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Slow return for consumer confidence

Published:  20 August, 2020

Consumer confidence with regard to eating and drinking out dipped in the UK in July as the reality of an altered hospitality landscape sank in.

This is the tentative finding of a tracking study of the UK market by Wine Intelligence, which is the first of new results in from a consumer attitudes survey replicating a survey taken during the height of lockdown across 14 major wine markets to assess willingness to go out to eat and drink.

That April survey identified four groups based on their attitude to post-lockdown life, under the largely self-explanatory headers of Halters, Reducers, Moderators and Hedonists.

The research, which found “remarkable overall symmetry” in the proportions found by group across the markets surveyed, identified around half of consumers as Moderators – those that anticipated largely returning to their previous socialising habits post-lockdown – and 15% to 20% as Hedonists – those that were determined to increase socialising post-pandemic.

However, early indications based on the first new research in from the UK market suggested that the bullish mood of the largest Moderator grouping has dampened down, with only 35% of the UK sample now in that bracket, as opposed to 56% in April 2020. The Hedonist quotient was also down, from 16% to 11%, while those identifying as Reducers – those “significantly curtailing their lifestyle post-lockdown – rose from 10% to 35% over the same period".

Halters – those “anticipating almost ceasing all social activities” – remained consistent, at 18%.

“Our four segments are still present, but in some cases their share has changed markedly. Many of the Moderators from April have now become Reducers, and Hedonists have shrunk from 16% to 11% of consumers,” wrote the report’s joint authors, Richard Halstead and Tina Fruth of Wine Intelligence.

“Perhaps most telling, [is the fact that] the combination of Reducers and Halters – those who have put the brakes on social life and eating out – now account for over half of all UK wine consumers. And this in the weeks after people in the UK were allowed out again.”

The report is clear that these are preliminary indications of current consumer confidence based on just the UK so far, with results awaited from markets as diverse as China, USA and Canada, where the experience and reality of the pandemic has been different.

However, it also speculates that consumers may be following the behavioural pattern outlined by the well-known Stages of Grief model, with people moving through denial, anger, bargaining, sadness, and then, finally, acceptance.

According to this pattern, April attitudes reveal denial among Moderators, and July – as the on-trade reopened – has been marked by a reversal, with much increased numbers of Reducers “believing it won’t be alright”, as the stages play out in a collective initial loss of confidence.

The big question, which may be partially answered by data from other markets, is how soon a majority of consumers will arrive at 'acceptance' and turn those Reducers numbers back into Moderators that will enjoy going out.

The scale of the challenge faced by the on-trade was recently revealed by data from CGA’s Coffer Peach Business Tracker, which showed that Britain’s managed pub, restaurant and bar groups saw trading fall to just over half of ‘normal’ trading in July 2020 compared to the same month in 2019.