Chase the family pound, pub operators are urged

20 September 2007 by
Chase the family pound, pub operators are urged

What with the poor summer, the smoking ban and reports warning about falling consumer spend, pub operators could be forgiven for claiming 2007 has been an annus horribilis so far. But canny operators can still prosper by targeting families and promoting their offerings more clearly, according to in-depth research unveiled last week.

In its first look at the pub market, consultancy firm Him! put 125 questions to more than 5,000 customers and 700 employees at pubs owned by Charles Wells, Greene King, JD Wetherspoon, Shepherd Neame, Mitchells & Butlers (in All Bar One and Vintage Inns outlets) and Laurel Pub Company (in Slug and Lettuce, Ha! Ha! Bar and Yates's).

The study revealed that while families spend over £5 more per person than the average customer in a pub, just 9% of pub-goers visit with their families, rising to 12% on Sundays.

Tom Fender, sales and marketing director at Him!, urged operators to chase the family pound and become more child-friendly. He said families eating out in pubs could spend, on average, 50% more per customer, pointing to menu-ordering comparisons, where 15% of pub-goers order a hot meal but just 3% of those order a dessert.

"The margins on desserts are attractive and we need to ask why the gap is so wide," Fender said. "Could this be to do with the service, or is it to do with the fact that in this country you don't order your main course and your dessert at the same time?"

The research also showed that 42% of customers would like to buy a hot beverage in a pub with 30% also visiting a coffee chain during the week. Fender said pubs should challenge the popular divide between pubs for alcoholic and cold drinks and coffee shops for hot beverages because both were competing for the lunch market.

"Coffee is a £2.5b per annum business. It's a huge market that has relatively come up from scratch in the past decade," he said. "What has the coffee shop got that the pub hasn't got? We need to break creatures of habit and where people buy coffee. We want it to be a key component of our offer."

However, the number of adults visiting coffee shops in the typical week has stalled over the past year, averaging 7% as the number of adults visiting a pub in a typical week has fallen from 21% to 15%. Restaurants have been the main winners, rising in that time from 18% to 21%.

Pub operators need to improve their marketing efforts, with the research showing that only 16% of pub customers noticed promotions and only 5% of pub-goers were buying promotions. Fender said the competition pubs faced for the consumer pound meant pubs should promote themselves more.

If pub operators felt they should be doing more to entice customers, at least the research showed they are keeping their staff happy. Nine out of 10 pub staff enjoy bar work, while eight out of 10 enjoy working for their company. About three-quarters felt valued and well informed but only 32% implemented agreements with head office all the time. Disturbingly, just 12% of bar workers knew what their best-selling beer was.

Nigel Bunting, retail director at Shepherd Neame, warned that operators shouldn't get too hung up about attracting brand new customers. "What we should be aware of is not what customers we're not attracting but looking at the loyal customers we have and giving them things they might not think they want," he said.

In conclusion, Fender insisted pubs still had an exciting future. "We spend 10% of our disposable income on food and drink. Competing for that pound is getting more intense and is no longer between different pubs and bars but between all high-street operators," he said.

By Christopher Walton

Source: Him!

Friends 38%
Partner 24%
Alone 19%
Family 9%
Colleagues 5%
Quiet drink 36%
Meal 23%
Meeting friends 17%
Special occasion 4%
Business meeting 1%
Atmosphere 36%
Price 35%
Food range 30%
Drinks range 30%
Staff friendliness 26%
Clean and tidy 19%
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