Beer consumers are settling into the “next” normal — and that means increased sales in the convenience channel, according to Nielsen VP of beverage alcohol practice Danelle Kosmal.
For the fifth consecutive week, off-premise dollar sales growth of beer, FMBs and cider in convenience stores outpaced sales in larger channels, Kosmal wrote in her weekly update.
For the one-week period ending August 1, beer category sales in c-stores increased 16.7% compared to the same week a year ago, while sales in food, drug, mass and club stores increased 9.9%. This marks a reversal of early COVID-19 trends, when consumers stocked their fridges with beer, cider, seltzer and FMBs from grocery and other large-format stores.
“During the early stages of COVID, growth rates of the grocery channel were close to double the growth rates of the convenience channel,” Kosmal wrote. “The bounce back of c-store, which of course is beer’s most important channel, is another sign that consumers have settled into a ‘next’ normal.”
Total dollar sales of beer category products during the last week in July increased 13.9% (core beer, excluding hard seltzer and FMBs, was up 7.8%) compared to the same week a year ago.
The latest one-week period also marked the 11th consecutive week of billion dollar sales for the category, totaling $1.034 billion for the week ending August 1. Still, growth rates decelerated week-over-week, as category sales were up 14.7% and core beer up 8.1% during the prior week.
In some states, sales of beer, flavored malt beverages and cider at off-premise retailers (excluding convenience stores) are outpacing overall U.S. growth:
- California: +14.3%;
- Florida: +10%;
- Ohio: +8.2%;
- New York: +6.4%;
- Illinois: +5.7%;
- Texas: +4.8%.
On-premise reopening has been paused or rolled back in Florida, California, Illinois and Texas due to spikes in cases of COVID-19 in those states.
Driving this growth in California is the hard seltzer segment, “which isn’t exactly a surprise,” Kosmal wrote.
“The magnitude of growth is impressive,” she wrote, adding that hard seltzers accounted for 70% of beer category growth in California during the latest week.
The top four growth brand extensions in California were all hard seltzers. The second strongest growth segment in the Golden State was craft beer, which increased 15% over the same week last year, led by Sierra Nevada’s Hazy Little Thing.
Nationwide, off-premise sales of craft beer increased 10.9%, with Brewers Association-defined craft breweries outpacing other craft and growing dollar sales 12%. In Nielsen’s key states, craft beer’s growth slowed considerably in Illinois, Florida and New York, Kosmal added.
White Claw’s No. 2 variety pack topped growth sales of brand extensions in California, Florida, Ohio and New York. Meanwhile, Michelob Ultra was the top growth brand extension in Illinois and Boston Beer Company’s Truly Lemonade Seltzer was the top growth brand in Texas.
Molson Coors’ new products — Vizzy Hard Seltzer, Blue Moon Light Sky and Leinenkugel’s Spritzen — were among the top growth brands in Illinois. Pabst Blue Ribbon Hard Coffee landed in the top 15 growth brands in Illinois and Ohio. In Florida, Seattle-based, Anheuser-Busch InBev-owned Elysian Brewing’s Space Dust IPA and Contact Haze IPA were among top growth brands.
The growth rates of spirits (+29%) and wine (+17.3%) continued to outpace beer category sales (+13.9%) during the latest week. Total alcohol sales for the final week in July were up 17.5% compared to the same week last year. For the year-to-date COVID period (March through August 1), total off-premise alcohol sales are up 23.6%.