Beer Marketer's Insights
Craft Declines in Nielsen xAOC Tuffest in Midwest & Pacific Regions; Best in Mountain & Mid Atlantic
While craft beer $$ declined 2% YTD thru Jul 1 in natl Nielsen xAOC channels, a couple key regions dragged craft segment further than others. Both East North Central and West North Central regions saw craft $$ sales slip 4% and craft $$ dipped 3% in Pacific region Nielsen xAOC channels YTD. West South Central craft declined 1.9%, in line with natl avg. And craft outperformed natl trend in all other regions with Mountain region (-0.1%) and Middle Atlantic (-0.2%) posting best trends of the bunch, East South Central and New England each down 0.7%, South Atlantic -1.3%.
Australian parent of alc-alternative player Sans Drinks has gone into voluntary administration, tho founder Irene Falcone insisted to local news outlet 7News that it's no more than a "simple restructuring." Bevco operating as Non Alcoholic Drinks Co went into administration on Jul 17, per documents filed with Australian Securities & Investments Commission that 7News cited.
Yakult USA, arm of Japanese probiotic bev giant Yakult Honsha, plans to build $305 mil plant in Cartersville, Ga, that will exceed in size its Fountain Valley, Calif, plant, per info from Gov Brian Kemp's office. Planned for industrial park that's 45 minutes NW of Atlanta, it will support eastern and central US markets when it opens in 2026, said Yakult prexy/ceo Yutaka Misumi. The Construction Broadsheet noted that opening announcement in 2014 of Calif plant indicated that site had building area of 63,500 sq ft and floor space of 76K. Yakult is best known for yogurt-like sweetened probiotic milk bev fermented with bacteria strain Lacticaseibacillus paracasei Shirota and sold in small plastic bottles.
For Electrolit sports hydration brand that's been enjoying 40-50% growth - and sometimes spikes of 80-90% - Christian Patino Webb would have to rate first year on the job as ceo as a disappointing one. In post-Covid inflationary environment, most players have been content to take price increases and suffer volume declines, and even Electrolit's double-digit growth, both in US and globally, is off the pace the Pisa Pharmaceuticals brand envisioned. Still, Electrolit, Prime and Gatorade have been the only major brands that are winning share, and his team takes heart from the fact that key drivers of health and performance haven't waned, not just in US/Canada but in brand's other markets in Latin America and Europe. So co is sticking to its game plan as it continues to build ACV, fills out its DSD distribution network, implements progressively more sophisticated marketing support and enjoys the seasonal lift that summer brings. They're also readying powdered format for launch. Nielsen scans reported by Goldman Sachs show the brand to have scored 26% gain in 52-wk sales to $328 mil, tho growth has decelerated to 17% over 12 wks, 10% over 4 wks and 4% over 2 wks.
Total bev sales growth accelerated to +6.6% in Q2, based on Goldman Sachs' Beverage Bytes survey that reps responses from execs representing ~36K stores across US that account for ~24% of c-store channel. Gains are "likely reflecting the continued wraparound benefit of price increases taken across the beverage industry and resilient underlying demand," wrote Bonnie Herzog. That solid growth offset a 1% dip in foot traffic. Sales were up same 6.6% over July 4th weekend based on survey. Non-alc sales were a bit stronger, up 7% over holiday weekend.
Industry & Others Send Mixed Messages to TTB on Trade Practices, Pleading for More & Less
In the 8 mos since asking the public how it might update federal trade practice rules - last revised 20+ yrs ago - to better reflect the modern mkt, the TTB received comments ranging from 5 words to 38 pages, covering at least as wide a range of speakers, messages and relevancy. Some sought to spur the agency into action, while others urged it to hold its horses with thinly veiled threats of litigation over potential perceived oversteps. Comments cover a wide range of conduct, too. But 3 major mkt shifts, developing over decades or popping up in a big way in just the last few yrs, received special attention: the power of major retailers, the expansion of digital alc bev mkts and the entrance of big non-alc players. However, each requires regulating powerful players not contemplated by the Fed Alcohol Admin Act, the 1935 law forming the statutory basis for TTB's purview over trade practices. And that's no small challenge to the agency's next steps.
Coca-Cola could soon become much more involved with strategy & mktg of its alc bev brands. Co set up separate subsidiary Red Tree Beverages late last yr, designed to firewall that biz from its nonalc ops as Coke seeks to amplify support of its crossover products, Beverage Digest first reported last Fri. Intriguingly, Red Tree received federal TTB wholesaler basic permit for an Atlanta office, INSIGHTS found. But Coke sez permit will minimize regulatory risk and allow it to ramp up involvement (while maintaining 3rd-party partners), claiming no desire to set up its own alc distribution arm.
STZ Biz Heating Up w/ Lotsa Background Action: New E-Comm Standards, Activist Investor, Canopy Mess
It's been a jampacked few weeks for Constellation. Co reported fiscal Q1 results, formed agreement with activist investor group and appointed new board members after Rob Sands announced retirement, battled and won in 9th circuit ct, saw continued unraveling of Canopy Growth and communicated to Gold Network on "prohibited" e-comm platforms. That's as Modelo Especial sales keep soaring to new heights. Its $$ were ~$50 mil ahead of Bud Light in Q2 scans as Bud Light's YTD lead continues to narrow. STZ beer biz continues to pick up pace in July scans too, including massive July 4 holiday period with Modelo family +27%, Corona beer family +8%, Pacifico +38% for 2 wks thru July 9 in Circana multi-outlet + convenience data. Total STZ beer $$ sales grew 13%, volume up 9% YTD thru July 9. And STZ ceo Bill Newlands foresees further oppy to gain shelf space this fall amid Bud Light fallout, he reiterated on co's earnings call. (Here more from Bill at Nov 13 Beer Insights Seminar in NYC.
Even with a better week for total beer and the Bud Light brand, Bud Light volume was still down 24% for 1 wk thru Jul 9 in Circana multi-outlet + convenience data. Down 29% latest 4 weeks. Several months into crisis, Bud Light still down over 30% in some recent weeks. For 13 weeks, its volume down 27%. So the staggering losses continue. For 4 weeks, total AB volume down 15.4% and for 13 weeks, down 15%, while total beer biz down 2.4%, Molson Coors and Constellation volume each up 11% same period. Terrible trends already locked in for half of peak-selling season. AB has not so far "seized the summer" as it aimed to do at distrib meeting in May.
9th Circuit Rules in STZ Favor; Vacates Olympic Eagle Prelim Injunction; Can Terminate w/o Cause
Just 11 days after hearing arguments from Constellation and Olympic Eagle attys, 9th Circuit Ct of Appeals ruled in Constellation's favor, vacating preliminary injunction and opening door for co to terminate Olympic Eagle without cause. "We vacate the preliminary injunction on the ground that Plaintiff has not shown a likelihood of success on the merits, and we remand," judges wrote. Indeed, judges clearly leaned in favor of STZ's arguments thruout hearing on Jul 10 and now make it official with ruling. Now case gets sent back to WA fed ct, and STZ is expected to send new 60-day termination notice ASAP, as STZ atty shared during hearing. Columbia Dist is lined up to buy STZ rights from Olympic Eagle after all following fallout with NBWA for siding with Olympic Eagle in this case.

