Shifts in American Drinking Behavior

Shifts in American Drinking Behavior

Our collective “adult beverage of choice” in the past has benefited from a diverse variety of options among the three traditional categories of beer, wine and spirits and as consumers we enjoy an abundance of options.  As generational shift continues to morph the acceptance and use of those beverage options we are experiencing a downward trend in consumption of our favorite brews, cocktails and varietals.  We’ll take a look at what’s driving this trend and options for hospitality operators to stem the tide of potential loss for an important sales category.

We’ve been following adult beverage consumption trends, especially the downward trend, for over a year and determined a follow-up was due.  As we shared approximately a year ago both Millennials and Gen-Z are consuming less alcohol (TMS, 2018) as the former have trended toward wine from beer and the latter have trended away from alcohol altogether.  Both groups have different reasons as recent trade articles have discussed (Business Insider, 2/2018) with beer being hit hardest, wine sales flattening and spirits the only bright spot among the three categories. 

So what’s happening among the two demographic groups that combined are the largest cohort among American consumers regarding alcohol?  One pattern we’ve noticed is Millennials prefer to entertain at home instead of dining, or drinking, out and their beverage of choice appears to be wine or the newest “small batch” spirit available.  That’s great if you’re an adult beverage retail shop, not so good for their hospitality brethren and in the “share of stomach wars” all is fair game so advantage retailers with this group.  As for Gen-Z first consider many of these Americans have never experienced life without a smart phone OR some type of social media so they are very aware of how their social media posts could impact their relationships, ability to obtain employment and steering clear of the long arm of the law as some metropolitan police forces do monitor social media.

Faced with the reality of further social and cohort scrutiny Gen-Z has become the first generation to drastically reduce alcohol consumption if they even take it up in the first place as many prefer a more health-forward lifestyle and would consider signing up for a yoga class instead of bar or club hopping for an evening with friends.  Faced with the behavior of both groups hospitality operators must find a path to encouraging them into their establishments and if not for alcohol perhaps an alternative to who we might call the “wellness” generation before it’s all over. 

Fortunately for those in the hospitality industry who know there are better margins on beverages than food their vendors have been studying this change in consumption patterns and are getting ahead of the curve.  Adult beverage manufacturers, especially brewers and distillers, are creating and testing brewed non-alcoholic beverages and low-alcohol distilled spirit options to attract these two groups who will be driving food and beverage consumption for decades to come addressing this generational shift (WSJ, 1/17/19).  A couple of suggestions come to mind, operators could test these new beverage options through a sampling program supported by their vendors OR could roll up their sleeves to create some lower alcohol beverage menu options or even the dreaded “Mock-tails” of our collective beverage operations past to determine which menu items will entice younger cohorts into entertaining “out” instead of the alternative. Whatever the challenge of hospitality managers they may trust we’ve been scanning the landscape to offer solutions to their operations and revenue challenges, find us at www.themenuspring.com.