the state of us beer
TRANSCRIPT
And what are the biggest challenges?
Jim Watson, Senior Beverage Analyst
January 2020
The state of US Beer Photo: Cercle
2
Putting US beer sales in context – it’s doing well!
Source: IRI, 2019
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
Beer Wine Spirits Coffee Soft Drinks
YoY dollar sale growth in measured channels
2019 2018 2017 2016 2015 2014
34
Increase in beer demand globally driven by emerging markets
Source: Euromonitor, Canadean, Rabobank estimates
(2.0%)
(1.0%)
-
+1.0%
+2.0%
+3.0%
+4.0%
+5.0%
+6.0%
+7.0%
0
50
100
150
200
2004A 2006A 2008A 2010A 2012A 2014A 2016A 2018A 2020E 2022E
billion litre
Volume y-on-y change, RHS
Forecast beer consumption growth by regionWorldwide beer consumption is expected to grow further y-o-y change
Volume consumption CAGR 2018A-23E
Industry consolidation
(0.9)%
+1.2%
+1.5%
+1.4%
+1.0%
+1.1%
+3.2%+3.9%
4
Top 12 movers in the beer industry (measured channels)
Source: IRI
$0
$100,000,000
$200,000,000
$300,000,000
$400,000,000
$500,000,000
$600,000,000
MichelobUltra
ModeloEspecial
WhiteClaw
VarietyPack
CoronaPremier
WhiteClaw (allothers)
TrulyBerry Mix
Pack
WhiteClawBlackCherry
Truly (allothers)
NaturalLight
CoronaFamiliar
TrulyTropicalMix Pack
Smirnoff
Tota
l Dol
lar
Valu
e Add
ed
2016-19 absolute growth in dollar sales
5
New challengers finding success across beverage categories…
6
A look at where growth in coming from in non-alc
Bottled Water, 25%
Carbonates, 37%
Juice, 17%
RTD Coffee, 2%
RTD Tea, 7%
Energy Drinks,
8%
Sports Drinks, 4%
US non-alc bev $ share
Bottled Water, 40%
Carbonates, 23%
Juice, 7%
RTD Coffee, 6%
RTD Tea, 11%
Energy Drinks, 11%
Sports Drinks, 2%
US non-alc bev$ share of projected 2018-23 growth
Source: Euromonitor
7
Top 12 movers in the beer industry – in the other direction
Source: IRI
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
Tota
l Dol
lar
Valu
e Lo
st
2016-19 absolute DECLINE in dollar sales
8
Seltzer growth is explosive – and driving the beer category
Source: IRI
0
50
100
150
200
250
300
350
400
450
500
2016 2017 2018 2019
Sal
es in
USD
m
Sales of top two hard seltzer brands in measured channels
Truly White Claw
0%
1%
2%
3%
4%
5%
6%
7%
2019 2018 2017 2016
sale
s gr
owth
-y/
y
US Beer growth in measured channels
Total beer Total beer (excl. White Claw and Truly)
9
Premiumization remains on track in alcohol
Source: NielsenSource: discus
Wine sales volume growth in 2018 (measured off-premise)Spirts volume growth in 2018
-6%
-4%
-2%
0%
2%
4%
6%
8%
Below $11 Above $11
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
Value Premium High-endPremium
SuperPremium
10
Overall beer pricing is good, but…
Source: IRI
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
2019 2018 2017 2016
YoY change in US beer pricing
Total Beer Total ABI ABI Acquired Craft
11
What consolidation looks like across the beverage industry globally
Source: Euromonitor
0%
20%
40%
60%
80%
100%
Bottled Water Beer Spirits Wine Carbonated SoftDrinks
Juice RTD Coffee Coffee
Percent of retail volume generated by top companies, by segment
Top 3 Top 10
12
What coffee shows us about consolidation in the US vs the world
Source: Rabobank, leading coffee importer
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Large Roasters Medium Roasters Small Roasters
Consolidation among world coffee roasters
Percent of total volume Percent of total roasters
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Large Roasters Medium Roasters Small Roasters
Consolidation among US coffee roasters
Percent of total volume Percent of total roasters
13
Beverage companies repositioning portfolios
Expansion into new categories
Divestitures of low-end brands
Acquisitions at a premium
Disruptors go mainstream
14
Global landscape for low/no alc beers is very country specific
Source: Euromonitor
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%Percent of beer consumption at 3.5% ABV or below
15
I can’t find too much sober-curiosity in the US data
Source: bw166
0
100
200
300
400
500
600
700
Ser
ving
s of
alc
ohol
per
yea
r fo
r LD
A c
onsu
mer
s
16
Alcohol consumption is smoothing out
Past month use, among LDA adults
White Men
White Women
Black Men
Black Women
Hispanic Men
Hispanic Women
30%
35%
40%
45%
50%
55%
60%
65%
70%
-4% -2% 0% 2% 4% 6% 8%
Bas
e ye
ar p
reva
lenc
e of
Pas
t M
onth
Alc
ohol
Use
(20
10)
Shift in prevelance of past-month alcohol use, 2010-2018
17
E-commerce sales in the US are a big opportunity for all alcohol segments
22%Combined Total Alcohol Ecommerce Sales in US
2.6bn
2019
USD
SpiritsUSD 230m
WineUSD 2.2bn
BeerUSD 155m
2019 Sales By Category 2019 YOY Growth
18
Thank you for listening!
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