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Beer Is Losing Ground in Alcohol Market

Discussion in 'Open Discussion (Work-safe)' started by LoKyBuckeye, Jan 13, 2005.

  1. LoKyBuckeye

    LoKyBuckeye I give up. This board is too hard to understand.

    Beer Is Losing Ground in Alcohol Market

    ST. LOUIS - If you sometimes find yourself ordering a glass of wine or a mixed drink when you used to order a beer, you're not alone.

    Wines and distilled spirits continue to gain a bigger share of the alcoholic beverage market, at the expense of the beer industry. It's a trend that has been going on since the late 1990s and continued in 2004. Analysts who follow the alcoholic beverage industry don't see it stopping anytime soon. "We believe there is an overall image crisis with beer," Smith Barney Citicorp analyst Bonnie Herzog said.

    As baby boomers age, they are more willing to buy wine and spirits instead of beer. And the wine and spirit companies are successfully targeting younger drinkers with advertising and promotions. "Our wholesaler contacts have told us through a survey we conducted recently that beer has lost its 'sexiness' and 'appeal to young consumers,'" Herzog said. "We continue to believe the road ahead is a long one for the beer industry."

    Beer remains, by far, the most popular alcoholic beverage in the United States. But its share of the alcohol market has slipped. Beer Marketer's Insights, a trade publication, estimates that beer accounted for 59.5 percent of the absolute alcohol content sold in its peak year, 1995. That had fallen to 56.7 percent in 2003.

    The spirits industry began its big push in 1999, when it had 28.6 percent of the market. In 2003, its share had risen to 29.7 percent. Wine went from 12.6 percent to 13.6 percent. The totals for 2004 aren't in, but it was "more of the same," said Benj Steinman, president of Beer Marketer's Insights.

    The spirits industry spent almost $100 million on broadcast advertising in 2004, compared with "almost zero" in 1999, said Frank Coleman, a senior vice president at the Distilled Spirits Council of the U.S. in Washington. August Busch IV, president of Anheuser-Busch Cos. brewing unit, has said that wine and spirits represent "a threat" to his company and the rest of the beer industry.

    Miller Brewing Co. President Norman Adami said, "The single biggest threat facing the American beer business today is the possibility that we will allow the American consumer to get bored with beer."

    So what are the brewers doing about it?

    For one thing, they are spending more money on promotions, including what they call on-premise spending. That means mostly bars and restaurants, but also hotels, clubs, and concession stands.

    On-premise sales, as opposed to store sales, account for only 25 percent of all beer volume in the United States, but 48 percent of all beer retail dollars, making it an important battleground. Wine and spirits companies have promoted themselves aggressively in bars and restaurants, increasing their sales, Legg Mason analyst Mark Swartzberg said.

    Anheuser-Busch, the brewer of Budweiser and Bud Light, has said it plans to spend an additional $30 million for on-premise promotions in fiscal 2005, a 150 percent increase. Milwaukee-based Miller Brewing also has increased spending. "Miller is spending about 40 percent more on advertising and promotion than 18 months ago," Swartzberg said.

    And a little generational rebellion must be overcome, as well, Swartzberg said. Younger drinkers may choose wine and cocktails because their parents chose beer. "Any given generation wants to be different than its parents," he said. "It's the natural ebb and flow."
  2. AKAK

    AKAK Well, that's like hypnotizing chickens. Staff Member Tech Admin

    I'm sure they will persevere some way. :wink2:
  3. exhawg

    exhawg Mirror Guy Staff Member

    Damn you Atkins!!!
  4. Bucktastic

    Bucktastic Troy Smith for HEISMAN

    Looks like I got some work to do this weekend
  5. BuckStocksHere

    BuckStocksHere Semper Fi!

    SABMiller eyes bid for Molson
    Brewer waits to seek if Coors offer fails

    The Associated Press
    Updated: 8:26 a.m. ET Jan. 13, 2005

    LONDON - Brewing giant SABMiller PLC indicated Wednesday it is interested in making a bid for Molson Inc. should the Canadian brewer's pending merger with Adolph Coors Co. fall apart.

    <TABLE style="PADDING-LEFT: 15px" cellSpacing=0 cellPadding=0 align=right border=0><TBODY><TR><TD class=textSmallGrey vAlign=top align=middle>advertisement
    </TD></TR></TBODY></TABLE>The London-based brewer said in a statement that "a Molson transaction would both have strategic merit and could be value enhancing to SABMiller."

    "If the Coors deal is voted down by Molson shareholders, we would welcome the opportunity to discuss a potential transaction that may be attractive to both Molson shareholders and ours," the company added.

    Molson and Coors shareholders are scheduled to vote in a week on the planned combination of Canada's biggest brewer and the third biggest U.S. beer company.

    Opponents of the deal — including Ian Molson, who broke ranks with his family and left Molson Inc. last year — have grown more vocal as the scheduled vote has approached, and the report of London-based SABMiller's interest could add to the pressure on the supporters of the deal.

    SABMiller, which was founded in South Africa more than 100 years ago, brews Miller, Carling Black Label and Nastro Azzurro among other brands around the world. Its shares were down 0.3 percent to 837 pence in afternoon trading on the London Stock Exchange.

    Coors, based in Golden, Colorado, is the third-biggest U.S. brewer behind Anheuser-Busch and SABMiller. Molson is the No. 1 brewer in Canada, just ahead of Interbrew SA's Labatt Brewing.

    Under the proposed Coors-Molson deal, the new Molson Coors would have a market capitalization of about $6.3 billion and would rank fifth globally in terms of both revenue and number of barrels sold.
  6. DEBuckeye

    DEBuckeye It ain't easy, bein' cheesy.

    I love beer, that will never change. But, when I'm out for dinner I will frequently have either a mixed drink or wine (especially at a nice place). I definately drink much less beer than I used to- and not just because I don't get ripped every weekend anymore. My tastes have changed.
  7. coastalbuck

    coastalbuck And this one belongs to the Reds!

    Sounds like we could see a price drop to raise demand!!!!! :cheers:
  8. BuckStocksHere

    BuckStocksHere Semper Fi!

    Olde Frothingslosh returns

    Pittsburgh Brewing celebrates 50th anniversary of 'pale, stale ale'

    Jan 7, 2005 - Pittsburgh Brewing Co. plans to celebrate the 50th anniversary of Olde Frothingslosh - the "pale, stale ale with foam on the bottom - with a limited edition can commemorating the beer that began as a joke.

    <!-- begin in content banner -->

    <CENTER>In 1954, Pittsburgh disc jockey Rege Cordic created a series of zany commercials for the fictitious beer, Old Frothingslosh, The Pale Ale for the Pale State Male. Pittsburgh Brewing Co. celebrated the gag by putting Old Frothingslosh labels on 500 cases of Iron city Beer bottles for friends of the company for Christmas. </CENTER>

    The next year Old Frothingslosh had new labels for Christmas and was sold to the public for the first time. The Christmas issue became a popular tradition and over time distribution ranged well beyond Pittsburgh. The beer was advertised as "so light, the foam's on the bottom" and as "brewed from hippity-hops on the banks for the Upper Crudney in Lower Slobbovia." It debuted in cans in 1968 with the introduction of Fatima Yechburg, a 300-pound go-go dancer who became Miss Frothingslosh, and was sold for decades.

    The commemorative gold can features the original "founder, Sir Reginald P. Frothingslosh," with his bow tie, pencil mustache, eye monocle and high-hat, and a circa 1960s picture of Cordic, who died in 1999.
  9. coastalbuck

    coastalbuck And this one belongs to the Reds!

    I drank some of that when I was in high school. :biggrin:

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