Some relief for import trend.  Shipments up 159,000 bbls, 7.6% in Oct, reports Lester Jones from Beer Inst, based on Commerce Dept data.  Big gain in Dutch and Irish (+25% each) and Belgian (+35%) beers, plus an 8% pop in Mexican shipments drove the Oct gain.  Yr-to-date trend, -686,000 bbls, -2.8%, still hard to accept given other known data.  Key is that Commerce reports show Mexican shipments up just 78,000 bbls, 0.6% for 10 mos.  But Crown shipments alone up over half-mil bbls thru Sep.  And HUSA’s Mexican portfolio also growing.  Elsewhere, imports from Netherlands, Canada, Belgium, Ireland and UK each still down in mid-single digit range yr-to-date.  Other than Mexico, only Germany showing gain among significant import source countries.  We’ll see if imports gain more ground in Nov and Dec, which combined for 381,000-bbl, 10% drop (much of that Mexican beer) last yr.  So very easy comps.   

Some relief for import trend.  Shipments up 159,000 bbls, 7.6% in Oct, reports Lester Jones from Beer Inst, based on Commerce Dept data.  Big gain in Dutch and Irish (+25% each) and Belgian (+35%) beers, plus an 8% pop in Mexican shipments drove the Oct gain.  Yr-to-date trend, -686,000 bbls, -2.8%, still hard to accept given other known data.  Key is that Commerce reports show Mexican shipments up just 78,000 bbls, 0.6% for 10 mos.  But Crown shipments alone up over half-mil bbls thru Sep.  And HUSA’s Mexican portfolio also growing.  Elsewhere, imports from Netherlands, Canada, Belgium, Ireland and UK each still down in mid-single digit range yr-to-date.  Other than Mexico, only Germany showing gain among significant import source countries.  We’ll see if imports gain more ground in Nov and Dec, which combined for 381,000-bbl, 10% drop (much of that Mexican beer) last yr.  So very easy comps.   

7G Distributing, a merger formed in 2010 between Lee Distributing and Kirchoff Distributing, has deal to buy 1.5 mil case Vanguard Dist in Davenport, Iowa.  The deal will close Jan 1 and Vanguard will be renamed 7G, which will now be almost 6 mil cases.  “We were in a good position financially and Bill Wallace wanted to exit the business,” Joe Lee told The Gazette.  Vanguard is contiguous and “we expect to achieve a number of synergies.”  This is “just the right time,” Bill told INSIGHTS.  He’s 61, been doing this since 1977.  Some may recall that Bill had bought a stake in the biz in 1998 and then purchased it outright from Duncan Cameron in 2005.  So this is unusual; 2d time in last decade that this AB distrib changed hands.   AB still has 62 share in Ia tho it has lost a couple share there in last 4 years.  Following this deal, two distribs, Doll and 7G, will be 70% or more of AB’s biz in state.  

ABI digital marketing veep for North America Lucas Herscovici spoke at ANA (Assn of Natl Advertisers)  “Real-Time Marketing Conference” earlier today, touching on hot topics ABI has addressed numerous times this fall. The message was similar: ABI is “betting big” on digital;  Lucas showed slide that sez AB looks to shift marketing focus from 90% paid advertising model to 50% earned media (word-of-mouth, consumer-created content, other social media talking about your brands, etc), 25% paid and 25% owned (website) media, and become “the best CPG company in digital.”  Asked how far along ABI is toward making this happen, Lucas declined to comment.  He again cited Facebook case study where Bud Light got 3.3% sales lift and 6:1 return on investment spend from Facebook posts with the highest engagement (boosted thru paid media). “ Sales” and “brand health” are the two key indicators of success via social media for ABI, sez Lucas.  This shift towards much higher % of earned media is “one of the biggest challenges we have,” he added.  

This is the 2d Miller distrib selling to a Coors distrib in NJ in last yr or so.   Shore Point (Coors/Crown) deal to buy Point Pleasant (Miller/HUSA) was announced to employees yesterday, with deal expected to close as soon as possible, pending supplier approvals.  Shore Point is about 7 mil cases and Point Pleasant about 2 mil cases.  The other MC transaction in NJ was Peerless Bev purchase of Kristen at the end of last yr, putting Peerless over 8 mil cases. Until then there was a separate Miller and Coors network in most of state, but following 2 deals, that’s certainly much less the case. 

Following this purchase, Shore Point and Peerless combined will represent over 25% of volume in state of NJ. Recall, AB has just 29 share in NJ, 1 of its lowest in US.  But its share about even since 2008.  Meanwhile, MC at 33.6 share last yr, down from 35.9 in 2008.   MC lost 146,000 bbls, 8.5% of its volume in NJ in last 4 yrs, while AB and total mkt down about 3%.  Crown at 13 share in NJ, up slightly, and HUSA at 8, down more than 1 share in last 4 yrs.  Recall, New Jersey shipments among softest in US in 2013, down 4.2% thru Oct.   

AB’s series of new videos on Bud Light’s YouTube channel that riff on running “Hold my beer” jokes featured in NY Times today.  Those videos were one of hits at AB’s sales conference last mo.  While phrase “hold my beer” is usually followed with “reckless stunts” in online clips, for Bud Light they will be more “sketch-oriented” comedy spots created by comedian John Krasinski, known for his years on “The Office.”  Videos will be promoted through social media via hashtag #holdmybeer (they can be seen on our Twitter page).  These videos are part of ongoing effort to “make Bud Light humor more relevant and more contemporary,” said mktg veep Paul Chibe.  “The big issue I saw was that we were making fun of our drinker; instead of laughing with, we were laughing at,” he added.  Videos are planned for online only but “if something pops” they could hit TV.     

As noted last week, state shipments data not quite as soft as US “total” of taxpaids plus imports, Beer Inst reports.  Indeed, data thru Oct suggests state shipments off 1% yr-to-date vs closer to a 2% decline for total shipments trend.  Unusual for there to be such a discrepancy.

Data shows only 10 states reporting gains for 10 mos.  That includes continued better trends in far west.  Calif (+0.7%), Oreg (+1.3%) and Wash (+2.7%) combined for 267,000-bbl, 1.1% gain thru Oct.  Otherwise gains spotty: New York has one of best trends in US, +175,000 bbls, +2% Jan-Oct.  Fla biz eked out 0.1% gain.  And shipments up in Ark, Ida, Nev, Me and Vt too.  But Tex off 0.7%, Pennsy -4.6% and NJ down 4.2%.  Big midwest mkts takin’ hits too: Ill (-2.4%), Oh (-2.1%) and Wisc (-1.9%).  Those 6 states combined shed 1 mil bbls, 2.2% Jan-Oct. 

BI economist Lester Jones also includes running 12-mo trends across the states.  If you go back to early 2009, there’s only been one sustained period of gain since then: May 2012 thru Apr 2013.  Otherwise, virtually all of the bars are in negative territory on running 12-mo basis.  For 12 mos thru Oct 13, trend is -0.9%.  Since Jul, trend has fluctuated between -0.7% and -1.4%  

Beer volume dropped 5.7% last 4 weeks thru Nov 23 in Nielsen all-outlet data.  Can’t make too much of such a short-term drop, especially since most if not all of slip based on timing shift of Thanksgiving to 1 week later.  (Last yr it fell on the 22d and this yr on the 28^th.)  So next available data set should be quite a bit better.   In this latest 4 weeks, even craft slowed to a 2% gain, while premiums down 9% and subpremiums down 6%.

Beer biz had been flat in prior 4 weeks thru Oct 26 in Nielsen.  While it’s worth noting (again) that beer trends overall have softened some this fall, still lotsa noise in Nov number.  An exec at one supplier said when you add up the week before and the week after Thanksgiving, those 2 weeks for his co pretty much on same trend as YTD.  A large MC distrib also called trends “mixed” but similar to yr-to-date, maybe even slightly better if you factor in 1 less selling day.  Recall, there was one less sell day in Nov. 

Interesting to note too that overall holiday sales of all goods at retail down nearly 3% over Thanksgiving weekend, according to Natl Retail Federation.  Down for the 1^st time in at least 7 yrs, noted Wall St Jnl on front page, even tho chains like Wal-Mart and Macy’s kicked off  weekend on Thursday with big discounts.  Major theme in WSJ and other reports: consumers are still stressed out.  Hopefully, it gets better from here. 

 “Law enforcement data shows the worst predictions of opponents” to liquor privatization in Wash state “have not materialized.”  So claims free-mkt think tank Wash Policy Center after reviewing some alc-related harm stats.  Public health advocates and other privatization foes “said privatization would lead to an increase in alcohol-related arrests,” WPC reminded, noting: “It hasn’t.”  For example, DUI collisions, which had been trending down, continued to do so, from 2,861 in 2008-2009 to 2,347 in 2012-13. (Private sales of liquor started in June 2012.)  DUI arrests fell as well, from over 21K each yr 2008-2012 to below 20K in most recent period.  Similarly, arrests for open containers, minors in possession and selling liquor to minors all continued to fall after privatization.  Then too, compliance rates – refusing sales to minors – are approx the same for private biz as they were for state stores, over 90%.  Finally, “though concerns have been expressed about minors stealing liquor at private stores, hard data does not exist to document the extent of any problem,” according to WPC.  Yet, while opponents “may have exaggerated” potential safety negatives, WPC points out, looks like supporters “underestimated” revs that would go to state.  WPC blames sky-high Wash taxes for that and suggests legislators reconsider taxes and fees. 

Has beer taken a knock in Wash with liquor much more widely available?  For calendar yr 2012, beer volume up 1%, slightly behind natl trend, but that followed 2-yr decline when taxes on big brewers jumped in 2010.  Yr-to-date thru Aug ’13, Wash beer volume up 0.6%, state reports, outperforming natl trend.        

We wish all of our subscribers a Happy Thanksgiving!

One round of talks ended after 3 weeks with a “couple of unresolved issues,” Teamsters Local 6 Principal officer Ron Shy told St Lou tv station KMOX late last week, tho he also described talks as “professional and well-mannered.”  Natl union talks begin next Monday Dec 2.  AB told distribs last week that talks are progressing well, but that just-in-case,  it had plans to boost distribs inventories in Jan to nearly 30 days, but will give distribs a day of credit for each extra day of inventory over 15 that they take on.