Introduction
Reinvigorating On-Trade Sales 2007 shows how, despite some recent tough times in this part of the alcoholic drinks market, there are significant opportunities for those able to develop targeted new products and invest in relevant point-of-sale marketing campaigns. On-trade occasions can be developed that are more in keeping with today's growing demographic groups and mass market lifestyles.

Scope
Countries covered: France, Germany, Italy, The Netherlands, Spain, Sweden, the UK and the US.
Product categories covered: beer, cider, flavored alcoholic beverages, spirits and wine.
A unique survey of the decision-making criteria for purchasing alcoholic drinks in the on-trade vs. the off-trade (5,000 consumers during June 2006).
Insightful analysis of consumer attitudes and behaviors driving change in the on-trade.
Highlights
The major on-trade trends show that people are going out more frequently but they are consuming less per visit; such that on-trade volumes are growing, albeit slowly. However, premiumization is driving value sales - particularly in spirits - and there are important lessons for all players to learn from this trend.

Surprisingly, consumers are less brand conscious in the on-trade than the off-trade. Partly this is to do with the fact that experimenting with new products is more likely to involve trying unknown brands and partly to do with the fact that the very social nature of the on-trade gives rise to new behavior because of word-of-mouth recommendations.

Point-of-sale marketing activity can be reinvigorated with innovative campaigns. Learn the power of such concepts as relaxed drinking, mentoring and customer education. These have all been tried and tested in specific countries and markets and are now ripe for you to adopt in your marketing strategy.

Reasons to Purchase
Consumer data - Understand the reasons for purchasing in the on-trade, by country and demographic group.
Demographic consumption analysis - Spot the growth segments that are changing the on-trade.
Actionable recommendations - Prioritize product, price and point-of-sale activities.

TABLE OF CONTENTS
CHAPTER 1 EXECUTIVE SUMMARY 3
The hot topic 3
The future decoded 3
Action points 6
CHAPTER 2 THE FUTURE DECODED 17
Introduction 17
TREND: On-trade visits – more frequent, less consumed 17
The number of on-trade drinking occasions is rising 18
Low but steady growth in on-trade visits per head 19
Alcohol consumption per occasion is falling in Europe 20
Volume growth will return to Europe but lessen in the US 20
TREND: Food is becoming vital to on-trade outlets 22
TREND: Midweek going-out is driving on-trade growth 23
Workplace sociability is the biggest driver of midweek drinking 23
INSIGHT: Wine and spirits will drive future growth 24
Beer remains dominant despite falling share 25
INSIGHT: Spirits and wine will gain from premiumization 27
Demographic groups approach premiumization differently 28
INSIGHT: Midlifers challenge Young Adults as the key on-trade group 29
Midlifers drive growth in Europe and the US 30
Young Adults' share is biggest in northern Europe 33
Early Midlifers are the new biggest target group 34
INSIGHT: Women are challenging men’s on-trade dominance 35
European drinking venues are decreasingly ‘men-only’ 35
US on-trade egalitarianism gets deeper 37
Women’s drinking behaviors and needs are different from men’s 37
INSIGHT: Smoking bans will speed change in the on-trade 38
Smoking is still popular among consumers and especially drinkers 38
Short-term alcohol sales may be hit by smoking restrictions 39
In the longer term the on-trade will attract new customers 41
INSIGHT: Health concerns are shaping drinking behavior 42
Consumers believe moderate drinking is healthy 42
Fears of binge drinking persist across all countries 42
The switch to healthy drinking currently favors the off-trade 43
INSIGHT: At-home offers better choices than going out 45
People are widening their drinks repertoires 45
The off-trade is best able to capitalize on growing repertoires 46
But the on-trade can benefit from greater experimentation 46
Conclusions 49
CHAPTER 3 ACTION POINTS 50
Develop premium alcoholic drinks 50
Developing higher price points 51
Encourage consumers to trade-up – regularly 52
Emphasize the premium qualities of mass market products 52
Market ‘accessible-premium’ on-trade alcoholic drinks 53
Develop limited edition ranges 54
Improve on-trade wine ranges 54
Pursue non-NPD solutions to improve on-trade quality 54
Brewers can learn lessons from wine and spirits companies 56
Create drinks and venues that attract Midlifers 58
Treat European Early Midlifers like sophisticated Young Adults 58
Provide an escape for US Midlifers and European Late Midlifers 59
Adjust to an increasingly feminized on-trade environment 61
Make venues and promotions female-friendly 62
Make female-friendly beverages available in the on-trade 63
Develop emerging ethnic markets 65
Target high-growth consumer occasions 67
Market drinks that complement food occasions 67
Target midweek alcohol drinking occasions 70
Position the on-trade as a healthy choice 71
Show that sociable on-trade drinking can be actively healthy 71
Adapt to smoking bans ahead of their introduction 72
Make the on-trade experience better than drinking at home 72
Turn bars into comfortable, convenient ‘homes from home’ 73
Create on-trade venues that outclass the off-trade alternative 73
Celebrate the authenticity of the on-trade 75
Celebrate the localness of the on-trade 76
Step up the level of on-trade point-of-sale activity 76
CHAPTER 4 APPENDIX 80
Supplementary data 80
On-trade alcoholic drinks in France 80
On-trade alcoholic drinks in Germany 81
On-trade alcoholic drinks in Italy 82
On-trade alcoholic drinks in the Netherlands 83
On-trade alcoholic drinks in Spain 84
On-trade alcoholic drinks in Sweden 85
On-trade alcoholic drinks in the UK 86
On-trade alcoholic drinks in the rest of Europe 87
On-trade alcoholic drinks in the US 88
Definitions 89
Research methodology 91
Report writing team 91
How to contact experts in your industry 92

LIST OF TABLES
Table 1: On-trade alcoholic drinking occasions, US and Europe, 2001-2011 18
Table 2: On-trade alcoholic drinking occasions per person per week, US and Europe, 2001-2011 19
Table 3: Alcohol consumption per on-trade drinking occasion, US and Europe, 2001-2011 21
Table 4: On-trade alcohol sales by volume, US and Europe, 2001-2011 21
Table 5: Forecast profit-sector foodservice compound annual growth rate, 2006-2011 (%) 22
Table 6: On-trade alcoholic drinking occasions in the US and Europe, midweek versus weekend (%), 2000-2010 24
Table 7: Answers to the question “How will on-trade sales of the following product types change over the next five years?”, 2005 25
Table 8: On-trade alcoholic drinks category share in Europe, 2001-2011 26
Table 9: On-trade alcoholic drinks category share in the US, 2001-2011 26
Table 10: Answers to the question “How is the on-trade price per unit of the following product types (excluding inflation) likely to change over the next five years?”, 2005 27
Table 11: Perceived importance of different demographic groups to the on-trade alcoholic drinks industry, 2005 29
Table 12: European on-trade alcoholic drinks consumption index by age group (average adult = 100), 2001-2011 31
Table 13: US on-trade alcoholic drinks consumption index by age group (average adult = 100), 2000-2010 31
Table 14: Average age at first marriage and childbirth, Europe and US, 2005 32
Table 15: Young Adults’ share of on-trade alcoholic drinks consumption, US and Europe, by volume of pure alcohol, 2001-2011 33
Table 16: Perceived on-trade alcoholic drinks growth potential of different demographic groups, 2005 34
Table 17: Europe on-trade alcoholic drinks consumption index by gender (average adult = 100), 2001-2011 35
Table 18: Women’s share of on-trade alcoholic drinks consumption in Europe and the US, by volume of pure alcohol, 2001-2011 36
Table 19: US on-trade alcoholic drinks consumption index by gender (average adult = 100), 2001-2011 37
Table 20: Prevalence of regular smokers in the US and Europe (%), 2000-2005 39
Table 21: France on-trade alcoholic drinks consumption, 2001-2011 80
Table 22: France on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 80
Table 23: Germany on-trade alcoholic drinks consumption, 2001-2011 81
Table 24: Germany on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 81
Table 25: Italy on-trade alcoholic drinks consumption, 2001-2011 82
Table 26: Italy on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 82
Table 27: Netherlands on-trade alcoholic drinks consumption, 2001-2011 83
Table 28: Netherlands on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 83
Table 29: Spain on-trade alcoholic drinks consumption, 2001-2011 84
Table 30: Spain on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 84
Table 31: Sweden on-trade alcoholic drinks consumption, 2001-2011 85
Table 32: Sweden on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 85
Table 33: UK on-trade alcoholic drinks consumption, 2001-2011 86
Table 34: UK on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 86
Table 35: Rest of Europe on-trade alcoholic drinks consumption, 2001-2011 87
Table 36: Rest of Europe on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 87
Table 37: US on-trade alcoholic drinks consumption, 2001-2011 88
Table 38: US on-trade alcoholic drinks consumption index by age and gender (average adult = 100), 2001-2011 88
Table 39: Definitions of terms 89
Table 40: Definitions of drinking occasions 90


LIST OF FIGURES
Figure 1: Consumer survey: “Do you agree that you are more price-conscious when drinking out-of-home than when buying drinks for in-the-home?”, June 2006 28
Figure 2: Consumer survey: “Do you agree that you are more health-conscious when drinking out-of-home than when buying drinks for in-the-home?”, June 2006 44
Figure 3: Consumers vary their drinks choice by occasion and need state 45
Figure 4: Consumer survey: “Do you agree that you are more likely to try new drinks when drinking out-of-home than buying drinks for in-the-home?”, June 2006 47
Figure 5: Consumer survey: “Do you agree that you are more brand-conscious when drinking out-of-home than when buying drinks for in-the-home?”, June 2006 48
Figure 6: Champagne Nicolas Feuillette One Fo(u)r, 2005 51
Figure 7: Even mass-market products can be marketed on the basis of quality 53
Figure 8: Smirnoff’s Triple Distilled campaign, 2005 53
Figure 9: Diageo’s Every Serve Perfect bar staff training scheme 55
Figure 10: Reinterpreting the packaging attributes that have been successful for spirits 56
Figure 11: Learning from spirits combinations that have captured the public imagination 57
Figure 12: Borrowing new product concepts from around the world 57
Figure 13: Carlsberg Export’s hygge bar concept, 2006 59
Figure 14: There is a significant gender difference in bar preference 62
Figure 15: Brewers are increasingly targeting female on-trade drinkers 64
Figure 16: Demystifying wine in a friendly atmosphere is a good way of appealing to female consumers 64
Figure 17: Niche interest on-trade promotions from Budweiser and Michelob, 2006 65
Figure 18: Spicy Varietals wines targeting the ethnic restaurant sector 68
Figure 19: Beer ranges for restaurants 69
Figure 20: Heineken’s sponsorship of the UEFA Champions League, 2006 70
Figure 21: Magners has built on the “time dedicated to you” concept, 2005 72
Figure 22: Coors delivers a different sensation to on-trade drinkers, 2006 74
Figure 23: Vintage Budweiser can design, 2005 75
Figure 24: Johnnie Walker mentoring program 77
Figure 25: Example of Everards’ Cyclops system for beer tasting notes 78
Figure 26: Hofbrau’s visually dramatic beer dispenser, 2006 79