Dear Client:
It ain’t happening. Yet.
Back in the economic crises of 2001 and 2008, economy/budget beer really started to kick it up a notch. In this crash, which is much worse, particularly now as federal government subsidy checks dry up, the economy segment is curiously not only still losing share, but its rate of share loss is actually increasing, in latest scan data.
Budget beer’s dollar share is down 0.7 points YTD in the latest Nielsen all outlet scans to August 1, but down 0.9 in the latest four weeks.
Of the top 10 economy brands in Nielsen, only three are growing dollars:
- Busch Light, up 15.5% for the four weeks, and up 17.5% YTD
- Natty Light, up 3.3% for the four weeks, and up 4.3% YTD
- And Pabst Blue Ribbon, up 3.9% for the four weeks and up 2.6% YTD
However, importantly, none of them are growing dollar share…
- PBR’s share is down 0.1 points for the four weeks and YTD
- Natty Light’s share is down 0.2 for the four weeks and down 0.3 YTD
- And Busch Light is flat in share for the four weeks and YTD
Even the big economy “Ice” brands are all down, which one may consider to be the go-to in times like these (more bang for your buck).
- Bud Ice, the biggest of the bunch, is down 10% for the four weeks and down 4.5% YTD. It’s also losing 0.2 dollar for the four weeks and YTD. (Every breath you take, every step you make, I’ll be watching you Bud Ice).
- The next biggest, Natty Ice, isn’t down as deep, but still moving in the wrong direction, down 2.6% for the four weeks compared to -0.4% YTD. The brand is also down 0.1 in dollar share for the four weeks and YTD.
- Milwaukee’s Best Ice is down 3.1% YTD, and down even deeper for the four weeks at -5.8%; it’s also losing 0.1 dollar share for the four week frame and YTD.
- And Keystone Ice really took a hit in the latest four weeks, down 26.3% in dollars, compared to its -6.2% trend YTD; and also losing dollar share down 0.1 in the latest four weeks.
OUR TAKE. What can we thank for this anomaly? Before last year, I always told our editors that whenever there is an anomaly in the sales data, the reason is nearly always: Price.
But these days virtually nobody is flagrantly discounting.
Nowadays, when there is an anomaly in the sales data, I say the reason is: Hard seltzers, which apparently draw enough demand that even cash-strapped consumers are saying, “Damn the torpedoes, full speed ahead,” and are picking up those variety packs. A brave new world.
MICHIGAN DOING ITS OWN THANG, AGAIN
There are three things you need to know about Michigan:
1. Their hot dogs are prepared with a meaty tomato-based sauce, followed by chopped onions, and a line of mustard. It’s absolutely delicious.
2. They have the most egregious bottle bill in the country at 10 cents a unit, and the redemption rate is over 95% (even though a good chunk of that comes from other states, naturally). It sucks.
3. They are good at passing extremely distributor-friendly laws. No opinion.
You may recall that Michigan passed a law in November basically saying, “Don’t tread on us.” In other words, quit shipping us inventory we don’t need (ironic now), and we won’t ship you back any inventory.
Well, come April after the pandemic shut down on-premise, Michigan retailers wanted the legal ability to have their kegs picked up by distributors, and so wholesalers pushed through another bill to allow that and to allow suppliers to pick up inventory as well, to keep it in line. A-B seemingly was on-board — at least verbally — according to sources.
Well now that the bill is passed, so far A-B has declined to accept the kegs from Michigan wholesalers. So we asked A-B about that.
A-B’S RESPONSE. “We’ve said throughout this crisis that we are prioritizing our people, our partners and our communities. In April, we announced several initiatives – including a keg buyback program — to support partners who’ve been particularly impacted by the restrictions designed to limit the spread of COVID-19. Unfortunately, when the program, was announced it was not allowed under Michigan law. The program has been inactive for several weeks.”
Ouch. What goes around, comes around. But this story ain’t over. Stay tuned.
PHILLIPS DISTILLING CO. NAMES ANDY ENGLAND AS NEW CEO
Remember Andy England, the former CMO of MilllerCoors? (Like I used to tell him: “You’re so British it’s overkill that your name is England.”)
Well, Minnesota-based Phillips Distilling Company has appointed Andy as CEO, effective August 10.
As most of you know, Andy has more than 30 years of experience under his belt across marketing, operations and general management, and 10 of these years he spent at MillerCoors as EVP and CMO. Most recently he was chief at National CineMedia.
At MillerCoors, Andy built new brand architecture, revamped the go-to-market approach for brands like Coors Light and Miller Lite, broadened the company’s reach in social and digital media, and created sponsorship deals with major sports franchises, per a release. His “success operating through a three-tier system and driving growth through distributor networks will be particularly relevant” to Phillips.
“After an extensive search, we are delighted to welcome Andy England as our new CEO,” says Phillips owner Brad Johnson. “We believe Andy’s established track record and breadth of business experience in expanding distribution while delivering growth and returns are critical to lead our business. His strategic leadership and proven ability to identify opportunities for development will ensure Phillips Distilling continues to be a leading innovator in the spirits industry.”
“The company’s focus on leading with innovation while continuing to grow its strong existing portfolio of spirits will allow me to build upon my past experience to help take the company to the next level,” adds Andy.
The Phillips Distilling portfolio includes UV Vodka, Prairie Organic Spirits, Revel Stoke Whiskies, Phillips Spirits, Trader Vic’s Rums, Douglas and Todd Small Batch Bourbon, and Tomatin Single Malt Scotch.
BEER BRIEFS:
The Brewers Association, after weeks of allegations from the Twitter-verse and others on the lack of diversity in the craft beer industry, has adopted a “Code of Conduct”, which includes such bromides as to not break the law (duh), drink responsibly (uhhh), and to embrace diversity (duh). Read it here>>
Until tomorrow,
Harry, Jenn and Jordan
“Speak the truth, but leave immediately after.”
– An old Slovenian proverb
———- Sell Day Calendar ———-
Today’s Sell Day: 8
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: 0
