Norm!
Word is out that the craft breweries with the largest market share are seeing their growth stall. We keep saying this makes sense given that a big part of craft beer’s success is its regionality. On a crowded shelf, maybe these big brands from across the country just have to expect diminishing returns at a certain level (I mean, jebeers, there are more than 5,000 breweries now). But there’s another downward pressure here — there is a ceiling on total alcohol consumption in the country, period.
According to the new On-Premise Intelligence Report jointly developed by Technomic and Beverage Marketing Corporation, consumer occasions involving a call for alcohol are not growing, resulting in flat total adult beverage volume growth. That means that more and more breweries and distilleries and wineries and all of those big commercial bullies are just elbowing each other for the attention of the same pool of drinkers.
But there is good news…
So yes, the outlook for drink sales in restaurants and bars calls for more intense competition among on-premise venues and alcohol brands in 2017. However, dollar sales continue to increase as consumers gravitate towards more premium spirits, wine and beer products.
“Consumers are favoring more expensive selections such as craft and imported beer and higher-end whiskeys when ordering drinks and do indicate they’re spending more now on drinks in restaurants and bars,” said Donna Hood Crecca, associate principal at Technomic Inc. “Drink price increases also play a role — nearly half of on-premise operators report raising adult beverage menu prices in 2016, and many expect to do so in 2017.”
Beer remains the most-consumed type of alcohol in restaurants and bars, however, and wine ranks second.
Both are growing in dollar sales, according to the report. The report reveals that spirits is the only adult beverage category achieving volume gains in restaurants and bars.
“Spirits continues on its growth trajectory,” observed Eric Schmidt, director, Alcohol Research, at Beverage Marketing Corporation. “Whiskey is a growth driver in on-premise, primarily due to momentum in American and Irish whiskeys. Vodka remains the largest-volume category and is now returning to growth, but aged spirits are really trending in restaurants, bars and other on-premise locations. We’re also tracking notable growth in aged tequilas and Cognac.”
The On-Premise Intelligence Report includes channel, category and brand performance metrics, consumer and operator insights, as well as menu trend information developed via primary research conducted by Technomic and Beverage Marketing Corporation.
Further reading: Craft beer consumer stats: How will they affect your business plan?
