Building Better Beverage Programs
Through On-Premise Consumer Insights
Presented By
January, 2009
Session Overview
• Building better beverage programs starts with on-premise
specific consumer insights.
• This session will feature the latest on-premise national
accounts consumer research fielded exclusively for the
Cheers Beverage Conference.
• This year’s session will focus on the hot topics of the
impact of the economy on beverage purchases, pricing
service and drink menu effectiveness.
• The session also includes a review of the latest
consumer beverage trends from our Cheers Consumer
Trend Monitor.
Contents
• Methodology
• Impact Of The Economy Of Beverage
• Pricing
• Service
• The Drink Menu
• Cheers On-Premise Trend Tracker
• Summary
Methodology
Methodology
• Custom on-premise national chain consumer research
conducted by Next Level Research and Nova Marketing.
• This study was fielded exclusively for the 2009 Cheers
Beverage Conference.
• The study was conducted in December, 2008 using the
on-line Zoomerang Database
• Zoomerang is the leading on-line survey tool with a
national data base of over 5 million consumers.
• The study provides quantitative information on the onpremise consumer at a 95% confidence level.
Consumer Screens
• All consumers were at least 21
years old
• Split 50% male / 50% female
• Evenly spread throughout U.S.
• Must have Visited an OnPremise National Chain within
the last 30 days
• Must have ordered an
alcoholic beverage at an
On-Premise National Chain
within the past 30 days
National Chain Focus
Study includes consumers from the top Casual Dining,
Fine Dining and Hotel chain consumers.
Consumer Composition
Study included 500 past 30-day national chain beverage
alcohol consumers providing 95% confidence level.
2,000
1,900
1,800
1,700
1,600
1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0
1,784
1,124
500
374
Consumers
Entered
Past 30-Day
Chain
456
321
Past 30-Day Past 30-Day Past 30-Day Past 30-Day
Chain TBA
Chain Beer Chain Wine Chain Spirit
Drill Down
Topic
#1
The Economy
Full Service Restaurant Spending
As a result of the economy, three-quarters of consumers say
they are spending less at full-service bars and restaurants.
90%
80%
76%
Females cutting
back slightly more
than males
70%
60%
50%
40%
24%
30%
20%
10%
0%
Yes
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
No
Reducing Full-Service Restaurant Spending
Nearly 80% of consumers say that they are going out
less often with 25% spending less when they do go out.
Source: NLR/NOVA: Dec 2008 with 380 past 30 day national chain beverage alcohol consumers that are cutting back
Ways To Reduce Spending Per Visit
Consumers looking to cut back on their spending per visit order
less expensive entrees, take advantage of special promotions,
cut back on side orders and cut back on cocktails.
Source: NLR/NOVA: Dec 2008 with 380 past 30 day national chain beverage alcohol consumers that are cutting back
Ways To Increase Consumer Visits
Consumers would respond to traffic driving promotions like
buy one get one meals and ½ priced drinks.
Source: NLR/NOVA: Dec 2008 with 380 past 30 day national chain beverage alcohol consumers that are cutting back
Drinking Behavior Changes
When asked how their beverage alcohol purchases have
changed over the past year, consumers are equally split
between ordering the same and ordering less per occasion.
More males are ordering the same while
more females are ordering less/occasion.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Drill Down
Topic
#2
Pricing
Bar & Restaurant Choice
When deciding which full-service restaurant to visit, food,
prices, service, location, atmosphere and alcoholic
beverages are the most important factors.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Most Importance Beverage Alcohol Items
Consumers rate “Everyday Drink Prices At A Good Value”
as the most important beverage program element.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Importance Of Price When Ordering Drinks
When ordering beer, wine and spirit drinks in full-service
bars or restaurants, price is very important for only 28% of
consumers but somewhat important for half the consumers.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Knowing The Exact Pricing In Advance
Most consumers do not know the exact price of beer, wine
and cocktails before
they place their orders.
70%
60%
56%
50%
44%
40%
30%
20%
10%
0%
No
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Yes
Drink Taste Expectations – Spirits
Consumers strongly agree that cocktails made with premium
brands taste better than those made with house brands.
100%
90%
83%
80%
70%
60%
50%
40%
30%
17%
20%
10%
0%
Agree
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Disagree
Drink Taste Expectations – Wine
Consumers strongly agree that premium branded wines
taste better 100%
than house wines.
90%
80%
75%
70%
60%
50%
40%
25%
30%
20%
10%
0%
Agree
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Disagree
Drink Taste Expectations – Beer
Consumers strongly agree crafts and
100% imported beers taste
better than mass domestic beers.
90%
80%
73%
70%
60%
50%
40%
27%
30%
20%
10%
0%
Agree
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Disagree
Drink Taste Expectations – Summary
Across beer, wine and spirits consumers strongly agree that
better brands taste better.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Drink Price Expectations
Across beer, wine and spirits most consumers expect to
pay more for premium brands.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
How Much More
On average, consumers expect to pay $1.81 more for a
premium beer, $2.44 more for a premium wine and
$2.80 more for a premium cocktail.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Drill Down
Topic
#3
Service
Key Elements Of Beverage Service
Consumers rank prompt drink delivery, appropriate/clean
glassware, prompt order taking and server greetings as the
most important elements of good beverage service.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Speed Of Service Satisfaction Levels
Consumers are generally satisfied with the speed of drink
service that they currently experience in national chains.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Speed Of Service Expectations
After placing their order, 85% of consumers expect to
receive their drinks 2 – 5 minutes.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Preferred Server / Bartender Greetings
Consumers clearly prefer server / bartender greetings that
provide them with more information
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Responsiveness To Suggestive Selling
If trade-up brands were suggested, 50% beer, wine and spirit
consumers would order them.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Ways Servers Can Enhance The Experience
On an open ended basis, the dining experience could be
enhanced if servers were faster, offered more suggestive
selling, were more knowledgeable and friendly.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Drill Down
Topic
#4
The Drink
Menu
Beverage Purchase Decision Timing
Nearly 80% of consumers do not know what beer, wine and
spirit drink they will order in advance.
90%
80%
79%
70%
60%
50%
40%
30%
21%
20%
10%
0%
Influenced In
Unit
Decide In
Advance
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Beverage Purchase Influencers
Beverage menus and bartender/server suggestions are the
most important order influencers.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
New Drink Trial
Nearly 70% of on-premise national chain consumers try a
new drink at least every 90 days.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Reading Drink Menus
When visiting full-service bars and restaurants, nearly 90% of
consumers read the drink menus.
100%
90%
80%
86%
70%
60%
50%
40%
30%
14%
20%
10%
0%
Yes
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
No
Reading Drink Menus
Females read drink menus more than males and younger
consumers read them more than older consumers.
100%
93%
90%
82%
77%
80%
60%
40%
20%
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
+
45
45
<
al
e
Fe
m
M
al
e
0%
Types Of Drink Menus
Consumers clearly prefer stand alone drink menus over
drink listings on food menus, table tents or insert cards.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Number Of Drinks On Drink Menus
On average, consumers want to see 14 beer, 14 wine and
16 cocktail offerings on national chain drink menus.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
How To List Beer Menu
Consumers prefer to have beer selection listed by
domestics, imports and crafts on national chain menus.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Information On Drink Menus
In addition to the drink name, consumers most want to
see drink descriptions on national chain menus.
Source: NLR/NOVA: Dec 2008 with 500 past 30 day national chain beverage alcohol consumers
Drink Menu Visual Tests
• Five separate drink menu visual tests were conducted as
part of this study.
• The menu visuals were presented to consumers in a
random order to prevent any order bias.
• Patrick Henry Creative Promotions provided the menu
visuals for this study and consulted on the menu
questions.
Drink Menu Visual Test #1
• Tested the consumer purchase intent of three different
margaritas, presented on the menu in three different
ways:
1. Functional descriptions
2. Romance copy descriptions
3. Romance copy descriptions with price
Menu Visual Test #1A - Functional
Based on functional descriptions, 47% of consumers would
order House, 31% Top Shelf and 22% Ultra-Premium.
47%
House
Top Shelf
31%
Ultra-premium
22%
0%
10%
20%
30%
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit cocktail consumers
40%
50%
60%
Menu Visual Test #1B - Romance
Adding romance copy, reduces House orders from 47% to
33% increasing trade-up from 53% to 67%
33%
House
Top Shelf
31%
Ultra-premium
28%
36%
30%
32%
34%
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit cocktail consumers
36%
38%
Menu Visual Test #1C – Romance & Price
Adding romance copy and price maintains trade-up at 67% with
slight trade down from Ultra to Top Shelf.
House
33%
Top Shelf
36%
Ultra-premium
28%
31%
30%
32%
34%
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit cocktail consumers
36%
38%
Menu Visual Test #1 – Results Summary
Adding romance drink copy to menus drives significant drink
trade-up and the addition of price is trade-up neutral.
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
47%
33%
31%
36%
31%
33%
36%
31%
22%
House
Top Shelf
Ultra-premium
Functional
Romance
Romance & Price
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit cocktail consumers
Drink Menu Visual Test #2
• Tested the consumer purchase intent of three menus
with varying degrees of drink photography:
1. Six drinks with no photos
2. Same six drinks with one photo
3. Same six drinks with a photo for each
Margarita Menu With No Photos
Margarita Menu With One Photo
Margarita Menu With Photo Of Each Drink
Menu Visual Test #2 - Results
Consumers clearly prefer drink menus that feature a
photo of each drink.
14%
17%
69%
A. No Photos
B. 1 Photo
C. Photo Of Each Drink
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit cocktail consumers
Drink Menu Visual Test #3
• Tested the consumer purchase intent of three different
wine menu layouts:
1. Progressive (all mixed in)
2. Progressive (by varietal)
3. By varietal and price
Progressive Wine Menu – All Mixed In
Progressive Wine Menu By Varietal
Progressive Wine Menu By Varietal And Price
Menu Visual Test #3 - Results
Consumers prefer their progressive wine lists to be
organized by varietal and price
13%
35%
52%
Mixed
By Varietal
By Varietal And Price
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Drink Menu Visual Test #4
• Tested the consumer purchase intent of three different
beer menu layouts:
1. List with text only
2. List of logos
3. List of bottle shots
Beer Menu – Text List Only
Beer Menu – Logos
Beer Menu – Bottle Shots
Menu Visual Test #4 - Results
Consumers prefer the bottle shot beer menu layout most
and the logo menu approach the least.
35%
20%
45%
Text List
Logo List
Bottle Shot List
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Menu Visual Test #5
• Tested the consumer purchase intent when premium
brands carried are communicated on the menu.
Chili’s Drink Menu Example
Menu Visual Test #5 - Results
When beverage menus feature listings of the premium
brands that are carried at the bar, most consumers say
that it makes them more likely to order cocktails.
60
57%
50
43%
40
30
20
10
0
Yes
No
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit cocktail consumers
Top 10
Drill Down Findings
Summary Of Top 10 Takeaways
1. Consumers are going out less often and they are more
promotionally minded than ever.
2. Drink prices that offer good value are important but
price is not very important to consumers when they
place their order. In fact, most consumers do not know
the drink price they will pay in advance.
3. Consumers believe premium brands taste better than
standard brands and they expect to pay more for them.
4. Two of the most important beverage service elements
are taking orders quickly and delivery drinks promptly.
Summary Of Top 10 Takeaways
5. Consumers prefer server / bartender greetings that
provide them with more information and they will
respond to suggestive selling recommendations.
6. Most consumers do not know what they will order in
advance and the drink menu is the key influencer.
7. Consumers prefer stand-alone drink menus with about
15 beers, 15 wines and 15 spirit drinks on them.
8. Adding romance copy to the drink descriptions on the
menu drives significant drink trade-up.
Summary Of Top 10 Takeaways
9. Consumers clearly prefer drink menus that feature a
photo of each drink.
10. On the beer menus, consumers prefer the beers
arranged by domestic, import and craft and they
prefer bottle shots over brand logos on the menu.
2009 On-Premise Beverage Alcohol
Consumer Trend Report
Beer Category
Trends
Beer Trends By Type
Domestics continue to dominate on-premise consumption
but crafts and imports gained ground in this year’s survey.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Light Vs. Full Flavored Beer
Regular and light beer consumption is split almost equally
with regular consumption increasing slightly this year.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Light Vs. Full Flavored Beer – By Type
• Regular beer drinkers split their consumption equally
across domestics, imports and crafts.
• Light beer drinkers skew heavily to domestics.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Top Domestic Beer Brands
• All of the top 3 brands are all lights
with Bud Light, Miller Lite, and Coors
Light all increasing in popularity.
• Other growth brands include
Michelob Ultra, Rolling Rock, and
Miller Chill.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Beer Imports By Country
• Mexican beer continues to be
the most popular import.
• Irish, German, Dutch and
Belgians round out the top 5.
• Rankings changed this year with
clarification of the top brands
by country.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Top Import Brands
• Corona and Heineken continue to
be the top 2 brands but both
dipped slightly in popularity.
• Rounding out the 5, Guinness,
Corona Light and Dos Equis all
posted strong popularity gains.
• Other growth brands include
Newcastle, Bass, and Stella.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Top Craft/Specialty Brands
• Samuel Adams continues to
dominate the segment and it
grew significantly in popularity.
• Blue Moon jumped over Killian’s
and Smirnoff Ice into the #2 spot.
• Other growth brands include
Killian’s, Sam Adam’s Light,
Yuengling, Sierra Nevada, Magic
Hat and Shiner Bock.
Source: NLR/NOVA: Dec 2008 with 374 past 30 day national chain beer consumers
Wine Category
Trends
Domestic & Import Wine Trends
Domestics continue to dominate on-premise consumption
with imports gaining ground and almost 20% don’t know.
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Wine Trends By Type
The top on-premise wine types are flavored reds, light-flavored
blushes and medium flavored reds, which increased significantly.
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Top Wine Varietals
• White Zinfandel and Merlot are
tied for the top varietal spot.
• Pinot Noir, Zinfandel, and
Rieslings posted strong gains this
year.
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Top 15 Domestic Wines
• Sutter Home and Beringer tied for
the top domestic brand spot.
• Beringer, Kendall Jackson,
Mondavi, Clos du Bois, Chateau
St. Michelle, Corbett Canyon and
Sterling showed gains vs. last year.
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Wine Imports By Country
• Italian wines continue to
dominate the imports.
• Wines from Germany are
showing the most growth.
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Top 15 Imported Wines
• Yellow Tail dominates imported
wine brand rankings.
• Black Swan, Santa Margherita,
Bella Sera, Ecco Domani made
significant gains this year.
Source: NLR/NOVA: Dec 2008 with 321 past 30 day national chain wine consumers
Spirit Category
Trends
Spirit Category Trends
• Vodka, Rum and Tequila continue
to be the key on-premise spirit
segments.
• Most segments showed increases
vs. last year indicating consumers
drink repertoire includes multiple
segment.
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit consumers
Top 15 Cocktail Flavors
• Strawberry continues to be the
#1 drink flavor.
• There is a 4 way tie for 2nd most
popular flavor with Apple,
Lime, Cranberry and Mango.
• The growth flavors are
Strawberry, Cranberry, Mango,
Pomegranate and Sour Apple.
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit consumers
Emerging Cocktail Flavors
• This year’s study included a
new question on emerging
flavors.
• Consumer are most interested
in the Passion Fruit, Mango,
Blood Orange Acia Berry,
Blueberry and Pear flavors.
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit consumers
Top 15 Spirit Drinks
• Margarita continues to be #1
but it slipped back while Rum &
Coke grew to a close second.
• Mojito and Screwdriver
increased significantly while
Flavored Martini decreased in
popularity.
• Sex On The Beach was added
to this year’s survey.
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit consumers
Next 15 Spirit Drinks
• Red Bull & Vodka, Jaeger
Bomb and Mai Tai increased
significantly.
• Fuzzy Navel, Vodka & 7-Up and
Kamikaze were added to
this year’s survey.
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit consumers
Top 15 Call Brands
• Bacardi continues to be #1
but Grey Goose has grown into a
very close 2nd position.
• Smirnoff dropped in popularity
while Patron jumped significantly
into the top 15 brands.
Source: NLR/NOVA: Dec 2008 with 456 past 30 day national chain spirit consumers
Top 10
Cheers On-Premise Consumer
Trend Report Findings
Summary Of Top 10 Takeaways
1. Domestic beer continues to dominate consumption but
craft beers are growing the fastest.
2. Total beer consumption is equally split between regular
and light beer with light beer skewing most heavily to
the domestics and least to the crafts.
3. Mexican beer continues to be the most popular import
type with Irish, German, Dutch and Belgian round out
the top 5 imports.
4. Domestic wines continue to dominate consumption but
imports are driving the growth and almost 20% don’t
know whether they drink imports or domestics.
Summary Of Top 10 Takeaways
5. White Zinfandel and Merlot are the most popular
varietals with Pinot Noir, Zinfandel, and Rieslings each
showing strong popularity gains this year.
6. Italian wines continue to be the most popular import
type with wines from Germany showing the most growth.
7. Within spirits, Vodka, Rum and Tequila continue to be the
key on-premise spirit segments.
8. Strawberry is the most popular spirit drink flavor with
growth coming from Mango, Pomegranate, Sour Apple
and Cranberry flavors.
Summary Of Top 10 Takeaways
9. Margarita continues to be the #1 drink but its popularity
slipped a bit while Rum & Coke pulled into a close
second.
10. The Mojito is the growth story and it seems to have
grown at the expense of Flavored Martinis.
Closing
•
We have been conducting custom on-premise consumer
research for over five years.
•
The research has ranged from macro beer, wine and spirits
studies to micro studies on specific drinks.
•
Our studies have been conducted for both suppliers and
directly for chain operators.
•
It is very exciting to see the research helping to guide more
informed beverage decisions that help drive growth.
•
Over the next few weeks, we will be following up with you to
get your feedback on future research topics.
Thank You!
Questions
Mike Ginley, Partner
Jeff Grindrod, Partner
Next Level Marketing
1330 Post Road East
Westport, CT 06880
203-292-6295
Nova Marketing
1 Darling Dr.
Avon, CT 06001
860-676-7900
mginley@nextlevel-co.com
Jeffgrindrod@comcast.net