After sluggish sales in 2009, top beer importers are putting much advertising and promotion effort into the summer season.
By Craig Levitt
When times are good people drink and when times are bad people drink. That pretty much means the alcohol business is usually a relatively safe bet. With the economy in a state of flux however, it seems more Americans are turning teetotaler, at least when beer is concerned.
According to the Chicago-based SymphonyIRI Group, for the 52 weeks ended March 21, while dollar sales for the entire category (food, drug and mass channels) decreased only 0.5% to $23.6 billion, case sales were down a more significant 2.5%. Imported beer sales struggled even more, as both case and dollar sales were down about 4.5% each. Industry observers say that many consumers have shifted to larger format stores—that tend to be more price driven—to make beer purchases, thus adversely effecting imported sales.
The grocery channel, however, outperformed other channels, actually improving by 2.5% in category dollar sales and remaining flat in category case sales. Grocery’s imported dollar sales were also essentially flat.
Many observers believe that the imported segment is poised to make a comeback, pointing to improved import sales in recent months. Observers further speculate that if consumers’ disposable income continues to show improvement, imported beers and the grocery channel are poised to reap the benefits.
“Grocery stores and liquor stores are the top two places consumers buy imported beer,” says Brian Sudano, managing director for the New York-based Beverage Marketing Corp. “So [when it comes to import sales] the channels that have been most impacted by the channel shifting are liquor stores and grocery. [For the rest of this year] we think there will be greater velocity of imports within those channels [than last year].”
The summer season is always crucial to the entire beer category and in recent years consumers have kicked off the summer with Cinco de Mayo celebrations. White Plains, New York-based Heineken USA is using Cinco de Mayo as a launching point for a myriad of promotions for not only its Dos Equis and Tecate brands, but Heineken and Heineken Light as well.
Beginning in May and running through Labor Day, Heineken and Heineken Light are running a promotion called “Plug into Summer.” The promotion is music-themed as consumers have the ability to win free song downloads, guitars and passes to concerts throughout the summer. According to Steve Ward, vice president of national accounts for Heineken USA, the promotion features 22 million cases of promotional packaging on 6-, 18- and 24-packs.
Beyond only summer promotions, Heineken USA is rolling out extended distribution of Heineken 18-packs and is launching a Heineken Light 18-pack.
“The 18-pack is a key package for grocery because it’s an opportunity to trade consumers up, particularly in the summer,” says Ward. “That package grew by more than 60% in the grocery channel and has become very profitable for grocery retailers.”
In May, Heineken USA is also introducing Newcastle Brown Ale in the popular 5-liter draught keg that Heineken has been available in for years. New to the Newcastle Brown Ale family is Newcastle Summer Ale, available in 6- and 12-packs in most major markets.
As import sales have slowed a bit, for the first time ever Crown Imports, based in Chicago, is running a summer promotion for its Corona and Corona Light brands, according to James Hannon, vice president of national accounts off-premise. The promotion offers 100 trips to Cancun and 900 Corona beach kits and is being supported by national television spots.
Beyond consumer promotion, Hannon says Crown Imports has taken a much more proactive position on value-added programming.
“We have developed basket building programs that are consumer-centric and align with our brands’ message and value proposition,” says Hannon. “From Cinco de Mayo through Labor Day. we will have integrated programs that will help drive traffic and higher basket rings.”
Bucking the trend
While the entire import segment has not been able to sustain the growth it enjoyed in previous years, there have been individual brands that have bucked the category trend. Herb Heneman, director international and import brands for Chicago-based MillerCoors, points to its Peroni as a brand that, through a disciplined and specific building plan, has thrived in targeted “must win” markets. Part of that disciplined and specific plan often includes educating consumers on the different brands that are available. Heneman says the opportunity exists for supermarkets to do the same.
“A number of supermarkets have gone to great lengths in the past few years improving the way they educate shoppers on wine,” says Heneman. “With the huge proliferation of brands and SKUs in beer, all three tiers in our value chain [brewers, distributors and retailers] can and must focus on the better education of beer intrinsics. What’s the difference between an ale and a lager? What’s a bitterness unit? ‘I like Heineken, and I know its Dutch, but how is it similar to or different from Grolsch?’ Crafts are leading the way in this front and imports could do better.”
A world of beer
Incorporating brewing traditions from around the world, the Michelob Brewing Co., a division of St. Louis-based Anheuser-Busch InBev, once again offers a sampler pack featuring four wheat beers for the Spring and Summer seasons. Included is Michelob Ginger Wheat, the newest beer in the brewer’s collection and only available in the Spring/Summer seasonal sampler pack.
The Spring/Summer Sampler Pack also includes the return of Shock-Top Belgian White, Michelob Dunkel Weisse and Hop Hound Amber Wheat.
“We received a tremendous response to last year’s sampler pack, as beer enthusiasts enjoyed exploring the diversity within the wheat beer style,” says Craig Heisner, brewmaster for Michelob Brewing. “With our sampler pack consumers have the opportunity to sample four very distinct beers.”
Every sampler pack includes tasting notes and a summary of each beer’s ingredients, revealing how brewmasters’ recipes impact the colors aromas and flavors found among the different styles. The Michelob Spring/Summer Sampler Pack is available nationwide through September in 24-packs (six of each beer) and 12-packs (three of each beer).