Beer Marketer's Insights
Mixed News; Alcohol-Related Crash Deaths Down 5.3% in 2019; Teen Drinking Drifting Back Up?
For years, society and industry celebrated declines in two key trends: alcohol-related traffic fatalities and teen drinking rates. Final figures for 2019 show "alcohol-impaired driving fatalities decreased by 5.3%," vs 2018 Natl Highway Traffic Safety Admin (NHTSA) reported recently. What's more, alcohol-impaired crash deaths were 28% of total crash deaths; that was the "lowest percentage since 1982, when NHTSA started reporting the data." Alcohol-impaired driving fatalities − any crash involving a car driver or motorcycle rider with a BAC of 0.08 or more − fell especially sharply among passenger vehicles, -11%. Preliminary figures for 2020 crash deaths skewed by pandemic and stay-at-home orders, natch, but so far looks like an increase in the fatality rate per mile driven, a measure that fell 3.5% in 2019.
Holiday slowdown continues as pandemic pressures weigh trends down, even as on-premise locking down. For 4 wks thru Dec 12, total beer/FMB/cider volume up 7.1%, $$ +10.1% in Nielsen all outlet scans. That's 4-point drop off compared to +11.3% and +15.2% yr-to-date, respectively. Indeed, $$ trend off 4 full percentage pts compared to 4 wks ended mid-Nov. So significant swing over just last mo. Every top supplier saw $$ sales slowdown for latest 4 wks vs YTD, with some steep decelerations mixed in. Mike's 4-week $$ trend up "just" 34.4% compared to +82.2% YTD, while Boston Beer up 36.5% for 4 weeks vs +51% YTD. Both cos still gaining $$ share albeit less than yr-to-date: Mike's +1 share for 4 wks, Boston +0.8. Meanwhile, Diageo no longer gaining share as co's $$ trend fell to +7.6% vs +23.7% YTD. And even tho AB and MC each donating close to 2 share points YTD, both losing less in latest period. Down closer to 1 share in latest 4 weeks.
Nov Taxpaids Dip 0.8%, Ending 5-Mo Streak of Gains; Total Shipments Still Down Near 1% YTD
Following tuff spring, then gains each mo Jun thru Oct, Nov taxpaid shipments by domestic brewers slipped 96K bbls, -0.8% in Nov, estimates Beer Inst. For 11 mos, taxpaids down 1.3 mil bbls, -0.8%. Revisions still expected, Beer Inst reminds, due to postponed report requirements/tax payment due dates. With imports near even thru Oct, total US shipments still off 1.5 mil bbls YTD, -0.8%. That's right about where NBWA economist Lester Jones pegged 2020 shipments trend during last's week's seminar with Fintech, pending revisions.
McLaughlin & Moran Deal in RI Falls Apart; Teamsters, Govt Officials; Levine Deal in CT Closes
One of the more groundbreaking distrib deals announced in 2020 didn't make it to the finish line. Following heavy Teamster protests and more importantly a Dec 14 ruling by RI Dept of Biz Regulation (DBR), C&C Dist deal to buy McLaughlin & Moran in Rhode Island got called off. (Recall C&C is a Mancini family co.) So the Coors guy will not buy the Bud guy after all. Teamsters release crowed: "Teamsters Rally to Stop Deal Between Rhode Island Beer Wholesalers." Recall, this deal dates back to Jul. At that time, Mancini applied to Dept of Biz Regs "for approval to transfer the wholesale liquor license owned by M&M to one of their companies," according to Teamsters. Hearing held on Oct 30, with Teamsters "in strong opposition" including full-page newspaper ad, billboards, petitions etc. On Dec 14, according to Teamsters, DBR director "announced that DBR will not approve the license transfer without investigating Mancini's ownership of other alcohol distributors and whether Mancini is violating state prohibitions on chain store alcohol sales. Days later," continued Teamsters, "the M&M sale was dropped." Traditionally, RI chain store statute has reportedly applied to retailers. Teamsters found a way to delay the license. DBR didn't reject deal, but merely said it needed time to investigate. That was apparently enuf for the parties to drop deal, based on uncertainty. But another Mancini Family Co in CT, Northeast Bevs, completed its acquisition of AB distrib Levine, announced in Oct.
Stocks of global brewers taking a hit today as rise in Covid-19 cases and news of a new strain of the virus spreading in the UK in particular, per Seeking Alpha. ABI shares down 3.9% in US, Carlsberg off 2.5.% in Copenhagen and Heineken shares slipped 3.3% in Amsterdam. "The development pushes back the expected timeline for a return of on-premise beer sales to 2019 levels and could lead to revised downward estimates for Q4," warned Seeking Alpha. Recall, just a few weeks ago, UK brought back, what The Independent called "devastating" restrictions on pubs, bars and restaurants thru most of England.
While AB's acquired handful of non-alc products in recent yrs, it's also marketing in-house NA brands, beer and beyond, in new ways heading into 2021. "NAB Lab," as co refers to it, is collection "no-alcohol beer" brands like O'Douls, Busch NA, Bud Zero, plus craft brewer additions in Golden Road Mango Cart NA, Karbach Free & Easy NA IPA, and new non-alc seltzers called MoodRing and Spiri+. The "bartenders" of NAB Lab, include several AB execs and vets, headed by VP of Corporate Social Responsibility Comms, Adam Warrington, Sr Director of Innovation for Brewers Collective, Joy Young and VP of Innovation for AB, Jake Kirsch, per website. VPs of mktg for Bud and Value portfolios, Monica Rustgi and Daniel Blake, Karbach and Golden Road brewmasters, Eric Warner and Victor Novak, and AB master cicerone Max Bakker round out team.
Double barreled shot of good news Sunday night as bipartisan deal finalized on Congressional $900 bil COVID relief package (will pass this week) and it includes CBMTRA (Craft Beverage Modernization and Tax Reform), now made permanent. Big Senate champion of CBMTRA, Ron Wyden of OR, said in statement: "In major wins for Oregon, tax incentives I developed for craft brewers, vintners and distillers are made permanent." Brewers Assn prexy Bob Pease said in statement that BA "expresses our gratitude to the 116th Congress… for including" CBMTRA "in this must-pass legislation." Given that "many small breweries, brewpubs and taprooms have been devastated by the economic fallout from the COVID-19 pandemic," Bob said, "this legislation and programs like the Paycheck Protection Program are vital lifelines to help small brewers weather this unprecedented health and economic challenge." Passage of CBMTRA "represents a collective annual savings of $80 million for craft breweries," Bob added.
2020 The Year in Beer
, Next Beer Insights Webinar, Coming Jan 27
In Case You Thought 3-Tier System Complex/Unwieldy, Get A Load of NJ's Proposed Pot Regulations
Bill to regulate New Jersey's recreational cannabis biz just went to Gov Murphy, who's expected to sign it. Key provisions, as outlined by MJBiz Daily, make alcohol regulation seem simple. Among 'em: 1) six separate classes of license, from cultivator to delivery, some combos will be possible, tho process "complicated"; 2) limits apply to licenses, except for "microbusinesses"; 3) an "application points system," yet to be determined, will be based on "operating, environmental and safety and security plans"; 4) "impact zones," areas that suffered from previous cannabis enforcement, granted several "priorities"; 5) municipalities can opt out of legal sales, but legislation put some roadblocks in to make it "more difficult"; 6) states sales tax will be 7%, a "social equity fee" may be applied and municipalities will be able to tack on up to 2% local tax, and more. Key to passage, reportedly: "Murphy and leading lawmakers agreed to target 70% of the tax revenue to communities most harmed by the war on drugs." Keys to further delays in developing what MJBiz Daily pegs to approach $1 bil mkt by 2024: 1) final rules unlikely to be adopted for another 6 mos; 2) current inability to meet medical marijuana demand, which has to be solved before those operators can sell for recreational use. In any case, NJ law "expected to ignite a domino effect across the Northeast and Middle Atlantic, especially putting pressure on neighboring New York and Pennsylvania to legalize adult use," MJBiz observes.
Ho Ho Ho: Outgoing SC Rep Cracks A Beer on House Floor, But Can't Drink It; Toasts Bipartisanship
Joe Cunningham, D-SC, recently lost re-election in his Charleston, SC district, making him a one-term member of the US House, after defeating ex-Gov Mark Sanford in 2018. During farewell speech on floor yesterday, Cunningham cracked a can of DC Brau's Joint Resolution, a hazy IPA, natch. House rules, of course, prevented him from taking even a sip. (They also barred him from bringing a sixer on to the floor last yr that he'd planned to give to Rep Peter DeFazio who chairs Small Brewers Caucus.) Cunningham hoisted the Joint Resolution to toast bipartisanship: "For the betterment of this country, we have to come together. We have to sit down and listen to each other and maybe even have a beer. The spirit of bipartisanship and cooperation. I raise this glass to my colleagues, both Democrats and Republicans." Republican Nancy Mace, who defeated Cunningham last mo, immediately released a statement: "I'll drink to that." Meanwhile, America continues to wait for Santa Claus to come to town with some stimulus in his sack.

