Social distancing. Masks. Contact-free. These are all buzzwords defining the current taproom experience.
Most states still have restrictions on capacity. Others have limited individual party sizes. Effectively, all these regulations have reduced the number of guests that can visit, therefore reducing your taproom revenue.
While keeping our distance has become the norm, everyone who chooses to visit your taproom for on-premise consumption is accepting that some sort of interaction will occur. Even during the shortest COVID-era encounter, you have the ability to build connections with your guests. In this article, we will show the financial value of engaging at a high level and why it is even more vital during a pandemic. A few extra bucks from each visit could be the difference between closure and survival.
Table of Contents
Defining Customer Engagement
Engagement is the emotional connection and level of attention your staff create with your guests. Customer engagement can be broken down into the following levels, which we will refer to throughout this post.
- Neutral: The staff goes through the motions, neither impressing nor disappointing the guest.
- Low: The staff does not attempt to build a connection with the guest and is absent for the bulk of the guest’s visit.
- Moderate: The staff greets the guest, offers recommendations, and checks back in a timely fashion.
- High: The staff goes above and beyond, “wow”-ing the guest.
Average Spend Based on Customer Engagement
A customer’s experience while at your taproom can have a marked impact on how much they spend and how likely they are to return. While we do not have a data set of COVID-era spending habits at breweries, I believe the pre-COVID data still provide valuable insight into consumer behavior.
The data referenced in this article was compiled by Secret Hopper based on 5,684 non-paid brewery visits. The sample set includes a nearly 50/50 mix of men and women. The average age of the respondent is 32.7 years old. The total amount spent includes tip.
When a guest receives neutral customer engagement, their average tab is $39.01. When a guest receives high engagement, they spend an average of $45.04 — 15.5% more than guests receiving neutral engagement. Only 22% of brewery experiences include neutral to low engagement; however, there is room for improvement that will not only help build the reputation of your brewery, but also craft beer as a whole.
Additionally, guests who receive high customer engagement are nearly 50% more likely to recommend and/or return to your brewery. (Guests receiving high engagement are 99.2% likely to recommend and/or return to your brewery while guests receiving low engagement are only 48.5% likely to do so.) This fact alone demonstrates how engagement in a single visit has consequences past the initial interaction that can impact your long-term growth and success.
Impacts of COVID on the Taproom
In 2020, every brewery, cidery, and winery experienced a significant drop in taproom or tasting room traffic, primarily due to government-mandated closures. On average, we can assume the number of guests decreased by half.
We partnered with Kary Shumway, founder of Kary’s Financial Training and CFO of Wormtown Brewery, on a model that analyzes the differences in spending based on varying capacity and levels of customer engagement.
In the chart below, we use Kary’s projected number of customers per day, per time of day, and inputted daily spending averages from the data we collected. The chart demonstrates average sales during pre-pandemic normal conditions ($10,067 per week) vs. with 50% fewer guests ($5,034).
Let’s take a deeper look into Saturdays in particular. Saturdays are likely your brewery’s busiest day. Due to high traffic, fewer visits include high engagement customer service. However, for guests who receive high engagement on a Saturday, we see them spend an average of $47.69, the highest amount spent for any day of the week. In a perfect world where all Saturday visits receive high engagement, your average Saturday would go from $3,354 to $3,546, up almost 6%.
Using Kary’s model and looking at the approximately 9 months of pandemic operation so far, basing taproom operation at 50% of average traffic, a brewery would see an additional $234 spent per week if all guests received high engagement. Assuming a taproom has been open 25 weeks out of the 9 months, a brewery would see an additional $5,850 in spending if all guests received high engagement during the pandemic.
While that increase in revenue will help, it’s not a complete game-changer. Approaching the subject of customer engagement is merely the tip of the iceberg into individual strategies that can increase revenue even more. I recommend watching 10 Ways to Maximize Taproom During a Pandemic for more actionable methods you can use to survive and come out stronger.
Would You Like Another Drink?
From a prior study, we discovered that 45% of guests are not being asked if they would like another beverage during a taproom visit. I repeat, nearly half of all guests are not being asked if they would like to order another drink. The average guest who is asked to order another beer spends $46.33 vs. $39.83 for those that do not get asked to order another drink.
Guests receiving high customer engagement are asked to order another beer 71.3% of the time. When asked this question, they spend an average of $46.87, compared to $40.49 when not asked. This chart demonstrates how frequently guests receiving each level of engagement are asked to order another drink and how much they spend.
The difference between a $37 and $47 tab could simply be engaging and asking your guest one more question.
What the Future Holds
In a December 2020 study, we asked, “How often are you visiting breweries for a beer on site compared to 30 days ago?” 57.2% of respondents said they are visiting breweries less for on-site consumption than 30 days prior, demonstrating a decrease from last summer and fall (2020) when on-site visits had temporarily increased.
With fewer visits to your taproom in the future, you need to think about how to capitalize on each and every guest. One important tactic your taproom staff needs to implement is encouraging beer to go. Why not save this guest a trip to their local beer store, or wherever they purchase, and encourage them to buy beer to go from your brewery?
We consistently see that brewery staff only encourage guests to purchase beer to go 20% of the time. Without prompting, guests will only choose to purchase to-go beer 9% of the time. However, when staff make a suggestion, guests will make the purchase 49% of the time. Guests who make a to-go purchase, when suggested, spend an average of 17.9% or $7.50 more than guests who do not.
It is absolutely vital to put in the effort to build relationships with your guests who have specifically chosen to visit your taproom. Make them feel safe, make them feel connected, and — as you are building these connections — put in the work to maximize each tab. Suggesting a second beverage and encouraging to-go purchases are merely two of many strategies that can take a positive visit and make it more profitable.