Christmas and new year are lucrative times of the year when pubs can really maximise sales and footfall by offering consumers the opportunity to premiumise their drinks and capitalise on their experience – making things a little more glamorous than other times of the year.
CGA figures from last year show consumers are more likely to try new categories and trade up at Christmas, so, the festive season presents an opportunity for pubs to leverage sales through their premium offer.
Spirits are the biggest winners over Christmas, especially the categories that perform well during the rest of the year. The CGA figures highlight that gin and golden rum can grow their share of the sales mix and vodka and dark rum benefit most from consumer trade up at this time of year.
Engaging consumers with new drinks at Christmas is key to driving year-round consumption in the on-trade because of the one in five consumers who have tried a new or different drink when out over the festive period, 63% are likely to order that drink again.
The number of consumers who are trying new drinks during the festive period is rising year on year. In 2015, for example, 18% of consumers had sampled a different tipple compared with 20% in 2016.
More than half (56%) of consumers switched from their normal drink to at least one of the following: liqueurs and specialities, hot alcoholic drinks, sparkling wine, cocktails or Champagne.
Premiumising the offer
Spirits in particular do well over the festive season, as CGA data shows the category outperforms all others with 18.9% of total serves being spirits. This is up 0.9 percentage points for Christmas year on year.
In fact, tying together premiumisation and spirits is just one way pubs can make the festive period work for them even more.
27.5%
the rise in premium gin volume sales – the market leader in the spirit and mixer category – followed by premium Tequila (up 24.6%) and premium rum (up 15.1%)
This is something soft drinks brand Franklin & Sons has spotted. Head of marketing Jennifer Draper says: “The traditional spirit and mixer has become increasingly popular in both the on and off-trades. Premium spirits in particular are driving the category forward, with premium gin leading the way, growing 27.5% in volume (data from CGA OPM MAT to 6 August 2016), closely followed by premium Tequila (up 24.6%) and premium rum (up 15.1%).
“It is imperative that premium spirits are offered to ensure pubs and bars are able to drive sales during this lucrative period.”
While premiumisation is one crucial trend operators need to keep an eye on, the ever-growing demand for healthy options is another.
Draper adds: “More than one fifth of UK adults now say they do not drink alcohol (Britvic Report 2016). As a result, premium, adult soft drinks are a growth-driving category.
“The crafted appeal of certain alcoholic products, such as beer and gin, is now transcending into the soft drinks category, resulting in more consumer choice for hand-crafted drinks with heritage.
“Some 1m more consumers drank soft drinks last year compared to the year before and the demand for history, provenance and the authenticity of drinks is rising. However, more than this, in order to meet the complex flavour demands from consumers, soft drinks need to boast more unusual flavour profiles and ingredients.
“Operators at Christmas cannot overlook this because it is a key area for premiumisation and upsell.”
￡829
the additional amount that a pub can take across the Christmas weekend because Christmas day falls on a Monday, over and above the amount a pub would take if the christmas weekend fell differently
Encourage the trade-up
Spirits giant Diageo echoes this point and head of category and insights Faith Holland explains the festive period is an occasion where consumers want to treat themselves.
She adds: “Christmas in the on-trade is a time when people are really happy to indulge and treat themselves.
“This creates a real opportunity for operators to maximise their sales because drinkers are willing to trade up their tipples and try new things.
“Licensees, therefore, need to make sure there are those opportunities for consumers to do just that. If you think about spirits, it is about making sure there are premium options.”
Soft drinks company Coca-Cola European Partners also highlights the importance of premiumisation, especially on this particular special occasion.
Trade communications manager Amy Burgess says: “Christmas is the perfect time for licensees to encourage greater sales of their premium offer as people look for a special drink during the festive period.
“With three quarters of consumers buying premium spirits when in a licensed premises and almost half saying they would rather order a premium spirit when buying a long mixed drink (according to the CGA Mixed Drinks Report April 2016), stocking premium options is essential.”
How to drive footfall
Providing an experience is key to driving footfall throughout the year but even more so at Christmas says CGA, so make sure you offer these things:
■ Festive cocktails
■ Christmas menus
■ Outlet events
■ Outdoor festive pop-up bars
Two weekends on offer
Diageo also urges publicans to be aware of the potential for extra trading opportunities because Christmas Day falls on a Monday.
With the three days leading up to 25 December taking place across a weekend, licensees need to grasp the potential additional sales on offer by ensuring they are adequately stocked and that they are driving footfall through activation and promotion in their outlets to benefit.
Holland adds: “There is an opportunity for pubs to take an extra ￡829 across that weekend more than there would be if Christmas did not fall that way.
“This is the same for New Year’s Eve, so there are, in fact, two weekends for on-trade operators to really capitalise on the opportunity the festive season brings.”
On the subject of dates, CGA also reveals that customers are looking beyond the traditional night out, not only at Christmas, but also for New Year’s Eve.
Pubs need to create exciting and engaging experiential events in an attempt to re-engage lapsed consumers with this occasion.
Tap into drinks trends
The benefits of getting this right are evident with customers typically spending 30% more on New Year’s Eve than their average big night out.
Therefore, operators need to push consumers to trade up with their drinks and tap into drinks trends to ensure their Christmas trading period is merry and bright.