Rekom UK will focus on moving towards a “blended” bar and nightclub offering, as socialising habits shift during the cost-of-living crisis, chairman Peter Marks tells MCA.
The late-night operator’s latest Night Index data shows that pricing remains the top concern for nearly half (44.9%) of consumers when deciding to go on a night out, indicating the clear influence of the cost-of-living crisis.
This has refocused the group’s efforts on the bar sector, which offers an extended trading period and appeals to a broader demographic, Marks says.
“To a certain extent, we’ve gotten into more bars recently”, he says, adding that its ‘reinvented pub’ concept Proud Mary has been trading very strongly.
“They’re multi-demographic and multi-occasion,” he explains. “So they’re not reliant just on a big Tuesday night.
“We have found those businesses have held up so much better than the clubs.”
Reseach also found that while students, stalwarts of the night out, used to go out during middle of the week, for over two-thirds of students, Saturday has pipped Friday to be the most popular day of the week to go out.
“Last year’s cohort didn’t act in the same way any other student cohort has in my long career.
“We saw a lot of really big drop-offs in the early week”, traditionally popular amongst the student-based market.
Last week it was announced that Rekom’s Pryzm Plymouth would close for good after a final New Year’s Eve party, as the cost-of-living crisis squeezes student budgets.
“That’s why we’re trying to change our business focus away from being just nightclubs to being a blended bars and nightclubs business- because it makes financial sense to spread the risk.”
Having already sold seven nightclubs this year, Marks says the business will focus on its “cluster” strategy which sees it operate a larger city nightclub with several bars in its vicinity.
He also highlighted the increased prominence of low and no alcohol consumption amongst young people.
“I think the drinks industry had done a great job in pouring in the research and development to come up with some great no-alchohol products.
“So we are seeing more people not drinking alcohol.”
However, Marks maintains that the majority negative impact remains around cost of living pressures.
“We are seeing a real choking at the moment, due to interest rates and the general cost of living crisis. “
Despite this, he remains positive that the night-time industry can adapt to current pressures.
“One of the things that I always say is that the nightclub industry has had to adapt all the time, and it’s one of the fastest, simply because it’s always had to.
“Our managers and our marketing teams, they never let the grass grow under their feet because they can’t.
“It’s all about having something in your club, whether it’s the serve of drinks in front of you, sparklers or smoke or a particular design feature - whereby people will share their nights out on their own social media. That’s your biggest marketing technique”.
”We’re trying to work out what the next 18-year-old wants, we look at 15-year-olds,” Marks adds.
“What are they doing? What are they like? How are they socialising?
“Because in two- or three-years’ time they will be your customers and your staff.”
Precis
