Nielsen’s Alcohol Beverage Team Reveals Insights into the Beer Industry

More than 1,900 fewer craft beer category products are being sold in the marketplace even while overall sales for the segment continue to grow.

More Beer is Being Sold but Fewer IPAs, Pale Ales, and Seasonals on the Market

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More than 1,900 fewer beer category (beer/FMB/cider) products — a majority of which were made by independent and longtail craft producers — were sold in off-premise retailers during the first six weeks of the COVID-19 crisis compared to the same period in 2019, according to market research firm Nielsen.

That equates to an 8.3% decline in beer category items sold during the six-week period ending April 11th compared to the same six weeks last year, the firm reported.

However, the number of craft offerings being sold was declining steadily even before COVID-19, according to Danelle Kosmal, Nielsen’s VP of beverage alcohol practice. Still, COVID-19 has had an impact as “the biggest decline” occurred between the weeks of March 21st and March 28th, 2020, “with a drop in 300 items selling from one week to the next,” she wrote.

“IPAs, seasonals, and American Pale Ales combined accounted for half of the declines in UPCs selling in craft, but those trends were happening before COVID-19,” she added.

Nevertheless, the top craft breweries ranked by dollar sales in off-premise channels were largely unphased by the declines, selling just 28 fewer items compared to 2019.

“The remaining segment of craft had a decline in 1,621 UPCs, down a total of nearly 12% compared to that same time period last year,” Nielsen reported. “Independent, or BA-defined craft is a similar story, with a decline by -11.3% in the number of items selling in off-premise channels. This of course places even more pressure on small to medium-sized brewers that are already facing enormous challenges with the shuttering of taprooms, bars, and restaurants across the country.

Craft wasn’t alone in declines. The number of cider and import items sold declined about 8% each. Premium lights (+1.6%) and below premium offerings (+0.6%) have sold essentially the same numbers as last year.

Hard seltzers continued to buck those trends, with the number of items being sold increasing 54%, about 100 additional items being sold, compared to 2019 levels, Nielsen reported.

According to Nielsen, the week ending April 11th was “an even stronger illustration of SKU rationalization” happening in the beer category. During that week, the total number of beer category items sold in off-premise retailers declined 11%, with declines in the number of premium light (-2.1%), import (-11.3%), cider (-9.4%), and craft (-13.1%) items sold.

Beer category sales continued to grow during the week ending April 11th, increasing 19.4%, to $861 million, while wine (+36.5%) and spirits (+32.4%) dollar sales also increased for the week, which included the Easter holiday.

Those numbers were in line with the previous week’s, as total beer category dollar sales in off-premise retailers increased 19%, to $836.3 million, compared to the same one-week period in 2019. Dollar sales remained below the peak stock-up week (March 15-21) when sales increased 42%, to $967.1 million. The week ending April 11th was still above the weeks ending March 14th and March 28th, when dollar sales were up 14% ($791.9 million) and 17% ($817.8 million), respectively.

Segment growth rates largely mirrored those of the prior week: hard seltzers (+321%), premium light (+8.6%), Mexican imports (+16.0%), craft (+17.4%), cider (+20.5%), and below premium (+6.2%) for the week ending April 11th.

Hard seltzers continued to pick up share in the beer category and now make up 7.8% of beer category dollars, up from 5% pre-COVID-19. Hard seltzers had been increasing share an average of 0.2 share points since January 2020, but have slightly accelerated, gaining an average of 0.3 share points a week since the start of March.

Finally, dollar sales of large pack sizes continued to outpace those of smaller packs, with 30- (+33%) and 24-packs (+38%) for the week ending April 11th, and 12-packs sales increased 39% compared to the same week in 2019.

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