Beer Sales Go Flat in 2005 (Again)
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I do wonder when “they” will ever get it. “They,” of course, are the world’s most quoted experts. You hear them summoned every day when someone authoritatively proclaims, “’They’ say …” fill in the blanks.
The beer biz, which has seen better days, will surely bounce back after they get the marketing right – or so “they” in the beer biz say. But “they” is wrong.
In the first half of 2005, the big guys shipped 1.2 million fewer barrels than in the same period a year earlier. Interestingly, though, specialty beers did doing great. Microbreweries managed 7.1% growth in that same time period and show no signs of growth slacking off.
Regular readers of these
ramblings may remember an earlier post about falling beer sales, but I
neglected to mention that the pricier specialty beers are enjoying a bit of a
boom.
Why of course, mainline beer sales are falling. And of course sales of wine and spirits are rising – along with luxury-priced beer. Why “of course?” It’s developmental. People tend to grow out of beer – it’s too ordinary – and into drinks with more élan. Happens in every generation.
“First, bring me a Gray Goose martini up – and don’t stir it. The please uncork a Belle Glos 2003 Pinot Noir. (ASIDE) I love its full-bodied, crisp, and lightly oaky taste with its hint of plum, clove, tobacco, and spicy oak. Good finish, too.”
Beer is not associated with sophistication. Good wine and overpriced vodkas are. No matter how of advertising by Bud, Miller, Coors and other suds makers can change that perception.
When most people enter the second half of life, their tastes tend to become more sophisticated. People running beer companies ought to study up on the psychology of human development.
Folks at Coke need to do the same. Like beer, soft drinks are, always were and always will be favorites of the young. Sure, I drink a coke once in awhile, but when I really want refreshment before the sun’s over the yardarm I usually drink water.
Pepsi perhaps realized a few years back that changing demographics were changing people’s beverage habits. That and growing concerns about health and weight prompted Pepsi to bottle water and sell it for the same price as its sugary bubbly. The suits at Coke didn’t catch on for a long time. They kept placing their bets on that cocaine-laced tonic that Atlanta pharmacist John Pemberton invented in 1886. Of course, the cocaine was removed decades ago, but if it were still part of the famous formula I wouldn’t be talking about Coke’s marketing travails.
In any event, there’s a big lesson in the story of beer sales going flat and the fizz draining out of the world’s most valuable brand (although its value is in decline, averaging 4% annually over a four year period ending in 2004).
The lesson is this: Best that you/and or your organization assesses the impact of the aging of the population on the products you and your company have to market. The second thing to do is to study up on human development to learn how people’s worldviews, values, aspirations and behavior change in the second half of life. Not only will you learn a lot about the New Customer Majority, but you’ll likely learn some important things about yourself. I always hear that from people who attend my workshops.
Perhaps the time has come to give mainstream beer and the "other" beer different names. In the 1950s, the best selling wine was Thunderbird, then it was jug wines. Now the wines you write nicely of are called "table wines" - consumers understand the difference.
It seems that craft beer isn't a label people exactly understand, but that segment grew faster than wine or spirits in 2005.
See: http://www.realbeer.com/news/articles/news-002847.php
Not all "beer" is dead.
Prosit - Stan
Posted by: Stan Hieronymus | February 16, 2006 at 09:09 PM