How Millennials Are(n't) Killing the Bar Industry

As someone currently undergoing a "reset" month — I hate calling them "sober" months because of some of the negative connotations — doing research for my job at Dun & Bradstreet on our Bars & Nightclubs industry profile recently was fairly eye-opening. I like to think, as a frequent purveyor of the nightlife scene, particularly where I live in Austin, I am fairly up-to-date on bar trends. There's seemingly a new bar or restaurant or brewery or cocktail truck popping up in Austin daily, and we have a swarm of visitors in town for SXSW enjoying them as I type this, at all hours of the day. (Cocktail trucks aren't really a thing, but I wish they were ... unless you count those annoying pedal-bars on wheels that I haven't decided if I dislike more than scooters or not.)

Most people I've briefly mentioned my "reset" month to have wondered why I'm doing it. And why now? Doesn't everyone do one of those in January? (Fun fact: The UK created "Dry January" — who knew?) I could answer: "Well, I'm a millennial." (It's my de facto response to one of my coworkers who loves ragging on us.) But the real reason is because I enjoy having a month or so at least once a year to take a little break from super-socializing and reflect on some of my recent accomplishments that have contributed to better physical, mental, or emotional growth (I ran my first marathon in January and uh, ate and drank whatever I wanted for six weeks afterward with the excuse "But I just ran a marathon! *om nom*", so that's part of it, too). Also, the aforementioned SXSW is here, and thus I didn't plan on leaving my apartment for two weeks in March, so what an easier time to give up alcohol!

Some sarcasm aside, I have still visited bars near home in the meantime because I can't possibly avoid ALL social activity. While enjoying a Topo Chico with some added bitters (it wasn't on the menu), I basically either confirmed a trend or became one that was recently noted in an economic briefing by the Distilled Spirits Council. Bitters, botanicals, and bartenders who can share their deep knowledge about cocktails are among the 2019 trends expected in the US liquor industry. Consumers, particularly millennials, are looking for unique and mindful innovations when visiting bars. Unusual base ingredients and botanicals, as well as experimenting with new bitters, create tailored flavor experiences. Session cocktails, locally grown ingredients, and sustainability continue to affect purchasing decisions, as well as an open dialogue with seasoned bartenders about preferred flavors and spirits.

It helps that my boyfriend is one of those seasoned bartenders the Distilled Spirits Council calls out. But how do bar operators clone him? What strategies have helped them appeal to younger consumers? Some bars are investing in their employees and increasing their training opportunities; others are diving into new beverage programs, such as housemade bitters or barrel-aged draft cocktails.

Here are a three other ways bars are attracting millennial drinkers today:

1. Partnering with App Developers — Gone are the days of throwing a drunken patron into a taxi at the end of the night. While Uber and Lyft have become mainstream ways to travel with a designated driver, bar operators can tap into tech to increase their customer base through rideshare and other apps.

Freebird Rides, an Uber-affiliated app, gives cash-back rewards to diners who travel to restaurants and bars through the rideshare service. World of Beer is a major company in the industry that uses the app. According to Nation's Restaurant News, Freebird users tend to spend about twice as much eating out compared to average diners, possibly because they may have a safe ride home after imbibing in alcoholic beverages. Because bars and nightclubs face competition from restaurants, hotel lounges, and customers who entertain at home — not to mention alcohol delivery services and emerging fast-casual concepts with liquor licenses — apps like Freebird Rides might be a great way to get customers in the door (and safely out).

2. Taking Advantage of the Craft Beer Boom — It probably goes without saying that craft beer is here to stay. According to the Brewers Association, while overall US beer volume sales were down 1% in 2017, craft brewer sales continued to grow at a rate of 5% by volume. In fact, sales of craft brews are rising more quickly at bars and restaurants than at retail stores as consumers seek out the growing variety of emerging brands available on rotating taps.

More than 40% of casual craft beer drinkers and more than 60% of frequent craft drinkers decide which bar to patronize based on its beer selection (hi, I do), according to Technomic. Frequent craft drinkers have higher price thresholds, visit bars more often, and consume a larger variety of alcoholic drinks than the average customer. Just for fun: If you want to pretend to be a craft-beer snob, keep these useless craft beer facts bookmarked on your phone for the next time you're out with friends.

While craft beer's increase in sales did slow in 2018, some manufacturers, like Boston Beer Company, are taking advantage of the popularity of alcoholic tea, cider, and seltzer brands to make up for the dip.

3. Revitalizing Booze-Free Menu Options — As health-conscious consumer preferences shift toward more low- or no-alcohol drinks, "dry bars" are popping up all over the US, Canada, the UK, and even Ireland (I say "even" because even in Chicago, where time-honored St. Patrick's Day Kegs & Eggs celebrations make me reminisce to younger, irresponsible days in my hometown, they've got bars serving non-alcoholic stuff like "The Good Irishman").

Kombucha and cold brew coffee on tap are also being offered at more bars, in addition to a wide array of sparkling water options; I can get a Topo in most Austin bars, but some are now becoming Waterloo- and Rambler-brand only. More mixologists, including ones in bar-ridden Portland, also now have a chance to reach new audiences as they dazzle with a delicious, spirit-free drink that embodies a complex cocktail, featuring fancy fizzes, egg whites, and fresh-pressed juices. Looks and tastes like it, but isn't — call it the vegan movement for booze. Just don't call them mocktail bars.

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In case you didn't notice the headline, millennials are the target customer base for bars. (Surprise, we don't kill everything! Even if you say we do.) They're currently age 23 to 38, and while bars will need to begin thinking of more creative ways to attract of-age Gen Z drinkers, the bars were made for us, right now. Even if we were probably also the intended audience for sober dating apps.

We might be moderating our alcohol consumption more than other age groups, but that's something bar operators should prepare for as the next wave of drinkers plans where to go — and what to drink — for their 21st birthday.

Amber Krosel is a reluctant millennial and an editor at Dun & Bradstreet, where she reports on emerging trends in the food and beverage industries. Her recent LinkedIn posts include "From CBD Cocktails to Hoppy Hybrids: What's New in the Distilleries Industry" and "4 Key Trends in the Non-Alcoholic Beverage Market".

Follow Amber on Twitter.