Beer Marketer's Insights
PepsiCo in Q2 suffered the consequences of its double-digit price hikes of recent years as consumers across all income tiers dialed back their spending, with CEO Ramon Laguarta telling investors the co will be offering more aggressive entry points for some product lines. "They're saying 'There's been a lot of inflation and my disposable income is stretched,'" Laguarta told Reuters today. "It's not only the lower-income consumer, it's throughout." Tho PepsiCo North American Bevs (PBNA) had long lagged, the weakness extended even to its Frito-Lay growth engine, where co now will be "surgically providing optimal value propositions within certain portions of our North America convenient foods portfolio," per Ramon statement. Massive product recall at Quaker Foods North America div didn't help topline either. Shares crashed by 4% in early trading today but by late afternoon had pretty much recovered all the losses.
Throwback Thursday
This week in 1999, as famed Broncos QB John Elway retired, he passed on opportunity to become a Coors distrib in Colorado Springs. Meanwhile, he was spokesman for Original Coors in new tv ads that broke on MLB's All-Star game. Elway instead got into car dealerships and eventually sold 5 of them to AutoNation for over $82 mil a few yrs ago and in 2022 made a significant investment in Tom's Watch Bar (sports bar chain) and joined co board as well.
Announcing The RTD Report
Don't miss this definitive guide to the growing world of ready-to-drink alc bevs. For the first time ever, Beer Marketer's INSIGHTS is compiling key stats across beer, wine and spirits RTDs in one comprehensive digital report. Dive deep into this rapidly developing subsegment with data that details: all-channel volume estimates for RTD alc bevs in the US from 2019-2023; top RTD suppliers, brands and segments in 2023, plus latest developments in the 1st half; a historical look at FMB/Seltzer/Cider shipments vs Total Beer since 1999; crossover brands and RTD partnerships since the early 2000s; a map and analysis of legal/legislative playing field at state levels; review of the latest developments in delta 9/THC bevs; and more! A digital version of the completed report will be sent once available September 10. Order today to reserve your copy now!
Feds Accepting Comments on Planned Alcohol Research for Dietary Guidelines; Stakeholder Meeting
Government-funded research into alcohol's impact on health, designed to inform the next update to the US Dietary Guidelines for Americans (DGA) and kept under wraps for up to 2 yrs before its disclosure in April, will finally be subject to public comment. Just before the July 4 holiday, the Interagency Coordinating Committee on the Prevention of Underage Drinking (ICCPUD) published the proposed methodology for what it calls the Alcohol Intake and Health Study. The extensive "series of studies" would cover a lot of ground, aiming to complete new research into how alcohol impacts a variety of health outcomes, as well as the history and efficacy of national drinking guidelines themselves, both in the US and abroad.
Gallo is looking to ramp up its new malt bev sales division, recently announcing that its hiring for high-level sales positions across dozens of mkts. "We're creating a Malt Beverage Sales Division to expand the distribution of fan favorites like Montucky Cold Snacks, VMC Tequila Cocktails, Waterbird, Pink Whitney Malt, [Fisher's Island], and more," post details.
The biggest beer distrib deal of the year officially closed. Just over two mos since announced, Sunkey Beverage Holdings completed its acquisition of Silver Eagle Bevs, the 15-mil-case AB and Constellation distrib in the San Antonio, TX area. Deal was reportedly expected to come in around $600 mil with a mid-to-high teens EBITDA multiple, putting former owner John Nau's sale of the Houston and San Antonio operations at ~$1.7 bil collectively, as our parent pub Beer Marketer's INSIGHTS reported last mo.
Consumer price index for beer rose 3% in Jun vs yr ago, per Bureau of Labor Statistics. Beer prices have been up right around 3% for 3 straight months. CPI for all items was up 3% in Jun vs year ago, just 0.1% lower than May growth rate. Still, that's smallest increase for all items in 3 yrs. CPI for spirits increased 0.8% in Jun vs yr ago while wine prices were up 1%. Year-to-date thru Jun, CPI for beer up 2.9% while All Items up 3.2%. Spirits and wine prices rose a more modest 0.8% and 0.9% respectively YTD.
A timely, wide-ranging and somewhat odd Reuters article published yesterday had a critical take on big brewers' low & no-alc endeavors, blaring that "Big Beer's low-alcohol Plan B has too much froth." While big global brewers like ABI, Heineken, Carlsberg, Molson Coors and Asahi are making concerted pushes into low and no-alc spaces "targeting an increasingly health-conscious consumer and the Gen Z generation…the boom looks relatively small, and if it gets any bigger non-brewers may muscle in," according to Reuters.
After a decade leading the Brewers Assn and 32 yrs with the BA and a predecessor org, Bob Pease will retire in early 2025. Bob moved up from customer service mgr to ops director of the Association of Brewers, beginning in 1993, before rising to VP of that org in 1999. When that org merged with the Brewers Assn of America in 2004, Bob served just below the combined org's prexy Charlie Papazian. Bob was named coo in 2010, just as craft beer began a period of speedy growth. He took the reins from Charlie as prexy/ceo in 2014, overseeing the org as craft hit new heights and then transitioned into a tougher period. Bob will serve 'til early 2025 when he can pass the torch to his successor, which BA retained Kittelman & Associates to help find.
Just one year after Constellation and Heineken launched intriguing new takes on imported light beers with Modelo Oro and Heineken Silver, those brands are no longer cycling in latest periods and other import light brands are down double-digits too.