The UK’s leading supplier of high-quality syrups MONIN has launched their annual winter report, revealing insights into the current state of play of the hospitality industry, how those within the coffee shop and bar sectors are currently feeling, and trends that are likely to impact winter 2023/2024.
The key findings from the 2023 winter report included:
- The UK branded coffee shop market is now the largest and most advanced in Europe, with 11.9% growth YOY.
- 54% of managed business leaders in the hospitality industry are feeling optimistic about the success of their own business over the next 12 months 1, up 7% from the start of this year
- Bars and pubs are still seen as an ‘affordable luxury’ by consumers, with cocktails more popular than ever before.
- Winter 2023 trends focus on the role of indulgent drinks as treats, the influence of bubble tea on the rise in textured drinks, the blending of coffee and cocktails across both markets, as well as the evolution of hot cocktails.
Over half of hospitality leaders feel optimistic about the next 12 months, but there is some way to go.
New industry trend research from MONIN, has uncovered that 54% of managed business leaders in the hospitality industry are feeling optimistic about the success of their own business over the next 12 months, up 7% from the start of this year. This is largely based on a positive 2022 for the OOH sector, with exciting trends coming to the fore and influencing consumer spending. In fact, 61% of consumers are happy to spend the same amount on out-of-home special occasions as they did last year, despite rising cost of living and inflationary pressures. These insights come from MONIN’s annual Winter Drinks Trends Report, which looks at the trends that are likely to influence the 2023/2024 season to help venues prepare for the colder months ahead.
The re-establishment of the OOH coffee market.
The UK branded coffee shop market is now the largest and most advanced market in Europe. It has seen a huge increase in market value in the last 12 months, rising by 11.9% and is now valued at £4.9 billion. Winter 2022 experienced some important industry shifts including:
- Hot chocolate overtook the flat white to become the 3rd favourite coffee shop beverage, and 1 in 3 consumers now choose non-dairy milk options for their hot drink2. This is the highest ever and only looks set to continue.
- The iced coffee maintained its popularity following the summer heatwave. With 71% of consumers purchasing an iced coffee in the past 12 months, the trend is being driven further by the 18- to 34-year-old consumer, with 7.3% drinking an iced drink OOH every day of the year, coffee shops should look to keep iced summer favourites on the menu throughout winter, alongside iced variations of popular winter flavours and LTOs to capitalise on this demand.
- Mochas have long been considered a winter staple, and the lines between coffee and hot chocolate only continue to blur, with offerings from last winter at branded and independent coffee shops alike driving this trend forward. This is set to further increase with many outlets offering different serve options and flavour variations, such praline, cookie and cold brew mochas.
- Pumpkin spice is synonymous with Halloween; but the flavour even appeared as early as August. In fact, searches for the flavour rose by 174% in August 2022, and again by 84% in October 2022. It’s set to remain ever popular this year, alongside the favourite autumn flavour, gingerbread.
Lee Hyde, Senior Beverage Expert at MONIN, comments: “It has been wonderful to see the OOH coffee market pick up following the devastation of the pandemic. Whilst there is no doubt that last year’s economic turbulence had an impact, it was a positive year for the industry when looking at the many exciting trends that came to the fore. Flavoured hot chocolates, particularly with a confectionary twist, proved popular, with key events, such as Halloween and Valentine’s Day, giving ample opportunity to diversify away from the norm. It will be interesting to see how they play out as we move towards winter 2023, and there is plenty of opportunity for outlets to flex their creative muscles to keep consumers excited about the industry.”
Premium drinks provided pubs and bars with vital opportunity.
Optimism in pubs and bars is also growing as we move into winter, as 54% of hospitality leaders are confident about their prospects over the next 12 months, up 7% since the start of this year. With the cost-of-living crisis continuing to have a grasp on the nation, the frequency of visits to hospitality venues declined but spending per visit rose as consumers traded up to the premium drink offering. Consumers wanted to enjoy quality drinks in pubs and bars, which continues to be an affordable luxury that consumers are holding on to. In fact, venues with a cocktail offering have been more resilient in the last six months of a rocky economy.
Winter 2022 also saw the rise of the premium cocktail, with rum playing a central role:
- More consumers were drinking cocktails OOH than ever before, with 18% agreeing they regularly order them when in a hospitality setting, and 29% agreeing they drink cocktails all year round. In fact, when looking at younger generations, 42% chose cocktails with just 15% selecting beer.
- In the last 12 months, all types of rum have seen an increase in consumption. White rum is proving particularly popular, with a 28.3% consumption rise YOY across all venues.
- Last winter saw spritzes everywhere, from sparkling highballs to sprites with festive twists, transforming them a summer-only serve to a winter essential. Recent data reveals 1 in 10 cocktails served are now a spritz6, up from 1 in 20 cocktails at this time last year
- The addition of texture in cocktails gathered pace, for example the inclusion of boba pearls in beautifully coloured drinks to add another dimension to the consumption experience.
Lee continues: “It’s great to see cocktails rise in popularity, as there is so much room for operators to use creativity to craft beautiful drinks that will entice consumers through the door. Not only is this fun for the drinkers, but it’s fun for the bartenders, too! Venues should take this rise as an opportunity to refresh their winter menus and introduce trend-worthy cocktails to drive footfall this winter. Time and time again, hot cocktails return as a popular alternative for many consumers, but bartenders are now looking to move past mulled wines into decadent boozy hot chocolates, an influence creeping in from the coffee shop sector. Hot Buttered Rum is a serve that is gaining serious traction, too.”
Looking ahead: the future looks promising.
This winter is no doubt going to have its challenges for the hospitality industry; the issues around recruitment, the supply chain and operational costs have not been resolved. But the consumer love for the industry is still evident, and there are plenty of ways that outlets and venues can elevate their drinks offering to encourage footfall and keep business as steady as possible.
The four key trends for winter 2023 across the coffee and cocktail sectors are:
- With iced drinks infiltrating all seasons and blended coffees the most increased beverage to order, we predict that we will see the overlap between coffee and cocktails going a lot further than just the classic Espresso Martini – think boozy frappés and fruity coffees. In fact, coffee is the 6th favourite taste profile for cocktails.
- With bubble tea booming in the UK and showing no signs of slowing down, we are seeing more outlets offering one of the many types of bubble tea. It’s no longer exclusive to bubble tea outlets, as coffee shops and bars from the high street to the high end are incorporating bubble tea and boba into their menus and cocktail offerings. We saw the start of this last year and expect it to accelerate this winter.
- With the cost-of-living crisis hitting homes hard, consumers are looking for affordable treats, providing the coffee and cocktail sectors with a huge opportunity.
a. Add seasonal syrup flavours to coffee shop beverages such as lattes, mochas and hot chocolates. We expect to see indulgent flavour combinations adding to the treat aspect of a beverage, whether coffee or cocktail.
b. Consider adding whipped cream and edible garnishes to cocktails, alongside a degree of customisation to give customers the element of choice. - With many alcohol drinkers seeking no & low ABV drinks as wellness trends remain popular, outlets should consider improving their no & low ABV offerings. 25% of pub visits are now alcohol-free, and an estimated £800 million revenue was missed due to a lack of suitable no/low alcohol options, offering a significant opportunity for all outlets.
Lee added: “Now is the time for outlets to start looking at their winter menus. There are some exciting trends coming our way from customisable garnishes to unusual textures and indulgences, providing a wealth of opportunity to capitalise on. We know that constantly innovating menus is hard work, but using these trends as the foundation can make the process fun, whilst grounding new ideas in insights that we know resonate with consumers. Plus, MONIN’s winter report features a range of recipes for bartenders and baristas to follow, to help you refresh your menu and drinks offerings, and make the most of these evolving trends.”