Market Report 2020

Premium Soft Drinks and Mixers
Market Report 2020

Introduction
I am delighted to introduce the second Fentimans Premium Soft Drinks and
Mixers Market Report in partnership with CGA.
It has been a tumultuous twelve months since we published our inaugural

report last summer. The UK’s exit from the European Union, the embedding
of the government’s ‘sugar tax’, an ultra-competitive trading environment, a
steady stream of new product launches and heightened interest in
sustainability—these and many more dynamics have contributed to an
evolution of the market in which we operate.
On top of that, all of us have been faced with the unprecedented challenge
of the Covid-19 pandemic, which has massively disrupted the sector and
triggered huge global economic uncertainty. It has been one of the most
significant events in living memory, and may well change consumers’ attitudes
and behaviour for good.
But the premium drinks market is a dynamic and agile sector, and there are
many reasons to be optimistic. Consumers are increasingly experimental, with
a thirst for quality and innovation. At Fentimans, a brand with a growing legion
of advocates both in the UK and overseas and a pioneer of the craft drinks
market, we are upbeat and positive that the premiumisation trend in soft
drinks and mixers will go from strength to strength.
In this report we aim to provide an objective view of the sector in which we

operate. By combining Fentimans’ long experience with CGA’s market-leading
data and insights, we set out the trade and consumer trends and influences to
follow. I hope you find it helpful and thought provoking as we together embrace
the many opportunities and challenges that lie ahead.
Eldon Robson, Founder of Fentimans Ltd
Fentimans Premium Soft Drinks and Mixers Market Report / 02

Part One
An overview of Britain’s on-trade market in 2020
Part Two
Consumer trends impacting the drinks industry
Part Three
A look at the key drivers shaping the on-trade channel – post lockdown
Part Four
A deep dive into the soft drinks and mixers categories
Part Five
Key flavour trends to watch out for over the next twelve months
03 / Fentimans Premium Soft Drinks and Mixers Market Report Fentimans Premium Soft Drinks and Mixers Market Report / 04
About the report
The 2020 Fentimans Premium Soft Drinks and Unless indicated, data in this report is drawn from The report also draws on a range of special
Mixers Market Report is the second annual analysis CGA’s unparalleled suite of research sources, reports issued by CGA and partners to measure
of the UK’s dynamic premium soft drinks and mixers including: and support the sector’s road to recovery after the
market. It provides comprehensive analysis of the Covid-19 lockdown throughout Spring and Summer
sector, blending Fentimans’ deep experience gained • CGA BrandTrack, the quarterly survey of the 2020. They include:
over more than a century in business with habits of 5,000 nationally representative British
authoritative data and analysis from the experts consumers, including their attitudes to more • Consumer Pulse, a bi-weekly survey of
at research consultancy CGA. than 270 drinks brands and 80 of the country’s consumers to review their latest attitudes
eating and drinking out brands and behaviours
The report assesses the market from the
perspective of both consumers and businesses, • CGA’s On Premise Measurement Tool, • The Market Recovery Monitor, a monthly
reviewing the most significant drinks trends and which analyses the on-trade and all guide to the reopening of the licensed sector
considering what might be coming down the line categories of drinks across Britain, produced in association with
over the next twelve months. It is our attempt to AlixPartners
gauge the exciting and rapidly evolving premium • Coffer Peach Business Tracker, the
sector and stimulate thinking and debate about benchmark of sales for leading managed • The Drinks Recovery Tracker, a weekly guide
the big opportunities for all of us in the future. pub, bar and restaurant groups to sales in different drinks segments, powered
by CGA’s Trading Index
• The CGA Business Leaders’ Survey, which
gathers the opinions of more than 170 • The ‘We Hear You’ survey of consumers’
influential individuals working at CEO, MD, opinions about the hospitality venues they
Chairman, Director or other senior have visited, conducted in association with
management level. UKHospitality, Yumpingo and nearly 200
leading operators
• Research into the post-lockdown market in

China and the latest US data from Nielsen CGA.
For more details about CGA’s sources and

methodologies, visit www.cga.co.uk
Total drinks market
1
Premium soft drinks
£31bn
Value of Britain’s long alcohol drink, spirits,
1.8%
Year-on-year
£603m
Value of the premium soft drinks market in
12.1%
Share of the total soft drinks
and mixers market now taken
wine, soft drinks and mixers market in the increase in the
Britain in the last twelve months by premium soft drinks
last twelve months market value
Premium mixers
£13.7bn £11.8bn £5.5bn
Drinks sales in
the drink-led
pub sector
up 7 by
1.9%
year on year
Drinks sales
in the food-led
sector
up by
2.1%
year on year
Drinks sales
in bars and
clubs
up by
0.9%
year on year
£375m 18.3% 8.1%
Value of the premium mixers Year-on-year increase in the Share of the total soft drinks and
market in Britain premium mixers market mixers market now taken by
Top five premium soft drinks categories by value premium mixers
1 4 5
59%
2 3
Share of year-on-year growth in the soft drinks
Mixers Flavoured carbonates Juice Water Lemonade and mixers market taken by premium mixers
(£374.7m, 18.3%) (£50.8m, 0.2%) (£45.3m, 16.8%) (£42.8m, 3.1%) (£33.7m, 0.9%)
Soft drinks and mixers The impact of lockdown
£4.6bn 1.1% 15.0% £11.1bn £1.7bn £198m

Value of the soft drinks and mixers Year-on-year value increase in the Share of the total drinks market Year-on-year fall in drinks sales Year-on-year fall in soft drinks Year-on-year fall in premium soft
market in Britain total soft drinks and mixers market now taken by soft drinks and across Britain’s on-trade from sales in the same period drinks sales in the same period
mixers 22nd March to 8th August 2020
1
All data in this section is taken from CGA’s On Premise Measurement Tool, twelve months to February 2020
Stage 1: Pre-Covid
As the pandemic arrived, the British on-trade was in a stable position with
substantial optimism for 2020. Sales over 2019 had been steady rather
than spectacular, with CGA’s Coffer Peach Business Tracker indicating
like-for-like sales growth at leading managed pub and restaurant
groups of 1.6%.2
Pub and restaurant sales
up 1.6% by value
Consumer levels of eating and drinking out had remained resilient. In late
1.6%
2019, half (50%) of all consumers said they ate out at least once a week,
Part One: An overview of and a third (32%) drank out at the same rate3—and both numbers have
held steady for several years now, despite pressures on spending and
50%
economic uncertainty. Across the UK’s entire hospitality sector—including
Britain’s on-trade hotels, entertainment venues and other licensed premises as well as pubs,
bars and restaurants—sales rose at a healthy rate of 4%, to nearly
£134bn in 2019.4
It is impossible to discuss the on-trade and drinking-out market without considering the
seismic impact of the Covid-19 pandemic and lockdown. Here, with the help of CGA’s CGA’s Business Leaders’ Survey confirmed the sector was in optimistic
market-leading research sources and analysis, we review the three distinct phases of 2020: mood at the start of 2020. More than four in five (83%) leaders of pub,
the state of the market before the pandemic, the impact of the lockdown that closed pubs, bar and restaurant businesses said they were optimistic for their
bars and restaurants for nearly three months; and the recovery period since hospitality prospects in 2020—a figure that was the highest since the EU Referendum
was given permission to reopen from Saturday 4 July. of mid-2016, and that had increased by around 20 percentage points since
late 2018. Three quarters (74%) of leaders thought British consumers Of all consumers said they ate out
would eat and drink out more or as often in the next six months.5 at least a week in late 2019
32%
The Business Leaders’ Survey revealed some concerns—especially around
staff recruitment and retention following the UK’s formal departure from
the European Union, and about high levels of ingredient and property
costs. But it is ironic that the pandemic hit at the highest point of business
Of all consumers said
confidence for nearly four years—and at a time when, after Brexit and a they drank out at least once a week
General Election, consumers and politicians alike were starting to plan for
the future with more certainty.
2
CGA Coffer Peach Business Tracker, January to December 2019 4
UKHospitality and CGA Quarterly Tracker, January 2020
3
CGA BrandTrack, October 2019 5
CGA Business Leaders’ Survey, January 2020
Stage 2: Lockdown
CGA’s data shows the instant and enormous impact of the lockdown
on sales. UKHospitality’s turnover tracker with CGA showed a
89%
Month-on-month plunge of sales in
Stage 3: Recovery
Since 4th July 2020, operators have rolled out stringent measures to reassure consumers that they are in safe hands
when they go out to eat and drink. Table spacing, ample supply of hand sanitiser, contactless ordering and payment,
month-on-month plunge in sales of 89% in April—equivalent to £4.7bn staff PPE and enhanced hygiene protocols all had a positive effect on the crucial first impressions of guests returning to
April—equivalent to £4.7bn of lost
of lost turnover.6 In March and April combined, the hospitality sector venues. In early August, a survey for the ‘We Hear You’ initiative—designed to gather feedback from guests and show
turnover
accounted for 33% of the UK’s entire drop in GDP, the Tracker showed. that their views were being acted on—showed that nine in ten (89%) people were satisfied with the safety measures
Confidence plummeted, and in April just 5% of leaders felt optimistic In March and April they had found.10
about the market over the next twelve months—by far the lowest point combined, the
ever recorded by CGA’s regular quarterly survey.7 hospitality sector Safety measures quickly reassured younger people in particular, and two thirds (67%) of 18 to 34 year-olds had been
accounted for 33% back to the on-trade within a month of reopening.11 And while safety precautions inevitably made some aspects of
The lockdown soon triggered some of the most significant changes to of the UK’s entire eating and drinking out different to pre-Covid, in general they haven’t appeared to diminish the experience of guests.
consumer behaviour ever seen. CGA’s BrandTrack survey in June drop in GDP In fact, two in five (42%) said their visits had exceeded their expectations—compared to just 7% who felt that
highlighted the sudden impact on household finances, with a fifth experiences fell below what they hoped.12
(20%) of all UK workers furloughed and a third (34%) of consumers
seeing their income drop. Three quarters (75%) said they were Another welcome boost to the industry came via the government’s Eat Out to Help Out initiative, which offered
worried about the long-term financial impacts of Covid-19. 8
consumers 50% off meals and soft drinks on Mondays, Tuesdays and Wednesdays in August. Participating venues
reported huge interest in the scheme, and official figures showed that around 64 million claims were made in the first
Ahead of the easing of restrictions, it was clear that the UK’s pubs, A fifth (20%) all UK workers furloughed
three weeks alone.13 As well as food, this had a sizeable impact on the soft drinks market. In the second full week of
bars and restaurants faced an enormous challenge in attracting August, sales of soft drinks actually exceeded the equivalent period in 2019 by 8.2%.14
Fewer than a quarter of consumers
consumers back out again. CGA’s BrandTrack survey in June, just
23%
say they would only drink
before the sector reopened, showed the scale of this task, with more The scheme also encouraged more pubs, bars and restaurants to reopen to take advantage of the wave of interest, and
or eat out again
than half of consumers saying they would only drink or eat out CGA’s data showed that four in five (81%) on-trade sites were back trading again by mid-August—a steady increase
with caution
again with caution (23%) or if they were sure that added precautions from fewer than half (45%) who opened as soon as restrictions were eased in early July.15
were in place (33%). Even more alarmingly, a quarter (25%) said they
wouldn’t feel comfortable at all visiting hospitality venues until the A quarter (25%) wouldn’t feel Warm weather in the first half of August, and an increase in the number of people choosing ‘staycations’ in the UK
pandemic was under control. 9
comfortable at all visiting hospitality instead of overseas holidays, delivered more lifts to drinks sales—especially for pubs, bars and restaurants that were
venues until the pandemic was under able to provide outdoor seating. Overall, however, on-trade drinks sales were still running around 20% below 2019
control levels by the end of August, including the effects of lockdown, and it is clear they will take a long time to return to
pre-Covid levels.16 If restrictions on social gatherings and curfews continue through the winter, the road back will be
even longer.
6
UKHospitality and CGA Quarterly Tracker, April 2020 10
CGA UKHospitality and Yumpingo ‘We Hear You’ survey, August 2020 14
CGA Drinks Recovery Tracker, w/e 15 August
7
CGA and Fourth Business Confidence Survey, April 2020 11
CGA Consumer Pulse survey, July 2020 15
CGA and AlixPartners Market Recovery Monitor, August 2020
8
CGA BrandTrack, June 2020 12
CGA Drinks Recovery Tracker, August 2020
9
HM Treasury, August 2020
The rest of 2020 and beyond for the on-trade
What can the UK’s pubs, bars and restaurants
expect to see over the remaining months of 2020
and beyond? CGA’s research in China, and Nielsen
As in China and the US, the UK’s sales will
clearly take a long time to recover, and a
significant proportion of the population remain
83%
Projected volume of soft drinks
CGA’s detailed analysis of the US market, offers hesitant about going out to eat and drink, with
a few clues. older people—who have proved more vulnerable sales in 2021 relative to what was
to Covid-19—especially anxious. There is expected before Covid-19
A survey of consumers in China showed that average widespread concern about a second wave of
spend in the aftermath of lockdown was down by infections and local lockdowns, which as CGA’s
around 10%, with consumers keeping a tight grip data has shown have a rapid impact on sales as
on spending and making shorter visits to venues people retreat from socialising in the on-trade.
to minimise their risk of infection.17 As in the UK, Even by mid-August, CGA’s surveys suggested that
consumers tended to stay close to home when nearly half (45%) of consumers had yet to eat or
eating and drinking out, and there was a notable drink out since lockdown ended.19
increase in those trying to lead healthier lifestyles.
There were signs of financial polarisation too, Continued attention to detail in safety
with some people’s spending unaffected by the precautions is going to be essential if these A survey of consumers in China
pandemic but others facing shortfalls. This has hesitant consumers are to be persuaded back out showed that average spend in the
led to a widening split between drinkers choosing to eat and drink. But if operators can find the aftermath of lockdown was down
premium and value brands. right balance between protection and by around
10%
experience—demonstrating that people can have
In the US, Nielsen CGA’s research demonstrated a good time while staying safe—there are grounds
the wide variation in sales and footfall from state for optimism that the sector will continue to take
to state, and the close connection between spikes steady steps along the road to recovery. Pubs,
45%
in coronavirus cases and downturns in sales.18 bars and restaurants will be impacted by any
A common trend across US states has been that limits on group sizes and curfews though, so will
cities have tended to perform worse than suburban be hoping that government restrictions will ease
or rural areas. With many offices closed, sporting in late 2020 and early 2021.
events and entertainment cancelled and tourism
CGA’s surveys suggested that nearly
down, it has been difficult to generate footfall in
half (45%) of consumers had yet to
many major city centres—but pubs, bars and
eat or drink out since lockdown ended
restaurants in more residential areas have taken
advantage. We can expect to see this trend mirrored 17
CGA survey of 2,000 on-premise customers in China, 2020
in the UK for some time to come. 18

Nielsen CGA US Covid-19 Impact Report
19
CGA Consumer Pulse survey, August 2020
1. Pubs outperforming restaurants
Soon after the hospitality sector was given permission to trade again, it became apparent that pubs were opening at a
faster rate than restaurants. By late August, CGA data showed that nine in ten (91%) pubs in Britain were back trading
again, compared to 79% of restaurants. The bar sector, which relies more heavily than most on night-time trade and
nightclub industry, where social distancing is hard to achieve, is at the back of the line for full reopening.
These trends may reflect perceptions from consumers that it is safer and easier to visit pubs for a drink or two than it
is to sit down for a meal in restaurants. Many pubs have also been able to adapt their generally large and flexible floor
spaces to quickly accommodate people, while restaurants have had to do more work to get their operations back up to
full speed. While Eat Out to Help Out has helped to restore eating-out habits, we may well see pubs and drinking-out
occasions continuing to fare better than food-led visits in coming months.
2. Ongoing premiumisation
In the post-lockdown drinking-out market, one of the biggest questions is the extent to which the trend for premiumisation
will be affected. In last year’s Fentimans Premium Soft Drinks and Mixers Report we noted that the value of sales growth in
the soft drinks and mixers market (5.4%) was triple that of volume growth (1.8%)—a clear sign that people were paying more
for their drinks.21
Five key For many premium drinks consumers, the pandemic is unlikely to make any difference to purchasing behaviour. In fact,
post-Covid trends
those who make fewer trips to drink out in pubs and bars may choose to treat themselves to more premium options when
they do so. However, with more than a third (37%) of consumers anticipating less disposable income, due to the pandemic,22
others will be much more cautious in their spending and have higher expectations of value.
As the market settles into a ‘new normal’, here are five

As price becomes more important, it wasn’t surprising to see a slight decrease in average spend in the weeks after
trends we can expect to see in the on-trade over the
reopening—from £14.50 per head in February 2020 down to £14.41 in late July.23 During lockdown, most (80%) consumers
coming months, how they will affect the premium soft
said they were buying the same brands as usual, but 11% said they were trading down to cheaper ones—more than the
drinks and mixers markets, and what operators and
8% who were treating themselves to more expensive brands than usual.24 This tells us two things: that many people remain
brands can do to capitalise.
receptive to trading up their drinks, but that there is a new cohort who are have grown more sensitive to price and will need
to be convinced that premium brands are worth their hard-earned cash.
20
CGA Outlet Index, August 2020 23
CGA BrandTrack, June 2020
21
CGA Consumer Pulse survey, July 2020
22
CGA On Premise Measurement Tool, April 2019
3. Localised drinking and eating 4. Changing Occasions
People who started working from home and shopped and Two big new consumer trends—staying local and planning more—are combining to create new patterns in the
exercised in their local vicinity during lockdown are likely to carry times of day at which people eat and drink out. CGA’s June BrandTrack survey found that two thirds (64%) of
at least some of their habits into their eating and drinking out in consumers would try to avoid visiting pubs, bars and restaurants during peak times, and 14% said they would eat
future months. This is good news for pubs, bars and restaurants or drink out more in the daytime than before lockdown.26 Consumers switching from evening to daytime drinking,
14%
in suburban and residential areas, but more challenging for those and opting for relaxed catch-ups over high-tempo drinking occasions, may well favour soft drinks over alcoholic
in city centres like London that rely on office workers, tourists and drinks, providing a new opportunity to encourage the trial of brands and generate loyalty.
public transport for a large part of their footfall.
The new popularity of reservations also appears to be reducing the time that people spend in venues. Visitors
Of consumers say they would eat or drink
It has already led to some interesting trends in site reopenings. spent an average of 67 minutes on their on-trade visits in the first ten days of reopening, with fewer than one in
out more in the daytime than before
In August, CGA’s Market Recovery Monitor with AlixPartners twelve (8%) staying for more than two hours.27 Along with pressure on disposable income, this inevitably reduces
lockdown
showed that the proportion of licensed premises in London that the number of drinks that consumers purchase, with one in three (33%) consumers saying they are drinking fewer
had reopened was 12 percentage points lower than in the North
East and South West of England.25 The Eat Out to Help Out scheme
has helped to narrow the gap between regions since then, and the
government’s encouragement for workers to return to offices has
33% serves per visit than they did before lockdown.28 While dwell time is likely to increase as people regain more
confidence about eating and drinking out, the rate of purchases may take longer to increase.
been a welcome boost for city centre businesses, especially those One in three consumers say they are
in the on-the-go sector. But for the foreseeable future we can drinking fewer serves per visit than 5. Range Rationalisation
expect to see many consumers continuing to prefer to drink within they did before lockdown
walking distance, rather than travel further afield by bus, With footfall reduced and average consumption down, some pubs, bars and restaurants have taken the
train or tube. opportunity to rationalise range in various drinks segments. Among consumers who said they were drinking
fewer serves after lockdown, a third (31%) said they had noted fewer options on drinks menus since restrictions
were lifted.29 We have also seen an acceleration of the churn of range, with a steady stream of new brands
arriving on the market and others falling out of favour.
We are in the early stages of recovery and the variety of choice may increase as consumers move closer towards
31% pre-lockdown preferences. But with so many brands available in the premium sector in particular, reductions in
range may continue into the longer term. As ever, one size will not fit all, and designing range with the needs and
habits of local consumers in mind will be crucial.
A third of consumers
say they had noted
fewer options on drinks menus since 25
CGA and AlixPartners Market Recovery Monitor, August 2020 28
26
restrictions were lifted 27
Premium soft drinks consumers eat and drink out course, sharply focused on safety when they do so.
as regularly as the national average, and they spend However, this hasn’t altered their interaction with
around the same amount of money too—though drinks, and the emphasis on quality and value for
they have an above-average household income, money remains high. With so many venues and
which indicates that many drinkers have disposable brands competing for a reduced consumer base in
cash to spend on their drinking-out. light of the pandemic, it is more important than ever
to gain a hyper-local understanding of consumers
These drinkers are varied in their tastes, with an and adapt soft drinks range accordingly.
average of 10.6 brands in their soft drinks and
mixers repertoire—a figure that has increased from
last year, and that compares to a national average of
Part Two:
7.5. This indicates they like to experiment with their
soft drinks, and will be receptive to marketing and
promotions that invite them to trial new brands. But
the large repertoire also suggests that these
63%
The balance of drinkers is skewed towards women:
Consumer trends consumers can be fickle in their tastes, and it can

be challenging to secure their loyalty to any
nearly two thirds are female and only one third male
single brand.
40%
What does the premium soft drinks consumer look like in 2020? CGA’s BrandTrack data provides
valuable insights. Early indications from CGA’s post-lockdown
research suggest that the profile of the premium
As in last year’s report, the balance of drinkers is skewed towards women: nearly soft drinks consumer has not been altered a great
two thirds (63%) are female and only one third male (37%). This demonstrates the importance of deal by the pandemic. With older people more Two in five premium soft drinks consumers are aged
focusing marketing efforts on women, while being careful not to exclude men. reluctant to return to restaurants and pubs since the 35 to 54
end of lockdown, the market has been tilted slightly
There is also a notable tilt towards middle-aged drinkers. Two in five (40%) premium soft drinks towards younger consumers who were already
consumers are aged 35 to 54, which means they are more likely than average to choose premium heavy users of the on-trade. As we note elsewhere
options out-of-home. Consumers from the 18 to 34 age range (29%) are in line with the national in this report, these drinkers have tended to drink
average, but the 55+ age group (31%) under-index. close to home since lockdown, and are, of
The premium soft drinks and mixers consumer
Figures refer to percentages for premium soft and mixers
consumers, followed in brackets by all-consumer averages30
Age group split Gender
Male Female
29% 29% 40% (35%) 31% (36%)

37% 63%
(49%) (51%)
18-34 yrs 35-54 yrs 55+ yrs
Frequency
Drink out weekly Average household income
28% (30%) £43K (£38k)

Eat out weekly Average Spend on eating
and drinking out
48% (46%)
£87.71 (£87.26)
Soft drinks / mixers brands in repertoire
10.6 (7.5)
Premium consumers All-consumer averages

30
All data in this section is taken from CGA BrandTrack, February 2020
21 / Fentimans Premium Soft Drinks and Mixers Market Report Fentimans Premium Soft Fentimans
Drinks andMarket
Mixers Report
Market2020 / 04
Report / 22
1. Conscious consumerism
Eco-anxiety, activism and pressure on brands
In the twelve months since we published the With more and more consumers waking up to our
first Fentimans Premium Soft Drinks and Mixers impacts on the planet and seeking immediate action,
Report, we have seen consumers’ attitudes towards they are increasingly conscious of the environmental
sustainability and the environment grow from impacts of daily purchases. The fashion industry,
awareness to eco-anxiety. Interest has been for example, has seen a decline in fast fashion but a
accelerated by climate change movements and growth in the second-hand market and the hiring of
activists like Extinction Rebellion and Greta one-off pieces. The high street has seen an increase
Five emerging
Thunberg, and by events like the devastating fires in packaging-free stores, where consumers can re-fill
across the Amazon, Australia and the US. their own containers with various foods, cleaning
and beauty products. Eco-consciousness has
movements to follow More recently, the Covid-19 pandemic and

lockdowns in many countries have led to some
become a status symbol, and consumers who
choose to opt out of action are increasingly shamed.
unexpected environmental benefits, including a
As the attitudes and behaviours of consumers
sudden drop in carbon emissions from reduced This individual consumer effort has developed into
continue to evolve, here are five of the most
travel and improved air quality in major cities. a huge collective pressure on brands, stores, venues
significant trends to watch.
The long-term benefits of this temporary global and corporations to address their own sustainability
shutdown remain to be seen, but it has highlighted issues. From packaging to production to transpor-
that change is possible. Covid-19 has given us a tation to day-to-day operations, everything is under
unique opportunity to rethink our efforts on scrutiny. CGA research shows that nearly two thirds
sustainability, and examples of progress—like (65%) of consumers now expect to see ethically
the UK government’s pledge to spend £2 billion sourced food and drink, and around half (54%) want
promoting cycling and walking—have already to find environmentally friendly packaging.31
occurred. The pandemic has also made
consumers even more mindful of what they buy Businesses are also responding to this pressure.
and the amount of food they waste. Nine in ten (91%) leaders in the industry consider
sustainability a priority area for their organisation,
and the vast majority are either giving the issue
31
CGA BrandTrack, October 2019 more (42%) or the same (56%) investment
32
CGA and Fourth Business Confidence Survey, July 2019
resources year-on-year.32
2. The power of plant-based
Eco, ethical and health issues change eating and drinking
Long before the start of the Covid-19 pandemic, The rise in conscious consumerism has also led to
ethical, environmental and health factors had people seeking out foods that have less of an impact
fuelled a significant rise in the popularity of on the environment. Plant-based diets are a natural
plant-based food options. We only have to look at answer to this quest, because increasing numbers
the 60% increase in people taking part in Veganuary of people think the production of meat is putting too
this year to see the seismic shift in eating habits.33 much pressure on the planet. CGA data shows that
Plant-based options are no longer an afterthought more than a quarter (29%) of consumers are trying
on menus, but leading the business agenda and to reduce their meat consumption, and nearly one
marketing focus of brands and outlets. The majority in five now identify as either vegetarian (7%), vegan
of mainstream fast food chains now offer plant- (4%), flexitarian (4%) or pescatarian (3%).34
based variants of their food types—from Gregg’s
vegan steak bakes to Burger King’s Rebel Whopper. Consumers are also adopting plant-based diets
as a functional health boost. Recent studies have
With more consumers shopping locally and growing shown links between red meat and various health
their own vegetables at home, the pandemic has problems, and plant-based food has been shown to
accelerated the take-up of plant-based foods. aid and even cure some ailments. Mintel’s research
A study by Mintel showed that a vegan diet had shows that half (51%) of British adults think plant /
become more appealing for one in eight (12%) botanical ingredients can have medicinal benefits.
British consumers over lockdown—rising to a
quarter (25%) of those aged 21 to 30. “For Plant-based drinks that aid digestive wellness
consumers struggling to know how to make a are also on the rise. Consumers are now more
positive difference, cutting out animal protein educated on ingredients and botanicals such as
may be seen as a way of tackling the climate crisis, Keffir and Kombucha that help with digestion and
showing compassion for nature and boosting microbiome, and they are increasingly looking for
their nutrient intake,” says Alex Beckett, Associate these when out in bars and restaurants.
Director for Mintel Food & Drink.
33
Veganuary campaign
34
CGA 2019 Food Insights Report
3. Healthy body, healthy mind
Growing consumer and brand engagement with wellbeing
Since the start of the Covid-19 pandemic, a trend Consumers are making both physical and cognitive Alcohol consumption continues to decline amongst
that was already on the rise has taken on a whole health more of a priority in day-to-day life. young people, with functional drinks increasing
new meaning. The UK’s lockdown gave many of Mindful exercise is gradually becoming as important in popularity. More than four million people took
us the chance to pause, reflect and consider what is as physical, and the rising need for cognitive health part in Dry January in 2020,37 and for those people
important to us in life. With more free time on our improvement is encouraging brands to address and others, low-abv drink options are increasingly
hands, many of us took to the outdoors, enjoying these issues. Improved understanding of mental popular. One in three (32%) adults say they have
daily walks and other exercise and renewing health has led to an increase in technology, products consumed a no or low alcohol beer, wine or spirit in
connections with nature. Anxieties brought on by and services to help alleviate daily stress. the last six months—equating to some 15.5 million
the pandemic, like concerns over health and consumers. This has driven a 48% increase in the
finances, reinforced the importance of maintaining DNA, allergy and intolerance testing are also helping no/low alcohol category in the last twelve months.38
healthy bodies and healthy minds. In June, CGA’s people to take a more personalised approach to
BrandTrack survey showed that nine in ten (92%) their health and nutrition. These diagnosis The health benefits of no and low alcohol drinks
consumers were taking precautions to protect techniques are making people more aware of the are likely to become more prominent in the months
their health as a result of Covid-19, and that had a ingredients and products they should increase and ahead. Alcoholic drinks brands have never been
knock-on effect on eating trends. A quarter (24%) avoid in their diets in order to reach their health allowed to market their supposed health benefits,
of consumers told the BrandTrack survey that they goals. This personalised approach to health has but there are no restrictions on 0% abv products.
were buying healthier food in lockdown, and 70% led to pressure on brands, products and venues It won’t be long before we see alcohol-free cocktails
were proactively trying to lead healthy lifestyles—up to provide maximum transparency on ingredients, and long drinks promoting their added health
by eight percentage points in two years. 35
production techniques and offerings. CGA research benefits on menus.
suggests that two thirds (65%) of consumers now
Many consumers will seek to continue to emphasise seek menu information in advance of going out, with
their wellbeing in their day-to-day lives well beyond the need for information about allergens and
70%
the pandemic. Brands are already responding to ingredients a key component of that demand.36
the need for cognitive health improvement, includ-
ing with stress-relieving, calming, and comforting 35
products, and Mintel predicts a continued focus on 36

GO Technology report, CGA and Zonal, February 2020
ingredients and products that help consumers relax

37
Dry January campaign Of consumers are proactively trying to lead healthy
38
Understanding Moderation in the On-Trade report, CGA, November 2019
and cope with daily stress. lifestyles,up by eight percentage points in two years
4. Digital balance
A 21st century necessity, but moderation is 62%
Two thirds of consumers feel more
the key to wellbeing comfortable sharing their data
The relationship between consumers and digital Some brands have started to address this problem. The coronavirus crisis, which forced the majority
technology is complex and evolving. In last year’s There has been a rise in ‘anti-tech tech’ that rewards of the population into online rather than physical
report we noted a backlash against some forms of users for not using their phones, while Apple has connections with family and friends, may well
digital technology, and the growing number of introduced a screen time feature on the iPhone that accelerate this digital backlash in 2020. People
consumers questioning the value of online allows users to set ‘down time’ reminders and time have been reminded of the enormous value of
connections. A lot has changed since then, and limits on apps, and screen communication during face-to-face interaction, and are likely to emerge
many people have embraced new digital behaviours certain times. Some consumers are partaking in from the coronavirus lockdown with a fresh
to maintain connectivity during the pandemic. ‘Social Free Sundays,’ when technology takes a appreciation of human contact.
Consumers who may not have been comfortable back seat and they focus on physical social
using digital devices have been forced to embrace interactions instead. As technology develops, reliance on data also
them to work or learn remotely, shop and stay in increases. It was once easy to collect customers’
touch with family and friends. Those who were With 5G expected to link 125 billion devices by 2030, information through Wi-Fi logins or email sign ups,
already highly engaged with technology have used and reliance on internet-based technology for but people are now more aware of the value of their
it to enhance their lockdown lives, finding new ways everyday activities increasing, resentment data, and we can expect to see consumers asking
of exercising, entertaining and socialising. In both towards technology may continue to grow. To avoid for much more in exchange for it in the future. One
cases, these new attitudes to technology are likely to this backlash, brands and venues need to ensure positive side-effect is that consumers may be more
endure as we return to some sort of normality. authenticity in their communications and services. likely to engage with brands if they positively
They can help meet the needs of consumers craving consent to hand over their data. A recent survey
But not everyone has been so grateful for the social interaction with products and services that found that nearly two thirds (62%) of consumers
increased levels of digital interaction. For some, the enable technology down time. For example, there felt more comfortable sharing their data since the
renewed desire to lead a healthy lifestyle means has been a rise in cafes where Wi-Fi is deliberately introduction of the General Data Protection
being conscious of time spent in front of a screen. unavailable, and even the largest online companies Regulation in 2018.39
Information overload, a reliance on social media are now providing physical spaces, like Amazon’s
for entertainment and a constant stream of news bricks and mortar stores. This merger of a physical
stories during a difficult period have all been linked and digital experience has even inspired a new
to negative effects on mental wellbeing. term: ‘Phygital’.
39
Varonis, 2019
5. Closer connections
A fresh desire to be part of a community
With huge numbers of the global population living While social distancing is still encouraged, social For brands and venues, it is important to
in Iockdown at some stage during 2020, consumers support networks are increasingly important— understand the significance of these communities
have been forced to adapt to a new normal. The especially among the most vulnerable. At the height and the nuances of identity that they generate.
pandemic has prompted some people to turn away of lockdown we saw how local communities rose to CGA research shows that well over four in five (86%)
from a 24/7 on-demand culture and to slow down the challenges of isolation, rallying support for consumers consider it important that brands invest
and appreciate the simpler things in life. There vulnerable neighbours and friends. Research pre- in their local communities, and the figure is rising by
has been a notable shift from extroversion to dicts that these close connections are likely to be the year.41 Fostering a sense of community within
introversion, with many adopting new hobbies sustained into the future as consumers have a their consumer base and investing in local projects
such as gardening, cooking and exercising outdoors. new perspective and will seek new means of can help all businesses to establish a reputation
Another seismic shift has been the move to home finding fulfilment, placing a greater emphasis on as authentic and caring brands, and provide a
working, seeing consumers spending a lot more experiences and human connections over chance to connect with consumers in a more
time at home and away from daily commutes and material possessions. meaningful way.
office work. Many will continue to embrace this
lifestyle, though for others it has led to increased Brands, operators and venues have a social
86%
isolation. responsibility to help combat the increasing
loneliness that Covid-19 has created for some
This trend has led to an increase in support people. Community hubs can help facilitate
for community focused retailers and other connections that address isolation and mental
organisations. CGA’s BrandTrack survey in June health issues, providing space to bring people More than four in five consumers consider
showed that a third (33%) of consumers were together around shared interests. it important that brands invest in their local
planning to support local hospitality businesses communities
through the tough lockdown period, including
33%
through schemes via vouchers, online fundraising
initiatives or advance bar tabs40. Take-up of these
‘pay it forward’ initiatives showed the willingness
of users to help their local businesses get through
the pandemic. A third of consumers plan to support local hospitality
businesses through the pandemic
40
CGA BrandTrack, October 2019
1. Planning and experience
The post-lockdown fall in spontaneity and the importance
of immersive experiences
One of the clearest impacts of Covid-19 has been on As consumers put more effort into their planning,
the spontaneity of consumers’ drinking out. Rules they will be scrutinising the experience that
around social distancing have led many venues to venues can offer, and operators that can go above
reduce capacity and ask consumers to book ahead and beyond to deliver memorable experiences are
to manage visitor numbers, and this has created a most likely to be front of mind. At the start of
surge in reservations. CGA’s Consumer Pulse survey 2020—and before the arrival of the pandemic—
in early July revealed that two thirds (66%) of adults CGA’s survey of industry leaders showed that nine
Part Three: were planning out-of-home visits more thoroughly

than they did before lockdown, and two in five (43%)
in ten (88%) leaders thought experience-led outlets
were well placed to thrive this year.43
Post-lockdown on-trade trends

said they were more likely to pre-book visits for
drinks. Only a quarter (28%) of consumers visited The London-based Inception Group is one of the
venues with no reservations in the ten days after standout operators in this field. All its venues are
hospitality reopened in July. 42
renowned for delivering immersive experiences,
The pandemic and lockdown have created significant changes in the way consumers engage
and the group was quick to respond to the
with restaurants, pubs, bars and drinks brands. Here are five important shifts since the first
In addition, whilst consumers in the past may have restrictions around social distancing in an
Fentimans Premium Soft Drinks and Mixers Report twelve months ago—all of which have
visited several venues in one outing, they are imaginative and non-intrusive way that didn’t
been accelerated by Covid-19, and all of which are set to evolve the on-trade not just in the
currently more likely to visit fewer. Operators distract from the experience—for example, by
short-term but in the long run too.
should consider this carefully in ranging and service adding seated mannequins to space out
decisions, and venues that meet the needs of a consumers and using beekeeper hoods as face
diverse group will be visited more regularly and for masks for staff at Mr Fogg’s House of Botanicals.
longer. If confidence levels about safety improve, This not only delivered some great PR for the brand,
drinkers may start to regain some of their but reinforced the message that experiences at
spontaneity when they go out—but advance Inception’s venues can be both safe and fun.
booking is likely to be locked into their behaviour for
some time.
42
43
CGA Business Leaders’ Survey, January 2020
“At Inception Group, we aim to The increasing use of reservations also creates
opportunities for operators and suppliers to
offer experiences that are unique to
advertise brands, promote special offers or sell
us and make our venues destinations
drinks in advance. This fast emerging engagement
that guests will want to seek out. point on the consumer journey could well be an
In light of the current pandemic, important sales and marketing tool for the remain-
the great thing about offering der of 2020 and beyond.
pre-booked experiences is that
they are a thought out, considered
purchase and once booked, guests
look forward to visiting.”
Three top tips
Simon Allison, Head of Marketing,
Inception Group 1. Think like a guest. Look at your
booking policy from a consumer as well as
operational perspective. Consider how the
Alongside this, the trend for increased reservations process can be maximised to drive
has created challenges for some operators— additional opportunities for your business.
especially around no-shows. CGA’s consumer
research soon after the end of lockdown showed 2. Consider occasionality. Show
that around one in seven consumers admitted to consumers the suitability of your venue
failing to fulfil a booking. When venue space is at
44
for known ‘occasions.’ If consumers are
a premium, there is a delicate balance to meet: choosing to book in advance, meeting the
consumers want to be assured they have a seat, needs of occasions like birthdays,
but this privilege is currently coming at a cost to anniversaries or work nights out will put
operators. It will be interesting to see how booking your venue front of mind.
policies will adjust, and what compromises will be
made by both operators and consumers. 3. Understand groups. Consider your
product range and venue experience to
create consensus among groups looking to
decide where to spend their evening.
44
2. Bringing the out-of-home in
Delivery and takeaways impacting drink as well as food
Another major impact of the coronavirus Top Cuvée, an independent bistro in North London, Elsewhere, the lockdown saw many leading
lockdown was the rapid seeding of the in-home responded to lockdown almost immediately; cocktail bars create bottled cocktails for
delivery model. While bars and restaurants all over converting their premises into an incredibly consumption in the home, either via subscription
models or online retail with great success.
Three top tips
the country were forced to close, third party delivery successful retail space rebranded as ‘Shop Cuvée.’
provider Just Eat reported a year-on-year increase Specialising in bottled cocktails and artisanal wines, 1. Consider the importance of your brand.
of 32% in orders in the first half of the year, and a Shop Cuvée was quick to capitalise on the inevitable What is clear in all of these examples is the Investing in long-term brand-building
quarter (25%) of consumers said they had ordered surge in off license sales both in store and online, potential for on-trade brands to leverage their marketing strategies will help define your
delivery for the first time, or more often, during offering four-hour delivery in London and next day credentials to maximise the reach and revenue of offering with consumers and create demand
lockdown.45 to the rest of the UK. This is a strand to the business their business beyond their premises with retail and for your online and retail offerings. The brand
that has been so successful that owners Max online offerings. strength of Wagamama and Nando’s are great
The convenience of having numerous brands and Venning and Brodie Meah see it as a permanent examples of this.
food types available to order to your home is an part of the offering for the future. The traditional ‘off trade’ and ‘on trade’ worlds are
incredibly strong proposition with understandably blurring as consumers want and expect to be able 2. Flex your products. Assess the potential
high appeal. But while the growth of home delivery to consume their favourite brands at home. The of your bestselling or ‘hero’ products for
services could be seen as a serious threat to the coronavirus lockdown could prove to be the catalyst
25%
takeaway or delivery. Many cocktails are
future of the on-trade, for many operators during for a solution to the increasing challenge of difficult to package or bottle while retaining
lockdown it became a vital revenue stream that operating a profitable hospitality venue in the quality, and this should be a consideration of
reached a whole new audience and kept current market: leverage your on-trade brand your in-venue offering.
existing customers engaged. A quarter (25%) of consumers said they had credentials to reach new consumers looking to
ordered delivery for the first time, or more experience your brand at home with retail, 3. Leverage your location. Do your premises
So what about drink-led operators? One of the few often, during lockdown takeaway, ‘to-go’ and online offerings. provide potential for a retail offering that fills
benefits of the coronavirus crisis is the glimpse into those traditional gaps in trade?
the future it briefly presented. If the in-home food
32%
delivery market continues to grow, high quality
drinking options provided by the expertise within
the on-trade sector are sure to follow.
Just Eat reported a year-on-year increase

of 32% in orders in the first half of the year
45
3. More tech transformation
The rise of app and voice-controlled ordering
For consumers and operators alike, technology has Venues will also need to consider how they can Three top tips
a greater role to play in the post-lockdown market. incorporate more technology-based services into
1. Know your base. Understanding your
From advance reservations to app-based payments, their day-to-day operations. This will have two clear
consumer base determines what type of
digital touchpoints have suddenly become more advantages: a reduction in operating costs through
technology they would be happy to engage
visible at several stages of a customer’s journey ordering and service solutions; and an improvement
with. Gather and review feedback about
through a venue. in the guest experience with digital at its core. As
what your customers would like to see in
the capability of technology continues to increase,
your venue.
Within three weeks of hospitality reopening, more it will be interesting to watch how venues realise
than three quarters (78%) of consumers had used this digital potential. Drink-led venues are far from
2. Be flexibile. Apps, digital menus and
an app or website to order, browse a menu or find becoming a robot-led world, especially as human
order systems allow for changes to made in
other information about venues46. CGA’s BrandTrack interaction and socialising is at the heart of this
seconds. This offers opportunities to adapt
survey indicates the high level of demand among industry—but it would be hard to deny the
or refresh menus based on seasonality or
younger adults in particular, with more than half advantages of adopting some level of
promotions without the cost of reprinting.
(54%) of 18 to 34 year-olds now wanting the option digital experience.
to order digitally through their phone.47
3. Plan now. The pandemic has given us a
The pandemic has added to the demand, with nearly
glimpse into the future and technology is at
The use of technology in other countries gives us a third (30%) of consumers surveyed before the
the heart of it. By trialling new systems and
a glimpse of what might be to come here. In China end of lockdown saying they would prefer to have a
planning ahead you can help to futureproof
and Japan, for example, we are starting to see entire digital menu on a mobile app when they went back
your business.
venues operated by AI voice assistants, with little out to eat or drink.48 At a time when consumers
or no human interaction with customers. US online have such high expectations around convenience
takeaway company Grubhub has meanwhile and customer service, technology that can drive
integrated with Amazon’s Alexa, allowing people to improvements in these areas should be embraced
order direct through their virtual assistant. Latest sooner rather than later to ensure the best chance
figures show that 22% of the UK population now of meeting a younger generation’s needs.
30%
own a voice-controlled digital device, and for some
it’s becoming their favoured way to operate. As
consumers seek recommendations of places to visit,
this is clearly going to be an important space for 46
venues to consider in their marketing plans in 47
CGA BrandTrack, June 2020 Nearly a third of consumers wanted a digital menu on a
the future.
48
CGA BrandTrack, June 2020 mobile app when they went back out after lockdown
4. A world on fire
Pressure mounts on brands to do the right thing on sustainability
The subject of sustainability is familiar to most food wanted to create something that sustainability in the sector will only increase over the
and drink operators, but pressure is mounting on had a real purpose and a positive impact on the coming years, and businesses that can challenge the
them to act. Lockdown, which gave consumers the environment.” Using Blockchain technology, Avallen status quo, adapt and prove their credentials on
opportunity to reflect on the environmental is also one of the first brands to make its laboratory sustainability to consumers will have a competitive
impacts of things like travel, has only sharpened analysis public in order to be completely transparent as well as ethical edge in the years ahead. Those
the focus. about what goes into its product, and everything who cannot respond to change risk becoming
from the raw ingredients to the bottle and label isolated very quickly.
According to a recent survey, consumers’ priorities have been carefully considered.
on sustainability include food provenance and
transparency, followed by energy use and carbon On the operator side, Greene King, who won The
footprint as well as plastics, packaging and food
waste. While there is still a long way to go in areas
49
Publican’s Best Sustainable Pub Company Award
this year, uses a complex food hierarchy to reduce
Three top tips
such as food waste and packaging, consumers are the amount of food that is wasted across the 1. Prioritise. On such a wide-ranging topic,
also keen to see brands and operators giving back. business. Wastage is considered at every stage, it’s important for all businesses to prioritise
Some may argue that it’s no longer enough to just including during the menu development process. and focus on areas they can act on
think about reducing our environmental impact, but Last year Greene King also ran a Food Waste quickly, while also building a plan for long
that we need to go further and actively engage in Awareness Week to raise awareness and engage term objectives.
practices that give back more than we actually take with staff internally. The last step in the process is
from the environment. communicating efforts on food waste to customers, 2. Stay informed. Sign up to industry
which has been achieved across Farmhouse Inn newsletters from bodies including UK
This is a view strongly shared by new calvados brand venues through point of sale material and by Hospitality (www.ukhospitality.org.uk) to
Avallen. Brand owner Stephanie Jordan says: “When thoroughly educating staff in these sites so they can stay updated with industry-related policies
we started, our vision was to create the world’s most in turn educate guests. and guidance.
planet positive spirit brand, we always knew that we
It is not always easy for operators to change their 3. Learn from others. For relevant case
environmental practices and ways of working. studies and examples and to help your
But with education and support, brands and business start to set some targets visit the
49
Re-shaping your business The impact of sustainability on the food operators can work together to innovate and WRAP website (www.wrap.org).
and beverage sector’, Eversheds Sutherland
push for a better future. The spotlight on
5. Keeping well
Committing to support for mental health and physical wellbeing
As we navigate our way through challenging times, Examples of commitment to wellness and mental
another area of utmost importance that requires health include William Grant’s ambassador,
ongoing focus is wellness in the workplace. The Fabiano Latham, launching ‘Reyka Runners’ in the
coronavirus pandemic has shown how vital it is to
look after employees, but even before the crisis a
UK earlier this year. The initiative encouraged
bartenders to lace up their running shoes to
Three top tips
lot of good work was being done to promote mental promote the use of nature and adventure to build
1. Talk to your team. Find out what’s
health. Mental Health First Aid England reported confidence, boost creativity and balance lifestyles
important to your workforce. Once you
140,000 people were trained in 2018-19—the most that are often hectic and nocturnal.
properly understand their needs, you can
ever in a single year,50 with participants ranging from
work out the ways you are going to
employees in small independent business to A new mental health and addiction focused
support them.
global corporations. Nearly half a million people platform called ‘So Let’s Talk’ has meanwhile
in Britain have now been through an MHFA launched in Manchester, and a unique health
2. Create a community. Set up an
programme—about one in every 100 adults. supplement, Hospro, aimed squarely at the
infrastructure to support your activities.
hospitality industry, has launched in Edinburgh.
You could consider hosting weekly events
In the global drinks industry more specifically, it Beyond the UK, Martini’s Racing Ciclismo
or fundraising initiatives—things that
feels like operators, individuals and brands are programme, which promotes physical fitness
give people something to look forward
beginning to take the health and wellness of our through cycling, has gone from strength to strength.
to at work.
people more seriously too. Tim Etherington-Judge, It gives bartenders around the globe the chance to
founder of Healthy Hospo, says: “The increasing come together and cycle, culminating in a
3. Get help. Check out websites that can
conversation around this important topic has ‘La Classica’ ride in Italy. our signature, ground-breaking health and wellness
help promote physical and mental wellbeing
inspired a growing number of organisations, events training, wherever they are in the world, on their
and keep you updated on industry
and brand activations in creative ways to address Healthy Hospo has been busy too. “We’ve had great terms,” says Tim Etherington-Judge.
initiatives, like Healthy Hospo
the problems of burnout, stress, mental and success in beginning this change in the industry and
www.healthyhospo.com
physical exhaustion, and strengthen social we’re continuing to innovate, partnering with online While the industry is starting to build some strong
connections.” training platforms such as Small Batch Learning to foundations to promote health and wellness, this
write custom training programmes for them. We’re area can be one of the first to suffer when
also working on our own pioneering digital learning businesses go through challenging times. As the
50
Mental Health First Aid England platform to give hospitality professionals access to industry recovers from the Covid-19 crises, it will be
important to affirm a commitment to give wellness
the focus and compassion it deserves.
Part Four: Premium soft
drinks and mixers trends
With soft drinks continuing to gain share across all day parts from breakfast
through to dinner, they have become the first choice alongside food, and operators
are increasingly looking for ways to add interest and excitement to a category that
can often lack inspiration. So what are the top trends to watch over the next twelve
months? The lines between the soft drinks and mixers categories are increasingly
blurred and showing similar trends and influences, so in this section we highlight
the trends and influences that affect both. Here are five of the most significant
developments coming down the line.
1. Low and no to grow
A rising interest in no and low alcohol beer, wine and spirits
The low and no alcohol movement is gathering
significant momentum, and has contributed to a
premium soft drinks. If a non-alcoholic offering isn’t
appealing enough, consumers may opt for water or Bringing no
blurring of the boundaries between soft drink a standard soft drink, which represents a lost
and mixer categories. opportunity to trade up to more premium options. and low to life
Around a fifth (21%) of the UK’s adult population For operators, the perennial challenge is freeing up Last summer Fentimans opened a
now say they don’t drink alcohol at all, and 51
fridge space—finding the optimal range that satisfies Secret Spritz Garden in London—ideal for
moderation is especially apparent in the 18 to 24 a variety of customer needs. One obvious solution after-work drinks and weekend cocktails.
year-old age group, more than a third (35%) of is to consider products that are versatile enough to Working in partnership with brands
whom either don’t drink alcohol, or do so on a less serve as standalone drinks, mixed with a spirit or as including Lillet and Martini, consumers
than monthly basis. But increasing numbers are
52
an ingredient in a cocktail. Offering a different drink were able to enjoy a range of delicious
turning instead to no or low alcohol options. CGA selection for earlier dayparts like breakfast and low ABV spritz cocktails using Fentimans’
research shows that one in three (32%) adults has lunch, before adapting menus for evening occasions, flavoured tonic waters. The month-long
tried a no or low alcohol beer, wine or spirit in the can also help maximise the potential of both. Drinks installation was Fentimans’ most
last six months—equating to some 15.5 million that have always been in fridges, like juices, need to press-covered initiative to date, reaching
consumers.53 The no and low alcohol category has justify their place as new and more exciting over 1.3 million consumers through Time
increased by 48% in the last year, and is now a entrants appear. Out alone and another 1.4 million through
£60m-a-year category.54 social media channels.
Whether they are abstaining from alcohol either
21%
partly or completely, these consumers don’t want to
compromise their out-of-home drinking
experiences. For pubs, bars and restaurants, it is
more important than ever to provide a compelling Around a fifth of the UK’s adult population
non-alcoholic range—and that, of course, includes now say they don’t drink alcohol at all
51
Office for National Statistics
52
Understanding Moderation in the On-Trade report, CGA
53
Understanding Moderation in the On-Trade report, CGA
54
CGA On Premise Measurement Tool, October 2019
2. Rum: the new gin?
Versatility and new mixers broaden its appeal
When anticipating new products in the mixer

category, it is important to understand the big
positions it well for growth in the months ahead,
and commands an entirely different mixer
The botanical
trends in the spirits market. The spirits category
in the on-trade remains very strong, with year-on-
proposition to tonic waters that have become so
familiar through the gin renaissance. This presents
collective
year growth of 7.2% or £482m—significantly ahead an opportunity for operators to review their mixer Last year Fentimans launched a new
of growth in beer (up 2.1%) and wine (down 1.4%). 55
ranges and ensure they have a selection to meet the Tropical Soda mixer to partner with dark
Nearly half (47%) of British adults now drink spirits needs of darker spirits as well as gin and vodka. spirits and particularly dark rums. The mixer
out-of-home—a figure that has jumped 10 was created by Fentimans’ in-house
percentage points in twelve months. One of the many brands to identify rum as a flavour team, following feedback from the
growing market is Coca-Cola. With the launch Fentimans Botanical Collective—a group of
Within the spirits category, the gin frenzy continues. of its new premium Signature mixer range, the five top bartenders from across the globe—
This has been among the boom areas in spirits company, which rarely markets itself as a mixer that there was a gap in the rum category
for several years now, but it has continued to brand, is stepping into the premium mixer sector for a premium tropical mixer. The Collective
accelerate, with on-trade volumes soaring 35.9% in competition with other leading brands. It has then taste-tested the mixer at each stage of
year-on-year—way faster than other spirits. Growth used credible industry experts, including a group development, and have gone on to support
is even higher in the flavoured gin category, as of leading bartenders, to help with the creation and the launch of the new Soda in the premium
consumers become more adventurous and seek out marketing of the range—a move that many other bar scene, both in the UK and overseas.
new and differentiated flavour combinations, which spirit and mixer brands are making because they
has led to an increased range of premium and see the value of getting insight and input from
flavoured mixers being stocked by many venues. experts in the bar industry. The new Signature
mixers are also a good example of the blurring of
Many in the industry have tipped rum to follow gin’s lines between mixers and standalone soft drinks.
meteoric rise. Growth is currently being driven by
standard golden and spiced brands, helping to lift
the volume of rum sales by 3% year-on-year, and
one in ten (10%) consumers now drinks it out
of home—equating to around five million
consumers.56 Many of the new rum drinkers are
millennials, who commonly consume it either with a
mixer or as part of a cocktail. The versatility of rum CGA On Premise Measurement Tool, October 2019
55
56
3. The health kick
Soaring interest in low sugar options and Kombucha brands
Another trend picking up pace, and which we expect
to continue into 2021 and beyond, is the desire of
But we must not forget that what matters most to
consumers when choosing a soft drink is the same Sugar v flavour
consumers to seek out healthier choices in soft as ever: flavour. When asked about important At Fentimans we are passionate about flavour,
drinks. This trend has been accelerated by both attributes of a premium packaged soft drink, ‘great and we won’t compromise when it comes
health concerns related to Covid-19 and the flavour’ is the top choice, with the number rising to making great tasting drinks. In 2019
government’s ‘sugar tax’, which has prompted many by five percentage points year-on-year.58 With the we launched a new range of all-natural,
soft drinks suppliers to roll out new healthy options numbers of people abstaining from alcohol or reduced-sugar soft drinks, using the same
or rework recipes to reduce sugar. For example, moderating their intake increasing, there is a huge botanical brewing method that Fentimans
low-sugar cola drinks have seen sales jump 22.4% opportunity to capture new customers with drinks have used for over 100 years. The Fentimans
in the last twelve months, while full-sugar varieties that provide great flavour experiences and act as a Lights range has the same authentic Fentimans
have declined by 13.3%.57 Consumers are savvy, credible, healthier alternative to traditional sugary flavour that our consumers know and love,
and while they are increasingly seeking drinks with soft drinks. but with reduced sugar and lower calories.
reduced sugar, they also look for no artificial The range is aimed at the growing number of
ingredients—and above all want quality. consumers who are proactively trying to lead a
healthier lifestyle but still seek great flavour.
22.4%
We are also starting to see ‘added health benefits’
filter through into the premium adult drinks sector,
with Kombucha and its antioxidants that support
and nourish gut health the most well-known
example. There has been an explosion in Year-on-year increase
Kombucha brands over the last year, and they can in low-sugar cola sales
now be found on soft drink menus in mainstream
venues including Greene King and JD Wetherspoon.
As consumers become more concerned with their
physical and mental wellbeing, drinks that offer
additional health benefits are likely to grow and
become part of everyday life.
57
58
CGA BrandTrack, October 2019
4. Crackdown on plastic 5. Brexit
New legislation on the horizon A new trading environment after an industry-changing 2020
Beyond Covid-19 concerns, sustainability continues and steel cans as well as glass bottles are being Brexit’s potential impacts on the UK’s soft drinks The industry has other Brexit-related issues
to be an important focus for both consumers and considered for inclusion, though exact details are industry dominated the sector in 2019, but the to consider, including plans for immigration
business leaders—and in the soft drinks industry, still to be worked through. issue has understandably taken a back seat during controls. CGA’s Business Leaders’ Survey at the
the issue of plastic use is looming large. The war on the pandemic. With the transition period for the start of 2020 showed that nine in ten (90%)
plastic bottles is intensifying, with debate focusing Another piece of legislation that is looming large UK’s departure from the European Union due to industry leaders think post-Brexit immigration
on the twin themes of recycling and the removal of is the upcoming plastic packaging tax, due to finish at the end of 2020, thoughts are turning controls will be a significant issue for them due to
plastic from the supply chain. More than half (54%) be introduced in April 2022. The tax is being again to its consequences for market conditions. the high levels of overseas staff employed in the
of consumers expect to see environmentally friendly proposed for products with packaging that is sector, and sizeable numbers also expressed
packaging when they go out to eat or drink, and a made from less than 30% of recycled materials. The Wine and Spirit Trade Association (WSTA) concern about the challenges of potential tariffs
quarter (25%) say they would pay a premium to raised awareness of the issue in May 2020 with a and trade deal impacts (60%) and food costs
receive it.59 Many brands and operators believe that these ‘Trade 21’ campaign that sought to highlight the (60%). As negotiations continue, leaders will be
schemes may result in increased costs, at least in key priorities for the alcohol industry at the end hoping that deals can be settled that ensure a
One response to the issue is a Deposit Return the short-term, which is a cause for concern of the transition period. Leaving the EU’s Single smooth and problem-free transition from the EU,
Scheme (DRS) – a service that encourages in what has been the most challenging year in Market and Customs Union will mean a new set of and looking to the government and trade bodies
consumers to recycle drinks containers by either history for many businesses. For many small trading regulations for UK businesses that import to provide support and clear direction on topics
placing a monetary deposit upon purchase or independents in particular, further regulations will or export their goods from European countries, like trade regulations and immigration.
receiving cash or other rewards upon recycling. add significant extra financial pressure. and the WSTA wants information relating to any
Some UK-based companies have already trialled a changes to be shared sooner rather than later so
DRS, including UK-based restaurant chain Leon. In that brands and operators can prepare for the
2019, an on-the-go recycling vending machine at new trading environment in good time.
London’s King’s Cross accepted plastic bottles and
aluminium cans, and for each one deposited
90%
customers were rewarded with a voucher for
10% off their bill at the nearest Leon restaurant.
Governments are also responding to the mounting

pressure. The Scottish government plans to Of leaders are worried about post-Brexit
introduce a DRS by July 2022, with the rest of the immigration levels and controls
UK likely to follow in 2023. PET bottles, aluminium
59
1. Close to home
Nostalgia renews interest in
British flavours
With geopolitics being ever more unstable and the
coronavirus crisis creating widespread alarm, more and
more people are seeking refuge and reassurance. The desire
to reaffirm national identity and self-dependence will lead to
renewed appeal for nostalgic British flavours, driven both by
Part Five: pride and recognised comfort.
Flavour trends Expect to see

Consumer tastes are evolving fast, and the pandemic is already causing substantial Rhubarb
changes in the way people behave and drink in the on-trade—so staying on top of Dandelion and burdock
the latest flavour trends is going to be crucial. These are five of the biggest
developments we’ll be watching over the next twelve months.
Shandy
British apple varieties
Sarsaparilla
Marshmallow
2. New takes on tropical 3. Keep it light
Global travel brings new exotic flavours Savoury flavours and hard seltzers push into the mainstream
While tropical flavours like pineapple, mango and As we note throughout this report, many consumers
coconut have always been extremely popular with Expect to see are seeking to reduce the amount of sugar they Expect to see
consumers, they are still rarely seen in pairings and consume in their day-to-day diets. Initially the
styles outside their own cultural settings. These market’s solution was flavour parity, replicating
flavours evoke a sense of place—a factor that is
Tropical-based spritzes sweetness through natural sugar alternatives. But Flavoured and alcoholic sodas
very appealing to consumers who want to be and aperitifs the reduction in sugar intake is also prompting a Fruit teas and infusions
transported to tropical climates during their preference for light, savoury and vegetal flavours
Premiumisation of tropical Flavoured waters
drinking experiences. ahead of sweet ones. For drinks brands it is no
New tropical spirit pairings longer enough to simply claim to be low in sugar:
The return of vodka
But things are starting to change. With new flavour profiles have to validate this claim, and that
generations identifying themselves as ‘global carves out a market for lighter and more neutral
citizens’ and the world shrinking due to global flavoured drinks and categories.
travel, geographical boundaries that have
defined traditional flavour pairings are falling away. New pairings and fusions In the US, hard seltzers—alcoholic flavoured
Tropical flavours are also changing as a result of Recent examples of innovative new drinks sodas—are flourishing, with on-trade sales reaching
their increasing availability and falling costs, and pairings include Chris Moore’s award-winning $1.2bn in 2019, having attracted 7.5 million new
venues are thinking more creatively about their use ‘Champagne Pina Colada’—a premium drinkers over the course of the year.60
in drinks. As a result, tropical flavours are becoming champagne-based twist on one of the most
more integrated into western drinking traditions, iconic tropical cocktails. Elsewhere, Porter’s In the UK, vodka, fresh lime and soda continues to
products and ingredients, particularly at the Gin has created a ‘Tropical Old Tom,’ playing grow in popularity. Fever Tree’s newly launched soda
premium end of the market. This can be seen most on the sweeter ‘Old Tom’ style of gin that range and continued strong growth of Fentimans
evidently in the continuing rise of the ‘Pornstar preceded London Dry, using tropical Soda are signs that soda could play a much bigger
Martini,’ which blends passionfruit, vanilla, vodka botanicals that reimagine the flavour profile role in the on-trade in the coming years.
and prosecco; a myriad of global flavours that is of a classic gin. Similarly, vermouth brand
curiously not questioned as unusual. Belthazar’s ‘Riesling Edition Vermouth’ has
incorporated Azores pineapples to provide a
tropical twist, and was considered one of the
most innovative launches to date in a
category steeped in European tradition. 60
Hard Seltzer Report, CGA Nielsen, February 2020
4. New acidities 5. Tastes good for you
Fermentation and interest in Kombucha help sour The rise of mood foods and
flavours to rival sweet guilt-free experiences
As consumers become more conscious of looking Growing recognition of the importance of nutrition in our physical
after their health and particularly their immune Expect to see and mental wellbeing is changing the flavour landscape. A new
systems, the fermentation category continues group of ‘mood foods,’ whose natural ingredients claim to help
to grow at pace. The global Kombucha market is reduce stress and relax, energise or invigorate us, are growing in
Fruit-based vinegars
forecast to be worth just over £1bn in 2020, with popularity. Within this segment, flavour credentials are secondary
annual growth of 29% predicted for the next six Kombucha cocktails to a product’s holistic benefits—and some unusual flavour profiles
years.61 Now that it is a mainstream rather than are emerging into the market as a result.
Kefir cocktails
niche product, it is likely to start influencing
flavour perception in the on-trade. Sour beer In a similar context, natural home remedies are returning, as some
people seek plant-based natural alternatives to medical problems.
Natural and organic wines
As a consequence, consumers are becoming The term ‘adaptogens,’ a key plant category with both physical and
more adept with the flavour profile of fermented mental health benefits, should begin to appear more and more as
products and the unique acidities created by the consumers seek these ingredients as part of their daily routines.
bacteria-led fermentations found in products such
as Kombucha, kefir, sour beers and certain
organic wines.
Sour drinks and flavours have also built

29%
Annual growth forecast for the Kombucha
In the on-trade, more and more venues are seeking to provide
experiences that are healthy and guilt-free, so we expect to see
these flavours integrated into menus and products more frequently.
assimilation with digestive health and play very market for the next six years
well to the macro trend for healthier drinking and
eating. Consequently, we expect characteristically Expect to see
sour flavour profiles to increase and diversify.
The use of common citrus fruit like lemon and
Cactus Yerba-mate
lime to provide sour elements to cocktails and
mixed drinks could become rivalled by new acidic Aloe vera Ginseng
building blocks found in Kombucha, sour beer,
Chaga Adaptogens
kefir and vinegars.
Mushroom
61
Market Watch, January 2020
Key contributors
This report has been compiled by Fentimans with the support of CGA.
At Fentimans, key contributors were:
Dave Robson, Group Sales Director
Andrew Jackson, Marketing Director
Claire Tyson, Senior Customer Marketing Manager
Neil Donachie, Out of Home Marketing Manager
Fentimans is grateful for contributions to this report from a range of drinks operators
and industry expects, including: Simon Allison, Head of Marketing at the Inception Group;
Tim Etherington-Judge, Founder of Healthy Hospo; Stephanie Jordan,
Co-founder of Avallen Spirits.

Market Report 2020

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Market Report 2020

Uploaded by

Copyright:

Available Formats

Premium Soft Drinks and Mixers

Market Report 2020

It has been a tumultuous twelve months since we published our inaugural

In this report we aim to provide an objective view of the sector in which we

Eldon Robson, Founder of Fentimans Ltd

Fentimans Premium Soft Drinks and Mixers Market Report / 02

• Research into the post-lockdown market in

For more details about CGA’s sources and

Soft drinks and mixers The impact of lockdown

£4.6bn 1.1% 15.0% £11.1bn £1.7bn £198m

in the UK for some time to come. 18

As the market settles into a ‘new normal’, here are five

Consumer trends consumers can be fickle in their tastes, and it can

Age group split Gender

29% 29% 40% (35%) 31% (36%)

28% (30%) £43K (£38k)

Soft drinks / mixers brands in repertoire

Premium consumers All-consumer averages

movements to follow More recently, the Covid-19 pandemic and

products, and Mintel predicts a continued focus on 36

ingredients and products that help consumers relax

Part Three: were planning out-of-home visits more thoroughly

Post-lockdown on-trade trends

Just Eat reported a year-on-year increase

Whether they are abstaining from alcohol either

When anticipating new products in the mixer

Governments are also responding to the mounting

Part Five: pride and recognised comfort.

Flavour trends Expect to see

Sour drinks and flavours have also built

At Fentimans, key contributors were:

Dave Robson, Group Sales Director

Andrew Jackson, Marketing Director

Claire Tyson, Senior Customer Marketing Manager

Neil Donachie, Out of Home Marketing Manager

You might also like