The most-repeated catchphrase for booze marketers these days is "premiumization," which is another way to say that expensive brands are leading growth.
The latest evidence came this week from the Beer Institute trade group which reported that retail beer sales grew 2% in 2011 to more than $98 billion, driven by imports, crafts and above-premium domestics. While this is welcome news for marketers, it's also true that the beer industry will likely never return to full health until its more mainstream brands such as Miller Lite and Bud Light grow again. These are still the giants of beer, after all, but they have struggled in recent years as blue-collar beer drinkers spent less during the economic downturn.
Just this week, MillerCoors reported that Miller Lite sales-to-retailers declined "mid-single digits." Overall beer volume shipped -- not accounting for pricing -- fell an estimated 1.4% last year, according to Beer Marketer's Insights. Both Bud Light and Miller Lite are planning new campaigns in hopes of boosting sales. But at the same time, MillerCoors and Anheuser-Busch are putting more energy behind premium brands. AB, for instance, launched Bud Light Platinum last month, a higher-alcohol version of Bud Light that sells for more.
Early results are promising: In one week ending Feb. 5, Platinum commanded 1.7% share of all beer sold in grocery stores, the brewer said, citing SymphonyIRI data. Longtime industry observer Beer Marketer's called that "a helluva stat," in a report this week. (Of course, it is still very early).
MillerCoors, meantime, continues to pour resources into its Tenth and Blake division of crafts beers and imports, recently acquiring Crispin Cider Co. of Minnesota, moving it into the fast-growing cider category, which commands higher pricing. In the fourth quarter, Tenth and Blake sales to retailers jumped by "double digits," the brewer said, on the back of continued growth of Blue Moon, Leinenkugel's and Peroni Nastro Azzurro.
As for where people are buying their beers these days, convenience stores remain the top destination, accounting for 32% of volume last year, according to the Beer Institute. Here's a closer look at all channels: