Thrifty consumers are practising 'conscious spending' and looking for brands that offer more value than just money – this is what this year's William Grant & Sons UK market report found, in its analysis of the consumer behaviours and trends in the drinks industry in the year to April 2015.
Launched last night, the report says that value is now much more than money to consumers; rather, they are interested in brands, products or services that can provide value on an emotional or functional level. Consumers are willing to pay more for a product that matches their values, hence the continued growth of premium products.
This is what William Grant & Sons UK marketing director Gary Keogh called 'conscious spending': the recession has left consumers used to a thrifty behaviour, which is making them buy perhaps less, but better.
'Conscious choice-making about where to, and where not to spend disposable income is here to stay – thriftiness has become not only habitual but celebrated,' Keogh said. 'This is conscious spending, not cost-cutting across the board. Consumers will spend money on those brands that offer something more to them, including the opportunity to associate themselves visibly and proudly with brands that project their values.
'The market is more polarised than ever and it’s premium brands that can really take advantage of this trend. It is notable how the trends we’re seeing in this post-recession, digitally transparent age are pointing towards consumers demanding more genuine relationships with brands, and how companies and brands who take that longer, more sustainable view are thriving.'
In terms of the market itself, the report highlights a good year for spirits, which grew almost twice as fast as the alcohol market, up 2.5% in value. Non-flavoured vodkas and non-cream liqueurs were the largest categories within the on-trade, representing 30.6% and 12.1% of the market respectively, with gin coming in third at 8.7%.
Premium spirits did even better, with value growth of 14.1% – accounting for 60% of total spirit value growth.
The number of drink-led outlets experienced a 3.8% decline across the UK, but food-led venues did well, growing 4.9%.
The report also noted the growing role of the internet in consumer research, with 54% of consumers researching on-trade venues before visiting.