Six Pack: Beer Buzz of the Week
Six items that have consumers buzzing in the world of beer, wine and spirits as we head into Memorial Day weekend:
1. Brewers Target Millennials to Drive Growth: Move over Boomers, the beer business is targeting Millennials, the category of about 80 million consumers born between 1980 and 1995. MillerCoors recently announced it is rolling out a coconut-flavored “malt beverage” and an apple-flavored beer in the hopes of wooing back young consumers who have passed on beer in favor of wine or liquor. Meanwhile, Heineken is also making an aggressive push to reach Millennials, putting 15 percent of its marketing spending towards social media, which the brewer says is second only to TV in terms of where the segment spends its time. Heineken expects Millennials to make up 70 percent of the growth in the beer category the next 10 years.
2. U.S. Brewery Count Tops 2,000: The growth of craft beer in the United States, consistently posting double-digit growth in terms of volume and dollar sales, continues unabated. As the craft segment grows, so does the national brewery count. According to the Brewers Association, as of April 30, 2012, the number of breweries operating in the U.S. now totals 2,051 with 2,000 of those being craft brewers. The number is expected to keep growing, with 950 breweries in the planning stages, according to the BA. The number is the most since Prohibition and a long way from 1988, when fewer than 100 breweries were in operation.
3. Craft Beer in China: While the rise of craft beer in the U.S. is well documented, the seeds of a craft beer movement appear to be slowly taking hold in China. Next week, Beijing is preparing to host its first craft beer festival, with 75 percent of all proceeds being used to help fund the launch of the city’s first home-brewing store. The Beijing festival follows the first annual Shanghai Beer Week, held two weeks ago. Currently the Chinese beer market is dominated by Snow Brewing, the world’s biggest beer brand, partially owned by SABMiller in a joint venture. According to industry research group Plato Logic, the Snow brand alone produced more than 90 million hectoliters of beer in 2011, more than the entire country of Germany, the fifth-largest beer market in the world.
4. Craft Beer Honors Memorial Day: Traditionally, Memorial Day is a day of remembering the men and women who died while serving in the United States Armed Forces. Unofficially, the Memorial Day weekend is the beginning of summer, and according to Nielsen, the two weeks leading up to Memorial Day are the second-highest of the year for beer sales. Now, online beer market Beerjobber.com has found a way to combine the two. The site is offering beer from Connecticut-based Calvary Brewing, a company owned by Mike McCreary, a 19-year veteran of the Army Reserves who served in Iraq. McCreary isn’t the only veteran entering the craft beer space. Dan Alger did two tours of duty in Iraq with the Navy and is now in the process of opening a brewery in Hoboken, N.J. He recently spoke to CNBC about his goal of having a staff comprised of 50 percent veterans.
5. Wine on the Go: Summer may mean big bucks for the beer business, but the wine industry is adapting its packaging to allow consumers to bring wine with them no matter where they go. Forget the corkscrew; from foil pouches to cans to boxes, wineries are pushing the boundaries to improve their products portability.
6. TV Liquor Advertising on the Rise: Brace yourself for a rise in hard liquor advertising on TV. Skinnygirl Cocktails, already one of the hottest liquor brands of the past year with 388 percent sales growth, is rolling out a TV campaign. The move is the result of Skinnygirl parent company Beam, boosting its TV advertising spending to 43 percent this year, up from 34 percent in 2011. Ad Age reports that Jagermeister, Southern Comfort and bourbon brand Wild Turkey are among the many liquor brands who are increasing their TV presence. Helping to fuel the rise in liquor ads is the fact that ABC, NBC and CBS have all begun accepting late-night alcohol advertising in the past year.