By the sound of things, Charlie Mitchell from CGA watches too much reality TV. He’s also in a bar a lot.
We all know about the perceived (and demonstrable) truth that brands are seeded and built in the on-premise channel before being grown and cultivated in the off-premise. But, is there a place for brand loyalty in bars, clubs, pubs and restaurants? And if so, what does it look like?
Let’s start with a few facts. Worldwide, the average on-premise visitor has 11 brands in their overall alcohol repertoire at any one time and churns nearly one in three of them every six months. Just three in ten of them state that they always stick to the same alcohol categories and brands when out, while two in five actively look for new and different brands when deciding what to choose.
Like a reality TV love show contestant, in the on-premise, loyalty is shunned in favour of promiscuity.
Just like the stereotypical star bachelor or bachelorette, on-premise consumers also have multiple temptations that turn their heads. Growing distribution and stocking policies mean the channel is a hotbed of trial and experimentation, while the very nature of visits being something out of the ordinary means that drinks choices also differ from the usual choice.
CGA’s latest global consumer research has highlighted that the rise of Social Media has a role to play here as well. We surveyed over 5,000 consumers across 27 countries over a two-month period – 40% told us they often order drinks that they’d previously seen on Social Media. On higher-tempo occasions across late-night and evening, in particular, the consumer is looking to be a trendsetter and update their ‘brand of self’ on Social Media.
Being one of the first in the know – and being seen to be having a great time with a new product – is the link to a social currency measured in likes, shares and clicks and is one of the very reasons why marketers target bars and clubs to build brand equity. The equation of a new drink associated with a great experience and shared online equals instant brand credibility and a right to play across other channels. What it doesn’t provide, however, is any sense of loyalty or longevity.
So, is building loyalty impossible?
Returning to the reality dating show comparison, there is the occasional couple who stays together and – just like Elizabeth and Jamie from Married At First Sight season nine – some relationships in the on-premise can stand the test of time.
The fact that one in three brands are churned every six months means that two in three stick in the consumer’s repertoire. Indeed, a total of just 11 alcoholic brands within repertoires at any one point isn’t overwhelming, when you consider the number of different categories within this (depending on the market, this varies from four to six go-to categories for on-premise users).
Perhaps we’re monogamous after all.
In order to build that loyalty, establishing connections and building relationships with consumers is crucial. Linking your brands to moments of exuberance, fun and good times, which the on-premise offers in abundance, is one sure-fire way of doing this. A targeted and well-executed on-premise activation can not only drive sales but also create those links between brands and consumers.
However, once that initial spark has worn off, just like the end of those heady early days of a relationship, it becomes something entirely deeper. Here, the relationship with a brand becomes less superficial and consumers start to want more. At this stage, on-premise loyalty can be constructed through a matching of brand values.
All our research points to the consumer increasingly looking for drinks brands they trust, be it around ethical and sustainability initiatives or shared links to a sense of locality or place. If these values are met, then the relationship can develop further.
It is at this point that a sense of ritual can be built, even in the on-premise. Those brands that consumers have developed longstanding relationships with are the ones that always appear within habits and rituals – the drink that the owner at your local knows you want before you set foot in the venue, the shot serve at the start of a night out or the go-to beer with a ramen.
It’s at that exact point that brands cement themselves within repertoires for a very long time. You might even say they find love.
This article was initially published in July/August’s issue of Global Drinks Intel magazine. For details on how to subscribe, click here.
