Big Beer is getting smaller.
New figures out of the United States show that some of the continent’s most familiar brands are over a barrel. Budweiser, Miller, Michelob Lite, and Heineken all lost significant market share in recent years as promiscuous consumers took their thirst elsewhere.
Sales of nine top brands, taken together, dropped a remarkable 25 per cent in volume between 2007 and 2012 in the United States versus a 2.3-per-cent dip for the overall beer market, according to Beer Marketer’s Insights, a Suffern, N.Y.-based trade newsletter that tracks the market. Chief among the losers was one-time powerhouse Budweiser, the self-styled “King of Beers.” At one time the No. 1 brew in America but now in third place, Bud retreated by 6.8 million barrels, or 796 million litres, in the period, a 28.8-per-cent plunge.
Not that the general downward trajectory of mainstream beer has been a secret. But the release last month of detailed brand figures, normally kept under wraps by brewers (especially in Canada, where no reliable corresponding figures exist), drove home just how fickle Joe Sixpack has become. Loyalty to the megabrands is going the way of the stubby.
“Nine beers Americans no longer drink” declared the headline in 24/7 Wall Street, an online magazine that was first to publish the figures and to rank brands based on their percentage volume drop. It was a click-bait exaggeration, of course, but it sure drew attention, not least from a few agitated brewers.
“You’re going to get me in more hot water, thank you very much,” Eric Shepard, Beer Marketer’s Insights’ executive editor, facetiously remarked when I called him to verify the stats. He said National American Breweries, U.S. distributor of Labatt Blue, was an especially unhappy camper.
For the record, here is 24/7’s full list, in order of percentage decline: Michelob Light (69.6 per cent); Budweiser Select (61.5); Milwaukee’s Best Premium (58.5); Miller Genuine Draft (56.4); Old Milwaukee (54); Milwaukee’s Best Light (39.7); Heineken Premium Light (36.7); Budweiser (28.8); and Labatt Blue (28.3).
When viewed in absolute-volume terms, however, the rankings seem even more startling, I think. According to Shepard, the biggest losses from 2007 to 2012 were, in order: Budweiser (down 796 million litres); Miller Lite (421 million); Bud Light (310 million); and Miller Genuine Draft (210 million). In a three-way tie for fifth, with more than 100 million litres, were Natural Light, Corona and Heineken.
Talk about trouble among the dominant brands. It’s almost starting to look like Detroit’s Big Three circa 1980.
Brewers blame the recession, of course. And that’s a fair point. Shepard says the economy disproportionately impacted blue-collar working stiffs – mainstream beer’s core drinker – more than your typical Baltic-porter craft-brew aficionado. But that’s not half the story. Shepard cites a new generation of independent-minded young drinkers for much of the big-brand collapse. “Millennials are, I think, clearly more promiscuous in brand choice and beverage choice.”
Some of those drinkers bailed to alternative mainstream brews, such as once-dowdy but now hipster-chic Pabst Blue Ribbon, one of the success stories of 2007 to 2012, along with Coors Light, Modelo Especial and Blue Moon. Some consumers took to fashionable, sweet cider, while many increasingly chose wine.
Wine’s growing appeal has represented an especially acute problem for brewers in Canada. Between 2001 and 2012 in this country, wine grew in value from 23 per cent of the alcoholic-beverage market to 30 per cent, according to Statistics Canada. Meanwhile beer slid from 50 to 45 per cent.
Spirits, too, especially flavoured vodkas and rums, did damage in both the United States and Canada. That’s why brewers have lately been expanding the flavoured-beer lineup with malt-based beverages masquerading as cocktails. As in the successful new Bud Light Lime-A-Rita, an 8-per-cent-alcohol riff on the tequila-spiked margarita.
“There’s a lot of exciting things happening in the beer category and a lot of innovation taking place,” said Luke Harford, president of Beer Canada, a trade association representing 26 companies that account for 90 per cent of beer brewed in this country. Harford notes there were 400 unique brands available in Canada in 1990. Today the number’s well over 2,000 when limited-run seasonal products and craft brews are included. “People like to talk about [the market] as flat. It’s flat but very vibrant.”
Amid the shifting sands, though, one thing remains more or less constant. “Beer has not figured out really how to appeal to women in great part,” Shepard said. He cited statistics from a U.S. market-research firm showing that 56 per cent of men drank beer in 2012 while just 33 per cent of women defined themselves as beer drinkers. “For spirits it was 44 per cent and 42 per cent,” respectively, he said. “I think that’s remarkably telling. It’s a fairly significant headwind.”
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Beppi Crosariol’s new ebook, Ask A Wine Expert: 101 Things We All Want To Know, is free to Globe and Mail subscribers and can be downloaded at tgam.ca/ebooks. His new hardcover cookbook, The Flavour Principle, co-authored with Lucy Waverman, is in bookstores everywhere, published by HarperCollins.