Low-calorie beers driving growth
InMarket, a market data firm, used location data from over 50M ComScore verified active users and compared the average amount spent per device in February 2020 to March-April 2020. According to InMarket, the top ten beer brands’ sales growth is illustrated in the chart below. The top four brands in terms of growth, were all under 100 calories. It was noted that Busch Light’s growth was fueled by a winter promotion that included a $1 rebate for every inch of snow across seven states. The results would seem to indicate to us that location-based consumer spend tracking isn’t as accurate as POS data. Nielsen has reported robust growth in large package sizes (which is a key driver of growth for the top four brands in the chart) has continued in April, however premium light beers and below premium beers have returned to pre-pandemic ~+1% levels in recent weeks.
Beer category re-accelerates, but wine and spirits are outpacing
According to Nielsen, the week ended April 25 saw beer sales increase 6.3% from the week ended April 18 and grow 20% year over year. The latest week re-accelerated from the 12.3% YOY growth from the prior week, as seen in the chart below. Wine sales were flat week over week and up 29% year over year. Spirits sales increased by 1.4% WoW and 40% YoY. Total alcohol sales grew 3.6% WoW and 26.4% YoY.
Cannabis lobbyists push for the SAFE Banking Act in the next relief bill
A coalition of cannabis advocacy groups sent a letter to the House leadership on Friday asking to incorporate language allowing the cannabis industry to access banking services in the upcoming coronavirus relief legislation. The current banking restriction on the sector causes most cannabis businesses only to accept cash. The letter cites the increased risk of the virus when paying in cash. The letter said, “While some businesses saw a brief spike in revenue at the beginning of the pandemic, this was not an industry-wide trend, and revenues across the industry have since plummeted.” The letter recommends including language from the House-passed Secure and Fair Enforcement (SAFE) Banking Act. Cannabis advocates tried to push for the industry to be included in earlier coronavirus relief bills like the Small Business Association (SBA) loans. However, the SBA made it clear that federal policies prohibit it from providing services to firms that market marijuana or firms that indirectly work with the industry, such as law or accounting firms. Many in the industry do not expect full passage of the SAFE Banking Act until after the election in November. The House passed bill is currently held up in the Senate Banking Committee.
