Beer Purchasers’ Index signals optimism for the summer (STZ)
The National Beer Wholesalers Association’s Beer Purchasers’ Index (BPI) increased to 58 in June, up from 54 last year. The BPI did decelerate from 63 in May. The June reading was the highest reading for June since 2021. The BPI is a diffusion index where a reading over 50 denotes expansion and below 50 denotes contraction.
Most segments increased YOY but cooled compared to May.
- Imports were 70 in June, up two points from the prior year, but two points lower than May.
- Below premium was 54, up one point YOY and 4 points from May.
- Premium lights were flat YOY at 52, but two points lower than May.
- Craft fell 11 points YOY to 27 and 5 points below the reading in May.
- Premium regular fell 4 points to 49 from both June 2023 and May 2024.
- FMBs/hard seltzer were at 38, up 7 points YOY, but down 4 points from May.
The at-risk inventory measure was 42, down from 47 last month, indicating lower levels of inventory within a month of expiration.
Canadian Beer Sales (TAP)
Beer volumes in Canada decreased by 4.3% YOY in May, improving modestly from the 4.6% decline in April. Domestic volumes decreased by 3.8%, decelerating from -2.6% in April. Imported beer volumes improved from the -19.9% decline in April. Beer sales have been under pressure for several years in Canada. The Canadian Centre on Substance Use and Addiction recommends two drinks or less per week to avoid alcohol-related consequences. 40% of Canadians 15 years and older consume more than six drinks per week.
Tik Tok Begins for Alcohol (BUD)
TikTok recently opened up advertising on its platform for beverage-alcohol brands because of the aging of its user base. The Distilled Spirits Council of the United States, The Beer Institute, and the Brewers Association require that audiences are at least 73.8% of the legal drinking age for social media marketing. TikTok confirmed its demographic data that users have aged up to the percentage which represents the overall percentage of legal drinking adults in the U.S. TikTok is the fifth most popular social media network, but it has the highest engagement rate.
61% of total alcohol ad spending is digital, according to Standard Media Index. Over half of the spending comes from beer companies. Bud Light’s advertising spend was estimated to be up 48% YOY through the first 11 months of 2023 compared to Miller Lite’s 18% increase and Busch’s 122% increase. The beer companies spend the majority of their advertising budgets on cable or broadcast TV. The beer industry has also been challenged to be as popular with consumers who have turned 21 in recent years. Controlling the ads may be more comfortable for the brands than leaving it to influencers.
