COVID-19 ON PREMISE IMPACT N i e l s e n C G A - 0 4 . 0 3 . 2 0 - - PowerPoint PPT Presentation

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Sep 08, 2022 43 likes •464 views

Brewers Association Power Hour COVID-19 ON PREMISE IMPACT N i e l s e n C G A - 0 4 . 0 3 . 2 0 2 0 About Nielsen CGA CGA was established 30 years ago in England Specialist On Premise consultancy World-leading On Premise

SLIDE 1

COVID-19

ON PREMISE IMPACT

N i e l s e n C G A - 0 4 . 0 3 . 2 0 2 0

Brewers Association Power Hour

SLIDE 2

About Nielsen CGA

CGA was established 30 years ago in England
Specialist On Premise consultancy
World-leading On Premise services in UK,

France & US

Global strategic partner of Nielsen
After 4 years in the US – We have built a full

suite of measurement, consumer & analytics services; many the first of their kind for the US

SLIDE 3 Matthew has managed and provided consultancy for some of the largest Bev Al manufacturers across Europe. In January 2014, Matthew became part of the joint venture between CGA and Nielsen which has helped bring the first ever truly robust on premise measurement service to the US. Matt is a craft beer and beverage management

professional. He has over 15 years experience

working in the complex on-premise market and three tier system. When he’s not drinking beer and traveling for work, Matt likes to drink beer and travel for pleasure.

Matthew Crompton – Client Solutions Director Matt Drummond – Client Solutions Manager

SLIDE 4

Agenda

COVID-19 Impact Report – Delivery & Takeout Brewpub/Tap Room Channel Strategy BA Craft Beer Knowledge Center Q & A

SLIDE 5 COVID-19 On Premise Impact Report issue #2 focuses on the attitudes of consumers to take out/delivery both from a food and an alcohol point of view. To analyze this topic we surveyed 1,200 consumers from four states

NY, California, Illinois and Florida, over the weekend (March 28-

29) and analyzed sales trends from our RestauranTrak dataset (week ending March 21 + March 28). RestauranTrak (powered by CLIP) dataset consists of over 10,000 transaction-level POS feeds from a geographically balanced set of outlets. Predominantly consisting of independently owned concepts and small, often unbranded groups, RestauranTrak can be seen as a robust measure to complement other credible industry sources that are focused mainly

n larger chains.

IMPACT REPORT OVERVIEW

SLIDE 6

T OTA L US

Source: RestauranTrak ACV Sales 2 Weeks w/e March 28 + Custom Consumer Research

w/e March 21

w/e March 28 Res t auran Trak Sales Dat a 11% Pre-CV19 Takeout/Delivery Share +110% Overall Takeout/Delivery Increase Takeout /Deliver y St at s O verall $ Sales Velocit y

SLIDE 7 If all outlets across the US On Premise are closed for March and April 2020 there would be approx. 17.8m 288oz EQ of BA Craft beer sales lost.

L O S T VO L U M E D U E T O C O V I D - 1 9 I M PAC T

Source: NCGA OPM DATA TO 4 W/E 01/25/20 7,600,000 7,800,000 8,000,000 8,200,000 8,400,000 8,600,000 8,800,000 9,000,000 4 W/E 01/27/2018 4 W/E 02/24/2018 4 W/E 03/24/2018 4 W/E 04/21/2018 4 W/E 05/19/2018 4 W/E 06/16/2018 4 W/E 07/14/2018 4 W/E 08/11/2018 4 W/E 09/08/2018 4 W/E 10/06/2018 4 W/E 11/03/2018 4 W/E 12/01/2018 4 W/E 12/29/2018 4 W/E 01/26/2019 4 W/E 02/23/2019 4 W/E 03/23/2019 4 W/E 04/20/2019 4 W/E 05/18/2019 4 W/E 06/15/2019 4 W/E 07/13/2019 4 W/E 08/10/2019 4 W/E 09/07/2019 4 W/E 10/05/2019 4 W/E 11/02/2019 4 W/E 11/30/2019 4 W/E 12/28/2019 4 W/E 01/25/2020 Predicted: 4 W/E 02/22/20 Predicted: 4 W/E 03/21/20 Predicted: 4 W/E 04/18/20 4 Weekly CE BA CRAFT VOLUME

SLIDE 8

T OTA L US

Source: RestauranTrak ACV Sales 2 Weeks w/e March 28 + Custom Consumer Research

21% 21 to 34 year olds 30% 35 to 54 year olds 9% 55 plus years old Drin k in g m ore t h an usual 22% Drinking more than usual 28% Drinking less than usual 50% Drinking the same C on sum er Pulse Sur vey

SLIDE 9

NEW YO RK S TAT E

Source: RestauranTrak ACV Sales 2 Weeks w/e March 28 + Custom Consumer Research

Sales Velocity

Number of Checks

Check Average Res t auran Trak Sales Dat a 22% Drinking more than usual 28% Drinking less than usual 50% Drinking the same C on sum er Pulse Sur vey

* Shelter in place ordered for March 20th

SLIDE 10

CA LIFO RNIA

Sales Velocity

Number of Checks

Check Average Res t auranTrak Sales Dat a 21% Drinking more than usual 26% Drinking less than usual 53% Drinking the same Con sum er Pulse Sur vey

Source: RestauranTrak ACV Sales 2 Weeks w/e March 28 + Custom Consumer Research * Shelter in place ordered for March 19th

SLIDE 11

ILLINO IS

Source: RestauranTrak ACV Sales + Custom Consumer Research

Res t auran Trak Sales Dat a 23% Drinking more than usual 28% Drinking less than usual 49% Drinking the same Con sum er Pulse Sur vey

w/e March 21 Sales Velocity

w/e March 28 Sales Velocity

* Shelter in place ordered for March 21st

SLIDE 12

F LO RIDA

Source: RestauranTrak ACV Sales + Custom Consumer Research

w/e March 21 Sales Velocity

w/e March 28 Sales Velocity Res t auran Trak Sales Dat a 21% Drinking more than usual 26% Drinking less than usual 53% Drinking the same C on sum er Pulse Sur vey

* Shelter in place ordered for April 2nd

SLIDE 13

T OTA L US

Source: RestauranTrak ACV Sales 2 Weeks w/e March 28 + Custom Consumer Research

66% Have ordered takeout/delivery over past 2 weeks 15% Have ordered alcohol with takeout/delivery Takeout & Deliver y

SLIDE 14

T OTA L US

Source: RestauranTrak ACV Sales 2 Weeks w/e March 28 + Custom Consumer Research

61% Expect to pay more for takeout/delivery than retail 58% Ordered alcohol to avoid going to grocery store 24% Have purchased alcohol bundles on offer Takeout & Deliver y Factor s

SLIDE 15 Over half of those that have ordered alcohol with takeout/delivery have purchase craft beer, showing high demand for the category

D R I N K S O R D E R E D W I T H TA K E O U T / D E L I V E R Y

37% 42% 43% 44% 47% 47% 50% 51% 55% 60% Neat Spirit Dom Non-Craft Beer Sparkling wine/Champagne Cocktail kit Spirit Mixer Pre-made cocktails White Wine Craft Beer Imported Beer Red Wine Alcohol Type Ordered Source: Custom Consumer Research

SLIDE 16 16

W H AT R E A L LY S E T S O U T C R A F T D R I N K E R S W H E N C H O O S I N G W H AT T O D R I N K , I S T H E D R I N K B E I N G U N I Q U E . T H I S I S A L S O A T O P FAC T O R F O R C H O O S I N G A L C O H O L TA K E O U T A N D D E L I V E R Y

34%

Of craft drinkers, state uniqueness as a factor influencing drink choice

+11pp

Vs Avg brewpub/tap room visitor

Source: NCGA Channel Strategy Report July 2019. Base size: (389-679) COVID-19 Impact Report Custom Consumer Research

31%

say they ordered takeout/delivery in the past 2 weeks from a venue due to a specific drink offering

SLIDE 17

T HE EA RLY EVENING IS T HE M O S T PO PULA R T IM E T O VISIT BREWPUB/ TA PRO OM S, T HIS IS A LSO T HE PEA K T IM E O F DAY FO R TA KEOUT/DELIVERY SERVIC E.

Nielsencga.com 17 3% 14% 25% 53% 29% 23% 8% Brunch Lunch Mid-afternoon (2pm-5pm) Early evening (5pm-8pm) Happy hour Late evening (8pm-10pm) Late night (10pm

nwards)

The average brewpub visitor spends

$24.67

On drinks per visit to this channel

Source: NCGA Channel Strategy Report July 2019. Base size: (679-680) RestauranTrak ACV Sales w/e March 28th Which of the following times of day did you visit brewpubs/tap rooms in the past 3 months?

Early Evening is top time of day for takeout/delivery sales $ velocity

SLIDE 18

Brewpub and Taproom visitors over index when experimenting with different choices and using social media to find new places to eat or drink.

Nielsencga.com 18 Source: NCGA Channel Strategy Report July 2019. Base size: (679-680) RestauranTrak ACV Sales w/e March 28th I believe bars and restaurants could do more to promote sustainability and the environment

82%

Brands are important to me when choosing drinks

81%

+2pp

I like to experiment with different drink choices

73%

+9pp

I believe technology should be used more by bars and restaurants

71%

+2pp

I use social media to find new places to visit, eat or drink

64%

+7pp

General Attitudes - % agree with statements

Index vs. Avg US

SLIDE 19

ON PREMISE KNOWLEDGE CENTER

Nielsencga.com 19

SLIDE 20 20

ON PREMISE KNOWLEDGE PORTAL

SLIDE 21 21

ON PREMISE KNOWLEDGE PORTAL

SLIDE 22

Measurement Data

The first ever, fully projected, US

n premise market measurement

tool for beer, wine and spirits

On Premise Measure

SLIDE 23 23

Measurement Data

Facts

Dollar Sales
Volume Sales
Total BevAl
Segment
Subsegment
Beer Style

SLIDE 24

Consumer Data

An in-depth survey of 30,000 on premise

consumers. Census representative by

age, gender and location.

On Premise User Sur vey

SLIDE 25 25

Consumer Data

Demographics

Age
Gender
Income
Serve Preference
National Accounts

SLIDE 26

Analytic Data

POS data from 10,000+ independent and chain on premise outlets.

Check Level Insights Pool

SLIDE 27 27

Analytic Data

Reports

Time of day
Day of week
Style velocity
Subsegment velocity

SLIDE 28

Additional Features

SLIDE 29

Questions?

SLIDE 30 Nielsen CGA’s sole focus is to measure, understand and consult on the On Premise channel. In these testing times, this has never been more important. Following on from Issue 1 of our COVID-19 On Premise Impact Report, which focused on sales and consumer behavior leading up to the mandated closure of the channel, we asked you, our valued client base, which topic you would like us to focus on for Issue 2. The number one topic was overwhelmingly attitudes of consumers to take

ut/delivery both from a food and an alcohol point of view.

To analyze this topic we once again surveyed 1,200 consumers from four states - NY, California, Illinois and Florida, over the weekend (March 28-29) and analyzed sales trends from our RestauranTrak dataset (week ending March 21 + March 28). For context, the RestauranTrak (powered by CLIP) dataset consists of over 10,000 transaction-level POS feeds from a geographically balanced set of outlets. Predominantly consisting of independently owned concepts and small, often unbranded groups, RestauranTrak can be seen as a robust measure to complement other credible industry sources that are focused mainly on larger chains.

INTRODUCTION

SLIDE 31

Summary

Nielsencga.com 31

As bars and restaurants across the country close or significantly reduce their operations; those that

have remained trading have seen $ velocity fall by -73% to w/e March 21 (versus the average week) and remained down at -77% w/e March 28.

We can see a split in consumers drinking behavior during the impact of COVID-19. Half of US

consumers stated they are drinking the same amount of alcohol as usual. Interestingly, there appears to be a fairly even divide of those drinking more (22%) and less (27%).

Pre the COVID-19 Pandemic, take-out accounted for 11% of $ velocity in the US. As we enter full

lockdown, Take-out is now key to sales for outlets that are still operational, growing by +110% w/e March 28 vs the norm.

66% say they have ordered a take out/delivery in the past 2 weeks
Of those ordering take out/delivery, over 1 in 3 have been ordering food from venues they have

eaten or drank in before.

15% are ordering take out/delivery with alcoholic drinks, this behavior is more popular with younger

consumers; one in four 21-34 year olds have ordered alcoholic drinks with take out.

Results show that products which are easy to transport and order, such as wine or imported/craft

beer, are those most frequently purchased

The top factor influencing the choice to buy alcoholic drinks with take out/delivery relates to ease

and safety. 58% did so to avoid a trip to get food and drink at the grocery store/supermarket or liquor store. Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 32 As bars and restaurants across the country close or significantly reduce their operations; those that have remained trading have seen $ velocity fall by

73% to w/e March 21 (versus the average week) and remained down at -77% w/e March 28.

The decline in velocity is driven by a fall in both the number of checks and the average value of checks, with them halving in w/e March 28. This highlights that even though some outlets have switched to take out only operation, survival will still be difficult if check values remain at this low level. The drop in $ velocity over the last two weeks equates to a -$45k drop in value w/e March 21 and a further loss of -$48k w/e March 28 vs the average

week. The key questions here are how suppliers can support outlets that are still open and help them remain operational – furthermore, as alcohol

delivery laws are relaxed across a number of states, figuring out how to boost check value and alcohol sales could be critical.

TOTAL MARKET SALES

Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 33 In Washington State, where we saw the first hits to velocity, it continues to plummet as we move through March. $ velocity declined by -82% w/e March 21 and remained at this level into the following week. The decline in velocity in outlets which are still trading can be attributed to the reduction in number of checks by 2/3’s vs the average week. Average outlet velocity is

$42k lower than the weekly norm in w/e March 28.

Before getting into delivery, let’s look at whether consumers are drinking more or less during the changes to On Premise operations as a result of COVID-19. During the last two weeks (to March 29), we can see a split in consumers drinking behavior during the impact

f COVID-19. Half of US consumers that have had a drink in the On Premise in the last 3 months, stated they

are drinking the same amount of alcohol as usual. Interestingly, there appears to be a fairly even divide of those drinking more (22%) and less (27%). This reveals that there remains a large proportion of consumers still actively drinking and carrying on with normal consumption levels despite the change in circumstances. Younger consumers are the most likely to be drinking more during these uncertain times: 21% of 21-34 year

lds and 30% of 35-54 year olds, versus just 9% of those aged 55+.

WA SHINGT O N HA S DRINKING BEHAVIO R C HA NGED?

Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 34 Comprising 37,916 outlets in the On Premise universe, California makes up 12%

f dining and drinking outlets in the US. With such a significant proportion of
utlets, it is important to understand what is happening within the market.

As with NY and WA, $ velocity in trading outlets in California has fallen by -80% vs the norm during the last two weeks of March. Both the number of checks

rdered and the average value of those checks have halved across the state.

Average outlet velocity is -$57k lower than the weekly norm in w/e March 28. 21% of consumers from California that drink out in the On Premise say they are drinking more alcohol than usual and 53% are drinking the same amount.

CA LIFO RNIA

Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 35 Accounting for 22,000 outlets in the US On Premise market, New York has a significant On Premise market. As lockdown started across New York state, outlets that are still operational saw velocity drop by -85% w/e March 21 and stayed down into the following

week. Outlets in New York report only 36% of checks (vs the average week)

and a -57% decline in average check value w/e March 28. Average outlet velocity was -$68k lower than the weekly norm across the same time period. Similar to the average, 22% of consumers from New York that drink out in the On Premise say they are drinking more alcohol than usual and 50% are drinking the same amount.

NEW YO RK S TAT E

Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 36 Illinois reports a similar story; $ velocity is -77% lower than the average week to w/e/ March 21 and -80% w/e March 28. Both the number of orders/checks and the value of a check have fallen by half across the state as take out at present does not provide nearly the same revenue that was achieved in a fully operational outlet. Average outlet velocity is -$63k lower than the weekly norm in w/e March 28. 23% of consumers from Illinois are drinking more alcohol than usual and 49% are drinking the same amount. Illinois had the greatest percentage of consumers saying they are drinking more than usual. This shows, positively, that across all regions greater than 50% of consumers are retaining their usual drinking behavior, even if they have to supplement where they would usually purchase and consume it.

ILLINO IS

Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 37

F LORIDA

In Florida, where we do not yet see a total closure of restaurants and bars, the drop in capacity coupled with changing consumer behaviors has still resulted in large $ velocity declines. However, declines in this state are slightly behind that of the states hit hardest by the virus, with velocity down -60% w/e March 21 and it declined further to -76% in w/e/ March 28. Average outlet velocity is -$56k lower than the weekly norm in w/e March 28. Similar to the average, 21% of consumers from Florida that drink out in the On Premise say they are drinking more alcohol than usual and 53% are drinking the same amount. Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 38

TA KE O UT BEHAVIO R

This research seeks to focus on delivery/take out. 66% say they have ordered a take

ut/delivery in the past 2 weeks and from these consumers we will look at specific

delivery behavior and attitudes, as well as what drives consumers to order alcohol with a take out. Pre the COVID-19 Pandemic take-out accounted for 11% of $ velocity in the US. As we enter full lockdown, Take-out is now key to sales for outlets that are still

perational, growing by +110% w/e March 28 vs the norm.

In Florida & Illinois, where take-out proportion is slightly lower than the US average at 10%, growth of +111% and +112% respectively has been reported. However, it is key to note that even with this growth in take-out, this still only equates to 24% and 20%

f normal weekly velocity in both states respectively.

Take out represented a lower proportion of velocity in California at the start of 2020 but it has grown in line with the wider US trend at +109%, equating to sales that are 20% normal weekly trading. In New York State where take-out accounts for 13% of velocity, take out $ velocity has grown by a lower rate of +31% and therefore only represents 16% of normal weekly $ velocity. Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 39

TA KE O UT BEHAVIO R

Of those ordering take out/delivery, over 1 in 3 have been ordering food from venues they have eaten or drank in before as a result of COVID-19, showing a loyal group trying to support businesses they know and love. Consistent across the 4 states, this highlights the importance of creating a good impression on consumers and establishing returning visitation. This is exceptionally high for consumers aged 55+ (48%), implying older consumers have the greatest inclination and/or means to support their favored establishments. In contrast, 12% of US consumers have ordered from places they haven’t tried

r visited before, showing opportunity to win over new customers, who if you

impress now, may continue visiting when normal service resumes. C O N T I N U E D In terms of alcoholic beverages, 15% of consumers are buying drinks from the supermarket/grocery store to have with their take-out, this behavior is more popular with younger consumers (18%). Equally, 15% are ordering take out/delivery with alcoholic drinks; this is particularly popular in California (18%) while slightly less popular in Illinois (13%). New York and Florida remain closer to the average at (14%) and (16%) respectively. Once again this behavior is more popular with younger consumers; one in four 21-34 year olds have ordered alcoholic drinks with take out. This particularly high proportion of young consumers

utlines them as a key demographic to target alcohol delivery with food.

Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 40

O R DERING A LCO HO LIC DRINKS WIT H DELIVERY

The top factor influencing the choice to buy alcoholic drinks with take out/delivery relates to ease and safety. 58% did so to avoid a trip to get food and drink at the grocery store/supermarket or liquor store. 31% of those who ordered alcohol with take out/delivery wanted to order a drink specific to a venue which shows the benefits of a unique selling proposition. Customers will be encouraged to order from somewhere which offers something unique or will have to order from your venue if you are the

nly one offering something they have grown fond of.

While 24% overall said they ordered due to bundles of drinks on offer, only 13% in New York said they have ordered for this reason. Proving more popular in other states, New York venues could potentially do more bundle offerings to capitalize on sales. Promisingly, 61% expect to pay more for an alcoholic drinks when ordering take out/delivery than they would in a grocery store/supermarket, and perhaps surprisingly 57% said they would expect to pay more than when in a restaurant/bar. This highlights the significant opportunity to balance revenue losses through strong alcohol take out/delivery option during outlet closures. Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 41 Over three in five of those that drink alcoholic beverages are consuming the same type of drink at home that they drink in bars and restaurants usually. Furthermore, 59% are drinking the same alcoholic drink brands at home that they typically would in bars and restaurants. This shows that if the offering of your product is available, many of your consumers will continue to purchase it. In terms of replacing their visits to bars and restaurants, 49% are replacing typical visits to bars and restaurants where they would usually have an alcoholic drink, with drinks they bought from stores and 46% are ordering take out/delivery in place of when they would usually visit bars or restaurants for a meal. This means almost half

f consumers are substituting On Premise visits with consumption in the home. The

young consumer remains a key target for delivery, as 58% 21-34 year olds are substituting drinking occasions for drinks bought in stores and 61% are ordering take

ut when they would usually visit venues for a meal. This reveals they are more likely

to be using these alternatives, rather than just going without.

O R D E R I N G A L C O H O L I C D R I N K S W I T H D E L I V E R Y

C O N T I N U E D Source: RestauranTrak ACV Sales + Custom Consumer Research

SLIDE 42

METHODOLOGY

Analysis of RestauranTrak demonstrates that current (week ending March 21+29) On- Premise performance is two Standard Errors away from normal market variation. We can therefore infer that as one of the main variables that cannot be controlled for is COVID-19, and it is this that is driving market performance. Market baseline data is utilized to understand variation from the norm, baseline week is calculated on the time period between September 1 2019 & February 29 2020. RestauranTrak: Powdered by CHECK-LEVEL INSIGHTS POOL NCGA have surveyed 1600 LDA On-Premise consumers across four key states (Illinois, NY, Florida, California). 400 respondents were collected from each state, with each nationally representative on age and gender. For the Total US stats an average of the four states has been used. Fieldwork was 03/27/20 to 03/29/20. CONSUMER