MHW and Nielsen continue to provide you with the latest weekly update for beer, wine, and spirits sales in Nielsen measured off premise channels. Again, please note that this represents retail sales in key off premise trade channels, and not all trade channels.

This update includes a summer recap, and will be the final weekly update that we will deliver. Moving forward, we will provide monthly updates. As always, please reach out with any thoughts or questions.

TOTAL ALCOHOL

All trends for the first section below are for Nielsen off premise channels for the week ending 9/12/20 compared to the same week in 2019.  We continue to remind our readers that we measure sales in specific off premise channels, and that the impact of the health crisis on sales is uneven across companies in the alcohol industry.

For the week ending 9/12/20, total fast-moving consumer goods sales were nearing double digit growth again, up 9.9% compared to the same week last year. Off premise alcohol sales had a good week, up 22.6% compared to the same week last year. However, strong growth rates in part are due to the timing of Labor Day. The latest week of off premise data includes Labor Day in 2020, but the year ago comparison does not include Labor Day in 2019. For the latest week, spirits again led off premise growth, up 30.1% compared to the same week last year. Wine followed, up 22.9%, with beer/FMB/cider lagging slightly, up 19.9%.  

Core beer (excluding FMB/seltzers) was up 13.6%, with one of its strongest weeks since June. Core beer growth was led by super premium (+29.3%) and craft (+22.5%). In craft beer, 20 big craft brands accounted for 43% of the segment’s off premise growth for the latest week, but a lot of growth came from the long tail too. 

OFF PREMISE ALCOHOL SUMMER 2020 RECAP

Unless otherwise noted, all time periods below are for the week ending May 23, 2020 through the week ending September 12, 2020. This data includes Memorial Day sales through Labor Day week sales, providing a complete 2020 summer recap for off premise sales.

SPIRITS: SUMMER 2020 

Spirits led off premise growth for the summer, with dollar sales up $1.5 billion (+29.7%) compared to summer of 2019. One consistent characteristic of off premise alcohol during COVID has been the acceleration of premiumization. That trend continued for spirits during the summer months, with consumers shifting on premise dollars to high-end spirits in off premise. Ultra premium and premium price tiers accounted for 80% of total spirits dollar growth in off premise. Ultra premium spirits led growth, up 54.3% in off premise channels from Memorial Day week to Labor Day week.  

Given its overall size, whiskey was the largest contributor to growth among categories in spirits, accounting for nearly ⅓ (31%) of total off premise spirits growth. American whiskey was the biggest driver of that, growing 30.3%, slightly outpacing total spirits growth. Most other segments of whiskey, however, grew at a slower pace than other spirits. The only exception to that is Japanese whisky (+65.6%).

Throughout the summer, tequila was one of the fastest growth categories in off premise spirits, up 63.9% from Memorial Day through Labor Day week. Tequila now accounts for 12.1% of off premise spirit dollars, up 2.5 share points from last summer. One of the interesting aspects of tequila off premise growth during COVID is that trends haven’t slowed down at all. We can look at other categories, such as gin, that had an initial bump in off premise sales during the first months of the pandemic, but then have slowed in recent months, particularly through the summer months. Tequila, on the other hand, has maintained strong double-digit growth above 50% nearly every week since March. During the first three months of COVID, tequila grew by 65.4% in off premise compared to the same months last year. Off premise tequila growth is essentially the same for summer months, up 63.9% compared to summer 2019.

Cognac was also a summer growth driver that experienced a significant shift in trends during recent months. During the initial 3 months of COVID, cognac grew by 43.8% in off premise dollars compared to the same 3 months last year. With those growth rates, cognac was outpacing growth of spirits during the early phases of COVID, however, growth has accelerated even faster during the summer months of 2020, up 61.1% in off premise channels. Similar to tequila, cognac’s off premise strength during COVID, in part, can be attributed to its previous strong position in on premise. Much of that volume has of course shifted from on premise to off premise with partial and full closures of in-door space in bars and restaurants. The accelerated growth of cognac was also driven by growth in liquor channel and c-store channel, although convenience is still quite small.

Finally, ready-to-drink cocktails – while still small – was another growth leader in spirits for summer 2020. The RTD segment was up 162.4% for the latest 17 weeks, compared to the same weeks last year. 

WINE: SUMMER 2020

For summer 2020 (17 weeks ending 9/12/20), total wine grew 19.7% in off premise channels compared to the same weeks last year. During the first 3 months of COVID, table wine (+29.0%) slightly outpaced growth of sparkling wine (28.8%).  However, that trend shifted for the summer months, with sparkling wine up 33.3% and table wine up 15.9% from Memorial Day week through Labor Day week, compared to that same time period in 2019. Throughout the pandemic, growth of Prosecco has been somewhat consistent, with growth rates earlier in the pandemic up 43% and growth rates for this summer up 34.4%. French champagne experienced different dynamics, with slower growth rates during the first 3 months of the pandemic (+17.0%), followed by an extreme pick up in off premise growth during summer months (+65.1%). The $30-$50 price tier was the strongest contributor to growth in French champagne. Combined, French champagnes ranging from $30-$99 contributed to 81% of growth this summer. 

Across varietals, sauvignon blanc (+26.9%), pinot noir (20.0%), rosé (+19.8%), and cabernet sauvignon (+18.4%) led for off premise dollars. Blended table red wines also saw strong growth through the summer period (+21.9%). While growth leaders sauvignon blanc, pinot noir, and cabernet sauvignon peaked in early summer, rosé peaked late in the summer, up 37.2% in the latest week ending 9/12/20 versus the same week year ago.

Despite strong growth across top table wine varietals, sauvignon blanc and red blends are the only ones that grew share, while rosé and pinot noir have maintained share, and the remainder of table wine varietals lost share of total wine as the popularity for sparkling wines and wine based cocktails increased through the summer period.

BEER/FMB/CIDER: SUMMER 2020

Beer/FMB/cider grew $2.3 billion in off premise sales for the summer of 2020 compared to last summer, representing a dollar growth rate of 15.9%. Hard seltzers and big brands drove much of this growth. 

Hard seltzers accounted for 45% of category growth dollars for the summer, with an average growth rate of 154% for the 17 weeks from Memorial Day through Labor Day. Hard seltzers grew by $1.1 billion in off premise sales this summer compared to last summer. That’s impressive growth considering how big of a splash hard seltzers made during the “seltzer summer of 2019.” However, as we’ve continued to question, how much bigger could the growth have been without the out-of-stock challenges? Price of hard seltzers played a role as well, with the average case price of seltzer down 7.9% this summer compared to last summer. Average promoted price of hard seltzers was down even more, -11.5%. The top 5 growth brands for hard seltzers were White Claw, Truly, Bud Light, Corona, and Vizzy. Combined, those 5 brands accounted for 95% of total hard seltzer growth in off premise channels for this summer. 

Super premiums, up 19.0%, were the next largest contributor to off premise growth for the summer. Mich Ultra drove most of that, and finished out the summer up 24.0%. Craft beer also had a relatively strong summer in off premise, up 13.5% compared to last summer. The top 5 craft breweries or brand families that drove off premise growth were Blue Moon, New Belgium, Sierra Nevada, Elysian, and Firestone. Mexican imports bounced back some and ended the summer up 10.3% in off premise. The segment started the summer off with strong growth rates, but dipped into single digits — and even declined for one week — in July. Mexican imports were up 16.9% for the latest week (ending 9/12/20), due in great part to growth from Modelo. Other segment performance for the summer included: premium lights (+5.9%), below premium (-0.2%), cider (+8.1%), hard tea (+33.5%), hard kombucha (+104%), and non-alcoholic beer (+38.4%). 

LARGE PACK SIZES: During the first 3 months of the pandemic, large pack sizes (12 packs and larger) accounted for ¾ of beer/FMB/cider growth in off premise channels. We saw similar trends in wine and spirits, with large sizes driving growth. However, in each of those categories, trends have returned to growth in smaller sizes, whereas in beer, large packs continue to drive most of the growth. During summer 2020, large packs have gained 4.5 shared points compared to last summer. Seltzers in 12 packs are driving a lot of that, but 24 packs continue to outpace growth of total category and small packs. We should expect for this to be a lasting trend throughout the next few months and leading into the winter holidays.