Long-anticipated and angst-creating Amazon entrée into alc bev retailing in wake of its purchase of Whole Foods hasn’t really gone big-time yet.  But steps have been taken.  Latest: Amazon recently applied for liquor store license in San Francisco, reports Business Insider and Mercury News.  Application before state and city officials calls for small, 200-square foot store to be open from 8 AM to 4 PM daily to sell beer, wine and liquor.  But real plan is to use storefront, sited at Amazon’s warehouse in city, to “deliver alcohol to Prime Now customers in San Francisco.”  Amazon’s two-hour Prime Now service already offers alc bevs in Chicago, Dallas, LA, two NYC boroughs, St Lou, Washington DC and several other cities, Biz Insider points out.  

In other Amazon news, Travis Gibbons grabbed the Public Policy position for which Amazon posted a job search back in April, as it sought to beef up its alcohol policy expertise.  Travis knows alcohol policy.  He was Sr Director of Health Policy and Regulatory Affairs for Beer Inst from Apr 2017 thru Jun 2019.     

 Consumer price index for beer surged to +2.6% in Jul vs Jul 2018, per latest gov’t stats. CPI for beer has been up over 2% in 3 separate months so far in 2019 after not getting above that mark prior 15 months. Beer prices outpaced 1.8% increase for All Items in Jul as well as solid 2.4% increase for spirits prices and 1.6% gain for wine.  YTD thru Jul, CPI for beer is up 2.1%, compared to 1.8% increase for All Items and just behind 2.2% spirits gain.  CPI for wine up 1.2% Jan-Jul.

Nielsen all-outlet scans strong again for latest 4-wk period thru Aug 3.  Volume +1.8% and $$ up 5.3%.  That drove volume back into the plus column yr-to-date, +0.1% and $$ +2.7%.  How much is seltzer driving the positive change?  FMB volume +42.4% in most recent period vs +26.5% yr-to-date.  FMBs grabbed additional 3.6 mil case-equivalents for 4 wks while industry up 2.3 mil cases.  Mike’s actually up 80% for 4 wks.  Truly-driven Boston gain was 32.3%.  And Diageo Beer Co posted a 20% increase.  Craft flipped back to positive territory, tho up just 0.7% for 4 wks; still off slightly YTD.  Above premium now approaching 4 share gain; +3.6 share of volume for 4 wks to 41.4, +3.7 share of $$ to 54.3.

Constellation up 10%+ for 4 wks and yr-to-date.  AB and MC each off about 2% for 4 wks, MC trend an improvement from -3.5% YTD while AB on basically same pace both periods (-2.2/2.3%).  Miller Lite and Coors Banquet each up 1% for 4 wks, sole gainers among top-10 premium brands.  No improvement in Bud Light trend (-7.5% YTD); slight improvement for Coors Light (-3% for 4 wks vs -4.6% YTD).   Pabst and HUSA still down low-doubles, mid-singles respectively.  Nice reversal at FIFCO tho, +1.9% for 4 wks vs

-2.3% YTD.  Similarly, Sierra Nevada jumped 8.6% for 4 wks, vs -2% YTD.  New Belgium up almost 9% for 4 weeks too.

Boston Beer is officially upping its hard seltzer marketing game with natl Truly ad campaign starring actor/comedian Keegan-Michael Key launching today, co announced and AdAge reported. Five 15-second spots, Car Wash, Candle, Thirst, BBQ, and Chair, “go squarely after the beer, wine, and spirits categories,” wrote AdAge, comically enlisting new uses for them such as watering plants with light beer and polishing furniture with 12-year scotch. Now folks can “drink what you Truly want,” per tagline. Other spots show Keegan-Michael Key cleaning car tires with vodka, dumping a bottle of wine to use as a candle holder and pouring whiskey on a grill as lighter fluid. Ads will air across cable networks, online video and social media, focused on NFL, Bravo, Hulu, Instagram and YouTube, AdAge detailed.

Notably, this is Boston’s 3d straight ad campaign with competitive messaging under direction of new CMO Lesya Lysyj, hired in late March. New Sam 76 ads jab at domestic lagers with tagline: “finally, a refreshing lager that you can taste” (see June 26 issue of sibling pub Craft Brew News). And Sam Summer Ale new ad takes shot at Corona limes, opening with “anyone can stick a lime in a beer. At Sam Adams we brew with lime. Plus lemon, orange zest, summer wheat and grains of paradise for a new lighter and brighter summer ale” (see Jul 2 issue of Craft Brew News).

“We see a huge opportunity to grow Truly because, believe it or not, Truly is bigger than major beer brands like Stella Artois and Blue Moon, yet [only] four percent of households have purchased hard seltzer,” stated Lesya citing 4-wk IRI data thru Jul 28 and Nielsen 52-wk data. “There is real truth in our message,” Lesya told AdAge separately. “It is actually what people are saying and what they are doing; they are switching from their old drink.” Interestingly, Keegan-Michael Key and his wife Elisa wrote the ads themselves. “Sometimes [using] a celebrity isn’t a great idea, but in this case I think it is,” Lesya added.

Recall, Mike’s Hard Lemonade Co upped White Claw’s marketing spend to $25 mil this yr, including natl campaign with more targeted approach to join “the conversation where they want us,” svp of marketing Sanjiv Gajiwala shared at Beer Insights Spring Conference in May (see May 20 issue). And AB’s rebranded Bon & Viv spiked seltzer planned to spend $19 mil including expensive Super Bowl ads. Yet White Claw and Truly are running away with the hard seltzer show, collectively making up 84 share of all hard seltzer sales in Nielsen All Outlet. White Claw has been the dominant brand with nearly 55 share of segment $$ YTD thru Jul 27 and still gaining. Truly holding onto roughly 29 share in off-prem scans (tho lookin’ to jump ahead on-prem with natl launch of Truly draft). Bon & Viv in 3rd with 7 share, lost 6 share of hard seltzers YTD. Will be interesting to see how these share dynamics shift as AB brings its Natty disruptor into the mix, leading cos up their marketing games and several smaller players continue to enter the space.

AB “dropping a bomb on the seltzer aisle” a little sooner than initially expected, officially launching Natural Light Seltzer today, Aug 12, co announced. Recall, Natty Light Seltzer planned for Sep 23 launch, according to early sell sheet obtained by INSIGHTS (see Jun 4 issue), but now will be available in time for key Labor Day holiday. Natty Light Seltzer launching in two flavors, Black Cherry Lime and Mango Peach, clocking in at 6% ABV and 135 calories, “priced at roughly 80% of the cost of the leading brand(s) in the category,” co shared.  “This is a product that comes in to disrupt the segment,” said AB vp of mktg for core and value brands, Ricardo Marques. “That’s what we’re setting up for” as there’s “a gap there to be addressed.” “Vision is to replicate the success we’ve seen with Naturdays” and “bring that back into the seltzer category.”

Priced Much Higher than Rest of Natty Portfolio; Viewed as “Entirely Different Category” Gotta note, 80 index to White Claw and Truly is still well above typical Natty pricing. White Claw and Truly brand families avg prices are $33 and $31 per case YTD in Nielsen All Outlet data, with variety pks in the $30-31/case range. Suggests Natty Seltzers will fall in $24-26/case range (more likely on the lower end). Natty’s other offerings tend to fall between $15-16 per case, such as Natty Light ($15.51), Ice ($15.72) and Naturdays ($15.31). But hard seltzer viewed as “an entirely different category,” and Natty still bringing “value and affordability” to the segment, said Ricardo. Initially, Natty Seltzers will be sold in 12pk and 24pk cans as well as single-serve 25oz cans.

Then too, AB went with higher ABV and calorie count vs avg of 4-5% ABV and 100 calories or less as a point of differentiation, said Ricardo. Recall, AB specifically moved away from 6% ABV on rebranded Bon & Viv spiked seltzer to just 4% ABV. And Constellation ultimately discontinued Svedka hard seltzer brand after reformulating to 6% ABV (see last issue). So far, hard seltzer proposition has thrived most of all in lower ranges touting “better-for-you” attributes.

Natty Seltzer Will Get “The Natural Light Marketing Playbook,” Lots of Social Media Natty Seltzer brand names, “Catalina Lime Mixer” and “Aloha Beaches,” both reference lines from well-known comedy movies, Step Brothers and Forgetting Sarah Marshall. AB lookin’ to capture “tone and personality” of Natty Light branding and “pop culture references” tied in with that tone, Ricardo acknowledged. It will get “the Natural Light marketing playbook” level of support, which primarily includes social media in “disruptive and different” way. “That’s what makes Naturdays successful” and Natty Light among “top-5” brands in “share of mention,” he added.

Bon & Viv Not Cuttin’ It On Its Own? Remains to be seen how Natty Seltzer will affect AB’s already established Bon & Viv spiked seltzer brand going forward. Bon & Viv is solidly #3 brand family in hard seltzer, but it’s lost a lot of ground in the space since AB bought the original Spiked Seltzer. In a way, Natty Seltzer seems like an acknowledgement that Bon & Viv isn’t expected to gain that back on its own. So with AB playing catch-up in hottest segment there is these days, co is banking on Natty brand recognition and muscle to make fast impact.

Natty Family Back to Growth Across the Board in 2019 (Except Natty Rush) Natty brands are growing pretty much across the board in scans this yr, and $$ gains are outpacing volume gains. Lone exception is Natty Rush FMB line, collectively down 20% plus YTD thru Jul 14 in IRI multi-outlet + convenience data. Yet Naturdays launch more than makes up for Rush decline, already a top-100 brand sold nationally in IRI and among top-10 growth brands in all of beer YTD thru Jul 14. Then too, flagship Natty Light also a top-10 growth brand this year in terms of $$, up 4.5% and volume up 2% YTD. First time Natty Light’s been up in a decade, we estimate. Still a top-10 beer brand nationally. Natty Daddy Lager is keepin’ up double-digit pace, up 27%. And Natty Ice eking out 1% gain YTD.  Altogether, Natty family collectively up 8% by $$, gaining nearly 0.2 share of total beer to 3.9. Indeed, Natty is “playing the portfolio game,” and overall it’s “in a very good place right now,” said Ricardo.

2008 was a watershed year in US beer.  Industry shipments hit an all-time peak of 214.7 mil bbls.  InBev bought AB, the largest US beer deal ever.  The MillerCoors JV formed, the 2d-largest US beer deal ever.  Like the overall industry, both posted their highest-to-date shipments level.  A year earlier in 2007, Constellation consolidated the Modelo portfolio in the US.  The industry changed mightily in the aftermath of these deals.  Dig deeper into the past decade with the just-completed Ten Years After, the latest Beer Insights Special Report.  Ten Years After takes a broad view of key US beer industry data, revealing important shifts at both the national and state levels, reviewing the most impactful trends with quick-hitting text. Packed with data and exclusive analysis from the experienced editors at Beer Marketer’s INSIGHTS, Ten Years After: The Aftermath of 3 Huge Beer Biz Deals tracks a decade of big change in the US beer industry. Here’s sneak peek, just a fraction of all the great info in Ten Years After.

No other resource rounds up this hard-hitting information in one place. Order your PDF copy of Ten Years After now for just $200.  Please note: orders placed after 5 PM EST today will be filled Monday morn, Aug 12. 

Per usual, annual Gallup Poll of Americans’ drinking habits will have folks both nodding and scratching their heads.  Yet again, US drinking rate – Gallup asks adults age 18+ if they “have occasion to drink” – remarkably stable at 65%.  Believe it or not, that’s within 1-3 pts of what it was in 2009, 1999, 1988, 1978, and 1947!   Some things don’t change, regardless of how many others things do.  In sharp contrast, year-to-year bev choice sweepstakes shows volatility continues to reign.  When drinkers asked what they consume most often, long-term trends support shift from beer to spirits.  But spirits spiked from 19% in 2018 to 29% in 2019.  That’s after having fallen from 26% in 2017.  Howzzat happen?  Meanwhile, previous 5-yr avg for spirits preference was 22%.  Beer fell from averaging 42% in previous 5 yrs to 38% in 2019.  Wine dipped slightly to 32%.  Note too: these figures do not reflect each bev’s actual share of alcohol consumed.  In 2018, beer had 48 share, spirits 36 share and wine just 16 share based on shipments. 

One other constant about Gallup Poll (and all alc bev surveys): what people say about their drinking and what they actually do, and especially how much they drink, varies significantly.  Another big trend “change” in 2019 poll: percentage of those who say that had a drink in previous 24 hours plummeted from 39% in 2018 to 29% in 2019.  (Previous 5-yr avg: 36%.)  That would seem to support anecdotal reports that people are cutting back.  More likely: it supports notion that more people say they’re cutting back.  But just as drinking rate remarkably stable in US, avg consumption of absolute alcohol stable for decades in US too.  One more key measure shows you gotta take this poll with several grains of salt.  For last decade or more, avg consumption among drinkers when Gallup asked about how many drinks consumed over previous 7 days, was just 4 drinks.  Based on shipments/sales data, and Gallup report that about 2/3 of all adults drink, average American drinker consumes well over 2 drinks per day.

Here are a few more of the latest wild and crazy seltzer stats from the good folks at Nielsen: Seltzers climbed 163%, $118 ml to $190 mil for 4 weeks thru Jul 27. That’s 5.2 share of $$, almost double its 2.9 share of $$ yr-to-date.  And White Claw jumped to 56 share of segment in latest period (still up 224%), Boston Beer at 28 share (up a mere 152%).  Truly ad campaign coming soon with Michael Keegan Kay. Then too, Natty Light Seltzer already gaining more acceptance from chains than some expected in advance of launch; Winn Dixie corporate parent, Southeastern Grocers for example, already authorized it in 100% of stores, perhaps because it undercuts price less than expected.  Stay tuned.

Giant NYC beer distrib Manhattan Beer blew doors off in July, hitting all-time record of 5 mil cases in one mo, driven by weather, summer of seltzer and more. Some other NY metro distribs also hit all-time record mos, INSIGHTS hears.  Seltzers are changing trajectory for a lot of distribs this summer, selling big volume at high margin.  “What’s not to like?” said one.

Info starting to come in about Constellation’s price hikes this fall, now independent of what AB and MC are doing, since AB switched to spring increases.  And Constellation ain’t hesitating to move its prices up in many mkts, whether by front-line, discount reduction or a combo.  We hear price hikes in range of 2-2.5% across a number of mkts.  In FL, it’s mostly discount reduction, netting out to an over 2% increase starting 9/9.  But discount reductions improve wholesaler margins too.