Super Bowl beer decline (BUD)
Viewership for this year’s Super Bowl declined to 96.4 million compared to 102 million in the prior year. The top markets were Kansas City, Boston, and Tampa. The television only viewership decreased 8% and was the smallest since 2006. The streaming audience was up 69% to 5.7 million per minute, the highest to-date. According to BeerBoard, beer volume declined 46% on Super Bowl Sunday, in line with the average decline experienced nationwide for the week. Bud Light volumes increased 7% nationally, Michelob Ultra was up 3.5% nationally, and Modelo Especial was up 0.4% nationally. In an average year, the host city sees a big bump in sales during the Super Bowl weekend. Tampa's on-premise volumes declined 28.3% for this Super Bowl. Kansas City on-premise beer volumes fell 55%. Tom Brady back in the Super Bowl was not enough to entice Boston residents to visit on-premise establishments, with volumes down 69%.
Regional grocery merger
Price Chopper/Market 32 and Tops Markets announced that they had reached a merger agreement. The two regional chains are among the largest supermarket chains in upstate New York. Price Chopper has 130 stores in the Northeast. Top Markets has 162 stores in New York, Pennsylvania, and Vermont. Price Chopper’s CEO will be the CEO of the merged company. Both companies date back to the 1920s and operate in the same region. The challenges of the post-pandemic grocery environment likely brought the two companies to partner together.
E-commerce has increased the competition for groceries as well as stepped up the investments required to sell online. More consolidation among grocers is needed to fund the e-commerce investments, but the FTC has maintained a non-online view of the competitive environment. Last year Stop & Shop and King Kullen gave up on their Long Island merger plans after a long delay from the FTC. Price Chopper and Tops Markets do not have the same local overlap that Stop & Shop and King Kullen have but are close enough to have considerable distribution synergies.
Stella Artois: imported from Newark, NJ (BUD)
Anheuser-Busch InBev announced that it is now brewing Stella Artois in four of its U.S. facilities. The first bottles are expected to be on shelves in the early summer. Cans and kegs are expected to be produced in the U.S. by year-end. Consumers will likely be unable to taste the difference. Anheuser-Busch InBev is among the best in the industry at being able to produce the same beer in different locations. Stella Artois is already brewed in Belgium, the U.K, Hungary, Australia, and Canada. The brand is AB InBev’s largest import brand in the U.S. Transporting beer across an ocean is an expensive process. (Constellation Brands, which has the U.S. rights to the Grupo Model brands, has ruled out brewing for the brands anywhere except Mexico.)
Part of AB InBev’s $1B investment in its U.S. operations over the next two years includes the brewing move for Stella Artois. $400M will be spent on its 12 U.S. breweries. $50M was earmarked for new hard seltzer brewing capabilities. $100M will be spent on canning lines to increase slim can production and improve various packs' packing. Another $100M will be spent on sustainability projects like solar panel installation.
