2014 Beverage Report--Trend: The Stairway to Health. Countertrend: The Road to Flavor

Consumers alternately demand wellness and big tastes, and they’re willing to pay for both

Steve Holtz, Editor in Chief, CSP Daily News

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Beer & Wine: Bold Flavors Lead the Wedding Band

“High end” and “big flavor” continued to be the lead stories for beer in 2013 as awareness of small craft brews continued to grow and as the major brewers rolled out higher-end beers with distinct tastes.

Anheuser-Busch introduced its popular Shock Top in a single-serve 16-ounce can, branded a new cider with its Stella Artois moniker and added to its “-Rita” line with strawberry and cranberry flavors.

MillerCoors’ R&D team continued to function in high gear with three significant 2014 rollouts or line extensions: Miller Fortune, an undistilled golden lager with 6.9% alcohol by volume; Smith & Forge Hard Cider, the latest addition to the growing hard-cider field; and a new flavor of its year-old Redd’s Apple Ale, now available in strawberry.

Crown Imports aimed for bold flavor with its new Modelo Chelada, a tomato-flavored beer.

And Heineken USA will layer on the flavor this year like never before with Dos-a-Rita, a premium, ready-to-serve lager margarita; Strongbow Honey & Apple, a new hard cider sweetened with honey; Desperados, a tequila-barrel-aged beer with a hint of lemon; and Amstel Radler, a blend of beer and lemon.

The upscale beer “segment is more popular than ever, growing faster than mainstream and value combined,” says Dirk De Vos, senior vice president & chief commercial marketing officer for Heineken USA, White Plains, N.Y. The brands “are delivering more incremental cases and efficient growth thanks to the growing and influential millennial and multicultural consumer base.”

Still, premium and subpremium beers remain the most popular segments of the category, leading brewers to encourage a balanced portfolio.

“Operators that ensure they have the right assortment, with adequate cold and warm space, and engage shoppers in a fun and exciting way will be prepared to fully leverage the potential the beer category offers,” says John F. Knapp, director of category solutions for convenience for MillerCoors, Chicago.

Adds Kevin Wilkerson, vice president of national retail sales for small format for Anheuser-Busch, St. Louis, “Winning retailers utilize a balanced approach toward merchandising and promotion. As economic conditions improve, the formula for success will be availability of cold premium and value package beer and singles, and the right mix of leading high-end brands.”

Wine’s Next Generation

With a healthy 12% growth in unit sales in 2013—on top of 19% growth the previous year—wine continues to capture more customers’ attention in convenience stores.

“Slowly, this channel is beginning to increase their awareness of wine availability,” says George Ubing, director with E&J Gallo Winery, Modesto, Calif.

Driving the trends for the category is the millennial population, which is discovering wine at a younger age but approaching it from a different perspective, expecting it to be “refreshing” in a way older drinkers historically haven’t required. This has led wineries to introduce sweeter wines and more sparkling wines to satisfy a new niche.

Gallo’s recent introductions to meet these needs have come via Barefoot, the world’s largest wine brand. This includes Barefoot Refresh, Moscato and Bubbly, all of which target the millennial adult consumer. The move to put Liberty Creek wine in a Tetra Pak also targets millennials and their on-the-go lifestyles.

“Single-serve packaging is the fastest-growing size in this channel,” Ubing says.

Just the Stats: Beer & Wine

2013 unit growth in c-stores through Dec. 1: -1.8% (beer), 12.6% (wine)

Bright spots: High-end beer growing; millennials discovering wine.

Pain points: Boredom setting in for some of the biggest beer brands.

If beer and wine were musical entertainers, they would be: a well-rehearsed wedding band. It can get the party rocking or bring the volume down for an intimate encounter. Too much of it, and you may not feel well.

Best-Selling Beers

C-store sales, 52 weeks ending Dec. 1, 2013, Convenience AllScan, IRI

“Better beers,” such as imports Corona and Modelo, saw healthy growth in 2013, propelling Modelo into the top 10 c-store brands by unseating Keystone Light, which dropped to the No. 12 position after unit sales dipped 6.79%.

Brand Dollar Sales (in Millions) PCYA Case Sales (in Millions) PCYA
Bud Light $3,990.1 -1.58% 187.7 -2.15%
Budweiser $1,386.2 -3.48% 64.8 -4.45%
Coors Light $1,322.1 3.22% 61.8 1.67%
Miller Lite $1,025.8 -3.75% 47.8 -5.14%
Natural Light $776.0 -8.40% 48.2 -10.23%
Corona Extra $629.0 6.92% 19.6 4.93%
Busch Light $530.6 1.31% 34.0 0.12%
Busch $479.4 -6.52% 30.1 -7.70%
Michelob Ultra Light $349.3 10.83% 14.1 6.07%
Modelo Especial $351.0 22.65% 12.8












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