Nielsen: 25% of Consumers Say They Would Buy Fewer Alcoholic Beverages If Economy Worsens

If economic conditions in the United States worsen via recession or inflation, 39% of consumers said they wouldn’t cut back on purchases of beer or wine to save money, according to a survey conducted by Nielsen of 18,000 consumers from July 1-8.

However, what may be cause for concern for the beer industry is that a quarter of consumers said they would purchase fewer alcoholic beverages in order to save money. For lower income households, which Nielsen defined as those that make less than $30,000, respondents said they would stop buying beer and wine altogether.

A majority of consumers are also preparing for conditions to remain the same. The survey found that 60% of households expect their routines to remain the same for at least the next four months.

Even with somewhat gloomy responses, premiumization within off-premise alcohol purchasing trends has not slowed down and has actually accelerated since the COVID-19 period began in early March, Nielsen said.

Consumer sentiment is a bit more cautious overall, as about 42% of households said they are monitoring their spending due to the pandemic. On-premise dining remains on the chopping block, as 39% of consumers surveyed by Nielsen said they eat all of their meals and snacks at home. That’s a major change considering that before the pandemic just 12% of households said they eat all of their meals at home.

For those dining out, 39% said they eat 10% of their meals outside of their homes.

It doesn’t appear these trends will change much. A third of households said they plan to continue eating all of their meals at home in the coming months.

So who is more willing to dine out? Younger consumers in the 21-to-34-year-old age range. As expected, consumers 65 and older were less likely to want to venture out.

Nielsen also shared the latest one-week beer category scan data.

For the week ending August 22, beer category off-premise dollar sales increased 15.4%, to $1.007 billion, in Nielsen tracked channels. The beer category has now exceeded the $1 billion mark in every week since the start of May.

“Core” beer — excluding hard seltzers and FMBs — performed better week-over-week, increasing 9.8% for the week ending August 22. That’s a more than 1% jump compared to the prior week.

During the COVID-19 period (early March through August 22), off-premise dollar sales of beer have increased 18.7% compared to the same period in 2019.

The hard seltzer show continued, with dollar sales increasing 113% in off-premise channels tracked by Nielsen. The triple-digit growth comes against tougher comps and as such, hard seltzer growth rates have slowed compared to June and July. Even with those tougher comps, the segment is still claiming more than 10% of off-premise dollar share of the beer category (10.2% in the latest week).

Nielsen also shared data (courtesy of Molson Coors) that showed the top 10 growth brands for the four-week period ending August 22. Seven of the top 10 (and seven of the top eight) were hard seltzers. In order, they are:

  • White Claw variety pack No. 2 (Mark Anthony Brands)
  • Michelob Ultra (Anheuser-Busch)
  • Truly Hard Seltzer Lemonade mix pack (Boston Beer)
  • Corona Hard Seltzer variety pack (Constellation Brands)
  • White Claw Hard Seltzer Mango
  • White Claw Hard Seltzer Black Cherry
  • Vizzy Hard Seltzer variety pack (Molson Coors)
  • Busch Light
  • Twisted Tea original tea (Boston Beer)

Craft beer posted another strong week, increasing dollar sales in off-premise retailers 14.1%, while super premium brands increased sales 21.8% and Mexican imports rebounded, increasing dollar sales 12.8% during the week.

Overall, total off-premise dollar sales of alcoholic beverages increased 18% during the latest one-week period. That’s a deceleration from the COVID time period (March through August 22) in which sales are up 23.2%. Nevertheless, alcoholic beverage sales are outpacing other consumer product goods by a wide margin, as total fast moving consumer goods are up 15% through the COVID period and 8.6% in the most recent week.

The off-premise dollar sales growth rates of wines (+17.4%) and spirits (+26.2%) continue to outpace those of the beer category. Within spirits, Nielsen VP of beverage alcohol practice Danelle Kosmal noted that although whiskey dollar sales growth rates are lagging behind the overall category (+24.2%), the segment contributes more overall dollar growth compared to any other type of spirits.