PROOF Insight Weekly Update

Britain’s Summer of Sport set to encourage pub visits and spending.

The men’s football world cup will undoubtedly be the biggest sporting event of the year, with Design my Night reporting that venues have already begun to register ticketed events on their platform, despite the tournament not kicking off until November. Many sports fans have expressed their disappointment at the tournament being moved to winter, although there are still plenty of sporting events for them to sink their teeth into this summer.???

The Wimbledon Tennis Championships began on Monday (27th), with the final taking place on 10th July; whilst The European Grand Prix runs every weekend in July. The UEFA Women’s Euro 2022 tournament also takes place between the 6th and 31st July which could satisfy the country’s thirst for football before the men’s Premier League kicks off on 6th August.??

Wimbledon is traditionally one of the largest sporting events of the British summer. However, this year, it will be slightly less traditional than normal after ending its 86-year partnership with Robinsons squash. The underlying reasons have not been announced, although it has been reported that the tournaments organisers were opposed to Britvic (Robinsons’ owners) promoting their other products at the tournament.??

Sports could offer a much-needed lifeline to many pub operators with 82% saying that a profitable summer is important to their future success. A further 67% of operators expect sport to play an important role in providing a profitable summer. According to a recent report, operators can expect increased consumer spending of ￡13 per head on big sporting occasions. When it comes to maximizing this opportunity, quality and atmosphere are crucial. 75% of consumers are influenced by the quality of a pub’s live sports offering when choosing a venue and 66% of operators say that a positive sporting atmosphere will encourage customers to return.

Source: The Guardian, Propel, DesignMyNight, KAM Media

Venues explore measures to save money as a minority report turning a profit.

In light of rising costs of energy, goods and wages, it may not come as a surprise that a recent survey has shown only 37% of UK hospitality businesses are currently turning a profit. Furthermore, only 28% are currently able to invest money into their business and one in six report they currently have no cash reserves. As consumers restrict their expenditure given the rising cost of living, it has created “a perfect storm” for the hospitality industry that some cannot weather.??

As venues explore ways of surviving the current climate, almost half (45%) have reduced their opening hours to avoid permanent closure. With PROOF’s research finding less than one in ten (9%) alcohol drinkers go to the pub on a Monday or Tuesday and the majority choose to relax at home (69%) or watch TV (72%), it would make sense to reduce opening hours on these days and focus resources later in the week.??

Other ways to offset financial pressures for the industry are to explore activities in venues, as consumers look towards experiences in their desire to make memories (see our ‘Experience it All’ trend). One in five under-35s would visit the on-trade on a Monday or Tuesday if they held a quiz (22%) or a drink tasting event (19%) such as wine or beer tasting. For many venues, promotions are out of the question as they are unable to absorb the cost implications, however this was the top factor that would encourage consumers out.

As consumers and businesses alike feel the squeeze, the key may well be to offer an experience for consumers at limited extra cost to the venue.?Contact PROOF?to find out what your consumers enjoy.

Source:?PROOF POURtraits panel research February 2022, Propel, British Beer & Pub Association

BIS prompts central banks to act before soaring inflation becomes entrenched.

Bank for International Settlements (BIS), whose mission is to support financial stability through international cooperation, has released the annual report urging central banks across the world to act before soaring inflation becomes the norm. BIS suggests that while the short-term effect might be costly the long-term benefits will outweigh these and ultimately maintain stability in households and businesses.

While the Bank of England had hoped that the rising inflation would be transitory, inflation in the UK has grown to 9.1% in May 2022 – the highest in 40 decades - and is expected to reach double figures by the end of the year. Moreover, businesses are facing increase pressure as demands for higher wages rises to keep up with rising cost-of-living which might further inflation even more. The uneven impact on consumers is apparent; whilst 44% of adults are cutting back on food purchases, Bentley cars has reported record-breaking sales.?

While the hospitality trade is not immune to inflation there are some promising signs, such as 9 million more consumers planning to stay in the UK for their holidays and 1 in 4 consumers prioritising experiences over material goods, which is expected to benefit the trade during the summer.

Source:?FT, ONS, Business News, PROOF Insight

Investments, Mergers & Acquisitions:???

• Sapporo acquires American craft beer producer, Stone Brewing, for US$165m.
• Star Pubs & Bars struck an improved energy deal with British Gas for licensees to help mitigate the energy crisis
• Brucan Pubs announced plans to double existing estate from five gastropub sites to ten by 2027.
• Pernod Ricard sold single malt producer, Tormore Distillery, to Elixir Distillers for undisclosed sum.
• Ascot Brewing Co hits ￡150,000 crowdfunding target to fund opening of new taphouses in Berkshire, Hampshire and Surrey.
• Boparan Restaurant Group (BRG) confirmed four further openings for their Slim Chickens brand in Leicester, Liverpool, Milton Keynes and London’s Bishopsgate.
• Admiral Taverns has sold seven pubs to FB Taverns as part of its requirements from the CMA, after its purchase of Hawthorn.
• Foley Family Wines acquired Silverado Vineyards’ 121 hectares of vines across three Napa districts, in US$150m deal.

Sources:?Big Hospitality, Propel, Morning Advertiser, The Drinks Business

Product Launches & Campaigns:

• Gary Barlow added a Spanish rosé, 100% Tempranillo, to his Organic wine range in partnership with Benchmark Drinks.
• English winemaker, Terlingham Vineyard, released two new vegan friendly wines; their 2021 Chardonnay and 2021 Rosé.
• US hit sitcom ‘It’s Always Sunny in Philadelphia’ stars have created Four Walls Whiskey; an Irish whisky and an American Rye to capture the spirit of the shows fictional Paddy’s Pub.
• Greenall’s expand their flavoured gin portfolio with Tropical Fruits gin, launched exclusively at Tesco.
• Smirnoff expands its flavoured vodka portfolio with Berry Burst, launched exclusively at Morrisons with wider availability expected from September.
• Carlsberg is fielding a limited trial of their bio-based Fibre beer bottles, made with a combination of PEF lining and sustainably sourced wood fibre with insulating properties.
• Jack Daniel’s has wrapped a number of London buses to promote the JD apple and lemonade serve.

Source:?Drinks Business, Spirits Business, Morning Advertiser

On-trade Quarterly Market Update Report

PROOF's?Insight team?have compiled the latest quarterly?Market Performance?update for the?GB on-trade, which analyses?current trends?and?consumer behaviour?and what it means for brands and operators. Contact PROOF if you would like a copy.