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Drinking in the Home - UK - June 2013

“Lower-alcohol drinks tend to be cheaper, because of lower taxation, and are often lower calorie. Both factors should make them attractive to people drinking at home, helping to retain users at a time when people are cutting back on spend.”

– Chris Wisson, Senior Drinks Analyst

Some questions answered in this report include:

  • Why are consumers cutting back on alcohol?
  • How can you appeal to 18-24-year-olds?
  • How can usage in underperforming in-home categories be boosted?
  • What will the impact of the likely tighten in advertising regulations be?
  • How will the tax escalators introduced impact this sector?

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Table of contents

  1. Introduction

      • Definition
        • Excluded
          • Abbreviations
          • Executive Summary

              • The market
                • Figure 1: Forecast for UK retail value sales of alcoholic drinks, 2007-17
              • Market factors
                • Alcohol consumption is in decline, along with consumer confidence
                  • The cost of excessive drinking looks set to keep spurring government involvement
                    • Population changes set to have an influence
                      • The consumer
                        • 58% of adults drink at home at least weekly
                          • Figure 2: Frequency of drinking alcoholic drinks in the home, April 2013
                        • Still wine is the most popular in-home drink
                          • Figure 3: Types of alcoholic drinks drunk in-home, April 2013
                        • Favourite brand/beverage is the leading choice factor when buying drinks for home
                          • Relaxing/unwinding is the key occasion for drinking at home
                            • The majority of in-home drinkers have not changed their habits…
                              • … although there may be changes ahead as a result of the 2013 Budget
                                • Figure 4: How consumers expect their drinking habits to change in response to changes in alcohol taxation in the 2013 Budget, April 2013
                              • Drinking in-home seen by consumers as helping to relax and unwind
                                • Figure 5: Attitudes towards drinking in-home, April 2013
                              • What we think
                              • Issues and Insights

                                  • Consumers are cutting back on alcohol
                                    • The issues
                                      • The implications
                                        • Appealing to 18-24-year-olds
                                          • The issues
                                            • The implications
                                              • Boosting usage in underperforming in-home categories
                                                • The issues
                                                  • The implications
                                                    • Advertising regulations look likely to tighten in the future
                                                      • The issues
                                                        • The implications
                                                          • Tackling the tax escalators
                                                            • The issues
                                                              • The implications
                                                              • Trend Application

                                                                  • Life Hacking
                                                                    • The Nouveau Poor
                                                                      • Mintel Futures Trend: Brand Intervention
                                                                      • Internal Market Environment

                                                                        • Key points
                                                                          • Alcohol consumption in decline, while government intervention rises
                                                                            • Figure 6: Trends in UK per capita consumption of 100% alcohol, 2006-11
                                                                          • Drinking in the social context
                                                                            • Figure 7: Hospital admissions with a primary diagnosis attributable to alcohol consumption IN England, 2002/03-2011/12
                                                                            • Figure 8: Hospital admissions with a primary or secondary diagnosis wholly attributable to alcohol consumption in England, by age, 2011/12
                                                                            • Figure 9: Accident & Emergency attendances in England, by age group, 2011-12
                                                                          • Pub visits in decline as consumers switch to cheaper in-home drinking
                                                                              • Figure 10: Indices of real disposable income per adult (18+) and affordability of alcohol on a per capita basis in the UK, 1980-2012
                                                                              • Figure 11: Consumption of alcoholic drinks in-home and out of home, 2001/02-2011
                                                                          • Broader Market Environment

                                                                            • Key points
                                                                              • Consumer confidence remains low despite the recession ending
                                                                                • Figure 12: Household income vs expenditure per head (£), 1997-2012
                                                                                • Figure 13: Consumer Confidence Index, monthly, January 2007-May 2013
                                                                              • An ageing population may benefit the in-home market
                                                                                  • Figure 14: Projected trends in the age structure of the UK population, 2012-17
                                                                                • Socio-economic changes to bring threats and opportunities
                                                                                    • Figure 15: Changes in the adult socio-economic structure of the UK population, 2012-17
                                                                                  • The weather and high profile events also influence drinking habits
                                                                                  • Market Size and Forecast

                                                                                    • Key points
                                                                                      • In-home sales continue to increase
                                                                                        • Figure 16: Value and volume sales of in-home alcoholic drinks, 2007-17
                                                                                      • Forecasts
                                                                                        • Figure 17: Forecast for UK retail value sales of alcoholic drinks, 2007-17
                                                                                        • Figure 18: Forecast for UK retail volume sales of alcoholic drinks, 2007-17
                                                                                      • Forecast methodology
                                                                                      • Segment performance

                                                                                        • Key points
                                                                                          • Wine is the leading in-home drinks category in value terms, but beer dominates volume sales
                                                                                            • Figure 19: Share of retail value sales of different alcoholic drinks, 2013 (est)
                                                                                            • Figure 20: Share of off-trade volume sales of different alcoholic drinks, 2013 (est)
                                                                                          • In-home category estimates for 2013
                                                                                            • Beer
                                                                                              • Cider
                                                                                                • Still, sparkling and fortified wine
                                                                                                  • Spirits and liqueurs
                                                                                                  • Brand Communication and Promotion

                                                                                                    • Key points
                                                                                                      • Adspend remains steady in 2012
                                                                                                        • Figure 21: Total above-the-line adspend for BWS, 2009-12
                                                                                                      • Beer dominates total adspending…
                                                                                                        • … driven by investment by Heineken
                                                                                                          • Figure 22: Total above-the-line adspend for BWS, by company, 2012
                                                                                                        • TV remains the most popular way to advertise
                                                                                                        • Consumer – Frequency of Drinking In-home

                                                                                                          • Key points
                                                                                                            • 88% of adults drank alcohol at home in the last year
                                                                                                                • Figure 23: Usage of alcoholic drinks, by location, April 2013
                                                                                                              • 58% of adults drink at home weekly
                                                                                                                • Figure 24: Frequency of drinking alcoholic drinks in the home, April 2013
                                                                                                                • Figure 25: Usage of alcoholic drinks in and out of the home, by frequency of use, April 2013
                                                                                                              • Three in ten adults drink in-home a few times a month or less
                                                                                                              • Consumer – Changing In-home Drinking Habits

                                                                                                                • Key points
                                                                                                                  • The majority of in-home drinkers have not changed their habits
                                                                                                                    • Figure 26: Changes in in-home drinking habits, April 2013
                                                                                                                • Consumer – Types of Alcoholic Drinks Drunk In-home

                                                                                                                  • Key points
                                                                                                                    • Still wine is the most popular in-home drink
                                                                                                                      • Figure 27: Types of alcoholic drinks drunk in-home, April 2013
                                                                                                                    • Fierce competition in the sparkling wine segment
                                                                                                                      • Lager is drunk by half of in-home drinkers
                                                                                                                        • Cider’s success built upon its appeal to younger drinkers
                                                                                                                          • Spirits and liqueurs appeal to different types of in-home drinkers
                                                                                                                            • RTDs and cocktails hold niche appeal
                                                                                                                              • 45% of in-home drinkers only drink one or two types of drinks
                                                                                                                                  • Figure 28: Repertoire of types of alcoholic drinks consumed in-home, April 2013
                                                                                                                              • Consumer – Reactions to the 2013 Budget

                                                                                                                                • Key points
                                                                                                                                  • The majority of consumers are likely to be unmoved by recent tax changes
                                                                                                                                    • Figure 29: Summary of how consumers expect drinking habits to change in in response to changes in alcohol taxation in the 2013 Budget, April 2013
                                                                                                                                  • Beer demand set to remain largely unchanged but may see some growth…
                                                                                                                                    • Figure 30: How consumers expect their beer drinking habits to change in in response to changes in taxation of beer in the 2013 Budget, April 2013
                                                                                                                                  • … cider is likely to see little overall change in in-home drinking habits…
                                                                                                                                    • Figure 31: How consumers expect their cider drinking habits to change in in response to changes in taxation of cider in the 2013 Budget, April 2013
                                                                                                                                  • … wine may also feel the squeeze…
                                                                                                                                    • Figure 32: How consumers expect their wine drinking habits to change in in response to changes in taxation of wine in the 2013 Budget, April 2013
                                                                                                                                  • … while spirits look set to be the worst hit
                                                                                                                                    • Figure 33: How consumers expect their spirits drinking habits to change in in response to changes in taxation of spirits in the 2013 Budget for spirits, April 2013
                                                                                                                                • Consumer – Choice Factors

                                                                                                                                  • Key points
                                                                                                                                    • Favourite brand/beverage is the leading choice factor…
                                                                                                                                      • Figure 34: Choice factors when buying alcoholic drinks for drinking at home, April 2013
                                                                                                                                      • Figure 35: Choice factors when buying alcoholic drinks for drinking at home: US and UK, February/April 2013
                                                                                                                                    • … with cost also carrying a strong influence
                                                                                                                                      • Other choice factors only carry a limited influence
                                                                                                                                      • Consumer – In-home Drinking Occasions

                                                                                                                                        • Key points
                                                                                                                                          • Seven in ten in-home drinkers do so to relax/unwind
                                                                                                                                            • Figure 36: In-home drinking occasions, April 2013
                                                                                                                                          • Socialising and meal times are important in-home drinking occasions
                                                                                                                                            • Special occasions and watching events are also popular drinks occasions
                                                                                                                                              • In-home drinking occasions appeal to parents
                                                                                                                                                • Figure 37: Drinking during in-home occasions, by presence of children in household, April 2013
                                                                                                                                            • Consumer – Attitudes Towards Drinking In-home

                                                                                                                                              • Key points
                                                                                                                                                • Drinking in-home is seen as helping consumers to relax and unwind
                                                                                                                                                  • Figure 38: Attitudes towards drinking in-home, April 2013
                                                                                                                                                • Alcohol pricing remains a bone of contention
                                                                                                                                                    • Figure 39: RPI Index for alcoholic drinks and all items, 2006-12
                                                                                                                                                  • Potential for online growth
                                                                                                                                                    • Recreating the out-of-home experience at home
                                                                                                                                                    • Consumer – Further Attitudes Towards Drinking In-home

                                                                                                                                                      • Key points
                                                                                                                                                        • Home comforts hold a particularly strong appeal
                                                                                                                                                          • Figure 40: Further attitudes towards drinking in-home, April 2013
                                                                                                                                                        • One in five drink more on at-home occasions than out of home
                                                                                                                                                        • Appendix – Market Size and Segmentation

                                                                                                                                                            • Figure 41: Best- and worst-case forecasts for the in-home alcoholic drinks market, by value, 2013-17
                                                                                                                                                            • Figure 42: Best- and worst-case forecasts for the in-home alcoholic drinks market, by volume, 2013-17
                                                                                                                                                        • Appendix – Consumer – Frequency of Drinking In-home

                                                                                                                                                            • Figure 43: Highest frequencies of drinking alcoholic drinks in home, by demographics, April 2013
                                                                                                                                                            • Figure 44: Other frequencies of drinking alcoholic drinks in home, by demographics, April 2013
                                                                                                                                                            • Figure 45: Frequency of drinking alcoholic drinks in home, by most popular types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                            • Figure 46: Frequency of drinking alcoholic drinks in home, by next most popular types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                        • Appendix – Consumer – Changing In-home Drinking Habits

                                                                                                                                                            • Figure 47: Changing in-home drinking habits (frequency), by demographics, April 2013
                                                                                                                                                            • Figure 48: Changing in-home drinking habits (spend), by demographics, April 2013
                                                                                                                                                        • Appendix – Consumer – Types of Alcoholic Drinks Drunk In-home

                                                                                                                                                            • Figure 49: Types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                            • Figure 50: Most popular types of alcoholic drinks drunk in-home, by demographics, April 2013
                                                                                                                                                            • Figure 51: Next most popular types of alcoholic drinks drunk in-home, by demographics, April 2013
                                                                                                                                                            • Figure 52: Types of alcoholic drinks drunk in-home, by frequency of drinking alcoholic drinks in home, April 2013
                                                                                                                                                            • Figure 53: Repertoire of types of alcoholic drinks drunk in-home, by demographics, April 2013
                                                                                                                                                            • Figure 54: Types of alcoholic drinks drunk in-home, by repertoire of types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                        • Appendix – Consumer – Reactions to the 2013 Budget

                                                                                                                                                            • Figure 55: How consumers expect drinking habits to change in in response to changes in alcohol taxation in the 2013 budget for beer, cider, wine and spirits, April 2013
                                                                                                                                                            • Figure 56: How consumers expect beer drinking habits to change in in response to changes in alcohol taxation in the 2013 budget, by demographics, April 2013
                                                                                                                                                            • Figure 57: How consumers expect drinking habits of cider to change in in response to changes in alcohol taxation in the 2013 Budget for cider, by demographics, April 2013
                                                                                                                                                            • Figure 58: How consumers expect drinking habits of wine to change in in response to changes in alcohol taxation in the 2013 budget, by demographics, April 2013
                                                                                                                                                            • Figure 59: How consumers expect drinking habits of spirits to change in in response to changes in alcohol taxation in to the 2013 budget, by demographics, April 2013
                                                                                                                                                        • Appendix – Consumer – Choice Factors

                                                                                                                                                            • Figure 60: Most popular choice factors when buying alcoholic drinks for drinking at home, by demographics, April 2013
                                                                                                                                                            • Figure 61: Other choice factors when buying alcoholic drinks for drinking at home, by demographics, April 2013
                                                                                                                                                            • Figure 62: Choice factors when buying alcoholic drinks for drinking at home, by most popular types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                            • Figure 63: Choice factors when buying alcoholic drinks for drinking at home, by next most popular types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                        • Appendix – Consumer – In-home Drinking Occasions

                                                                                                                                                            • Figure 64: In-home drinking occasions, by demographics, April 2013
                                                                                                                                                            • Figure 65: In-home drinking occasions, by frequency of drinking alcoholic drinks in home, April 2013
                                                                                                                                                        • Appendix – Consumer – Attitudes Towards Drinking In-home

                                                                                                                                                            • Figure 66: Attitudes towards drinking in-home, April 2013
                                                                                                                                                            • Figure 67: Agreement with the statements ‘I am concerned about buying alcoholic drinks online’ and ‘I am interested in beer/wine clubs but am put off by the cost’, by demographics, April 2013
                                                                                                                                                            • Figure 68: Agreement with the statements ‘I am interested in replicating drinks which I’ve had in pubs/bars when at home’ and ‘Prices of alcoholic drinks have risen more than other food and drink products’, by demographics, April 2013
                                                                                                                                                            • Figure 69: Agreement with the statements ‘I like to drink at home to help me unwind/relax’ and ‘There are too many cheap alcoholic drinks in supermarkets/off-licences’, by demographics, April 2013
                                                                                                                                                            • Figure 70: Attitudes towards drinking in-home, by most popular types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                            • Figure 71: Attitudes towards drinking in-home, by other types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                        • Appendix – Consumer – Further Attitudes Towards Drinking In-home

                                                                                                                                                            • Figure 72: Further attitudes towards drinking in-home, April 2013
                                                                                                                                                            • Figure 73: Further attitudes towards drinking in-home, by demographics, April 2013
                                                                                                                                                            • Figure 74: Further attitudes towards drinking in-home, by demographics, April 2013 (continued)
                                                                                                                                                            • Figure 75: Further attitudes towards drinking in-home, by most popular types of alcoholic drinks drunk in-home, April 2013
                                                                                                                                                            • Figure 76: Further attitudes towards drinking in-home, by next most popular types of alcoholic drinks drunk in-home, April 2013

                                                                                                                                                        Companies Covered

                                                                                                                                                        • Anheuser-Busch Companies Inc
                                                                                                                                                        • Diageo UK
                                                                                                                                                        • Guinness
                                                                                                                                                        • H P Bulmer Holdings PLC
                                                                                                                                                        • Heineken N.V.
                                                                                                                                                        • Molson Coors Brewing Company
                                                                                                                                                        • Ofcom
                                                                                                                                                        • Wm Morrison Supermarkets

                                                                                                                                                        Drinking in the Home - UK - June 2013

                                                                                                                                                        £1,995.00 (Excl.Tax)