BEYOND THE CORE · Danny Brager –SVP Beverage Alcohol Practice, Nielsen BEYOND THE CORE What We...
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Copyright © 2020 The Nielsen Company. Confidential and proprietary. January 28, 2020 – San Francisco, CA Danny Brager – SVP Beverage Alcohol Practice, Nielsen BEYOND THE CORE What We Should Know That Maybe We Don’t, And Why We Should Care
Transcript of BEYOND THE CORE · Danny Brager –SVP Beverage Alcohol Practice, Nielsen BEYOND THE CORE What We...
Copyright © 2020 The Nielsen Company. Confidential and proprietary.
January 28, 2020 – San Francisco, CA
Danny Brager – SVP Beverage Alcohol Practice, Nielsen
BEYOND THE COREWhat We Should Know That Maybe We Don’t,
And Why We Should Care
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DID YOU KNOW…
Sources: Nielsen; Nielsen CGA; Headset
RTD Spirits in Cans now 25% of
Prep Cocktails – and +100% vs YAG
Wine Cocktails doubled in size from
last year
Value Add Water/Sparkling Water –
both growing double digits
Legal Cannabis Recreational Market
$6.6 Billion; +36% vs YAG
Hard Seltzers – now>$1.5 Billion &
still growing >+200%; >5% of Beer
20% typically consume a low alc/non
alc Beverage (BW or S) while out
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WINE CATEGORY TRENDLINE IS FALLING
Source: Nielsen Total U.S. Measured Off Premise Outlets;; 52 w/e 12-28-2019
-2%
0%
2%
4%
6%
3 Yr Ago 2 Yr Ago 1 Yr Ago Curr 52 wks
Retail Off Premise SalesPercent Change vs YAG
Value Volume
-3%
-2%
-1%
0%
1%
Dec-18 Mar-19 Jun-19 Sep-19
Wine Depletions Rolling 12 Mos Volume Percent Chg vs YAG
0%
5%
10%
15%
20%
2016 2017 2018 2019
DtC ShipmentsPercent Change vs YAG
Value Volume
0%
1%
2%
3%
4%
5%
6%
7%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Total Wine ShipmentsPercent change vs YAG
2019Total Wine: +1.1%
Still Wine: +0.2%
DM Wine: Flat
IMP Bulk Still: -6.3%
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BUT SOME WINE SEGMENTS GROWING WELL
Source: Nielsen Measured Off Premise Channels (52 w/e 12-28-2019); DOLLARS
Double digit %
Rose’
3L Box
Prosecco
Oregon
Tetra
Cans
Wine Cocktails
$ S
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Low
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+5%-+10%
$20+ Glass*
$11-$15 Glass
$15-$20 Glass
Sauv Blanc
375 ml glass
Fr. Champagne
Israel
*DtC Shipments + Nielsen Retail
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SPIRITS GAINING SHARE – AT BEER & WINE EXPENSE
Source: BW166
0%
10%
20%
30%
40%
50%
60%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Share of Servings – Total Bev Al = 100%
Beer Wine Spirits
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SPIRITS LEADING; “BEYOND” CORE BEER TURNING
“TOTAL” BEER AROUND; WINE TRAILING
*Total Store Definition – Includes Departments Bakery, Baby Care, Dairy, Deli, Frozen, General Merchandise, Grocery, Health & Beauty Care, Household Care, Meat, Pet Care, Produce….
Does NOT Include Alcohol and Tobacco Products (UPC Coded + Random Weight)
Off Premise Source: Nielsen Measured Off-Premise Outlets – Total U.S.
Beer + includes ALL Flavored Malt Beverages, Hard Cider, Hard Kombucha
3.4
1.0 1.4
2.1
5.4
2.7
1.91.6
Rolling52 Wks -12/28/19
Rolling52 Wks -11/30/19
Rolling52 Wks -11/02/19
Rolling52 Wks -10/05/19
Rolling52 Wks -09/07/19
Rolling52 Wks -08/10/19
Rolling52 Wks -07/13/19
Rolling52 Wks -06/15/19
Rolling52 Wks -05/18/19
Rolling52 Wks -04/20/19
Rolling52 Wks -03/23/19
Rolling52 Wks -02/23/19
Rolling52 Wks -01/26/19
Rolling52 Wks -12/29/18
Rolling52 Wks -12/01/18
Rolling52 Wks -11/03/18
Rolling52 Wks -10/06/18
Core Beer BEER (+) WINE SPIRITS TOTAL STORE
Rolling 52 Week Dollar Trends (Off Premise)
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63% 61%
32%
Also drink beer Also drink spirits Also drink other types ofalcoholic beverages
WINE DRINKERS DRINK OTHER ALCOHOLIC
BEVERAGE TOO!
Base: 2,209 U.S. wine drinkers
Source: WMC – U.S. Wine Consumer Segmentation Survey, June 2019
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High frequency
wine drinker
Occasional
wine drinker
Wine-based drinks (such as
sangria, wine spritzers, etc.)78% 78%
Hard cider 34% 22%
Premixed, ready-to-drink
cocktails32% 19%
Hard seltzers 24% 14%
Hard tea 15% 12%
“OTHER ALCOHOLIC BEVERAGE” CONSUMPTION BY
WINE DRINKERS HIGHEST AMONG HIGH FREQUENCY
& YOUNGER LDA’S
Base: High Frequency wine drinkers (more than once a week), n=774; Occasional wine drinkers (once a week or less
often), n=1,435; Drink beer/spirits, no wine, n=1,438. Source: WMC – U.S. Wine Consumer Segmentation Surveys, June 2019
Drink “Other Alcoholic
Beverages” at Least Every 2-3
Months Among Wine Drinkers
iGen (21-24) 58%
Millennial (25-42) 41%
GenX (43-54) 32%
Baby Boomer (55-73) 21%
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MULTI-CATEGORY DRINKERS CONTINUE TO GROW
IN IMPORTANCE – BUYERS & SPENDINGTotal Bev Alcohol Buyer Overlap and Sales (Off Premise)
Source: Nielsen Homescan Panel, Total US: 52 weeks ending 06/29/19 Wine includes Still & Sparkling; Beer includes FMB and Ciders
Exclusive Wine
15% HH/4% $
Exclusive Beer
18% HH/7% $
Exclusive Spirits
6% HH/2% $ Vol
Wine & Beer
19% HH/17% $
Wine & Spirits
7% HH/7% $
Beer & Spirits
8% HH/9% $
WineBeerSpirits
Wine/Beer/Spirits
27% HH/55% $
Exclusive WINE
drinkers
represent only a
small percentage
of sales
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HEMP-CBDHEMP
SEED/OILTHC & CBDTHC
CANNABIS
MARIJUANA PLANT HEMP PLANT
NOT FEDERALLY LEGAL
Legal Recreational Use - 11 states (not all with Retail Structures yet)
Sold in regulated dispensaries
FEDERALLY LEGALSold in traditional retail
Some product formats; largely non-ingestibles today
PSYCHOACTIVE NON-PSYCHOACTIVE
Experience Enhancer/Social Enabler Health & Wellness
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CANNABIS-INFUSED NA-ALCOHOL-STYLE
BEVERAGES ARE ALREADY IN-MARKET
MARIJUANA-INFUSED HEMP-CBD INFUSED
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LEGAL RECREATIONAL CANNABIS MARKET
CONTINUES TO GROW, ESPECIALLY IN ‘NEWER’ STATES
Source:
$0
$1,000,000,000
$2,000,000,000
$3,000,000,000
$4,000,000,000
$5,000,000,000
$6,000,000,000
$7,000,000,000
2014 2015 2016 2017 2018 2019
Legal Recreational Market Size (Dispensaries) - Dollars
CA CO WA NV OR
+90%
+16%
+8%
+28%+3%
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Source:
Thru October 2019
+27% +79%
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NOT SURPRISINGLY, YOUNGER GENERATIONS
LEAD IN CANNABIS SALES
Source:
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Which of the following types of products have you ever legally consumed? Please select all that apply.
Source: Nielsen CannaUse Study (US) 2019.
CANNABIS USEAGE AMONG WINE DRINKERS IS CLOSER TO
OVERALL ADULT POP’N, AND LESS THAN BEER/SPIRITS
THC-Dominant Marijuana
CBD-Dominant Marijuana
Hemp-CBD
All U.S. Adults 18% 8% 12%
Beer Drinkers 24% 10% 13%
Wine Drinkers 19% 8% 14%
Spirits Drinkers 26% 10% 15%
Current Cannabis Usage Among Total U.S. Adults and Beverage Alcohol Drinkers by Type
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Source: Nielsen CannaUse Study (US) 2020.
SOME CANNABIS USERS (& WINE DRINKERS) CLAIM THAT THEY’LL
CUT BACK THEIR ALCOHOL CONSUMPTION – BUT A SMALL
(AND LIKELY MORE “OCCASIONAL”) WINE DRINKING GROUP
3%
2%
4%
31%
29%
35%
62%
66%
59%
4%
2%
2%
Beer
Wine
Spirits
Stop Using Decrease Usage No Change Increase Usage
Among drinkers of a given bev-al category below who are likely to consume THC-dominant marijuana in the next 12 months answering about that category…
Marijuana Usage Impact on Beverage Alcohol Consumption
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NON ALC BEVERAGES - COMPETITION & INSPIRATION
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NON-ALCOHOLIC BEVERAGES
Source: Nielsen Total U.S. All Outlets (xAOC + Convenience); 52 w/e 12-28-2019
0%
2%
4%
6%
8%
10%
12%
14%
$0
$3
$6
$9
$12
$15
Energy Bev SportDrinks
Value AddWater
SparklingWater
RTD Coffee SeltzerWater
Kombucha
#%
ch
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vs
YA
G
Do
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Sale
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Non-Alcoholic Beverage Trends
Dollar Sales (billions) % chg vs YAG
Aggregate: +9% vs YAG; +$2.4 Billion
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WHAT DO THESE HAVE IN COMMON?
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WHAT DO THESE HAVE IN COMMON?Non-Alcoholic Beverage Label Characteristics
Natural Presence
No Caffeine/Caffeine Free
Calorie free
Caffeine Free
Sugar Free
GMO Free
Gluten Free
No Artificial Sweeteners
Mineral Presence
Antioxidants
No Artificial Flavor
Excellent Source of Vitamin
No Artificial Color
High Fructose Corn Syrup Free
Total U.S. xAOC + Convenience – Annual 2019
• Organic
• Stevia
• Low Calorie
• Brain Health
• Less sugar
• Probiotic
• Soy Free
• Lactose Free
• Excellent Source of Protein
• Good Source of Protein
• Fiber Presence
• Saturated Fat Free
• Vitamin & Mineral Presence
• Flax or Hemp Seed
$ S
ale
s O
rder (H
igh
est to
Lo
west)
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NON ALC BEVERAGES –COMPETITION & INSPIRATION
Hard
CiderHard
Tea
Hard
Seltzer
Hard
Kombucha
Hard
Coffee
Hard
Water
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Premium
Below Premium
Mexican
Other ImportsCraft
Super Premium
FMB ex HS
Hard Seltzers
Hard Tea
Cider -12
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
14
16
18
20
22
-8 -6 -4 -2 0 2 4 6 8 10 12 14 16 18 20 22
Vo
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han
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Value Percent Change
Source: Nielsen Total U.S. All Outlets (xAOC + Liquor Plus + Conv + Military); 52 w/e 12-28-2019
Total U.S. - Off Premise
X-Axis: $ % Chg vs. YA
Y-Axis: EQ % Chg vs. YA
Bubble Size: Annual $ Share
HARD SELTZERS, SUPERPREMIUM, & MEXICAN LEAD
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Source: Nielsen Total U.S. All Outlets (xAOC + Liquor Plus + Conv + Military); 52 w/e 12-28-2019 (annual time periods)
0
50
100
150
200
250
300
$-
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
$1,400,000,000
$1,600,000,000
4 Yr Ago 3 Yr Ago 2 Yr Ago 1 Yr Ago Lat. 52 weeks
Annual Dollar Sales – Off Premise
Dollar Sales # of Items
Still growing at well over +200%; over 5% share of Beer
59%26%
HARD SELTZERS JUGGERNAUT
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BEYOND THE CORE BEER RELATED BEVERAGES – ALL UP!
Source: Nielsen Total U.S. All Outlets (xAOC + Convenience); 52 w/e 12-28-2019
213%
13%21%
69%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
200%
220%
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
Hard Seltzer Hard Tea Non Alc Beer HardKombucha
Hard Water Hard Coffee
#%
ch
an
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vs
YA
G
Do
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Sale
s (
MM
)Non-Alcoholic Beverage Trends
Dollar Sales (MM) % chg vs YAG
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HARD SELTZER $ COMPARED TO WINE SEGMENTS
Source: Nielsen Measured Total U.S. Off Premise Outlets; 52 w/e 12-28-2019
$0
$500,000,000
$1,000,000,000
$1,500,000,000
$2,000,000,000
$2,500,000,000
Beyond CoreBeer
Sparkling P. Grigio P. Noir Sauv Blanc Rose'
Latest 52 weeks Dollar Sales – Nielsen Measured Off Premise Channels
Hard Seltzer Hard Tea Non Alc Beer Hard Kombucha Hard Water Hard Coffee
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Vodka
Whiskey
CordialsBrandy
Cognac
Rum
Tequila
Gin
RTD's
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
14
16
18
20
22
-6 -4 -2 0 2 4 6 8 10 12 14 16 18 20 22Vo
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Value Percent Change
Source: Nielsen Total U.S. All Outlets (xAOC + Liquor Plus + Conv + Military); 52 w/e 12-28-2019
Total U.S. - Off Premise
X-Axis: $ % Chg vs. YA
Y-Axis: EQ % Chg vs. YA
Bubble Size: Annual $ Share
RTD’S, TEQUILA, & WHISKEY LEAD SPIRITS GROWTH
Bourbon Led
Cans led
growth
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THE CHANGING FACE OF RTD SPIRITS
Source: Nielsen Total U.S. All Outlets (xAOC + Liquor Plus + Conv + Military); 52 w/e 12-28-2019
RTD Spirits in Cans: ~$100MM in Nielsen Measured Channels
RTD/Prep
Cocktails
- Spirits
CANS BOTTLES
Share % chg Share % Chg
25% +102% 71% +4%
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Thanksgiving beer: It’s
time to bump wine from
the holiday tableCross wine off your drink list for Thanksgiving
dinner. Write in beer instead. Beer is as
mainstream and sophisticated as wine is and
worthy of a place setting during the holidays.
"There's not a dish that beer can't pair with,"
and that includes all the dishes we love to
enjoy on Thanksgiving.
Anchorage Press
Nov 25, 2019
55% Fewer Carbs than a Glass of White Wine
…Botanicals are
recruiting consumers
from white wine
Deirdre MahlanPresident, Diageo N America
…12 oz can offers same
calories as only 1 glass
of most champagnes
Find a new use for
your old trick. Drink
what you “Truly” want
BEER/SPIRITS
COMPETING
AGAINST
WINE…
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AND SOME ENTERING WINE (& SPIRITS)…
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BEYOND “CORE” WINE…
Source: Nielsen Total U.S. All Outlets (xAOC + Liquor Plus + Conv + Military); 52 w/e 12-28-2019 (annual time periods)
$-
$50,000,000.00
$100,000,000.00
$150,000,000.00
$200,000,000.00
$250,000,000.00
$300,000,000.00
Wine Based Cocktails Flav Bev Wine
4 Yr Ago 3 Yr Ago 2 Yr Ago 1 Yr Ago Lat. 52 weeks
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BEER, WINE, or SPIRITS??? How much does the base Liquid matter compared to other factors?
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HOW & WHERE
IN THE
STORE???
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CONVENIENCE: CANS ON THE RISE
Source: Nielsen Measured Off Premise Outlets (Total U.S); 52 w/e 12-28-2019
Potential for Wine to do some catching up…
CANS $CANS $
SHARE
CANS
Dollar %
chg vs YR
AGO
BOTTLES
Dollar %
chg vs YR
AGO
Cider $184MM 37% +30% -17%
Craft Beer $2.1B 42% +24% -13%
RTD Spirits $85MM 25% +102% +4.4%
Wine
• Table
• Sparkling
$125MM 0.7%
0.5%
1.4%
+79%
+70%
+90%
+0.5%
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BLURRING/
PROMISCUITY
Categories
Channels
Competitors
DRINKING
“BETTER”
Premiumization
FLAVOR
Taste/Styles
Mixology
POP’N/GEN SHIFTSMulti-Cultural
Ageing Population
Gen Z/Millennial vs Boomers+
TODAY’S BEV AL U.S. CONSUMER DRIVEN LANDSCAPE
CONVENIENCE
How/where we buy (e-comm)
What we buy (packaging)
EXPERIENCE
Authenticity & LocalFood & Entertainment led
Cocooning
HEALTH &
WELLNESS
Better for MeBetter for WeTransparency
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MORE HEALTH-MINDED CONSUMER
NON ALC BETTER FOR YOU MINDFUL EVENTS
Average ABV of new Bev Al Items in last year is 20% lower
than the new item average in 2010
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WINE NEEDS “BOTH” AGE ENDS TO BE SUCCESSFUL -
INTRODUCTORY ON-RAMPS & EXTENSION OF OFF-RAMPS!
• Source: Silicon Valley Bank Industry Survey
2%
17%
35%
40%
6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Gen Z (21-22) Millennials (23 - 38) Gen X (39 - 54) Boomers (55 - 73) Mature (74+)
% Wine Consumption by Cohort2014 2015 2016 *2017 2018 2019
34% of 21+Pop’n
10% of 21+Pop’n
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ARE WE THINKING MORE ABOUT MORE…• Occasionality/Convenience
• Smaller serve packaging
• Health & Wellness
• Transparency
• Bubbles
• Flavors
• Affordable/appealing on-ramps
Give consumers what they want, where and how they want it
