Keeping Young Adults Loyal in Alcoholic Drinks

Published by: Datamonitor

Published: Sep. 6, 2006 - 106 Pages

Table of Contents

CHAPTER 1 EXECUTIVE SUMMARY

The hot topic

The future decoded

Young Adults account for a shrinking proportion of alcohol spend

Young women are altering consumption patterns

Drinking is more frequently partnered with mealtimes

Tastes have matured, driving changes in drink choice

Action points

CHAPTER 2 THE FUTURE DECODED

Introduction

Defining Young Adults

TREND: Young Adults account for a shrinking proportion of alcohol spend

The population of Young Adults is shrinking

The per capita spend on alcohol by Young Adults is shrinking

The off-trade overall is growing faster than the on-trade

Rise of singles in the 25-34 demographic is the key growth driver in the on-trade

Young Adults occasions are growing in the off-trade

The need for alcohol as a social lubricant will continue to ensure sales in the on-trade

TREND: Young women are altering consumption patterns

Female lifestyles are changing

Rising number of female Young Adults entering tertiary education

Young Women are staying single for longer

Female social drinking is focused on interaction and sharing

The on-trade is witnessing the feminization of venues

The off-trade is being driven by growth in the female demographic

There is a rise in mixed sex groups

TREND: Drinking is more frequently partnered with mealtimes

Food occasions have encouraged premium alcoholic drink uptake

The on-trade needs to upgrade to prevent negative growth

The off-trade is benefiting from an increase in premium product offerings

Food occasions have driven wine consumption

Young Adults' spend per occasion in the on-trade is decreasing

INSIGHT: Age boundaries are blurring and it is no longer sufficient to base marketing on age stereotypes.

Young Adults do not like to be labeled

The Young Adults group itself consists of two very different groups

Students are not necessarily price-led

The desire for maturity affects Young Adults' drink choice

INSIGHT: Image plays an important role in determining the success of channels

Word of mouth is effective in targeting Young Adults

Young Adults say they aren't influenced by word of mouth but in fact their behavior is

Advertising does not drive consumption upwards

INSIGHT: Tastes have matured, driving changes in drink choice

The image of beer has been affected by the premiumization trend

The image of wine is benefiting from its association with food

Young Adults' interest in wine has encouraged manufacturer activity

There is further potential to target Young Adults in the wine segment

The image of FABs has suffered in recent years

The FABs craze peaked later in current growth markets

The decline in FABs could reflect a switch to off-trade consumption

Young Adults in Germany are put off by higher prices of FABs

The slump in demand has led to the disappearance of brands

FABs consumption may be swayed by promotional activity

FABs can play some role in achieving customer loyalty in later years

The image of cider has improved following the introduction of more premium products

The UK may provide a good indication of emerging cider trends overall

The decline of FABs has had a positive impact on the cider market

Cider manufacturers are learning from FABs' mistakes

INSIGHT: Interaction between male drinkers is often based around sports

Male drinking is characterized by the presence of secondary activities

Conformity forms a large part of male drinking

INSIGHT: Repertoire drinking is becoming increasingly important

Need states and occasions determine Young Adults' drink choice

Young Adults are likely to be more experimental than older consumers

INSIGHT: Innovations are reflecting changing Young Adult tastes

There has been an increase in the number of sweet tasting drinks available on the market

Vodka has benefited from its adaptability

The opportunity to experiment proves an attractive option

INSIGHT: Increased health awareness provides an opportunity in the market

Indulgence is more important than health issues

Debit and credits behavior allows for indulgences

Baby boomers are the key group for health products

Consumers recognize the health benefits of wine

Future smoking bans are unlikely to negatively impact the market

Smoking bans may increase health awareness

The link between alcohol and smoking means bans will affect on-trade consumption

Smoking bans may encourage smokers to quit

The effects of the smoking ban on the on-trade will be minimal

Conclusions

CHAPTER 3 ACTION POINTS

Increase the quality of the off-trade offering

Enhance premium offerings in the off-trade

Encapsulate the benefits of the on-trade into off-trade products

Alter the on-trade experience to cater to changing tastes

Turn bars into comfortable, convenient 'homes from home'

Adjust to an increasingly feminized on-trade environment

Associate alcohol with food occasions in Young Adults' minds

Build the connection between food and beer

Focus wine on informal Young Adult related meal occasions

Case Study: Banrock links wine with Aussie BBQ bangers

Demystify wine to target Young Adults

The wine market needs to address Young Adults drinking preferences

Case Study: Constellation Wines - giving wine brands demystified attitude

Ensure dual targeting for drinks

Target consumers with a premium product, at a competitive price

Case Study: Positioning Magners as a premium cider

Use event marketing to build brand loyalty

Establish a connection with music events

Establish long-term sponsorship contracts

Create novel products in order to maintain interest

CHAPTER 4 APPENDIX

Supplementary data

Young Adults' alcoholic drinks in France

Young Adults' alcoholic drinks in Germany

Young Adults' alcoholic drinks in Italy

Young Adults' alcoholic drinks in the Netherlands

Young Adults' alcoholic drinks in Spain

Young Adults' alcoholic drinks in Sweden

Young Adults' alcoholic drinks in the UK

Young Adults' alcoholic drinks in the US

Definitions

Research methodology

Future readings

How to contact experts in your industry

List of Tables

Table 1: Number of Young Adults in Europe and the US (m), 2000-2010

Table 2: Number of Young Adults in Europe and the US as a percentage of overall population (%) , 2000-2010

Table 3: Young Adults' alcoholic spend per capita (US$), US & Europe, 2000-2010

Table 4: Young Adults' alcoholic spend as a percentage of all groups' spend (%), US & Europe, 2000-2010

Table 5: Total number of alcoholic drinking occasions (m), US & Europe, 2000-2010

Table 6: Total share of alcoholic drinking occasions by occasion type (%), US & Europe, 2000-2010

Table 7: Off-trade share of Young Adult alcohol consumption (% volume), US & Europe, 2000-2010

Table 8: Young Adults' per capita consumption of alcohol overall (liters of pure alcohol), US & Europe, 2000-2010

Table 9: Number of women students in Europe and the US (m), 2000-2010

Table 10: Mean age at first marriage - females, Europe and the US, 1990-2010

Table 11: Mean average age at time of first childbirth Europe and the US, 2000-2010

Table 12: Overall alcoholic drinks values in the off-trade (US$ m), US & Europe, 2000-2010

Table 13: Overall alcoholic drinks volumes in the off-trade (Liters m), US & Europe, 2000-2010

Table 14: Wine as a percentage of Young Adults alcohol consumption overall (% volume), US & Europe, 2000-2010

Table 15: Overall alcoholic drinks values in the on-trade (US$ m), US & Europe, 2000-2010

Table 16: Overall alcoholic drinks volumes in the on-trade (Liters m), US & Europe, 2000-2010

Table 17: Young Adults' per capita consumption of beer (liters of pure alcohol), US & Europe, 2000-2010

Table 18: Young Adults' beer consumption as % of total beer consumption (%), US & Europe, 2000-2010

Table 19: Young Adults' per capita consumption of wine (liters of pure alcohol), US & Europe, 2000-2010

Table 20: Young Adults' wine consumption as % of total wine consumption (%), US & Europe, 2000-2010

Table 21: Young Adults' per capita consumption of FABs (liters of pure alcohol), US & Europe, 2000-2010

Table 22: Young Adults' per capita consumption of FABs (liters of pure alcohol), US & Europe, 2003-2005

Table 23: Young Adults' FABs consumption as % of total FABs consumption (%), US & Europe, 2000-2010

Table 24: Young Adults' per capita consumption of cider (liters of pure alcohol), US & Europe, 2000-2010

Table 25: Value of Young Adults overall alcohol spend (US$ m), France, 2000-2010

Table 26: On-trade share of Young Adult overall alcohol spend (% value), France, 2000-2010

Table 27: Volume of Young Adults overall alcohol consumption (Liters of drinks m), France, 2000-2010

Table 28: On-trade share of Young Adult overall alcohol consumption (% volume), France, 2000-2010

Table 29: Value of Young Adults overall alcohol spend (US$ m), Germany, 2000-2010

Table 30: On-trade share of Young Adult overall alcohol spend (% value), Germany, 2000-2010

Table 31: Volume of Young Adults overall alcohol consumption (Liters of drinks m), Germany, 2000-2010

Table 32: On-trade share of Young Adult overall alcohol consumption (% volume), Germany, 2000-2010

Table 33: Value of Young Adults overall alcohol spend (US$ m), Italy, 2000-2010

Table 34: On-trade share of Young Adult overall alcohol spend (% value), Italy, 2000-2010

Table 35: Volume of Young Adults overall alcohol consumption (Liters of drinks m), Italy, 2000-2010

Table 36: On-trade share of Young Adult overall alcohol consumption (% volume), Italy, 2000-2010

Table 37: Value of Young Adults overall alcohol spend (US$ m), The Netherlands, 2000-2010

Table 38: On-trade share of Young Adult overall alcohol spend (% value), The Netherlands, 2000-2010

Table 39: Volume of Young Adults overall alcohol consumption (Liters of drinks m), The Netherlands, 2000-2010

Table 40: On-trade share of Young Adult overall alcohol consumption (% volume), The Netherlands, 2000-2010

Table 41: Value of Young Adults overall alcohol spend (US$ m), Spain, 2000-2010

Table 42: On-trade share of Young Adult overall alcohol spend (% value), Spain, 2000-2010

Table 43: Volume of Young Adults overall alcohol consumption (Liters of drinks m), Spain, 2000-2010

Table 44: On-trade share of Young Adult overall alcohol consumption (% volume), Spain, 2000-2010

Table 45: Value of Young Adults overall alcohol spend (US$ m), Sweden, 2000-2010

Table 46: On-trade share of Young Adult overall alcohol spend (% value), Sweden, 2000-2010

Table 47: Volume of Young Adults overall alcohol consumption (Liters of drinks m), Sweden, 2000-2010

Table 48: On-trade share of Young Adult overall alcohol consumption (% volume), Sweden, 2000-2010

Table 49: Value of Young Adults overall alcohol spend (US$ m), UK, 2000-2010

Table 50: On-trade share of Young Adult overall alcohol spend (% value), UK, 2000-2010

Table 51: Volume of Young Adults overall alcohol consumption (Liters of drinks m), UK, 2000-2010

Table 52: On-trade share of Young Adult overall alcohol consumption (% volume), UK, 2000-2010

Table 53: Value of Young Adults overall alcohol spend (US$ m), US, 2000-2010

Table 54: On-trade share of Young Adult overall alcohol spend (% value), US, 2000-2010

Table 55: Volume of Young Adults overall alcohol consumption (Liters of drinks m), US, 2000-2010

Table 56: On-trade share of Young Adult overall alcohol consumption (% volume), US, 2000-2010

Table 57: Definitions of terms

Table 58: Definitions of drinking occasions

List of Figures

Figure 1: Different age demographics as a percentage of overall population able to drink (%), Europe, 2000-2010

Figure 2: Different age demographics as a percentage of overall population able to drink (%), US, 2000-2010

Figure 3: Germany has the highest alcohol consumption among Young Adults

Figure 4: Handyman Red is an example of a more contemporary wine

Figure 5: Henkell's champagne provides an example of a product which attempts to target the female consumer using sweet tastes

Figure 6: Anheuser's fruit-infused beer provides an example of beer manufacturers catering for the sweeter tastes of women

Figure 7: An increasing number of draught beer appliances provide an example of how manufacturers are increasing quality in the off-trade

Figure 8: Eze Ready to Drink cocktails provide an example of a typically on-trade drink tailored for the off-trade

Figure 9: Tikka beer provides an example of a beer product which caters for a specific food type

Figure 10: Miller Brewing Company's talking beer cans provide an example of a novel product

Figure 11: Russian Roulette developed a drinking experience rather than just a product with the introduction of their vodka-based game

Abstract

Young Adults' per capita consumption of alcohol is decreasing, reflecting a move towards more relaxed drinking occasions. Meanwhile, Young Adults have begun to upgrade their drinks, particularly in the off-trade which is growing its share of throat in the overall market. Manufacturers have to act quickly to identify trends and adapt accordingly in order to prevent loss of share.

• Analysis of Young Adults on- and off-trade alcoholic drinking occasions between 2000 and 2010 across major European markets and the US
• Quantitative data covering the value and volume of Young Adults alcoholic drinks sales between 2000 and 2010, broken down by country and category
• Detailed consumer insight into values, attitudes and behaviours and unmet needs driving Young Adults drinking trends
• Actionable recommendations offering practical strategies based on Young Adults alcoholic drinks trends and insights analyzed in the report

Following declining cider volumes in the early part of the 2000s, cider has overcome image-related problems and redeemed itself as a credible drink among Young Adults. This has spurred a revival in the market, and between 2005-2010 overall growth is forecast at 2.3%, after the reported 0.8% decline in per capita growth between 2000 and 2005.

Students are upgrading their drinking occasions; swapping the student union for more classy establishments, and more relaxed occasions. It also suggests that while students are generally more price restricted than young professionals, they do not necessarily choose the cheapest drink available.

US Young Adults are drinking out more often, however, the reverse is true in Europe as consumption switches to the off-trade. European on-trade spend is also falling, due to a rise of 'alcohol with food' occasions and a more relaxed rate of drinking. Significant opportunities remain to develop off-trade offerings to capture Young Adults loyalty.

• Gain exclusive data concerning on-trade and off-trade drinks occasions, sales value and volume, and consumption among the Young Adult demographic
• Understand the attitudes driving changes in Young Adults' alcoholic drinks consumption behavior
• Improve your marketing strategy by tailoring alcoholic drinks to the fastest-growing occasion types and consumer needs of Young Adults

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