Food and DrinkNews

Super-Premium Sales Rising As On-Trade Drinks Market Polarises

New premiumisation report from CGA reveals a sharp upswing in upmarket drinks products and sales—but a resurgence for some mainstream brands too

The out-of-home drinks market is increasingly polarised between super-premium niche brands and big mainstream names, a new report from CGA shows.

The ‘Premiumisation: Change, Challenge and Opportunity’ report sets out major trends in premium drinks and identifies opportunities for operators and suppliers to increase sales. It highlights a growing appetite for premium options, with nearly half (47%) of consumers now willing to pay more for a better-quality drink, and a surge in very high-end sales in 2019—including 21% growth in super-premium spirits. Premiumisation continues to reshape the beer category too, with 848,000 more people drinking world lager in 2019 than in 2016.

“From spirits to beer to soft drinks, premiumisation continues to disrupt the on-trade,” said Mark Jackson, senior client manager at CGA. “But it’s a complex and fast-changing story, and we’ve seen the market diverge substantially over the last year, with examples of growth in both super-premium and mainstream categories. Where the market goes from here remains to be seen—but it’s clear that an understanding of the nuances in consumers’ attitudes to factors like quality, range and price is more crucial than ever in 2020.”

The report uses CGA’s new MATCH consumer segmentation service to pinpoint the consumers who are driving super premiumisation. They include people in the ‘Business Class-Seekers’ segment, who spend an average of £251 a month on eating and drinking out—an indication of the lucrative size of the premium market.

“Consumers are increasingly fickle and experience-driven and have developed very high expectations of out-of-home eating and drinking. Understanding the drivers, dynamics and habits of their behaviour has never been more important when it comes to capitalising on premiumisation,” concluded Jackson.