Beer Marketer's Insights
Avg pricing remains high, up double-digits in every non-alc beverage segment except energy drinks for 4 wks thru Mar 25, per NielsenIQ data reported by Goldman Sachs. With high pricing, volume trends worsened in each category over those 4 wks.
Ron Sarasin, president of Natl Beer Wholesalers Association from 1990-2000, and a former US Congressman from Connecticut, passed away at 88. Ron really professionalized NBWA as a Washington DC association in his decade as president. And he hired many of its key long-term personnel, including current president Craig Purser, former president David Rehr, and senior executives Patti Rouzie, Laurie Knight and Linda Auglis. That's a pretty strong track record.
Neither Health Benefits Nor Risks Associated with Up to 2-3 Drinks Per Day, New Analysis Shows
As a group of researchers set out to once and for all dispel the notion that a coupla drinks a day isn't good for your health, they also showed that it probably isn't that bad for you either. As expected, they "did not find significantly reduced risk of all-cause mortality associated with low-volume alcohol consumption," or up to around 2 drinks per day, according to a study published late last wk in the Journal of the American Medical Assn's free Network Open database. But they also found that "daily low or moderate alcohol intake," or up to 3 drinks/day, "was not significantly associated with all-cause mortality risk," either. Risk for women does become statistically significant around 2 drinks/day, while it's over 3 drinks/day for men, the study found.
Heineken USA chief sales officer Jim Sloan sent distribs a bare-bones notice that co has made "difficult decision to eliminate non-core SKUs marked as 'exceeding allocation amounts.' This will ensure a continuous supply of our core packs and regular, reliable product deliveries moving forward." HUSA invoked "worldwide supply chain challenges over the last two years" which "have created inventory issues throughout the US and ultimately impacted our ability to fulfill product orders on a regular basis."
Despite tuffer trends in Mar, beer continued to gain share of total alc bev $$ in IRI multi-outlet + convenience channels thruout the first 3 mos of 2023. Beer $$ grew 3% for 12 wks ending Mar 26 compared to total alc bev $$ up just 2.2%. So beer gained 0.5 share of alc bev $$ to 62.7 in Q1 scans (excluding liquor channel). Yet $$ gains were entirely driven by 6% avg price increase as volume slipped 3% for 12 wks. Spirits continued to outpace beer with $$ up 5.7% for 12 wks, volume up 5.4% and avg price/case up just 0.3%. Gained 0.54 share of alc bevs to 16 total. And wine remained extra soft with $$ down 2.6%. Lost 1 full share of alc bev $$ to 21.3.
Just a handful of years after opening the Guinness Open Gate Brewery in Maryland, parent co Diageo will shut down its larger-scale brewing operation and lay off 97 employees this spring at an adjacent production facility in Relay, MD, Baltimore Biz Journal first reported and co confirmed with INSIGHTS. On Friday, Diageo notified Baltimore County of its plans to close the plant and lay off 108 workers, tho co anticipates 97 roles to be impacted.
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Thru decades of funding from AB and its wholesalers, Bud Light has been a marquee sponsor of both major league sports and LGBTQ+ Pride events. But these days, spreading the wealth can be akin to a high-stakes tightrope walk. Over the weekend, transgender social media star Dylan Mulvaney revealed Bud Light as one of the latest brands to shower her in sponsorship dollars in an Instagram post. It promotes the brand's Easy Carry Contest, riffing on early yr ad of woman carrying 5 pints of Bud Light, and features an image of one-off can the co sent Mulvaney with her face on it. Conservative pundits quickly picked up the post, stirring up their social media followers to boycott the brand for "going woke." Not to be outdone, liberal followers accused the co of sponsoring a trans activist with one hand while funding anti-trans legislators with the other.
Sales from Innovation Down 25% For 52 Wks Thru Feb 25; Total Beer Sales Up 3.5%, per NielsenIQ
While beer innovation remains inefficient, it's also declining vs prior years. Sales from beer category innovation dropped 24.8% for 52 wks thru Feb 25 vs yr ago, at same time as total beer $$ grew 3.5%, per NielsenIQ off-prem analysis (using slightly different metrics than BWC). Innovation accounted for 1.4% of total beer sales. But that's down from 1.9% contribution in prior 52 wks ended Feb 2022. With #1 beer innovation co in recent yrs, AB, making concerted effort to focus on existing core brands in 2023 (among others), beer biz could be in for another year of less $$ from innovation.
Beer's Flawed "Innovation Efficiency" on Blast in BWC Monthly Update; Slowest Spring Reset Yet?
Beer biz has an inefficient track record when it comes to innovation, latest Bump Williams Consulting monthly update highlights. Total of 3,309 new "brands" (including new packages and items for existing brands) collectively accounted for just 1.2% of total beer $$ sales but 12.6% of total brands in tracked Nielsen off-prem data for the latest 52 wks thru Feb 25, 2023; $605 mil outta $48.6 bil total. The splits vary by segment, with FMBs and cider outperforming other segments while craft and hard seltzer "remain some of the most egregious offenders." But "none of the ratios ever come close to a very efficient mix."