Last orders: how can alcohol brands and bars respond to declining interest in Gen Z?

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How can 'Gen Z' be tempted back into bars?

It's been well documented in the media recently that the new generation of adults are fundamentally different to previous generations. Generation Z has turned its back on alcohol and would prefer to post a snap of their avocado on toast on Instagram than have one too many down the pub with their friends and regret their actions the next morning. These findings must set alarm bells ringing for the alcohol industry and make them question what the future holds for them. Opinium Research wanted to answer that question for them.

Opinium Research teamed up with Red Brick Road to dig a bit deeper into the attitudes of Generation Z (18-24 year olds in this case) and uncover some of the reasons why their behaviour is different to previous generations’ when it comes to alcohol and spending time in bars. Both qualitative and quantitative research was conducted among 18-24 year olds and bar managers in urban areas across the UK to provide a rounded view of behaviour, both from those doing it and those observing it.

Although a lot of the findings supported what others have found in that there is a clear trend towards a lower alcohol, health conscious lifestyle, this doesn’t necessarily mean the end for bars and alcohol brands. It actually creates an opportunity for them to adapt and get ahead of their competition. Generation Z are not aliens and do hold many similarities to previous generations, however, it would be foolish to ignore the trends which are starting to emerge. We identified four key areas of focus for the industry:

Provide a unique experience

Stay at home entertainment is at an all-time high with the likes of Netflix and Deliveroo leading the way and enabling consumers to do what they love in the comfort of their own home. There are indications that a similar trend is starting to take hold in the drinks industry with DIY drinking becoming more and more popular amongst younger drinkers. Making cocktails at home is something 40% enjoy doing and 14% choose to stay at home as they enjoy learning how to prepare new drinks.

So how can bars and alcohol brands combat this? To get Gen Z off the sofa and back into bars, they need to be provided with a bit more than good food and drink. This age group want something that they cannot replicate at home and our research found that 70% enjoy going to bars that are different, unique or interesting whilst 64% are more likely to visit a bar for the experience than purely to get drunk. Quirky décor, themed bars and weird and wonderful drinks are some of the ways that bar managers are setting themselves apart from their competition.

Provide ‘Instagrammable’ moments

Online image and how individuals portray themselves on social media is number one priority for a lot of this age group. Their image is built on demonstrating to their followers that they lead a desirable, exclusive life built on the foundations of spending free time in different and quirky locations. This is a driver for why Gen Z are now choosing quality over quantity and opting to go out less regularly but when they do, they want to make it a special experience that can be uploaded to their social media profile. The bar industry is a big part of this and they need to consider how they can provide ‘Instagrammable’ moments for their customers, often via the unique experiences previously mentioned.

It is not only the venue that needs to be Instagram ready, the drinks that are served need to be just as aesthetically pleasing. Themed cocktails served in skull heads, tea cups or even Pot Noodle tubs are some of the ways that bar managers are trying to attract this social media obsessed younger crowd and feed the need to enhance their online image.

Cater for the health conscious

Bar managers have noticed a trend in younger customers being more health and image focussed. This is driven by requests for healthier alternatives to traditional drinks orders in bars. Over the last five years, over two-thirds of bar managers have seen an increased demand for mocktails and low alcohol drinks and they believe it has got to the point where they cannot afford to ignore it anymore.

General interest in health and fitness has changed through the generations with Gen Z the most likely to care about being fit and healthy, watch their weight and actively avoid food or drinks that have a negative impact on health. Their priorities have changed also with having good physical and mental health being the main priority in life ahead of work, education, hobbies and socialising. This was not the case for previous generations with our research showing that there was much less emphasis on health and priorities were around having fun and socialising with friends when they were aged 18-24.

Increased awareness how alcohol impacts health along with a stronger desire to have a healthy image have contributed to a change in bar behaviour for Gen Z. This provides a big opportunity for alcohol brands to extend their product range to cater for this as well as opening the door to soft drink brands to capitalise on the trend. Non-alcoholic doesn’t mean just a glass of orange juice, however, these people will still want to be wowed if they are to spend their money.

Nail your social media presence

The importance of social media to Gen Z is clear to see which provides a huge opportunity for bars and brands to communicate the things that matter to this age group. Being able to demonstrate one or more of the drivers of visiting bars such as offering a different experience, providing Instagrammable moments or catering for healthy alternatives would be powerful marketing strategies.

A social media presence can be a double-edged sword though with it sometimes becoming a forum for sharing negative experiences. The rise of smartphone usage in bars has resulted in a drop in communication not only between friends ‘socialising’ but also between the customer and bar staff. Bar Managers are feeling the pressure to deliver quality first time around as if they don’t, the risk of a negative review for all to see instead of a conversation to correct the issue is a growing possibility.

These four areas are by no means representative of the overall current bar customer population and not even of all 18-24 year olds, however, they do represent noticeable behaviours which haven’t been seen in previous generations. If these findings act as a window into the future showing the wants and needs of the youngest drinking demographic, it marks a huge opportunity for brands and bars to recognise the change and be ready to adapt their offer.

Jordan Wood is research manager and partner at Opinium

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