Trending 2021: Wm Grant’s Market Report

Glenfiddich

No-one could possibly claim that 2021 has kicked off as we’d hoped, but we do have much to feel optimistic about: our mass vaccination programme is rolling out faster than any other in the world, we’ve learned a lot about ourselves and the depths of our resilience, and we’re two-thirds of the way through Dry January (or indeed Veganuary), so that can only be a good thing!

On a serious note, coping with Covid has cost us dearly, not least in the on-trade, and it continues to cost us. So in an effort to ease your worries and give us all something positive to focus on, I thought I’d take you through my summary of William Grant & Sons’ Trending 2021 report, offering key insights into the post-Covid consumer and making recommendations that you can use when you open your doors again. Nikki Oji, former O2 Trends Analyst reports.

SOCIAL

The Cult of the Home existed pre-Covid, accelerated during the first lockdown, and will continue long after a post-Covid world of mass vaccination. The home is now seen as a cocoon of safety, a place of work, a centre of learning, entertainment, nourishment and exercise. It deserves to be elevated, added to, upgraded, cherished, enjoyed… But if lockdown taught us anything, it’s that the need to socialise and engage with one another physically, is a fundamental human truth. Bars, pubs and restaurants that make this easy, uber-safe and fun will thrive as demand soars.

Ageless Society – A trend which previously heralded ‘the end of ageing’ as we once knew it, now sees a return to fear, and a reminder of the vulnerabilities that come with age. What was once a thriving, affluent, travelling, confident cohort, is now variously shielding, biding at home or, tragically and quite literally, dying from this deadly disease. But where possible, they’re going online en masse, and they have money to spend.

Local vs Glocal – Having emerged some 6 or 7 years ago, this trend gains unexpected momentum as households across the world are told to stay home, stay local, connect digitally… Our contacts have simultaneously shrunk to those in our immediate bubble and inflated to include those we encounter online that share our values. Businesses that understand this tension and cater to it (perhaps with super-local serves or that exotic, Japanese whisky that has tantalised tastebuds at home) will flourish as drinkers and diners tentatively return to their local.

TECHNOLOGICAL

Mission Critical Connectivity – With businesses operating from bedrooms, as they seek life-support online, teachers educating our children remotely via digital devices, and everyone seeking virtual entertainment, now, more than ever, in-home connectivity and data are the hottest commodities on the block! As a new normal emerges, people will expect this connectivity to follow them outside the home – call it the Martini Effect – anytime, anyplace, anywhere- connected.

Tech Poverty – While the radical rollout of 5G cannot come soon enough at an infrastructure level, for many, the simple provision of reliable WiFi would be a step forward. The ‘have-nots’ are more in danger of slipping behind at school, in business and even in the ability to entertain and feed themselves safely. This pandemic has not only impacted the health of more of society’s poor, it has also disproportionately impacted them economically. Brands that show empathy here could win long-term trust and loyalty.

Radical Adoption of e-Commerce – The astonishing acceleration of e-, s- and v-Commerce during the first lockdown reached levels that had been predicted to take 10 years to achieve, according to McKinsey. These channels have grown +79.7% YoY in the UK and 38% of new digital shoppers are retirees, with deep pockets, seeking the safety and convenience online offers.

ECONOMIC

We are now living through the worst recession on record. The UK economy is c.9.7% smaller than it was before the pandemic. Unsurprisingly there will be a major struggle to recover long-term, with the creative industries, for example, projected to lose £1.5bn a week in 2021. Hospitality is the worst hit sector by job losses and close to 1m workers are being supported by the government furlough scheme.

Considered Consumption 2.0 – A trend that took hold during the last recession and grew steadily since, is set to re-dominate the foreseeable future. This time, however, mass market products and high street names may suffer more as people seek to support local businesses or chase value from international discounters.

ENVIRONMENTAL

Green is the New Black – On the ascension pre-pandemic, this trend now sits in tension between the massive drop in pollution levels seen during the first global shutdown and the vast levels of plastic, PPE equipment that has been essential to fight the spread of the disease and protect our front line workers. Face masks are the new rubbish on our streets, littering them with all too regular reminders that life as we know it has changed, and that our rivers and oceans will once again pay a hefty price. Businesses that demonstrate a ‘greener way’ will appeal to many, and become expected by many more.

Build Back Better – This refrain will dominate 2021 as politicians and eco-warriors alike seek to repair the damage we had already caused, and reduce the impact of new behaviours on our planet. Opportunity therefore knocks for businesses to rethink practices and come back greener, leaner and ultimately stronger as people vote with their wallets.

The 15-Minute City – In the longer-term, smaller, more walkable ‘mini cities’ could emerge, with all life’s amenities within a 15 minute walk. This could be better for public health, the environment and our communities. Could you be the corner pub that out-of-town suburb has been waiting for?

POLITICAL & REGULATORY

Trust – The trust gap has been widening between consumer-citizens and traditional sources of authority for many years. Covid-19 has only seen attitudes harden further due to more time spent online, in the echo-chambers of fake news and social media. Perceived mismanagement of the virus, of unfairly tiered lockdowns and of the flagrant disregard by some of the political elite (in particular) have shown towards the rules – fancy a drive to Barnard Castle anyone? – have crystallised this issue further.

As regulations around public health evolve and change, business must stay ahead of the curve to secure the trust of a distrusting public and be seen as the vanguard of ‘doing the right thing’ where our safety is concerned.

KEY CONSUMER-CITIZEN CONCERNS AND THEIR IMPLICATIONS FOR BRANDS & BUSINESSES

My Identity – The universal contraction of social groups has led to an unprecedented mass-introspection that has resulted in heightened self-actualisation, a greater sense of community, a sharing of our vulnerabilities and a level of ‘realness’ we previously sought to polish or conceal.

Exacerbated by unjust deaths, BLM protests and the severe impact of Covid on ethnic minorities and the poorest in society, we have retreated to our ‘tribes’ on one hand, and reached out in empathy to those in need, on the other.

Recognising the severe impact of Covid shutdowns on the people who work in the trade, William Grant & Sons started to mass- produce hand sanitiser in their distilleries. This soon evolved into a legacy programme called #STANDFAST. By fundraising, providing essential goods and shared experiences, #STANDFAST supported thousands of those affected by hardship across the industry.

Data is the New Oil – Protecting our data, versus the time-saving convenience and greater relevance of targeted advertising, is a tension with which the consumer-citizen is all too familiar. Data capture will extend to our physical spaces as they become smarter, more connected, and more able to direct us in our daily lives. The NHS Track & Trace app was downloaded by 20M people, despite 80% of consumers agreeing with the statement “I am concerned about data protection and privacy on the internet” (up 6% from 2016). The ethical management of personal data will continue to be increasingly important. Preparation for a 5G-enabled, spatially- connected world should begin now, if it hasn’t already.

MY HEALTH

Our hygiene obsession will continue as we tentatively return to the shops, bars and restaurants we love. The greatest impact of Covid, however, may not be on our own physical health but on our mental health. Whether through loneliness and isolation, or through financial concerns, or even the torment of caring for a sick loved one, our ability to cope has been tested beyond measure.  As a result, wellness will become a premium ‘product’. Those brands that can democratise ‘wellness’ and offer it up along with fundamental essentials like physical distance, face coverings and hand sanitiser, will win in the short term.

Economic pressures will mean fewer people are able to afford health goods due to their premium price tag. Despite this, a number of kombucha beer brands such as Nirvana Twisted Bucha Beers (0.5% abv) are looking to focus on gut health by combining beer with kombucha to provide a health benefit while unwinding.

Future focus: Tech gadgets that help us measure our health will proliferate as hygiene, immunity, and resilience become watchwords for wellness. Those catering to jittery consumers would do well to overindulge their concerns with maximum levels of reassurance.

MY EXPECTATIONS

Know Me – With so much data collected, we as consumers now expect to be better known and understood by the brands that serve us. This demand will always be countered, however, by the desire to remain in control. With more time on our hands to research and carefully curate, consumers will become more discerning than ever, rejecting any hint of erroneous assumptions or mass-marketing. 75% of global consumers agree that “it is important to have products and services that can anticipate my needs”, a significant jump of 8% on 2018.

Save Me Time – Despite the apparent boredom some suffered during lockdown, consumers increasingly value their time more, with a 5% increase in people agreeing with the statement “I am willing to spend money to save time” since 2017.

Help Me Work – Hybrid social spaces are due to see a surge in demand post-pandemic when cooped-up homeworkers look for functional places to work. Apps like TALLY allow employers to save on office space, enabling them to gift ‘tokens’ to employees to work at cafes, restaurants and bars during the day, with food or unlimited coffee as a perk. What would it take for you to pivot your business model to accommodate the ‘laptop army’? Would a subscription or ‘pay as you play’ model work best for your town? Time to start planning…

Future focus: Higher reliance on convenience and home delivery will be an undoubted legacy of Covid. Cross-category or even cross-sector partnerships could offer business efficiencies while fulfilling multiple consumer needs across fewer touchpoints.

MY EXPERIENCES

Limited social contact has heightened our appreciation of loved ones and taught us to cherish them more than ever. Making the most of technology to facilitate social contact has become a habit we’re unlikely to break, even once we can physically gather together again. Brands that have learned to reach out and create novel experiences during lockdown are likely to retain the affection of their participating consumer-audience.

A pent up desire to share with those we’ve decided are our ‘priority people’ is likely to show itself post-pandemic. Illustrating this point: ‘making loved ones a greater priority’ ranked first when consumers were asked which statement was most relevant to them in a recent Kantar survey.

Sensory Shift – Sound, smell and touch have become the next frontier for brands and businesses looking for novel ways to engage customers. Weekly podcast listeners have surged by 24% since 2018. Spotify reported more than a third of overall listeners are consuming podcasts as a way to boost their mood. How can you stimulate the desire for your product or service through sound? That last orders bell never sounded so good! From Ikea’s ASMR ‘soundscapes’ to Magnum’s partnership with Deliveroo (which gave several lucky customers a decoration kit with which they could recreate classic British summertime flavours), those brands and businesses that can sensorily innovate will win the viral lottery (pardon the pun)!

Immersive Experiences – Virtual Reality has long been heralded as the next big thing in marketing, but beyond gaming, it has failed to deliver. Demand from consumers for immersive experiences, however, does exist, with 21% of consumers saying they paid to watch or participate in online experiences during lockdown. Fever-Tree served up a virtual cocktail masterclass, while theatres and concert venues live-streamed performances to culture-starved audiences. Could your sommelier or cocktail waiter be the next internet sensation, putting your place on the map and engaging customers near and far?

My Values

Diversity and Inclusion – Suffering unprecedented turbulence in our daily lives as a result of Covid has heightened our awareness of our communities and empathy for those in the most vulnerable categories. With the disease affecting black and ethnic minorities more severely, and women making up a higher percentage of at-risk carers [– 70% of caregiving hours are provided by women (Cambridge Journal of Economics, Vol 39:3, 2015)], the Diversity and Inclusion agenda has been strengthened.

Fair and Democratic – 55% of consumers believe that “it’s important to me that the brands I buy from are committed to making our society better”. In other words, business ethics have never been more highly valued, or carefully scrutinised. Drinks brand, Discarded, reduced their waste by giving by-product ingredients a second life, using banana peels to flavour its rum, for example.

Community Contribution – Our wartime spirit was made manifest once more, not only by people consuming locally to keep local businesses afloat, but also by the vast army of citizens who volunteered to help the effort to fight the virus – one fifth of UK adults. Businesses also got on board.

Will this ‘all in it together’ spirit endure? Can your business capitalise on this to build trust and loyalty that will last going forward? One would like to hope so…

WHISKY – WHAT YOUR DADDY DOESN’T KNOW AND YOUR GRANDPA NEVER DREAMED OF!

Diversifying Dram Drinkers

Although sometimes perceived as the tipple of traditionalists, whisky has been enjoying something of a renaissance as younger consumers explore the heritage and female drinkers, with a nose for experimentation, indulge in a dram or two.

Innovation

Brands that push the boundaries in production are gaining traction. Compass Box claims to be a world first with its blend of Scotch and Calvados, while William Grant & Sons’ innovative Whisky brand, Ailsa Bay, is the only Scotch Whisky to undergo a process called ‘micro maturation’.

Rarity

Small production runs and scarcity are tantalising the connoisseur and the collector in equal measure. In May 2020, John Crabbie & Co released a single cask 1994 25 YO Island Malt with just 247 bottles available in the UK, priced at £300 per bottle.

Occasion

At the very top end, consumers are opting for Scotch Whisky to bond and socialise. 31% of consumers say they drink whisky to ‘wind down’ or ‘chill out’, according to Kantar,

SO WHAT DOES THE PUB OF THE FUTURE LOOK LIKE?

In many ways, it’s safe to say that pubs will remain much the same: serving a little bit of sanity and cheer in a glass to those who want to unwind after a day at the office or simply meet their mates for a chat and a pint. But changes are inevitable – after all, will they have actually spent a day at the office now that offices themselves are nigh on redundant? Licensees who anticipate the changes and ready themselves to pivot their business towards this evolving consumer will have the best chance of success in our post-Covid world.

As we learned during the summer and autumn of the pandemic, outdoor space is now prime real estate, as hasty car park makeovers delivered beer gardens where none existed before, and pavement takeovers saw our streets turn that little bit more Euro in flavour. People want to congregate, even when the great British weather has other ideas. Making this as comfortable as possible, with retractable awnings, space heaters, blankets, fur- covered seating or simple umbrella-tables to shelter from the rain, will be essential.

Inside, a pro-active focus on hygiene will, quite literally, be a hygiene factor. Good air quality and ventilation will set nervous minds at rest – this does not simply mean leaving the door open so customers freeze, though!

There will be a shift in focus from traditional ‘vertical drinking’ at the bar to table service and comfortably-spaced seating options which will likely include screening of some sort. One can see a flurry of remodelling to include booths with designed-in screening that appears more ‘classy and intimate’, less ‘medical necessity’. Tech-driven, app-enabled table service will prevail, with a continuation of the ‘Contactless is King’ behaviours with which we’ve become all too familiar. Having said that, I’m not predicting Robo-Barman, just yet! Well-trained, sales-oriented staff, who understand the need to maximise the potential of every cover – by recommending a wine to match that steak, or which whisky cocktail offers the best, smoky flavour – will be worth their wait in gold.

Retraining for temporary and permanent staff alike will be delivered remotely, via mobile devices and tailored to suit your own unique, business needs. An up to date, digital menu, highlighting a quality food offering, with drinks pairings, will help increase ROI per customer, as dwell time remains, but profits from the standing- room-only drinkers of yore are flushed away.

Drinkers may have to moderate their expectations by accepting the need to pre-book a trip to the pub, with a time-restricted slot. The pub crawl of the future could include a location-based app that sources tables for the drinker from hour to hour. Would you sign up to entice nearby revellers to book that 11pm, pre-closing hour slot?

Cover-charged entertainment will entice the live-music starved. American-style, 2-drink minimums may suffice, because, let’s be honest, after you’ve had two, you probably want another… two! The variety of offering will continue to shift subtly away from traditional beers to hand-crafted IPAs, even more elaborately flavoured gins and a whole new world of whiskies. But bars will also need to consider how to meet the demands of the lo-and-no alcohol drinkers more carefully. How do you serve those who seek a health benefit even from their booze! Kombucha beer, anyone? Rarity, exclusivity and visually-stimulating drinks will, as always, drive the premium, luxury-oriented crowd in the door. But there will still be a cohort of careful consumers who may be better enticed with a click-and-collect, drink-at-home option. Broadcast on social media and delivered to their door, can you serve your customers at home using the technologies they’ve come to trust and rely on during lockdown?

Social media will play a massive role in engaging younger drinkers in particular. Publicans will clamour to get Instagram-savvy and Tik-Tok ready… What gif-of-the-day are you serving? By meeting the online expectations of customers, pubs can win the attention, affections and ultimately custom of this group – ignore them at your peril, they literally are the future.

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