Large Pack, Value, Trusted and Non-Promoted Brands: The Four Key Shifts

Dear Client: 

IRI Principal – Client Insights Patrick Livingston shared with BBD the four key consumer bev alc shifts they’re seeing in the current era: the switch to large packs, value, trusted brands, and unpromoted beverages (i.e., full price).

We’ve been covering those themes, but seeing them borne out in IRI data is illuminating. 

LARGE PACKS – EVEN 24s, 30s — GOING GANGBUSTERS. For example, large beer packs – those 12 packs and above – have risen to almost 72 dollar share of beer in the three weeks to 3/22, vs. the 68.4 share baseline they saw YTD to 3/1, Patrick said. That’s much more pronounced in channels like liquor and c-stores. 

But here’s the “holy sh*t” slide on that: Beer 12 packs (already a top volume package) have gone from being up 13% prior to COVID trends (again, YTD to 3/1), to up 36% in the three weeks to 3/22. 

But large pack configurations like 24 packs, up 7% prior to COVID, are now up almost 50% in the latest three weeks. 

And 30 packs, for which we don’t even have a growth measure prior to COVID era (it wasn’t a top grower) are up 40%. Singles and 6-packs are up single digits. 

Does this mean the end of premiumization? Heck no. In fact, that’s still helping to drive total beer growth. In the COVID era, we’re simply in a time of further polarizing “both, and” buying patterns. 

POLARIZED VALUE TRENDS. Consider that both high end and sub premium beer are up way higher than their pre-COVID patterns. High end beer was up 14.6% YTD, prior to the latest three weeks. In the three weeks to 3/22, its growth trend more than doubled, to up almost 32%, per Patrick’s insights. 

Sub-premiums were down 2.5% prior to the last 3 weeks. But in the most recent three weeks, they’re up 11.5%. 

IRI noted there is a bit of a downward pressure on beer price mix shift.

A MAJOR SHIFT TO TRUSTED BRANDS. Another major trend: Consumers buying giant brands, some of which had previously fallen into flat or down trends. Not now, people want what they know.

In fact, the top 15 growth brands in the last three weeks include a bevy of premium brands that couldn’t have touched that list before. 

Pre-Covid 19, FMB/seltzer and imports (mostly Constellation) dominated that list. Now? White Claw is still no. 1, but no. 2 and 3 have switched, such that Michelob Ultra is now growing faster than Modelo. 

Beyond that the top growers list sees a sea change, with  Bud Light (up 7.2%), Coors (up almost 16%), Miller Lite (up almost 19%), and Busch (up 22%) hitting the list. New brands Bud Light Seltzer and Corona Seltzer made the list, also. 

PROMOTED VOLUME DROPS. And finally, sales on “merch” have been reduced. “The large beer package percentage of volume sold on promotion pre-COVID was 42%,” while in the post-COVID impact era it has fallen to 28%. 


As we’ve been saying, the psyche of COVID shutdowns will last long after we’re free to move about the public. 

IRI data supports this. “About half of consumers expect COVID-19 outbreak to last more than 3 months and are preparing for prolonged impact and lasting adjustment in habits and behavior,” per its grocery shopper consumer panel done 3/20-22. 

Another key finding: Consumers may still feel uneasy when social distancing is eased. 

“When COVID-19 starts to improve and social distancing is eased,” more than 50% of respondents in a Datassential survey in March indicated they would not feel comfortable eating at a restaurant. Another 69%-70% indicated they wouldn’t be totally at ease going to bars, or attending concerts or sporting events.  

DISTINCT SHOPPING PHASES. More tomorrow about current market dynamics and consumer buying habits. IRI Principal – Client Insights Patrick Livington shared three distinct shopping phases we can expect to see over the next few months, each with different consumer purchasing and product growth patterns: Stock Up (which has already peaked), Replenishment (which we may have started to enter), and Recovered (which may be a long way off). 


As the second largest brewer in the world, it should come as no surprise that Heineken has taken a hit from COVID-19.

The outbreak “is having a significant impact on HEINEKEN’s markets and on its business in 2020,” the brewer shared in an update yesterday.

The brewer is already feeling it – saying it believes its global beer sales and volume dropped 2% and 4%, respectively, in the first quarter of 2020 – and expects the “impact” to “worsen in the second quarter.”

The good news is the company “entered the crisis with a strong balance sheet as well as undrawn committed credit facilities and has successfully secured additional financing on the debt capital market in recent weeks.”

Still, “the lack of visibility on the end date of the Covid-19 pandemic and the duration of its impact on the economy leads HEINEKEN to withdraw all guidance for 2020.” Of course, they’re not the first brewer to scrap its 2020 outlook, ABI and Molson Coors have done the same, as has Carlsberg.

HEINEKEN PROMISES NO LAYOFFS IN 2020. In a separate announcement, the brewer also shared some of the measures it has taken in the wake of COVID-19, and some of the commitments they have made to keep their people safe, protect the continuity of their business, and offer support to their communities.

Chief among these commitments is a vow to forego any “structural layoffs” until the end of 2020. 

In regards to its customers, Heineken has committed to scale up initiatives “in support of on-trade customers across markets in all regions.” For its suppliers, Heineken has pledged to pay suppliers “at agreed payment terms and will support its most vulnerable small and medium sized suppliers through early payments.” And for its communities, Heineken is “deploying multiple local initiatives” across the globe like donating water and non-alc beverages to front line workers and producing hand sanitizers and monetary contributions to “front line medical facilities.”

Additionally, Heineken said it will donate “€15 million to support the International Federation of Red Cross and Red Crescent Societies (IFRC) relief efforts for the most vulnerable people affected by Covid-19, in particular in Africa, Asia and Latin America.”


Yesterday Constellation announced “steps it is taking to reduce its brewery production activities in Mexico to a level that safeguards the environment and avoids irreversible impact to its operations.” Chief Bill Newlands commented that the development happens “after gaining more clarity related to the Mexican government’s response to this health and

economic crisis.”

As Constellation plans to reduce operations in Mexico starting today, some have asked us whether they’ll be able to get beer into the U.S., if, for example, distribution/importing activities are shut down, or considered non essential. 

As far as we know, however, Constellation told analysts of its confidence that it can indeed ship to the U.S. whatever comes out of a reduced production effort over on the other side of the border. 

We should also note that the laundry list of COVID-time precautionary and safeguarding measures we included in yesterday’s announcement of reduced operations in Mexico — from reducing operational shifts and reverting to work from home efforts, as well as  pre-shift wellness checks and social distancing measures — were enacted a few weeks prior to the new news about ramping down, naturally. 

ANALYSTS RUN THE GAMUT: FROM “NOTHING TO SEE HERE,” TO ANTICIPATING OUT OF STOCKS.  Upon yesterday’s morning news of the STZ’s scaleback in Mexico, some analysts seemed unmoved. 

“While unwelcome, a) the news is unsurprising post ABI/HEIA’s similar decisions last wk,” wrote Jeffries, “but b) better than worst-case scenario of a full shut-down. Actions are transitory, STZ has built “substantial supply”, and co. does not expect any NT service disruptions to retailers/consumers.”

Meanwhile, MKM took the other side, sounding the alarm about eventual out of stocks if the situation doesn’t resolve on April 30, as per Mexican government’s current timetable for nonessential business shutterings: 

“We believe Constellation could experience select package/brand out-of-stocks before day 70” as per Constellation’s guidance of how many days of stock they have in the system, “and broad out-of-stocks on day 71 if they can not resume brewing by May 10.”

How’d they get to that number? The firm estimates a brewing/aging production time of 30 days for STZ’s lagers. 

“With an additional estimated 10 days to reach retail shelves, we estimate it would take 40 days from resuming full-scale brewing for Constellation’s marquee products to reach shelves. Therefore, to have retail product on Day 71, Constellation would need to start brewing on Day 31 (May 10).” Again, under current Mexican proclamation, that shouldn’t be a problem — but it’s likely the shutdowns could extend beyond April 30, considering where Mexico is on the curve behind other nations’ testing and actions.

But “even before Day 71” they assert, there could “select pack-size out-of-stocks: For instance, we doubt there are 70 days of Corona Seltzer variety packs in the system.” 

More as it rolls in.

Until tomorrow,

Harry, Jenn and Jordan

“Walking is man’s best medicine.”

– Hippocrates

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