Abstract
This report examines some of the key issues surrounding an alcohol market challenged by a slowly declining consumer base and the increasing emphasis placed on ‘health issues’.
The alcohol market is too broad and diverse to cover comprehensively in one report, so this report will primarily concentrate on four sectors (lager, cider, wine, white spirits). However, other sectors will be used to illustrate examples where relevant.
Table of Contents
- Introduction
- Key themes
- Definitions
- Premium data
- Insights and Opportunities
- Choice is the bane of our lives
- One for each hand
- Market in Brief
- Fewer drinkers and lower prices
- Premiumisation -- where next
- Threats to the alcohol market
- Readjusting the balance
- The future is an attitude change
- Conclusion
- Fast Forward Trends
- The Lego Way
- What' s it about?
- What we' ve seen
- Implications
- Embed With My Dinner -- The Smart Mirror
- What' s it about?
- What we' ve seen
- Implications
- Market Context
- Key points
- Appetite for alcohol
- Figure 1: Attitudes towards alcohol consumption 2006
- Figure 2: Total alcohol volumes by category, 2002-07
- The rise of the non-drinker
- Economic factors
- An ageing population
- Staying in is the new going out
- The cheap flight bug
- The Impact of Food on the Alcohol Market
- The premiumisation of food
- Fairtrade and organic food
- Figure 3: Estimated UK sales of ethical foods, 2002-06
- Competitive Environment
- Growing demand for soft drinks
- Figure 4: UK volume sales of soft drinks, 2001-06
- Infinitely affordable
- Figure 5: The relative price of alcohol index vs. the affordability price index, 1980-2006
- Legislation and Government Strategy
- Legislative context
- 24-hour party people
- Alcohol Harm Reduction Strategy
- Strategy in detail
- Global strategy evaluation
- Tried and tested
- Raising tax on alcohol
- Raise drinking age or lower it?
- The advertising environment
- Advertising future
- Market Value
- Key points
- Mixed performance
- Figure 6: Selected alcohol values at current prices, 2003-11
- A changing world
- Finding value
- Figure 7: Index of price of selected alcoholic drinks, 2002-11
- The premium answer
- Figure 8: Selected alcohol volume sales (litre) split by premium, standard and value, 2006
- A question of space
- Sector Performance?
- Key points
- Lager
- Figure 9: UK retail sales of lager, by volume and value, 2002-07
- Wine
- Figure 10: Consumer expenditure on wine*, at current prices and constant 2002 prices, 2002-07
- Opportunities for growth
- Convenience
- Spirits
- Figure 11: White spirit market, by value and volume, 2001-07
- Cider
- Figure 12: UK retail sales of cider, by volume and value, 2001-06
- What Does the Future Hold?
- Food shows the way to premiumisation
- A healthy approach
- A change in culture?
- On- vs. Off-Trade
- Is in the new out?
- The persuasive price differential
- Figure 13: Average price of selected alcohols in the off- and on-trade, September 2007
- Will food continue to drive the on-trade
- Figure 14: Location of alcohol purchase, 1998 and 2006
- Alcohol and a Healthy Positioning
- Can alcohol create a healthy positioning and as a result create another route to premiumisation?
- Key points
- Health aware
- Catch 22
- The right combination
- Perfect partners
- Water works
- The red wine effect
- Functional future
- All natural purity
- The worst case scenario
- Conclusion
- Threats and Opportunities
- Forthcoming issues for the industry to consider
- Opportunities
- New Product Development Trends
- Key points
- The power of provenance
- Premium +10
- Creditable connections
- Full of flavour
- Other innovative ideas
- Consumer Usage of Alcohol
- Key points
- Consumption begins to decline
- Figure 15: Consumption of alcoholic drinks, 2003-07
- Beer driving overall decline in consumption
- Figure 16: Consumption of specific alcoholic drinks, 2003-07
- The Consumer -- Premium Purchase
- Key points
- Popularity of premium is price based
- Figure 17: Purchase category of selected alcohol types, July 2007
- Broadening appeal and accessory crucial to growth of wine
- Education, education, education
- Age is a driver, but is enough being done to remove the barriers?
- How about a gift?
- Rose by name, Rosy by nature
- Lessons to be learnt
- Long and fizzy
- Lager
- Cider is on the move
- Bitter
- Quality counts
- Spirits
- Whisky
- The Consumer -- Health Concerns
- Key points
- Figure 18: Attitudes towards alcohol and health, July 2007
- Free spirits
- Age acts in mysterious ways
- Figure 19: ' Drinking occasionally does you no harm at all'
- Men are trading up
- I' d rather go without
- ' A glass of wine a day is good for you'
- The Consumer -- The Trade Off
- Key points
- Figure 20: Attitudes towards paying a premium for drinks, July 2007
- It' s all about quality
- Can' t taste the difference
- The Consumer -- A Question of Promotion
- They have made their bed....
- Figure 21: Attitudes towards special offers
- Will we discount forever?
- The Consumer -- Out of Home
- Key points
- Figure 22: Attitudes towards purchasing drinks in the on trade
- Something a little special
- Traditionally traditional
- Appendix
- Market in context
- Figure 23: EU pure alcohol consumption per capita 5 to increase/decrease, 1993 and 2003
- Figure 24: Per capita consumption of alcohol in Europe, 1970-2004
- Internal market environment
- Figure 25: Consumption of alcoholic drinks in the last 12 months, by type, 2002-06
- Figure 26: UK consumer expenditure on alcohol, 1995 and 2005
- Figure 27: Drinks most likely to be taken at home and in the pub, May 2005
- Figure 28: Factors which entice people in, February 2006
- Figure 29: Trends in breath tests and breath test failures by drivers and riders involved in accidents, 1996-2005
- Broader market environment
- Figure 30: PDI and consumer expenditure, at current and constant prices, 2001-11
- Market value and forecast
- Figure 31: UK sales of white spirits, by volume and value, 2001-06
- Consumer 1 -- Detailed demographics
- TGI consumption data
- Figure 32: Consumption of alcoholic drinks in the last 12 months, 2002-06
- Figure 33: Consumption of specific alcoholic drinks, 2003-07
- Figure 34: Category of expenditure most likely to spend in -- red wine, July 2007
- Figure 35: Category of expenditure most likely to spend in -- white wine, July 2007
- Figure 36: Category of expenditure most likely to spend in -- Rose wine, July 2007
- Figure 37: Category of expenditure most likely to spend in -- Cider, July 2007
- Figure 38: Category of expenditure most likely to spend in -- Lager, July 2007
- Figure 39: Category of expenditure most likely to spend in -- Bitter, July 2007
- Figure 40: Category of expenditure most likely to spend in -- white spirits, July 2007
- Figure 41: Agreement with the statement, July 2007
- Figure 42: Agreement with the statement, July 2007
- Figure 43: Agreement with the statement, July 2007
- Figure 44: Agreement with the statement, July 2007
- Figure 45: Agreement with the statement, July 2007
