While overall beer category sales are challenged in both on and off-premise, growth rates are under even more pressure in traditional On Premise (restaurant and bars), Nielsen researchers report.
For instance, Mexican and Belgium imports are growing at double digit growth rates Off Premise, but only up single digits On Premise, while moderate declines of Domestic Premium Beers Off Premise are much further exacerbated On Premise.
Craft growth rates have decelerated sharply in both channels over the past year, Nielsen finds, but Craft is still about 2.5x better developed (dollar share) in On Premise than in the aggregate of the various Nielsen-measured Off Premise channels.
Ciders have reached almost a 2% share of the Beer plus Flavored Malt Beverage plus Cider category On Premise, vs its 1.3% share Off Premise.
Wine Growth Slows, On and Off Premise
| When it comes to wine, Nielsen finds growth rates in the last quarter lessened in both Off and On Premise channels. While that is true for the overall category, an exception is Sparkling Wine, whose impressive growth in On Premise channels in the latest quarter held quite firm.
Rosé continues to be a big growth story within the wine category – and while it’s growing well On Premise, it’s the Off Premise where the growth rates have been ‘out of this world.’ This is unusual in that while On Premise usually sets the new trends and then Off Premise stores follow, it seems to be the other way around for this dynamic product segment. Wine imports overall are better developed On Premise. Some countries, namely Spain, South Africa and Portugal, are performing better in On Premise channels, while others like Italy and New Zealand are trending better in Off Premise. Spirits Growth Leaders Same in Both Channels As for spirits, there are considerable similarities between growth leaders in both channels; Cognac is by far out in front of all other segments, followed by Irish Whiskey, and Tequila. Of those three categories, Tequila and Irish Whiskey are better developed Spirit segments in the On Premise, while Cognac is better developed in the Off Premise. Flavors: On the other hand, while Whiskey flavors in aggregate are equally well developed as a share of Whiskey in both channels, their growth rates in On Premise lag Off Premise by a considerable margin. Rums and Cordials overall continue to struggle both on- and off-premise. Gin is performing better On Premise both in overall share and growth than Off. On-premise visitors are seeking experiences that cannot be duplicated at home, with brewpubs, tasting rooms and tiki bars especially popular among younger millennials, says Scott Elliott, svp of Nielsen CGA. That makes it critical, he says, for suppliers and retailers to “understand and activate against specific consumer needs, occasions and repertoires.” Food-led retailers (in particular, large chains) need help in developing more compelling beverage alcohol programs, he says, while independent outlets, on the other hand, need support in driving traffic and in targeting specific consumer occasions. Want to know what you can do to help your bar and restaurant customers? Listen to my interview with Scott Elliott. Danny Brager, SVP of Beverage Alcohol at Nielsen, says “e-commerce may be impacting Beverage Alcohol in the traditional Off Premise channel in a couple of different ways. One is online purchasing of alcohol increasingly taking the place of traditional store purchasing. The other is the indirect impact of less store trips impacting more discretionary categories, like adult beverages, where a significant percentage of purchasing has traditionally been impulse driven (i.e. not planned). This raises the question of what will happen to those impulse purchases if consumers are in stores less often to do their shopping? “E-commerce in beverage alcohol, while still relatively small in comparison to many other categories, will continue to expand,” Brager says. “Off Premise retailers will need to deal with a growing segment of consumers who may wish to ‘buy,’ but who may not need or see the need to visit the store to do so.” Another factor impacting category sales: Some mainstream retailers that sell alcohol in their stores are still not at the point of offering those products via their online platforms. |