Fintech and NBWA partnered up again to investigate 2020 Q1 beer data and see how the onset of COVID-19 could shape the year to come.

Way back in January, when we held our 2019 Beer Industry Review with NBWA’s Chief Economist, Lester Jones, we made a few predictions for 2020. We predicted a strong year for can packages, fall-inspired seasonal beers, and of course, seltzers. We also predicted that holiday success would depend on a few factors, like the timing of the holiday and the availability of the products. What we couldn’t foresee was just how dramatically the industry would shift in the next three months – three months that have felt for many in quarantine to have been a lifetime.

In our latest Beer Industry Review, Lester used Fintech data, which accounts for about a third of all beer sold across the U.S., to highlight the industry trends and setbacks from Q1. While the initial impacts of COVID-19 on our industry are daunting, there’s still hope. With proper execution and planning, a silver lining of new opportunities may arise from the challenges we’re facing now.

The Start of 2020

2020 started similarly to the previous two years, with total Sales to Retailers (STRs) case volumes matching nearly identically. Through the first 11 weeks, the top ten brands held an average of 62.5% of total shares, and premium plus light brands, like Bud Light, Miller Lite, and Coors Light, held firm as the top earners. Unsurprisingly – and true to our predictions – cans had a successful first quarter, and seltzers were striking the motherload. The opening week of 2020 saw nearly double the seltzer success as 2019, up to almost 268,000 cases nationally. In week three, the seltzer segment rocketed to 917,660 cases, with newcomer Bud Light Seltzer earning 46.9% of total shares. From there, favorite brands like White Claw and Truly have seen consistent shares, and the segment as a whole has seen overall growth.

The Week 12 Boom

Then came week 12 and the onset of COVID-19. In the mad dash to “pantry load,” overall STRs jumped up to 20.7 million cases – a 52% increase over the same week in 2019. To put this number in perspective, the volume of week 12 was higher than that of the Super Bowl, New Year’s, and even the Fourth of July, and it was only a hair shy of volume seen by two of 2019’s biggest drinking holidays, Memorial Day and Labor Day.

Consumers flocked to grocery stores to purchase familiar brands in big packages, with the top ten names jumping to 67.6% of total shares. Unfortunately, with the big increase for grocery stores and subsequent restrictions on bars and restaurants, the on-premise segment went from 16% in 2019 to 2% for the post-pantry-rush week 12 in 2020. This shift hit draft hard, dropping shares from 9% to .5% in just one week. Subsequently, craft, which often relies on on-prem taps, dropped from 10.8% to 8.4% of overall industry shares.

Now What?

Now that we’re settling into a new, coronavirus normal and the pantry-loading moment has passed, our data is pointing to trends that seem to be getting back to 2019 numbers. But how does the beer industry recover and succeed once regulations lift? Now that the on-prem segment is slowly starting to reopen, will consumers be gun shy about going out, or will they have less disposable income to spend on dinner and drinks? While Fintech has reliable purchase data intelligence, we don’t have a crystal ball to see the rest of 2020 and the outcome of COVID-19. But we know the industry is resilient, and consumers in the U.S. follow consistent and predictable consumption patterns.

Now more than ever, innovation will play a pivotal role in success. While there will certainly be challenges with restocking on-premise when it does reopen, and there will likely be an even further dip in share data when product returns begin, supply chain disruptions could mean opportunity. If international products, like Italian wine, become less available, retailers will rely on beer distributors to fill the gaps. And as safe physical-distancing procedures are implemented (whether by choice or regulation), retailers and distributors alike can lean into experiential, outdoor channels, like festivals and outdoor farmers markets. Focusing on activity-based patio packages could be just the thing that encourages consumers to get off the couch and into the taproom. No matter what your plan is, now’s the time to form it. Hopefully, with proper execution and a continued joint effort from all industry participants, we’ll regroup for our July recap of Q2 to show Memorial Day data that’s through the roof.

If you missed our webinar, you can view the presentation anytime here. Stay tuned for updates about our next beer industry review. Have questions about Fintech’s data, or how our partnership with NBWA can bring you the industry insights needed to build a better alcohol business? Contact us today!

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