Q4 2015: INDUSTRY REPORT

On-Premise trends end the year on a low note, Craft Spirits big winner in 2015

  • After a strong start to 2015 (+3% in January), traffic trends for the on-premise channel moderated and remained weak through the rest of the year (-1.2% FY15). Last year’s World Cup created tough summer comps, and holiday timing dampened traffic during the latest 4 week period (-2.6% through 12/27).

  • Share changes between alcohol beverage categories: Beer unit share was down -1.1 ppts during the latest 4 weeks, in line with full year losses (down -1.0 ppts FY15). Wine share was flat throughout 2015 (0.0 ppts), while spirits picked up share (+1.0 ppts during December, +0.9 ppts for FY15).  

  • Total Alcohol:  Total alcohol unit volume was down 2.7% for FY 2015 and down -4.0% y/y during the latest 4 weeks ending 12/27. Alcohol dollar sales were up 0.4% for FY15 vs total on-premise food and beverage dollar sales up 2% driven by food dollars up 2.9%.

  • Beer:  Beer unit growth was -4.7% for FY15 – slowing to -4.8% during 4Q15 and -6.2% during the latest four weeks ending 12/27 – which was partially hit by the timing of Christmas falling on a Friday. Beer dollar sales were down 1.8% for FY15 driven by 2.9% price/mix.

  • Beer Segments:  Craft unit volume declined during 2015 (-2.3% y/y for FY15), but still gained share from other categories (+0.8 ppts for FY15);  Premium Lights were the major share donors (-1.1 ppts for FY15); Import’s performance improved throughout the year (up +0.2 ppts in 4Q15/L4W), but still ended the year nearly flat (-0.1 ppts for FY15);  while Cider’s performance declined throughout the year (0.0 ppts during 4Q15) ending the year gaining slightly (+0.1 ppts for FY 15).

  • Overall Spirits:  Spirits ended the year with nearly flat unit volume (-0.3% y/y FY15, -1.4% during the latest four weeks ending 12/27).  Spirits dollar sales were up 2.5% for FY15 driven by 2.8% price/mix.

  • Spirits Categories: Performance of clear spirits improved in 2015 – Vodka ended the year up +0.3 ppts (propelled by Tito’s), Tequila was the biggest category gainer (+0.8 ppts), Gin also grew share (+0.2 ppts), while Rum declined (-0.4 ppts). Irish was the major dark spirits gainer (+0.6 ppts), while Fireball was a significant drag on the Bourbons, Blends category (-0.9 ppts). Canadians and Brandy/Cognac gained (+0.2/+0.1 ppts), while Scotch declined (-0.1 ppts).

  • Craft Spirits:  Domestic Craft Spirits were up nearly +40% y/y during FY15, ending the year at just over 10% of spirits (latest four weeks ending 12/27).

  • Overall Wine:  Wine unit volumes were -4.1% y/y during the latest four weeks, versus -2.4% for FY15. Wine dollar sales were up 0.1% for FY15 driven by price/mix up 2.4%.

  • Wine Varietals: The biggest 2015 gainers were Sauvignon Blanc, Prosecco, and Cabernet Sauvignon. Major donors were Merlot, Riesling, and Malbec.