New data from the US On Premise shows cause for optimism in the market, despite the ongoing economic challenges consumers are facing.
CGA by NIQ’s November Consumer Impact Report signposts ways drinks brands, suppliers and operators can win sales by understanding the key factors influencing consumer spend and the motivations for visitation.
Over a third of consumers are visiting the On Premise more than usual, despite the cost-of-living crisis and student loan repayments. On a continued encouraging note, the vast majority of consumers visiting bars, restaurants and similar venues in the past month have either spent the same amount or more overall (77%) and per visit (80%).
Why are they spending more when out? In short, while rising prices have played their role, 44% are simply going out more often and 32% are spending more because they’re treating themselves.
1 in 4 consumers have been directly affected by the re-start of their own or a spouse/partner’s Student Loan repayments on October 1st. Those aged 21-34, who typically visit the On Premise with a higher frequency than other age demographics, are especially impacted by student loan repayments with almost half of these consumers and/or their partner or spouse now making Student Loan repayments.
For this reason, almost two thirds of this category are experiencing a negative impact on their disposable income, and 7 in 10 are making a conscious effort to buy cheaper drinks options. What’s more, significant proportions have also been cutting back on frequency of visitation to the On Premise and/or opting for cheaper venues.
All in all, the Report paints a picture of higher spends across the board. Conversely, it also highlights greater budget consciousness and a desire for value options amongst the key 21–34-year-olds demographic.
For both purposes, it’s vital for drinks brands, suppliers and operators to strategically maximize higher and more frequent spenders, while not losing sight of the needs of younger consumers who continue to represent a sizeable prize.
Matthew Crompton, Regional Director – North America said: “The findings in the latest Report indicate ongoing resilience in the On Premise, with over a third of consumers increasing visits despite economic challenges. Understanding diverse spending motivations is crucial for brands, suppliers and operators to ensure a piece of the action. Conversely, over a quarter of consumers are visiting less, emphasizing varied preferences. Then there’s younger consumers, impacted by student loan repayments and seeking affordability. This key group represents both a challenge and an opportunity. So, it’s wise for suppliers and venues to balance how they cater to higher spenders while also addressing the specific needs of 21–34-year-olds for sustained success in a shifting environment.”
CGA’s On Premise Impact Reports help suppliers and manufactures across food and beverage keep a pulse on the industry by featuring current insights derived from a variety of our best-in-class data tools. Contact Matthew Crompton for more information at Matthew.Crompton@nielseniq.com to learn more about subscription access and wider capabilities.
About CGA by NIQ
CGA by NIQ provides definitive On Premise consumer intelligence that reveals new pathways to growth for the world’s most successful food and drink brands. With more than 30 years of best-in-class research, data, and analytics, CGA by NIQ provides the Full View(TM).
CGA by NIQ works with food and beverage suppliers, consumer brand owners, wholesalers, government entities, pubs, bars, and restaurants to protect and shape the future of the On Premise experience. Using the most complete and clear understanding of measurement and insights, CGA by NIQ provides a competitive edge to guide winning strategies for On Premise businesses.
NIQ was founded in 1923 and is an Advent International portfolio company. For more information, visit NIQ.com or www.cgastrategy.com.
New data from the US On Premise shows cause for optimism in the market, despite the ongoing economic challenges consumers are facing.
