Off- trade sales are a tiny fraction of the on-trade – but that could be about to change. Non-cream liqueurs, which include popular shot drinks such as herbal liqueurs, grew 11% to £172 million in the past year and make up nearly 5% of the off-trade spirits market, according to William Grant & Sons’ 2014 Market Report.
Meanwhile, tequila sales grew 9% to £11 million and sambuca 7% to £9 million.
In the on-trade non-cream liqueurs make up 13% of the spirits market but only grew 4% to £684 million, while sambuca sales rose 6% to £218 million and tequila 18% to £108 million.
Suppliers of shot drinks are seeing off-trade sales grow as cash-strapped consumers try to recreate the bar and club experience in their own homes – and are quick to point out the opportunity they represent for retailers.
Simon Green, marketing director for Global Brands, which supplies herbal liqueur Jungfrau, says: “Over the past couple of years there has been an increase in young people choosing to stay in rather than go out, with 55% of consumers aged 18-24 drinking at home for a special occasion, according to Mintel.
“We expect this trend to continue to grow with more and more young people moving to the off-trade for a big night in. Speciality liqueurs are leading spirits performance with the increase in at-home high-tempo occasions, and brands which offer a balance of affordability and credibility are helping to grow the category.”
Craig Chapman, marketing manager for Luxardo sambuca at Cellar Trends, says: “Historically, shot brands have been on-trade driven and, while this is still the case, the off- trade is playing an ever more important role. As drinking habits change, there has definitely been a shift to increased off-trade purchasing.”
Jägermeister marketing director Nicole Goodwin says: “A drink before going out is now the most important off-trade occasion for 18 to 24-year-olds, so stocking a range of best- selling spirits such as Jägermeister is becoming increasingly important for retailers.
“Shots generally offer better margin than beer, wine or cider. In addition, younger consumers choose to drink neat spirits as opposed to beer due to the growth of rum, specialities and malts. Shot drinks therefore tend to be incremental, so a huge profit potential for retailers.”
Cellar Trends’ Chapman adds: “Consumers are savvy, perhaps more so than ever before. While they are watching their spend, they want value for money, not just the cheapest product on the market. For the off-trade retailer, this is about having strong brands at competitive prices.”
So how can retailers make more of shots and shooters?
“Shots and shooters represent far more of an opportunity than more complex cocktail serves because they are easier to replicate at home,” says Dan Bolton, managing director of Hi-Spirits, which distributes Antica sambuca, Fireball cinnamon liqueur with whisky and Buffalo Trace bourbon.
“The main challenge for retailers is that a bottle displayed on a shelf is dull compared to the on-trade, where customers see the brand being poured and there tends to be more POS support.
“The key for retailers is understanding the signature serve of each brand and merchandising it accordingly. This can be as simple as putting a sign on a bottle of Fireball saying ‘serve ice cold from the freezer’. ”
The shooter and slammer trend all began with tequila – but leading brand José Cuervo is encouraging consumers to start sipping tequila.
Brand ambassador Gabriela Moncada says: “Tequila shots are still very popular but we promote sipping, as this is the traditional way of drinking tequila in Mexico. Trends are changing in the on-trade with tequila long serves becoming more popular, and this is reflected in retail sales too, with people looking for simple mixes for tequila.”
Halewood International says retailers can grow the market for shot drinks such as its Sidekick brand by merchandising them alongside mixers.
Brand development manager Alex Kennedy says: “Off-trade retailers need to proactively respond to changing drinking behaviour and consumer preferences either by positioning soft shots like Sidekick by mixers or by including serving suggestions on cards by the checkout.”