rate highly for
the value for money they offer, as well as on service speed and quality.

Pubs are increasingly staking a claim to become the ‘third space’ in society, after home and work environments, reclaiming that spot from coffee shops, by providing a comfortable space that proves attractive to both young and old customers.

Positive​

Speaking at the conference, Simon Stenning, Allegra’s executive director, said: “It’s important to say pubs must have a good coffee offer. But it’s also important to say that beer is better. Because beer quality has improved and developed there is another reason for consumers to come back to pubs.”

Stenning added that although the trading outlook was challenging, consumers were feeling more positive and becoming much more interested in the whole
eating-out experience.

“Pubs are doing things differently, improving their food offer and hosting more events. They are recognising that in order to drive their business they have to do something different from the norm,” he said.

“They have to provide more reasons for customers to visit and better reasons as to why they should choose them over the competition. Future pub growth is under way as pubs reinvent their mojo.”

Hybrid or speciality​

However, he sounded a note of warning, pointing at new research from PMA​ readers, which found that 30% of pubs are still not selling any food.

Stenning said that ‘hybridisation’ was a key development for the sector, and that pubs should either specialise in one of four trading models or become a hybrid of
them. The four models are: all-day, food destination, quality wet-led and after-work destination.

“Success will come from being specifically in one of those sectors or, dependent on location, being a hybrid model,” Stenning said.

Pubs with mainstream offers will continue to be squeezed, with the growth coming at both the value and premium end of the market, particularly in independent pubs.

For more details and to purchase the UK Pub Market Report​, contact Richard Hayman.​