VIBE Conference returned to California this week, bringing on-premise beverage decision makers together to learn, network and toast to a new era for the industry. There’s so much to do at this three-day event, from the impactful conference sessions to the networking breaks, parties and charity support.
If you weren’t able to attend VIBE Conference this year, read on to find out five of the top trends, as identified by IMI Agency, IWSR-Global, Technomic, and more.
Whether it’s a virtual restaurant, QR code, or alcohol delivery, it’s clear that bars and restaurants are going digital. The topic of digital innovation came up again and again throughout the conference. Attendees learned that 1 in 5 retail dollars are spent digitally, that 7 out of 10 brands with existing virtual concepts plan to open more, that the ‘homebody economy’ continues to grow, and that those homebodies have money to spend (especially if something can be delivered straight to their door).
What does that mean for you? It means it’s time to embrace technology in ways you haven’t considered before. At the most basic level, operators need to be adopting digital menus, online ordering and delivery, or they will miss out on valuable revenue streams. Studies have shown digital ordering (whether it’s through a QR code, third-party app or kiosk) actually increases the average spend by up to 5%. If you already have a digital menu, how can you optimize it? Forget about a stagnant PDF – make it interactive. Put enticing photos, and even videos in your digital menu to boost spending even more.
Premiumization is In
If there was a VIBE Award for most popular theme at VIBE Conference 2021, it would go to ‘Premiumization’. Almost every conference session touched on the fact that customers are now willing to pay more for top-quality products and service. After spending over a year in their homes playing bartender and chef, the average consumer now has refined tastes. Sure, they can make a solid Old Fashioned or Margarita, but they probably can’t make your fancy vanilla-infused, tobacco smoked Old Fashioned, or your Prickly Pear Margarita. And those kinds of elevated drink options are exactly what they want when they go out.
What does that mean for you? Like most operators, you’re probably running on a reduced menu right now. Make sure each one of your items has a ‘wow’ factor, something your customers can’t make at home or get delivered. When it comes to LTOs, think beyond well spirits and beer buckets. Studies have shown that the majority of consumers are after value, meaning they’d rather get top-quality spirits for a reasonable price, than cheap products for a cheap price. In fact, when surveyed, ‘everyday drink prices at a good value’ was the most important element in a beverage program for consumers. According to IWSR’s research, the hottest categories of spirits for the next four years are Ultra-premium tequila ($45-99.99), super-premium whisky ($30-$44.99), Super-premium gin ($40-$44.99), super-premium rum ($30-$44.99) and premium no-alcohol spirits ($22.50-$29.99).
Without going too far into it, the labor shortage is very real. You know it, we know it, the customer knows it. And of course, now that the supply is down the demand is up, and customers are actively seeking out good service. “If you take care of your people, they’re going to take care of your customers,” said Carmen Morgan, Food and Beverage R&D Manager at Dave and Busters during the ‘Masks On or Masks Off?’ panel. Morgan continued, “Reinvest in your people and don’t take your eye off the ‘culture ball’.” Fellow panelist Cami Lehmann, Director of Marketing, Brinker International, agreed. “To keep your staff, empower them to love their brand.” To recruit your staff, take down unnecessary barriers to entry. According to Lehmann, Chili’s application process used to take 12 minutes. Now, it takes just 45 seconds. “We have to soul search and find a new value proposition to keep staff. People have choices now, and they need a better reason to work than just a paycheck,” said Lehmann. Good service pays off, too. When people are deciding where to go, service is the third most popular factor overall, and 27% of surveyed consumers said that ‘knowledgeable servers and bartenders’ are the most important thing for them when it comes to on-premise satisfaction. That amount has grown up seven points since 2020, which shows that service is more important than ever.
What does that mean for you? There’s an opportunity here to shape the future of the industry and your business all at once. How? By recruiting, training and managing your staff for retention. Customers want service. People want good jobs. Kill two birds with one stone by investing in your staff, paying good wages, and showing them a clear path to professional advancement.
Wellness is Here to Stay
The zero-proof and low-ABV trends continue to rise. Not only are people looking for alcohol-free alternatives to drinking, they’re now looking for functional options that fuel their healthy lifestyle, even if they’re not sober-curious. People are interested in trying almost anything that sounds like it could be healthy, like seaweed cocktails, plant-based alcohol-free cocktails, ‘wellness’ waters with lichen and plant extracts, and of course, THC & CBD-infused drinks. Zero-proof spirits are one of the fastest growing beverage categories by volume. By 2025, they’re expected to grow in market share by 16.2%. That puts them just behind RTDs, which are expected to grow by 19.1%.
What does that mean for you? It’s time to start thinking of creative non-alcoholic options to add to your menu. The days of a Diet Coke for the designated driver, sober curious and sober are over. People are now happy to spend $10 or more on a well-crafted zero-proof cocktail, so make sure you have one for them to try. If you’re not sure where to start, tea is a great place to start.
Brand Loyalty is Out
People aren’t loyal these days. The average consumer doesn’t stick to one brand, one spirit, or even one type of drink. There is more crossover than ever before as consumers are more educated on products, and more willing to experiment. Only 26% of consumers know what they want to drink before they get to an independently owned restaurant, according to CGA’s research. While customers are getting harder to pin down, they still have some overarching traits that are worthwhile for operators to know: beer drinkers favor experimentation, wine drinkers are more conservative with their choices and cocktail drinkers are seeking premiumization.
What does that mean for you? It means independently owned bars and restaurants have the most opportunity to control the guest experience and purchase. Guests are especially prone to upselling now, with 76% saying they’d spend an additional $1-$2 more on a cocktail at the bartender’s suggestion. Add a few creative cocktails and whimsical beers into the mix, and you’ve set yourself up for some healthy checks at the end of the night.