On-trade loses out

Published: 23 July, 2008

The on-trade continues to lose out to the take-home market as the big night in' concept grows in popularity among consumers, a leading industry conference was told earlier this month (June).

David Glennon, marketing manager at AC Nielsen, told the Quality Drinks Conference, organised by Harpers and sister magazines Checkout and Independent Retail News, that fewer people are going to pubs on a regular basis. Even weekly visits are falling,' he said.

The average price of a pint in the on-trade is 2.24, said Glennon, while it is just 1 a pint in the off-trade, mainly due to heavy discounting by the major multiples. No wonder the off-trade is stealing share from the on-trade,' he added.

The on-trade still accounts for 80% of beer sales in value terms and 60% in volume terms, he said, but in-home entertaining is gradually eroding market share. Research showed that almost half of all drinking occasions in the home involve watching TV.

Glennon said the off-trade now accounts for 64% of wine sales, although the market is static' overall. The wine market continues to be influenced by the many cut-price promotions running in the major supermarkets, where more than half of all wines are sold for under 4. The 3.50 to 4 wines are growing at 16% year-on-year, he said.

The importance of the deal' in the off-trade was highlighted in AC Nielsen research, which shows that two-thirds of wine shoppers would buy a wine brand they wouldn't normally purchase if it was price promoted. Around 87% of shoppers actually look out for special purchases in-store, said Glennon.

Wine price promotions are changing, with more supermarkets going for the half-price offer, in particular 7.99 wines at 3.99. This has resulted in some promotions providing a 10% uplift in brand sales, said Glennon.

A full report on the Quality Drinks Conference will appear in Harpers 7 July.

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