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Bad News for Big Beer: Consumer Spending Expected To Shrink This Year


A recent study from AlixPartners shows that the next year is going to be a good one for most drink makers – unless you’re a macro brewer.

The study polled 1,000 people in early February, asking if they expected to spend more or less on certain kinds of beverages, from sports drinks to the heavy stuff.  The results were then weighted to “reflect nationwide adult demographics,” which I think means more emphasis was placed on the data received from folks who are representative of large chunks of Americans – insert chunky American joke here! 🙂 

The adjusted results show that 87% of Americans plan to spend as much or more on most alcoholic beverages in the next year, up from 70% in last year’s study.  Spending on adult beverages at restaurants and bars also looks rosy, with 37% of consumers expecting to enjoy a drink away from home, up from 21% last year.

But things aren’t looking so good for Bud, Miller, Coors, and the rest of the big boys.  This is according to Darren Morrison, VP of AlixPartners’ Consumer Products Practice, who says, “Our analysis found that one in three consumers would look to reduce their spending on beer by lowering consumption, looking for sales and promotions or trying less-expensive brands.”  The stagnation and shrinkage is expected to cost big beer about $1 billion in profits.

The signs of decline are already pouring in for big beer, with AB-InBev recently posting a 3.3% sales drop in the U.S. market for the first quarter of this year.

But fear not – things are still looking up when it comes to craft beer, which enjoyed an 11% growth in 2010.  This trend will continue according to Morrison, and craft beer will the only oasis in an otherwise desolate year for beer.

I can’t say that any of this news makes me sad.  Rising spending on alcohol, especially outside the home, points to a recovering economy.  The fact that the big boys aren’t coming along for the ride is a very sweet icing on that cake indeed.

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Categories: Beer, News

Author:Jim

Craft beer nerd, frequent beer blogger and occasional home brewer.

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26 Comments on “Bad News for Big Beer: Consumer Spending Expected To Shrink This Year”

  1. May 6, 2011 at 10:14 am #

    Plus, the jobs report out this morning suggest we’ve turned a corner. I think craft beer’s rise during the recession proved that people were looking for value, meaning they wanted more from their beer. Now that the economy is turning around, people who became hooked on craft beer are more willing to spend.

    • May 6, 2011 at 10:20 am #

      I think it’s also a sign that anyone who cares about flavor is slowing making the switch to craft beer. Macro beer will be left with the cheapskates and poor college kids. This data may show the beginning of that trend.

      • May 6, 2011 at 10:26 am #

        What’s interesting about the “poor college kids” angle is that they could do better drinking high ABV craft beers when you figure cost based on the amount of alcohol they’re ingesting. While I don’t advocate binge drinking in any way, you and I both know how easy it is to get drunk on 3-4 beers as opposed to 13-14 macros.

        • May 6, 2011 at 10:35 am #

          True, but you can’t drink RIS’s all day long in the parking lot of a sporting event. I can, but I’m a professional! 🙂

        • May 6, 2011 at 10:51 am #

          I just pictured a group of young college kids doing Oak Aged Yeti kegstands.

        • May 6, 2011 at 10:53 am #

          I now want to go back to school!

        • Don
          May 6, 2011 at 10:53 am #

          I just pictures said college kids hanging at Great Divide Brewery in their makeshift beer garden doing the same thing!

        • May 6, 2011 at 11:06 am #

          But isn’t the point that they won’t have to do keg stands anymore? Just drink that bitch straight from a 22 oz. bomber, yo!

        • Don
          May 6, 2011 at 11:12 am #

          They need a Foedy Yo!

        • May 6, 2011 at 11:36 am #

          Zac, that would remove “kegostandicus” from the evolutionary chain, causing a universe-ending paradox. Do you want that? Do you??

        • May 6, 2011 at 11:55 am #

          You know, you’re right, Alex. I don’t want that. Sorry I ever brought it up.

  2. Don
    May 6, 2011 at 10:29 am #

    We ought to rename ourselves the Whiskey and Data Nerd Brothers. Anyway, I think this might bb a bit of a wake up call for the big boys. I can see a point where the macro swill they make goes down in sales and revenue, and the Shock Tops and Blue Moons of the world increase in sales. I think they should stop making improvements in bottle neck technology giving them grooves, or vented cans or blue mountains, and focus on the beer they put into the vessels. then they may begin to regain market share.

    • May 6, 2011 at 10:30 am #

      Data nerds? You’re just mad because I’m giving you crap in your day-too-late tequila post!!

      • Don
        May 6, 2011 at 10:34 am #

        Whatever discount…

        • May 6, 2011 at 10:36 am #

          ? 😦

        • Jeff W
          May 6, 2011 at 10:38 am #

          I get it.
          LOL

        • Don
          May 6, 2011 at 10:43 am #

          That is because you’re smart Jeff!

        • May 6, 2011 at 10:52 am #

          Wait – are quoting a car insurance commercial?!!!

        • Don
          May 6, 2011 at 10:53 am #

          Did you Google “Whatever Discount”? Loser!

        • May 6, 2011 at 11:23 am #

          Yup. I’m such a loser for not knowing a throwaway line in an insurance commercial, Don. You got me!

  3. johnking82
    May 6, 2011 at 10:54 am #

    If you’re data nerds, does that make Jim, Lamar or Booger?

    • Don
      May 6, 2011 at 10:55 am #

      Definitely Booger!

      • May 6, 2011 at 11:06 am #

        So you’re Lamar? 😉

        • Don
          May 6, 2011 at 11:13 am #

          I’m totally not involved. I just know the Booger fits Jim very well.

        • May 6, 2011 at 11:22 am #

          Lamar was quite..umm…never mind, Don…

          But it might explain just what kind of *bear* you are!

        • May 6, 2011 at 11:26 am #

          Man, that Lamar could throw a javelin! Of course, his javelin utilized his limp-wristed throwing motion.

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