GuestMetrics: On-Premise Craft Beer Sales Up 7.1 Percent in 2013

The craft beer segment continued to grow on-premise in 2013 despite overall beer volumes dipping 4 percent, according to a new report from GuestMetrics.

According to the on-premise data supplier, craft beer grew 4 percent by volume in 2013 while dollar sales rose 7.1 percent. GuestMetrics, which uses the Brewers Association definition for craft beer, also said the craft segment gained 2.2 points of share from the overall beer category in 2013.

While craft continues to see growth, on-premise sales of  premium light beer saw steep declines last year, with volume down 10 percent and dollar sales off by 8.4 percent, the company said.

IPAs led all craft styles in terms of growth, and the category continues to see a surge in demand from both on-and-off-premise retailers. IPAs gained 1.2 share points in 2013, followed closely by a small but fast-growing cider category that took 0.5 share points of total beer volumes. Lagunitas, whose flagship beer is an IPA, and Angry Orchard, Boston Beer Company’s cider offering, were among the brands that enjoyed the greatest share gains. Total cider volumes increased 49 percent on-premise, according to GuestMetrics.

A full press release is below:

According to GuestMetrics, despite a difficult year for the beer category in on-premise in 2013, Craft and Cider both continued to post positive volume growth, taking share from Premium Light, Premium Regular, and Import beer throughout the course of the year:

As we wrote about earlier in the week, beer had a difficult year in on-premise in ‘13, with volumes down 4.0% for the full year and dollar sales down 0.7% with a particularly weak end-of-year, though it should be noted there was a broad deceleration in overall traffic in on-premise towards the end of ‘13, likely due to unfavorable weather & a shortened holiday shopping season.

Craft grew volumes about 4% in ‘13 compared to ’12 (dollar sales up 7.1%), and despite the broad slow-down across on-premise at the end of the year, still saw volumes grow 3% in 4Q, and remained in positive y/y territory at +1% during the final 4 weeks (these growth rates are more modest compared to off-premise due to craft having a much higher penetration in on-premise and therefore growing off a larger relative base in addition to pressure from the overall on-premise traffic weakness).  Craft gained 2.2 points of y/y share of overall beer volumes in 2013.  Given its y/y share was +2.1 points during the first three quarters and then increased to +2.4 points during 4Q, this indicates that even though craft growth slowed somewhat towards the end of the year, that underlying consumer demand for craft beer remains healthy.

Cider grew volumes about 49% for the full year compared to 2012 (also more moderate than off-premise growth due to having a higher penetration in on-premise).  Cider volume growth slowed somewhat to 42% in 4Q and 38% during the final 4 weeks of the year, but similar to Craft, given its y/y share gain held steady at +0.5 points throughout the course of the year, the slowing is likely indicative of weak traffic to on-premise rather than diminished consumer demand.

Premium Lights had a difficult year, with volumes down more than 10% for the full year vs. ’12 (dollar sales down 8.4%), and weakened even further at the end of the year.  Premium Light lost about 2.0 points of category share in y/y terms in ‘13, going from a 1.9 share loss during the first half to -2.1 point share loss during the second half of the year.  Premium Regular and Imports also had a difficult year in on-premise, each down mid-single digits in volume.

From a style standpoint, IPA continues to gain the most share (+1.2 points) along with Cider (+0.5 points), and Belgian Wit Ale and Bitter Ales both up +0.2 points of share.

Greatest share gains in ‘13 were by Angry Orchard, Dos Equis, Lagunitas, Redds, and Stella. Corona Extra also gained share.  Brands with the greatest gains in distribution (% of locations carrying) are Angry Orchard, Bud Black Crown, and Redds, and greatest velocity gains are Lagunitas, Angry Orchard, and Modelo.

About GuestMetrics LLC

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