‘Operators need to emphasise value for money credentials’

Pubs, bars and restaurants need to emphasis value for money credentials, as an increasing number of consumers align themselves to price-led values, according to Lumina Intelligence.

Sharing insights on a webinar this week focused on consumer and operators’ responses to rising costs, Lumina’s insights director Blonnie Whist said that its most recent Eating and Drinking Out Panel (EDOP) data had shown “a noticeable shift towards more price-led behaviour”.

“What this means for the market is that boosting spend per head is the key metric that matters,” Whist added.

Seventy-two percent of consumers now align with price-led values, therefore tools such as promotions and loyalty schemes, alongside good quality products and services, will become increasingly important levers for growth as the cost-of-living crisis continues, she explained.

One of the ways in which operators could look to drive spend is through targeting the dinner occasion, which is the highest spend occasion, and has seen average spend up across the channel by 10% in pubs and bar, and 3% in restaurants, over the last 12 weeks to 15 May 2022.

“These increases are partly driven by high inflation but also more consumers trading up on less frequent dinner occasions,” Whist said.

Dinner is also the occasion most likely to be joined by a drink. In particular pub and bar’s dinner share and average spend have been boosted over the past quarter. “It’s a really good sign for the on-trade and shows that for these high spend occasions, which are a bit more special and discretionary, pubs and bars are going to be the ones to win out here.”

Another positive to come from the data, in terms of the on-trade, is that dine-in on-premise is increasing, and has reached its highest point since November 2020, at almost 75%, with delivery falling to its lowest share since the pandemic.

Whist went on to note that when consumers visit a pub or restaurant, Lumina’s research has found that they are increasingly purchasing both food and drink. “Occasions that include both food and drink have really dominated the EDOP in the past 12 weeks, up by 1ppt – which is quite a significant change for this metric.”

It showcase the opportunity for operators to offer a greater range of meal deal pairings and drinks pairings, to really prompt consumers to enjoy both together and drive the total value, she said.

Lumina Intelligence has just published its new UK Eating Out Market Report 2022. To find out more please click here.