Beer Marketer's Insights
Growing group of beer/wine blends - in individual brands and biz models - getting more attention, distribution. Planned Brick and Barrel in Cleveland will begin as small brewery in 1st development phase before expanding into wine-making, according to Crain's Cleveland Business. Figueroa Mtn Brewery in Buellton, Calif announced collab with neighboring Margerum Wine Co and Whole Foods to create custom blend of Belgian-style table beer and Sauvignon Blanc. Nantucket-based Cisco Brewers began distributing its Cisco Cider only in Mass via state Craft Brews Guild, L. Knife & Sons and Seaboard Products at the beginning of the month. Note that Cisco owners also operate Nantucket Vineyards and Triple Eight Distillery.
After founding in 2011, American Mead Makers Assn announced US mead sales jumped 130% in 2013. But that's off super-small base. Mead (or honey wine) sales hit just under $17 mil on over 123K cases in 2013, we estimate based on AMMA stats printed in assn-journal American Mead Maker. The AMMA counted 150 meaderies in the US (operating under winery licenses, primarily producing mead) with another 44 companies (winery or brewery) producing at least one mead or mead-like brand. Won't be surprising where most of these co's based either. Calif and Mich have biggest concentrations, each with 18 meaderies; there are 16 each in Colo and Wash, plus 13 in NY, 12 in Pennsy and 10 in Oreg. The fledgling AMMA keeps working to strengthen its legislative committee with hopes for clearer definitions and treatment from TTB and state laws. The group also notes growing popularity of braggots, or beverages blending fermented grains (beer) and fermented honey (mead). A new Oreg co plans to make only braggots, adding to existing offerings from familiar bev-blending brewers Dogfish Head and Rogue.
After founding in 2011, American Mead Makers Assn announced US mead sales jumped 130% in 2013. But that's off super-small base. Mead (or honey wine) sales hit just under $17 mil on over 123K cases in 2013, we estimate based on AMMA stats printed in assn-journal American Mead Maker. The AMMA counted 150 meaderies in the US (operating under winery licenses, primarily producing mead) with another 44 companies (winery or brewery) producing at least one mead or mead-like brand. Won't be surprising where most of these co's based either. Calif and Mich have biggest concentrations, each with 18 meaderies; there are 16 each in Colo and Wash, plus 13 in NY, 12 in Pennsy and 10 in Oreg. The fledgling AMMA keeps working to strengthen its legislative committee with hopes for clearer definitions and treatment from TTB and state laws. The group also notes growing popularity of braggots, or beverages blending fermented grains (beer) and fermented honey (mead). A new Oreg co plans to make only braggots, adding to existing offerings from familiar bev-blending brewers Dogfish Head and Rogue.
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Oreg's Ninkasi Brewing will be distributed in Nevada by Bud network - Blach Dist, Capital Beverages, Nevada Beverage, Morrey Dist, Valley Dist - starting in May. Nev marks Ninkasi's 7th state (also in Vancouver, Canada) as co now has capacity to expand footprint further now that its 2nd facility came on earlier this mo. "Finally, we will have a space that we can grow in to for the next 10 to 15 years instead of constantly adapting our facilities to fit our needs," sez CFO, Nigel Francisco via blog. Second brewery will initially add 70K bbls of capacity "with room to grow to 250,000." As we head into May, take a look back at our monthly round-up of the distribution expansions that happened this past mo. Click here.
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04/29/2014
Fla Bill Moves Forward: Brewers No More Amenable to New Amendments; Senate Debate Details
Newly amended beer-focused Fla bill passed state Senate 30-10 this morning after more debate yesterday and today. Current version amended to loosen planned restrictions on retail sales at breweries, however small brewers remain opposed. It heads to the House, where it has little chance of passage or even discussion, CBN hears. Fla's legislative session ends Friday. Local press has continued to spill much ink in support of small brewers, tho discussions on Senate floor this week threw monkey wrench into some arguments. Viewing proceedings, it seems clear many legislators still largely confused about some of provisions of bill and particularities of beer biz. Meanwhile, support for small brewers turned into ugly attacks on bill sponsor by some beer fanatics.
Allowances Under Current Bill, Still "Lipstick on a Pig" to Fla Brewers Guild As bill stands now, some of most contentious language to small brewers in original bill changed. Draft beer brewed and sold at brewery for on-site consumption completely unrestricted for any brewer regardless of size by current bill. Growlers, including 64oz size, included in unrestricted sales. Packaged beer for off-premise consumption also unrestricted for brewers producing under 1000 bbls. New amendment limits sales of packaged beer for off-premise consumption for brewers over 1000 bbls to 20% of on-site production. Yet all brewers exempted on first 1000 bbls ("2000 kegs") and 20% calculated on everything after, sponsor Sen Kelli Stargel told colleagues in discussion on Senate floor today. Brewers not required to use distributors for beer sold on-site. Brewers may also transfer beer between owned-properties up to 1000 bbls or, if smaller, equal to production of receiving brewery. Further, amended bill allows brewers to transfer any current vendor's license, including expensive "quota license" that allows sales of any beer, wine or liquor for on-premise consumption, to another location, tho it does require such licenses be acquired on or before Oct 1, 2014. But amendment smeared as "lipstick on a pig" by Florida Brewers Guild lobbyist/exec director Josh Aubuchon to Saint Peters Blog as it "creates a layer of bureaucracy where one currently does not exist." Further, "it would be difficult for us to support any language that places additional burdens on small businesses that are experiencing such rapid growth," Josh said, according to Tampa Bay Times.
Senate Sponsor Claims Bill Removes "Ambiguity" and Protect Brewers from Possible Court Challenge On Senate floor yesterday, sponsor Sen Stargel argued that the state's "craft brewing industry is growing under an exemption," claiming that her bill acknowledges that "you're an industry, you don't have to hide behind a tourism exemption" and "you can do what you're doing." She reiterated such sentiment today, claiming that she's "afraid this industry is working in a lot of ambiguity" so this bill provides "protection and certainty of the law" for brewers "instead of working in a potential loophole that if ever challenged in court could shut them down completely." Stargel repeatedly claimed that brewers "are not going to be harmed by this bill." Handful of opposing Senators pleaded brewers' case. The "sad fact of it is that it's going to stifle an industry that's been growing in Florida," Sen Latvala said today, echoed by Sen Joyner: bill "would stop the rapid economic growth that has been afforded for the breweries and cause a significant loss of jobs" and "will kill a significant portion of what has been attained to date."
Others not convinced by these arguments, including Sen Soto who had been "very worried" bill would "snuff out these little guys." But amendment seems fair to him and instead he's concerned by Stargel's characterization that small brewers "don't want to be regulated at all," in his words. While Stargel may have exaggerated small brewer sentiment, she claimed that they've been "absent" from much of the debate and that their public blog entries and memos have been "the only way I get information from them…. They're not talking to me because they don't want a bill." Indeed, "I feel like I'm being a parent in this process." In the meantime, Stargel has reportedly received messages with expletives and threats via social media and calls to her cell and home phones, according to Political Fix Florida. Tho she's also intro'd or supported bills on education, immigration and abortion recently, some of her harshest critics have been so-called beer lovers. Some small brewers have since asked backers to cool it via social media.
Allowances Under Current Bill, Still "Lipstick on a Pig" to Fla Brewers Guild As bill stands now, some of most contentious language to small brewers in original bill changed. Draft beer brewed and sold at brewery for on-site consumption completely unrestricted for any brewer regardless of size by current bill. Growlers, including 64oz size, included in unrestricted sales. Packaged beer for off-premise consumption also unrestricted for brewers producing under 1000 bbls. New amendment limits sales of packaged beer for off-premise consumption for brewers over 1000 bbls to 20% of on-site production. Yet all brewers exempted on first 1000 bbls ("2000 kegs") and 20% calculated on everything after, sponsor Sen Kelli Stargel told colleagues in discussion on Senate floor today. Brewers not required to use distributors for beer sold on-site. Brewers may also transfer beer between owned-properties up to 1000 bbls or, if smaller, equal to production of receiving brewery. Further, amended bill allows brewers to transfer any current vendor's license, including expensive "quota license" that allows sales of any beer, wine or liquor for on-premise consumption, to another location, tho it does require such licenses be acquired on or before Oct 1, 2014. But amendment smeared as "lipstick on a pig" by Florida Brewers Guild lobbyist/exec director Josh Aubuchon to Saint Peters Blog as it "creates a layer of bureaucracy where one currently does not exist." Further, "it would be difficult for us to support any language that places additional burdens on small businesses that are experiencing such rapid growth," Josh said, according to Tampa Bay Times.
Senate Sponsor Claims Bill Removes "Ambiguity" and Protect Brewers from Possible Court Challenge On Senate floor yesterday, sponsor Sen Stargel argued that the state's "craft brewing industry is growing under an exemption," claiming that her bill acknowledges that "you're an industry, you don't have to hide behind a tourism exemption" and "you can do what you're doing." She reiterated such sentiment today, claiming that she's "afraid this industry is working in a lot of ambiguity" so this bill provides "protection and certainty of the law" for brewers "instead of working in a potential loophole that if ever challenged in court could shut them down completely." Stargel repeatedly claimed that brewers "are not going to be harmed by this bill." Handful of opposing Senators pleaded brewers' case. The "sad fact of it is that it's going to stifle an industry that's been growing in Florida," Sen Latvala said today, echoed by Sen Joyner: bill "would stop the rapid economic growth that has been afforded for the breweries and cause a significant loss of jobs" and "will kill a significant portion of what has been attained to date."
Others not convinced by these arguments, including Sen Soto who had been "very worried" bill would "snuff out these little guys." But amendment seems fair to him and instead he's concerned by Stargel's characterization that small brewers "don't want to be regulated at all," in his words. While Stargel may have exaggerated small brewer sentiment, she claimed that they've been "absent" from much of the debate and that their public blog entries and memos have been "the only way I get information from them…. They're not talking to me because they don't want a bill." Indeed, "I feel like I'm being a parent in this process." In the meantime, Stargel has reportedly received messages with expletives and threats via social media and calls to her cell and home phones, according to Political Fix Florida. Tho she's also intro'd or supported bills on education, immigration and abortion recently, some of her harshest critics have been so-called beer lovers. Some small brewers have since asked backers to cool it via social media.
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By turns defensive and expansive, Dogfish Head founder Sam Calagione covered a number of touchy topics during industry panel discussion at NBWA Legislative conference yesterday. Sam set up his comments on state laws (see above) with early point on key challenges facing the industry. Noting rapid industry concentration elsewhere while 1.3 breweries opening per day, he pegged key concern as "market access." Picked up same point later when discussing Yuengling, which will now come in under BA definition of craft brewer, saying its access to mkt challenges are same as craft brewers'. Yet Yuengling, like Dogfish Head, other growing craft brewers and vast majority of newbies, has no problems with access to market. Indeed, distribs are battling daily to attract these brewers to their houses, in some cases being asked for and agreeing to significant upfront payments, call 'em what you will. Sam reminded NBWA audience that avg size of BA member is just 7000 bbls annually, and those brewers face same challenges he faced when he was that small, calling it a "similar challenge in a new era." Sam (and his colleagues) did okay, it seems, in overcoming those challenges. Plus, his avg number includes over 1300 brewpubs, few of whom are seeking broader access to mkt and vast majority of those who are apparently having no trouble getting or expanding distribution.
Speaking of Yuengling and BA definition of craft brewer, could there be more tweaks? BA board reviews foundational documents every two years, said Sam. "If there are changing needs, it would be foolish to say there won't be further evolution."
On BREW vs BEER bills, which didn't generate much talk at lege conference even tho they're about the only fed beer legislation in the hopper that matters these days, Sam emphasized that BA supports BREW as "most realistic" way to "help small brewers of America." Those brewers have "very different challenges" when it comes to "access to capital" than global brewers. Big-brewer supported BEER bill, he noted, provides "vast majority of benefit" to top 2, and costs Treasury $1.8 bil, he reminded, while BREW cost is $65 mil. Then too, BREW currently has 2X co-sponsors of BEER. Sam did say "at most existential level" all brewers aligned against any increase in excise taxes, as well as being against tax equalization with spirits, given shared belief that "a drink is not a drink"
Looking at tax bills, NBWA chair Greg LaMantia asserted that "one picks winners and losers" (BREW) and the other benefits everyone (BEER). Also reiterated NBWA concern that BREW's identification of small as 6 mil bbls is "very concerning." In any case, passing either without industry aligned will be "very difficult." Heineken USA's Dolf van den Brink also expressed "concern" with having separate vehicles and suggested, as he has in past, "taking a page from the hard liquor playbook" in getting beer biz more aligned on a public policy agenda.
Sam got a bit defensive when asked about craft vs crafty and in his final thoughts. "It's not lost on me that the more negative topics are directed at a small segment that's generating positive growth," he said when asked to explain the former. (He'd also asked for NBWA report on distrib profits without that craft growth.) Original BA op-ed, said Sam, aimed "solely around the goal" of obtaining "more authenticity and transparency in the marketing of beer…. Big beer is not bad beer." At no time has BA put out statement in "effort to disparage quality or consistency of big brewery beer." Sam did wonder about sustainability of such quality at sale price of $59 per half bbl, referring to newly discounted price of Shock Top/Goose Island in some mkts. But craft vs crafty "went viral" with 80 mil impressions, said Sam, and "amplified conversation about who makes what." Dolf reminded that disunity reflected by "craft vs crafty" affected "ability for collective action by brewers," as well as ability "to get things done in DC and elsewhere." Suggested craft "needed to be smarter about when to express opinions and not."
In closing remarks, Sam said "we would not be here if you guys [distributors] did not care about us." But he returned to access issue and said that doesn't mean "our opportunity is equitable in every state." Pointed to 6-figure legal battle Dogfish had to wage in VA, a similar battle that New Belgium fought in Texas when it faced "no choice" where its brands went and current Fla flap over growlers where he said distribs seeking a cut of growler biz when that beer "never in" their warehouse.
Speaking of Yuengling and BA definition of craft brewer, could there be more tweaks? BA board reviews foundational documents every two years, said Sam. "If there are changing needs, it would be foolish to say there won't be further evolution."
On BREW vs BEER bills, which didn't generate much talk at lege conference even tho they're about the only fed beer legislation in the hopper that matters these days, Sam emphasized that BA supports BREW as "most realistic" way to "help small brewers of America." Those brewers have "very different challenges" when it comes to "access to capital" than global brewers. Big-brewer supported BEER bill, he noted, provides "vast majority of benefit" to top 2, and costs Treasury $1.8 bil, he reminded, while BREW cost is $65 mil. Then too, BREW currently has 2X co-sponsors of BEER. Sam did say "at most existential level" all brewers aligned against any increase in excise taxes, as well as being against tax equalization with spirits, given shared belief that "a drink is not a drink"
Looking at tax bills, NBWA chair Greg LaMantia asserted that "one picks winners and losers" (BREW) and the other benefits everyone (BEER). Also reiterated NBWA concern that BREW's identification of small as 6 mil bbls is "very concerning." In any case, passing either without industry aligned will be "very difficult." Heineken USA's Dolf van den Brink also expressed "concern" with having separate vehicles and suggested, as he has in past, "taking a page from the hard liquor playbook" in getting beer biz more aligned on a public policy agenda.
Sam got a bit defensive when asked about craft vs crafty and in his final thoughts. "It's not lost on me that the more negative topics are directed at a small segment that's generating positive growth," he said when asked to explain the former. (He'd also asked for NBWA report on distrib profits without that craft growth.) Original BA op-ed, said Sam, aimed "solely around the goal" of obtaining "more authenticity and transparency in the marketing of beer…. Big beer is not bad beer." At no time has BA put out statement in "effort to disparage quality or consistency of big brewery beer." Sam did wonder about sustainability of such quality at sale price of $59 per half bbl, referring to newly discounted price of Shock Top/Goose Island in some mkts. But craft vs crafty "went viral" with 80 mil impressions, said Sam, and "amplified conversation about who makes what." Dolf reminded that disunity reflected by "craft vs crafty" affected "ability for collective action by brewers," as well as ability "to get things done in DC and elsewhere." Suggested craft "needed to be smarter about when to express opinions and not."
In closing remarks, Sam said "we would not be here if you guys [distributors] did not care about us." But he returned to access issue and said that doesn't mean "our opportunity is equitable in every state." Pointed to 6-figure legal battle Dogfish had to wage in VA, a similar battle that New Belgium fought in Texas when it faced "no choice" where its brands went and current Fla flap over growlers where he said distribs seeking a cut of growler biz when that beer "never in" their warehouse.
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Are recent craft brewer attacks on franchise laws "part of a long-term coordinated" plan of BA, Craig asked on panel. Dogfish Head founder Sam Calagione noted "some similarities" between recent NY Times op-ed from Steve Hindy and earlier "craft vs crafty" flap. Tho craft brewers have "seat at the big boy table" now, said Sam, they still have "very small voice." "When we feel we're not getting heard," craft brewers "need to go to the consumer," their grassroots strength, and ask "does this seem fair to you?" And that was case with franchise issues. Sam said he's had "awesome discussions" with distribs since op-ed, with distribs wondering if it's just a "few bad apples taking advantage" of franchise protections. That's not "root problem," said Sam, but "it's about a few bad laws in a handful of states that we could fix." Sam did not acknowledge that distribs have responded to much broader attack on franchise laws than "a few bad laws." Nor did he identify those laws or what they do.
Greg said he was "happy to hear" Sam's clarification and "could not understand why small brewers were attempting to use an atomic bomb to kill a gnat's ass." His concern: "We already see some big- small [craft brewers] come in and say 'if I come in I don't want that local small-small'" brewer in the distrib's house. HUSA prexy Dolf van den Brink said NY Times op-ed had a "tremendous negative impact on our industry…. Do I like franchise laws? Not always." But 3-tier system "incredibly beneficial…we should cherish that, not start chipping away against that," especially if exemptions "for only some" players. His advice: get the right leaders together who "understand the grievances and resolve them in a mature way."
Greg said he was "happy to hear" Sam's clarification and "could not understand why small brewers were attempting to use an atomic bomb to kill a gnat's ass." His concern: "We already see some big- small [craft brewers] come in and say 'if I come in I don't want that local small-small'" brewer in the distrib's house. HUSA prexy Dolf van den Brink said NY Times op-ed had a "tremendous negative impact on our industry…. Do I like franchise laws? Not always." But 3-tier system "incredibly beneficial…we should cherish that, not start chipping away against that," especially if exemptions "for only some" players. His advice: get the right leaders together who "understand the grievances and resolve them in a mature way."
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Not surprisingly, recent craft brewer attacks on franchise laws dominated much of the discussion at NBWA Legislative Conference, in the open and (even more so) privately. Just prior to the mtg, NBWA board put out resolution on "the value of state beer franchise laws," aimed to directly counter some recent statements of BA leaders. Franchise laws enable distribs to "act independently" and "partner with a wide range of brewers" to deliver wide choice of brands, it asserts. "Efforts to dismantle existing state laws weaken confidence in long-term partnerships and undermine" the 3-tier system. In opening speech, prexy Craig Purser stepped it up a notch. Pointed out that: 1) American consumers "have never had so much choice"; 2) brewers have "more routes to market than ever before"; 3) independent distribs have "aided" craft's "un-freaking-believable" growth; 4) craft brewers get "special treatment" via laws that allow self-distribution and retail privileges. Makes Craig wonder whether called-for franchise reform is "a solution looking for a problem." Most important: "NBWA will not reverse course when it comes to supporting state franchise laws." So, to extent craft brewers take on individual states, Craig implied, they'll also be taking on the national assn. (Some of the following appeared in our INSIGHTS Express letter yesterday.)
Keep Differences Behind Closed Doors, NBWA Leaders Suggest Another recurring theme, from Craig and chairman Greg LaMantia: differences between craft brewers and distribs would be best resolved outside the public eye. Referring to NYT op-ed and other public comments that kicked off this issue, Craig lamented that "no one wins when policy disputes are aired in a public manner." Craig called BA attacks "counterproductive." While some members wanted NBWA to "throw off jackets" and publicly "counterpunch," Craig countered that would "be a little like mudwrestling with a pig. You both get dirty and the pig likes it." Greg suggested that to "shut the door and beat hell out of each other" would be "better place to be than to poke each other in the nose in front of the world."
Keep Differences Behind Closed Doors, NBWA Leaders Suggest Another recurring theme, from Craig and chairman Greg LaMantia: differences between craft brewers and distribs would be best resolved outside the public eye. Referring to NYT op-ed and other public comments that kicked off this issue, Craig lamented that "no one wins when policy disputes are aired in a public manner." Craig called BA attacks "counterproductive." While some members wanted NBWA to "throw off jackets" and publicly "counterpunch," Craig countered that would "be a little like mudwrestling with a pig. You both get dirty and the pig likes it." Greg suggested that to "shut the door and beat hell out of each other" would be "better place to be than to poke each other in the nose in front of the world."
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05/01/2014
Tax Talk at Beer Institute; Brewers Advised to Seek Single Bill; Equivalence, Earmarks, Etc.
Federal excise tax rates on beer remain a topic of keen interest at Beer Institute, as the issue came up repeatedly at its annual meeting. Incoming chair AB CEO Luiz Edmond said taxes are still priority number 1. Then too, the new "Know Your Drink" campaign (see above) is primarily aimed at forestalling tax equivalence, which brewers continue to believe is the end game of distillers' "drink is a drink" campaign. On a panel of Hill staffers and inside DC experts, brewers were told by one of the former that tax equalization is "absolutely something to worry about since it raises revenue." Congress will have a revenue target and "anything that brings in revenue we're throwing against the wall and see what sticks." There will be willingness to "hit a lot of industries to bring [tax] rates down." Staffers also strongly advised big and small brewers to settle on single tax bill, rather than separately advocating the BEER and BREW bills. One staffer pointed out her boss sponsors both bills but advised it's hard to bring the issue [up] when you have two options." It would be "helpful if [you] come together with one bill" and "get to one solution."
Another staffer said excise taxes are relatively small issue in grand scheme of tax reform and "if I don't have single message… it's tough for me to speak up, tough for my boss" to speak up and hard to get issue on agenda. A month earlier, leaders of NBWA, which represents beer wholesalers in DC, told members that, if asked, to advise the Hill NBWA doesn't support either bill. Another DC veteran also warned against "wedge" issues in the broader sense for alcohol beverages (like equivalence) pointing out that when industries fail to unite "they pay a substantial price when decisions are made…very bad results happen." BI's "Know Your Drink" will not make broad industry unity any easier to achieve on the federal landscape. Quite the contrary.
One disconnect: invited speaker Senator Heidi Heitkamp of North Dakota echoed staffers in advising brewers, importers and suppliers to "stay engaged," especially in tax reform debates. But she wondered whether anyone had ever seen proposals that dedicate tax hikes to the consequences of alcohol abuse (i.e. rehab centers), seemingly unaware that the industry has vigorously and continually fought against such earmarked proposals for many years. Excise taxes, equivalence, earmarks and challenges to industry unity. Some alcohol policy issues never go away. Go To Top
One disconnect: invited speaker Senator Heidi Heitkamp of North Dakota echoed staffers in advising brewers, importers and suppliers to "stay engaged," especially in tax reform debates. But she wondered whether anyone had ever seen proposals that dedicate tax hikes to the consequences of alcohol abuse (i.e. rehab centers), seemingly unaware that the industry has vigorously and continually fought against such earmarked proposals for many years. Excise taxes, equivalence, earmarks and challenges to industry unity. Some alcohol policy issues never go away. Go To Top
Cheers, 
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Responsible drinking issues, and industry executives' thoughts about them, are increasingly in the air these days. Recall, Diageo CEO Ivan Menezes focused his entire talk at IMPACT's March Marketing seminar on these issues and the need for increased commitments. (See last issue.) Subsequently, several other reports of remarks along the same lines have surfaced.
Alcohol beverages "are products which if consumed badly - too much or at the wrong time - cause damage, ill health or social disruption," acknowledged Paul Skehan, director general of SpiritsEurope to EurActiv in a recent interview. "So we know our products have this double side to them." Thus the group supports responsible drinking campaigns which in some cases may mean consumers should drink less, in others saying "you should take one or two days a week when you don't drink at all." Skehan pointed out that drinking patterns are often more important than amount consumed, citing higher harm levels in Scandinavia than Mediterranean countries, although average consumption is higher in the latter areas. "Those people in the Mediterranean who have a glass of wine at lunch and dinner, and spread that out through the week, they might drink more units of alcohol than someone who goes out on a Friday night in a very cold Finland and has 15 units of beer," said Skehan. European distillers, he said, are concerned about rising tax pressures in the region, which is making the market there "very difficult. If you add in all the austerity measures, it's a perfect storm against our type of product. First, people have less to spend and second, governments tax higher." At the Beer Institute annual meeting in Washington DC recently, AB InBev's US CEO Luiz Edmond pointed out that when excise taxes rose 200% in Russia, beer volume subsequently dropped 18%. A similar increase in Ukrainian beer taxes resulted in a 17% volume decline. Elsewhere at the BI meeting, top industry beer execs voiced continued commitment to responsibility efforts in the US market.
AB Spreads Family Talk Back across the pond, ABI's global vice president of "Beer & Better World" Carol Clark, wrote a lengthy feature for the Guardian, laying out ABI's responsibility perspective and efforts. Carol pointed out that "research has long shown that parents are the most important influence on a young person's attitude towards drinking." That's the basis of ABI's efforts to encourage dialog between parents and teens. This concept goes back nearly 25 years with AB's "Family Talk About Drinking" and forward to today with both the federal government and Mothers Against Drunk Driving increasingly encouraging more parent-teen talk. While some in public health dismiss such awareness efforts, Clark quoted the US Secretary of Health from a recent report noting the decline in teen drinking rates in the US. "These trends," the Secretary pointed out, "are important because they suggest that increased attention to the problem of underage drinking in the past decade has had a positive effect." Outside the US, ABI is working to "understand how attitudes and behavior towards alcohol differ from place to place" and tailor programs to countries with different "social norms." It took some years for officials in the UK, for example, to accept "any type of education effort" sponsored by a beer company, since drinking was considered "more as a private matter," inappropriate for educational campaigns. But now Family Talk is available in the UK, several other European countries and elsewhere, Clark pointed out. ABI also worked with "local experts" including educators from elementary school to university in China, Mexico and Canada to ensure the program was "culturally relevant." Family Talk is now available in 10 countries and reached "almost 145 million adults globally in 2011 and 2012 alone."
Can the Alcohol Beverage Industry "Wrest Control of the Health Debate" from Its Critics? A lengthy recent comment from just-drinks writer Chris Losh explores whether the alcohol beverage industry can advance the fact that moderate drinking is linked to health benefits and reduced mortality to offset the movement to make the industry as "isolated and vulnerable as the tobacco industry." Those health links, of course, clearly distinguish alcohol from tobacco, but as AII has documented for decades, many in public health continue to ignore that distinction. So do governments across the globe as they tighten restrictions, as Losh points out. In the UK, for example, men, women and teens "are all drinking less often and less heavily," yet that's not the common perception and public health continues to pressure for more restrictions. Beyond that, public health advocates seek to remove the industry from legislative debates over alcohol policy. The battle to stay in the debate may have already been lost in some established markets, ICAP's Marjana Martinec told Losh. Instead, "emerging markets are the new battleground for the industry. There's a great opportunity to put in place responsible marketing codes and behavior, things that will pre-empt the kind of behavior we're seeing elsewhere." As Losh points out, wresting control of the health debate, indeed, becoming part of it in some cases, will take "pan-industry unity (unlikely) and a costly commitment to a lengthy campaign of lobbying and promotion." Then too, there's the "complexity of the message. After years of pushing the idea that alcohol is bad, I can't quite see any politician staking their reputation on such a nuanced concept as 'it's good in moderation' however solid the science behind it," Losh wrote. And yet, that unity and advancing the message effectively remain critical to securing the industry's future and place in the policy debate.
Alcohol beverages "are products which if consumed badly - too much or at the wrong time - cause damage, ill health or social disruption," acknowledged Paul Skehan, director general of SpiritsEurope to EurActiv in a recent interview. "So we know our products have this double side to them." Thus the group supports responsible drinking campaigns which in some cases may mean consumers should drink less, in others saying "you should take one or two days a week when you don't drink at all." Skehan pointed out that drinking patterns are often more important than amount consumed, citing higher harm levels in Scandinavia than Mediterranean countries, although average consumption is higher in the latter areas. "Those people in the Mediterranean who have a glass of wine at lunch and dinner, and spread that out through the week, they might drink more units of alcohol than someone who goes out on a Friday night in a very cold Finland and has 15 units of beer," said Skehan. European distillers, he said, are concerned about rising tax pressures in the region, which is making the market there "very difficult. If you add in all the austerity measures, it's a perfect storm against our type of product. First, people have less to spend and second, governments tax higher." At the Beer Institute annual meeting in Washington DC recently, AB InBev's US CEO Luiz Edmond pointed out that when excise taxes rose 200% in Russia, beer volume subsequently dropped 18%. A similar increase in Ukrainian beer taxes resulted in a 17% volume decline. Elsewhere at the BI meeting, top industry beer execs voiced continued commitment to responsibility efforts in the US market.
AB Spreads Family Talk Back across the pond, ABI's global vice president of "Beer & Better World" Carol Clark, wrote a lengthy feature for the Guardian, laying out ABI's responsibility perspective and efforts. Carol pointed out that "research has long shown that parents are the most important influence on a young person's attitude towards drinking." That's the basis of ABI's efforts to encourage dialog between parents and teens. This concept goes back nearly 25 years with AB's "Family Talk About Drinking" and forward to today with both the federal government and Mothers Against Drunk Driving increasingly encouraging more parent-teen talk. While some in public health dismiss such awareness efforts, Clark quoted the US Secretary of Health from a recent report noting the decline in teen drinking rates in the US. "These trends," the Secretary pointed out, "are important because they suggest that increased attention to the problem of underage drinking in the past decade has had a positive effect." Outside the US, ABI is working to "understand how attitudes and behavior towards alcohol differ from place to place" and tailor programs to countries with different "social norms." It took some years for officials in the UK, for example, to accept "any type of education effort" sponsored by a beer company, since drinking was considered "more as a private matter," inappropriate for educational campaigns. But now Family Talk is available in the UK, several other European countries and elsewhere, Clark pointed out. ABI also worked with "local experts" including educators from elementary school to university in China, Mexico and Canada to ensure the program was "culturally relevant." Family Talk is now available in 10 countries and reached "almost 145 million adults globally in 2011 and 2012 alone."
Can the Alcohol Beverage Industry "Wrest Control of the Health Debate" from Its Critics? A lengthy recent comment from just-drinks writer Chris Losh explores whether the alcohol beverage industry can advance the fact that moderate drinking is linked to health benefits and reduced mortality to offset the movement to make the industry as "isolated and vulnerable as the tobacco industry." Those health links, of course, clearly distinguish alcohol from tobacco, but as AII has documented for decades, many in public health continue to ignore that distinction. So do governments across the globe as they tighten restrictions, as Losh points out. In the UK, for example, men, women and teens "are all drinking less often and less heavily," yet that's not the common perception and public health continues to pressure for more restrictions. Beyond that, public health advocates seek to remove the industry from legislative debates over alcohol policy. The battle to stay in the debate may have already been lost in some established markets, ICAP's Marjana Martinec told Losh. Instead, "emerging markets are the new battleground for the industry. There's a great opportunity to put in place responsible marketing codes and behavior, things that will pre-empt the kind of behavior we're seeing elsewhere." As Losh points out, wresting control of the health debate, indeed, becoming part of it in some cases, will take "pan-industry unity (unlikely) and a costly commitment to a lengthy campaign of lobbying and promotion." Then too, there's the "complexity of the message. After years of pushing the idea that alcohol is bad, I can't quite see any politician staking their reputation on such a nuanced concept as 'it's good in moderation' however solid the science behind it," Losh wrote. And yet, that unity and advancing the message effectively remain critical to securing the industry's future and place in the policy debate.
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The FTC's recent report on major alcohol beverage producers' marketing included some updated information on specific beverage preferences/use among underage drinkers from the University of Michigan's Monitoring the Future surveys (MTF). These figures show significant reductions across beverage types, with especially sharp declines in beer and flavored alcohol beverages. They also dispute two long-held and oft-voiced myths about teen drinking: that beer is the beverage of choice for teens and that flavored alcohol beverages are especially favored by teens. The table below shows that liquor is just as popular as beer among 12th graders. Also, flavored alcohol beverages are no more popular among these students than beer or spirits.
AII reported several months back that the long decline in overall teen drinking rates returned in 2013 after a brief pause in 2012 when rates increased slightly. The beverage specific data shows that the percentage of 8th graders who drink beer (at least once in the 30 days prior to being surveyed), dropped below 7% in 2013. That rate plummeted by over 60% compared to 1993 and by over 43% over the last decade. Dropoffs in beer drinking among 10th and 12th graders were not as dramatic, but equally significant: about a 30% decline over 20 years for 12th graders and 36% dropoff among sophomores. In the shorter 10-year period, the beer drinking rate declined by about 20% for both grades. While the popularity of spirits among 12th grades actually increased from 1993 to 2003, it also fell at a double-digit rate over the last decade. Wine drinking, never very popular among teens, also dropped at a double-digit rate for both the last 10 and 20 years. The MTF survey did not begin tracking flavored alcohol beverages until 2004. The table shows even sharper declines in the consumption of these beverages among youth than for beer.
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AII reported several months back that the long decline in overall teen drinking rates returned in 2013 after a brief pause in 2012 when rates increased slightly. The beverage specific data shows that the percentage of 8th graders who drink beer (at least once in the 30 days prior to being surveyed), dropped below 7% in 2013. That rate plummeted by over 60% compared to 1993 and by over 43% over the last decade. Dropoffs in beer drinking among 10th and 12th graders were not as dramatic, but equally significant: about a 30% decline over 20 years for 12th graders and 36% dropoff among sophomores. In the shorter 10-year period, the beer drinking rate declined by about 20% for both grades. While the popularity of spirits among 12th grades actually increased from 1993 to 2003, it also fell at a double-digit rate over the last decade. Wine drinking, never very popular among teens, also dropped at a double-digit rate for both the last 10 and 20 years. The MTF survey did not begin tracking flavored alcohol beverages until 2004. The table shows even sharper declines in the consumption of these beverages among youth than for beer.
| Prevalence of Alcohol Beverage Consumption | |||||
| 30-Day Use | % Chg | ||||
| 1993 | 2003 | 2013 | 93-13 | 03-13 | |
| Beer | |||||
| 8th Grade | 17.4 | 12.0 | 6.8 | -60.9 | -43.3 |
| 10th Grade | 28.7 | 23.2 | 18.4 | -35.9 | -20.7 |
| 12th Grade | 43.4 | 37.8 | 30.8 | -29.0 | -18.5 |
| Wine | |||||
| 12th Grade | 14.9 | 13.4 | 11.5 | -22.8 | -14.2 |
| Liquor | |||||
| 12th Grade | 31.4 | 34.3 | 30.1 | -4.1 | -12.2 |
| Flavored Alc Bevs* | |||||
| 8th Grade | 14.6 | 6.3 | -56.8 | ||
| 10th Grade | 25.1 | 15.5 | -38.2 | ||
| 12th Grade | 31.1 | 21.0 | -32.5 | ||
| *For FABs 2003 is actually 2004 data. | |||||
