In 2017, the UK spent £49 billion on food and drink purchased and consumed outside the home – and that doesn’t even include alcohol. Over 98% of the British public made such a purchase, which includes things like pub lunches, takeaway coffees, and sandwiches eaten at the workplace. That adds up to around £1000 per person.
On a global level, Kantar's new report on out-of-home (OOH), published this week, reveals that OOH consumption makes up nearly half (41%) of global spend on snacking and non-alcoholic beverages. In some categories, such as coffee, purchases outside the home make up as much as 70% of total spend, exposing a significant opportunity for retailers and manufacturers not currently considering OOH strategies.
The category is one that Kantar has tracked through its Out of Home panel of 7500 demographically representative individuals here in Great Britain, continuously since 2015. Brands use this data to make informed decisions about where and how to invest and what they need to do to grow. So what are the interesting trends to be aware of?
While we are spending more on our overall Out of Home consumption, individuals are going out less for all occasions compared to last year – except the evening meal. An extra £1.4 billion was spent on dining out in the evening in 2017. Unlike other times of day, this additional spend isn’t down to rising prices or premiumisation – it’s about people eating out more frequently.
£10.77 is spent per dinner on the town on average, compared to an average spend of £1.84 on afternoon snacks and £4.13 on lunch. We have cut back on those smaller occasions to save for the bigger events.
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Indeed, financial pressures have led consumers to opt for a good old-fashioned lunchbox – with a meal made at home – on 274 million MORE occasions over the past two years.
Within the entire Out of Home category, three of the top four performing subcategories are focused on meals – pubs and bars, quick service restaurants and full-service restaurants. Coffee shops are also in the top four (second), growing at over £300 million in 2017. This has been fuelled not only by the nation’s continued love of coffee, but also by their expansion into cold drinks and food.
Why do people eat and drink, more and more, out of home? Largely due to speed and convenience, finds Kantar Worldpanel, but that isn’t true of every channel. People value the atmosphere and social interactions possible in pubs, for example, so a speedy service should not come at the expense of ruining the ambience. Actually, addressing ADDITIONAL needs is something out of home outlets must consider. Those who offer ‘enjoyment’ as well as ‘speed’ can see phenomenal growth, as evidenced by fast-service restaurants encouraging consumers to trade up to more indulgent options.
Equally, we’ve seen growth from outlets that have considered what OTHER products could serve the same customer needs. Did you know that over half of coffee purchases at Greggs are now standalone purchases? Expanding ranges along with a more welcoming atmosphere could be one of the reasons some of us are swapping an average £1.83 spend at a supermarket for an average spend of £7.20 at fast-service restaurants.