Beer Marketer's Insights
PepsiCo will take a crack at energy from a new direction with launch of Starbucks Iced Energy even as it seeks to reinvigorate sluggish RTD tea segment with canned half & half line called Lipton Fusions. Its well-performing Propel hydration brand is adding an energy extension. And its struggling MTN Dew brand will undergo a makeover that drops the abbreviated form of "Mountain" as it does more to flag its mountainous roots as a Tenn mixer, with its founding date of 1948 now flagged on-pack.
Dozens of Congresspeople added to the pressure on a research panel aimed at informing alcohol guidance in the next edition of the Dietary Guidelines for Americans (DGA) yesterday. Concerned that the work by the Interagency Coordinating Committee on the Prevention of Underage Drinking (ICCPUD) is "duplicative" of separate work happening at the Natl Academies and that it is diverting the agency's attention "from its primary mission," letter signed by 113 US reps "requests a suspension of ICCPUD's activities on adult consumption at this time." The letter comes a week after chair of House oversight committee Rep James Comer formally subpoenaed info on the formation and activity of ICCPUD's research panel.
After Constellation beer sales slowed in July and Aug scans, each of co's top-4 beer brand families improved in Sep scan data. Modelo family $$ grew more than 6.5%, Corona family up 2%, Pacifico surged 28% and Victoria jumped 38% for 4 wks thru Sep 29 in Circana multi-outlet + convenience data. Notably, Corona beer fam is back to $$ growth with flattish volume after declining in recent mos, in line with execs' comments on earnings call late last week. And that's even as Corona Premier and Light remain soft. STZ's top 4 brand fams collectively grew more than 6% by $$ and nearly +5% by volume for 4 wks thru Sep 29.
Beer shipments dropped 4.5% in Aug as industry softened and shipments began to right-size with depletions, according to Beer Inst estimates. Yet drop wasn't quite as steep as some industry observers anticipated, as imports kept up impressive growth pace in Aug, albeit with some external factors at play.
Not a shock, given NBA phenom Victor Wembanyama's presence as an investor/endorser, but Barcode hydration brand has signed on as official performance drink of San Antonio Spurs, augmenting its prior ties to Miami Heat and Brooklyn Nets. The brand, recall, was created by former NBA trainer . . . NY-based Vita Coco coconut water is working that city's Marathon via alliance with tracking app Strava on a runner's challenge that will send as much as $26,200 to &Mother cause. It will send as much as another $25K to runners' marathon fundraising efforts, undertake a race day essentials giveaway, Marathon day cheer and sampling station, and post-race cocktail party .
Hoops superstar LeBron James hasn't only struggled to return his LA Lakers to their former hegemony. Some of his bev-related efforts have also proved to be a slog. Recall he invested some of his considerable prestige in a high-profile campaign behind Mtn Dew Rise energy drink only to see it derailed by a trademark challenge from coffee player Rise Brewing. Now it's looking as though the sports nutrition brand he launched with Arnold Schwarzenegger called Ladder has quietly gone by the boards, no pun intended. In recent weeks, consumers' queries on social media about brand's whereabouts have gone unanswered. "When will your protein powders be available for purchase?" asked one poster on Instagram, where Ladder boasts 119K followers. "It can't be bought from your website, and it is 'unavailable' on Amazon." Another plea: "What happened? No more products available for months."
Continuing the pattern of recent quarters, PepsiCo rode price increases to stable revenue performance despite suffering volume declines across most of its businesses in Q3 and eased back its full-year growth projections in uncertain consumer climate. Food biz, including Frito snacks, was soft. Revenues eased back 0.6% to $23.3 bil, operating profit sagged 3.6% to $3.9 bil and in their written prepared remarks issued this morning, chmn/CEO Ramon Laguarta and evp/CFO Jamie Caulfield moderated expectations for rest of year. "We expect consumers to remain choiceful and value conscious as the cumulative effects of inflationary pressures continue to impact budgets and spending patterns," they wrote. "Pockets of elevated geopolitical tension and macroeconomic pressure are also expected to persist in certain international markets. As a result, we will continue to take actions to stimulate growth through targeted investments in our brand, package, and channel offerings where better value, amplified advertising and more precise marketplace execution are needed." They now expect revenues to edge up in low-single-digits, not 4%. Still, in live q&a this morning, Laguarta assured listeners that "we believe in the long-term growth of both our snacks and beverage categories" so the modest increments seen lately shouldn't be viewed as representing any kind of permanent reset.
Several small but longstanding breweries are shutting down in coming weeks, including a couple in major metros that've seen upticks of late. In San Antonio, Busted Sandal Brewing announced plans to shutter all 3 of its locations over the next few wks after 11 yrs in biz. Co cited effects of inflation and said it "exhausted all avenues" to stay open, noting in social media post that "there are no more tricks up our sleeves and nothing in the immediate future that can turn this economy around and lower the burden on our customer's personal costs of housing, food and day to day life." It joins Weathered Souls among other San Antionio brewers to close in recent mos, with Alamo Beer also seeking investors to recapitalize.
Distribs Urged to Elevate Beer, Build Draft in Dynamic Times; Health, Hemp & More at NBWA
The beer and beverage industry moves at "whiplash pace" lately, NBWA prexy/CEO Craig Purser described while welcoming some 1,800 industry members to San Diego last Monday for org's annual convention. But distribs can be the "steady, reliable engine that keeps things moving" amid all the constant change, he suggested. "Change has never been this fast, and it will probably never be this slow again," Heineken USA CEO Maggie Timoney commented the next day, echoing the sentiment.
A handful of brews that debuted in Allagash's taproom will graduate to co's year-round lineup in 2025 starting with broader distribution in core Northeast mkts, ME, NH, VT, MA, NY, PA, CT, RI, and NJ, co shared. Allagash Hazy IPA first hit the taproom in Jul 2024 and will be available on draft and 6pk cans thruout the Northeast starting in early 2025. Allagash Lager is "the brewery's take on a classic pilsner," brewed with locally sourced malt from New England, available on draft and in 6- and 12-pk cans starting in NY, MA and ME this mo followed by full Northeast footprint in Nov. It first debuted at the taproom in Aug 2024. After launching taproom-only release of its first-ever non-alc in Jun, Allagash Hop Water 6pks will be available thruout the Northeast "in time for Dry January," co shared. Allagash is launching its "first-ever year-round Variety Pack" (our emphasis), a 12-pk 12oz can pack featuring flagship Allagash White, new Allagash Lager and Hazy IPA, plus Allagash Tripel "for the first time ever in cans." And co's bringing back its House series seasonal lineup with Ski House winter white ale brewed with ginger this winter, plus the returns of Surf House lager next spring/summer and Haunted House hoppy dark ale next fall.