Data from CGA Strategy published in the latest Wine & Spirit Trade Association (WSTA) market report revealed that total on-trade alcohol volumes fell 6 per cent in the 12 months to 25 January 2014, with value down 1 per cent.
This was primarily driven by beer, with volumes down 7 per cent over the year and value down 1 per cent. Wine sales also fell by 2 per cent in volume, while value plummeted 13 per cent.
In contrast, cider volumes were down 1 per cent but value rose 4 per cent, and spirit volumes and value rose by 2 per cent and 7 per cent respectively.
Separate data from CGA showed that soft drinks volumes fell by 1.3 per cent last year, but value rose 0.7 per cent.
Wine and spirits
WSTA said the increase in spirit sales was primarily driven by liqueurs, which enjoyed 10 per cent growth on the back of ‘increased popularity in cocktails’. Malt whisky recorded the most significant growth of 20 per cent over the year, but gin and imported whiskey also saw growth.
Although total wine sales were down, the organisation said that sparkling wine showed 11 per cent volume growth, while champagne sales were up 2 per cent over the year.
“Despite the tough trading conditions there is cause to be optimistic as categories such as sparkling wine and liqueurs continue to enjoy strong growth, and the move to premium products suggests that consumer confidence may be returning to the industry,” said WSTA chief executive Miles Beale.
He predicted that the Chancellor’s decision to scrap the alcohol duty escalator and freeze duty on spirits should boost sales in the year ahead.
Speaking at a Westons media briefing earlier this week, CGA Strategy spokesperson Johnny Jones said that cider value growth was driven by a move towards premium ciders, with premium draught ciders showing particularly strong growth of 18 per cent in volume terms and 25.6 per cent in value terms.
Jones added that apple ciders account for 97 per cent of volumes, but pear and fruit varieties are showing strong growth.
He said cider sales are likely to grow if there is good weather this summer, and the biggest challenge would be maintaining cider volumes over winter.
“Capitalising on the strong performance of cocktails could be a way to go,” he said, pointing out that some operators are already experimenting with ciders in cocktails and punch bowls.
Westons commercial director Roger Jackson agreed that the year ahead is looking positive for cider sales, although he added there is a possibility that supply could be affected by recent floods and high winds in major growing regions.
“There has been damage done, although we don’t know the severity of that damage at this stage,” he said. “It will be a couple of months before we know the impact on supply.
“But we do know is that there is still a lot of investment and proactive planting going on amongst growers.”
According to Britvic’s Soft Drinks Review 2014, soft drink value sales out-performed volume sales in the on-trade sector last year, with only managed pubs experiencing both volume and value growth.
“Managed pub chains held fast as the leader of the segment, increasing value sales by 2 per cent to more than £1.4bn, successfully tapping into the trend for casual dining and value for money,” said the report.
Within the hotel, restaurant and catering sector, restaurants saw the strongest soft drink value growth of 3 per cent.
Premiumisation was identified as a major trend in the on-trade soft drinks sector, with draught losing volumes to packaged in many categories.
Health concerns resulted in diet cola value growth, although regular propositions continued to outperform diet. A bigger impact was seen among flavoured carbonates, which were buoyed by sales of diet versions like 7UP Free.
Britvic director of category Claire Handford Jones said the key to boosting on-trade soft drinks sales was to ensure that options are more visible on menus, and serve quality is consistent.
“When we have a drink in a leisure environment the quality of the drink can vary greatly,” she explained. “If we can change the delivery so you get a perfect serve every time, people will want to drink more.”
She added that syrups would drive growth in the year ahead, offering operators the chance to personalise soft drinks and create ranges of ‘mocktails’.