Wonder

Research Outline

Prepared for Han | Delivered April 19, 2020

U.S. Alcohol Leaders' Revenues and Market Share

Goals

To provide an overview of the representation of major players in the U.S. alcohol market, using available statistics and data points.

Early Findings

Decline of consumption of beer Beer makes up 49% of alcohol consumption in the U.S., while wine and spirits make up 16.5% and 34.5%, respectively.
Acording to Nielsen sales of domestic beer fell 4.6% between October 2018 and October 2019, while spirits sales grew 6% to $15 billion in the same period.
 Constellation Brands was one of few major players to have growth in the U.S. beer market and the primary growth contributor to the market in 2019. The company's beer sales rose by 4.5% in 2018, while growth dropped by 6.8% for  Anheuser-Busch InBev , and by 0. 2% for Heineken Holdings in the same period.
There is high fragmentation in the U.S. beer market due to experimentation by small brands and portfolio expansion by larger brands.
Growth driven by seltzersHard seltzers, such as Truly from the Boston Beer Company, account for 43% of the ready-to-drink beverages category  of the U.S. alcohol market, and are driving sales for major breweries.   
For example, Truly is driving more than 100% of the Boston Beer's retail growth and had 15% sales growth in 2019.
In January 2020, Anheuser-Busch InBev added a seltzer based on its Bud Light brand on top of its "two well-established brands, Bon & Viv and the beer-and-fruit flavored Natural Light seltzer," which had an 88% rise in sales in 2019.
"White Claw and Truly brands own 80% of the hard seltzer market between them."
Rise in premium pricing"Instead of focusing entirely on selling high volumes of standard beer and wines, companies have shifted to selling more high-margin products — specifically premium-label spirits— at lower volumes and increased prices." 
For example, spirits priced at $25 and up increased in sales by 13.2% in 2019.
Diageo recently bought the Casamigos tequila brand which can retail between $40 to $120 per bottle.
E-commerce in the U.S. alcohol marketU.S. online alcohol sales were $2.6 billion in 2019, growing by 22% year-on-year. 
Online sales represent about 1% ($2.6 billion/$266.4 billion x 100)of the U.S. alcohol market. 
Nielsen predicted that U.S. suppliers and distributors will put more focus on their e-commerce efforts in 2020.
Due to COVID19 online alcohol sales outpaced in-store sales in the U.S. rising by 243% in the week ending March 21, 2020. Spirit sales were up 75%, while wine and beer sales rose up 66%, and 42%, respectively.
Summary of FindingsIn this hour, we have provided inisghts on the U.S. alcohol market, as well as how major players are represented or have been impacted by the market using available statistics/data points/examples.