Iwsr: economic and social factors slow down the recovery of alcohol consumption outside of home

Economic cycles are becoming shorter, but it is also true that many meteorites have hit the global economy in the space of just two years: the Covid pandemic, in 2020, and the war in Ukraine, in 2022. That brought devastating effects on consumption, particularly out-of-home, which is still struggling to return to 2019 levels. According to the IWSR data, on-premise alcohol consumption represented 35% of global consumption in 2019, a share that fell to 23% in 2020, 28% in 2021, and 29% in 2022. In this sense, the return to normality is still far away, and unlikely to occur in 2023, because the price race suggests, particularly in Europe and North America, the deliberate choices, with consumption thus returning to the home. Asian countries have a different attitude, where lockdowns and restrictions have lasted longer, fueling consumers’ desire to return to socialising spaces, and thus bars and restaurants.
“Home consumption is used as a savings tool in many markets to allow consumers to maintain relationships with premium brands. But this is not the case in Asia, where the restaurant relaunch is still in full swing”, says Richard Halstead, COO Consumer Insights Iwsr, commenting on the findings of an April survey of consumers in 15 major global markets (Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, South Africa, Spain, Taiwan, United Kingdom, United States), which shows that, on average, 60% of consumers in North America, a good part of Europe, South Africa and Australia say they go out less, while in China and India 50% say they go out more. When asked where they prefer to drink, consumers across all continents expressed a clear preference for domestic consumption, which was clearer in Australia and South Africa and weaker in Asia: 58% said that the last time they had consumed alcohol at home, 37% out of home.
As previously stated, consumers’ attitudes towards consumption are influenced by a variety of factors, including the macroeconomic climate and their relationship with society: in some markets, therefore, a decrease in disposable income has pushed consumers to go out less, or to enjoy your favourite labels at home, preferring more accessible options at bars and restaurants. According to the IWSR, 59% of consumers in the United States say they go out less, and this attitude is still influenced by the long wave of the pandemic when it was suddenly realized how much the costs of consumption in bars and restaurants weigh on the family budget. However, it is a choice that creates a violent circle, because bars and restaurants are forced to raise prices due to rising costs, as we see not only in the United States but also in most European countries.
There is also a significant difference in the relationship between alcohol and socialising between Europe and North America, where 60% of consumers do not consider alcohol to be an important part of their social life, and Asia, where 66% of consumers, particularly in China, consider alcohol to be a protagonist of sociality. Where, however, despite the strong recovery of away from home, concerns are growing about the slowdown of the country’s economy, with the stock market and real estate prices showing fragility and unemployment levels rising among young people. Regardless, Chinese consumers remain among the most financially optimistic in the world, still, these economic concerns force them to be more careful with their choices, which means visiting the most expensive establishments less frequently and spending less when they do.