Below is a complimentary research note from our Consumer Staples analysts Howard Penney and Daniel Biolsi. If you are an institutional investor interested in accessing our research email sales@hedgeye.com

Beer Spending Decelerates To Lowest Growth Rate Since Pandemic Restrictions - 5 4 2020 8 56 19 AM

The beer category sales in the off-premise channel grew 12.3% for the week ended April 18, YOY, according to Nielsen.

That marks the lowest growth rate since the pandemic restrictions began impacting sales but did include Easter Sunday, as seen in the chart below. Wine sales grew 13% and also decelerated from its six week average of 28%. Spirits sales grew 37% decelerating slightly from its six week average of 39%.

Beer category growth in the convenience store channel grew 17%, outpacing the 15% growth in the grocery channel. Imports grew 20% in the convenience store channel compared to the 1% growth in the grocery channel. Hard seltzers grew 422% in the convenience store channel compared to 221% in the grocery store channel. According to Bump Williams Consulting, hard seltzers now account for 8% of the beer category sales.

The premium light beers grew 1.5%, and below premium, beers grew 1.7%, indicating a return to pre-pandemic trends. Craft beers grew 5.8% while hard teas grew 28.4%. Large pack sizes (24 and 30 cans), which grew 20%, continued to outpace smaller sizes like six-packs, which decreased 2%, reflecting the consolidation of shopping trips by consumers. The number of households making alcohol shopping trips is up 27% for the week ended April 11, while the total alcohol spends per buyer is up by 13%.

Nielsen surveyed 10,000 alcohol beverage drinkers and found that only 17% said they stocked up on alcoholic beverages over the last month compared to their normal behavior, and 41% said they didn’t stock up. However, their actual spending shows a 25% increase in spending.Consumers who said they kept the same amount of alcohol on hand increased their spending by 13%.

Frequent on-premise drinkers were 80% more likely to have purchased alcohol online from a bar or restaurant.     

Beer Spending Decelerates To Lowest Growth Rate Since Pandemic Restrictions - beer1