Questions I have been asked lately, by Ann Elliott
Friday Opinion – Propel Newsletter – 11th March 2016
I often get asked: “What are the latest trends I need to know about and what’s really going on out there?” These are some of the questions from the last week or so.
Are millennials really drinking less?
There was some interesting research published this week by the Office of National Statistics on UK alcohol consumption, which said an increasing number of young people are either turning teetotal or drinking considerably less than before. According to the survey, over 50% of 16 to 24-year-olds had not had a drink in the previous week. The trend isn’t limited to the younger generation with 42% of all Britons (regardless of age) having not had a drink in the previous week, an 8% increase compared with a decade ago. So the answer is yes. This is not a new trend. It looks set to continue.
Do I need to take any notice of the Morrisons/Amazon deal you wrote about last week?
With the latest delivery companies, such as Deliveroo and GrubHub seeming old news (but still incredibly relevant for our sector), the Amazon’s latest partnership with Morrisons is still causing some surprise. According to a survey by Trustev, 64% of millennials are more likely to make a purchase from a retailer that offers same-day delivery. This is Amazon’s sweet spot. The big question for us is: “Will Amazon link with food distributors take part of the out-of-home food and beverage share?” The success of the partnership with Morrisons could be an indicator. I would certainly be taking notice.
What are others in the sector wanting from the upcoming budget?
The industry will be hoping for increased support from the government with the continuations of last year’s policies. In particular, continued cuts to beer duty and reform on business rates. A further 1p cut in beer duty would help ensure the pint remains affordable, support pubs and secure jobs. The industry would benefit from government support to help alleviate the costs of the National Living Wage, taking effect on April 1. Workers aged over 25 will earn £7.20 per hour, a 50p rise on the current rate. PwC estimates this will cost the hospitality industry £13.2m by 2020. I think the government is unlikely to do anything in this area but the impact of this on our sector is enormous and not yet being discussed openly.
Is there still growth in the bar side of business?
A survey of more than 1,300 diners and restaurateurs conducted this week by OpenTable found over half (55%) of diners had visited a restaurant specifically for their bar menu. 81% of consumers said they enjoyed eating at the bar, while 61% said a welcoming bar area was more likely to make them visit a restaurant. This has triggered a reaction from operators looking to attract additional trade. Of those operators surveyed, 65% either have invested or are planning to invest in their bar area in the next 12 months. This is a wise move – the link between bars and casual dining is a driver for growth.
My food is as good as ever but my like-for-like sales are pretty stagnant – thoughts?
Recent research from Mintel revealed 71% of consumers agree the atmosphere of a restaurant is just as important as the food. We also have lots of evidence to show the overall experience in a restaurant is key – not just one particular part of the offer. Every element of the customer journey has to be examined with the same sort of forensic intensity as the food and delivered consistently and brilliantly – and then communicated exceptionally well to guests. Always been important, always will be.
Where’s worth trying at the moment?
I would go back to Babaji in Shaftesbury Avenue, Palomar in Rupert Street, The Walgrave in Brendon Street, Yumi Izakaya in Shaftesbury Avenue, The Grazing Goat in New Quebec Street, and Grangers in St Pancras Square. I also went on an awesome food tour in Cambridge – Aromi was superb.
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Written by Ann Elliott, CEO of elliotts agency