The Survey Says....
by Loren Abrams
Here’s a sobering statistic: One in six neighborhood bars have closed since 2004, according to a new Nielsen
report. “That’s a huge figure,” said a Brewers Association representative. .The latest on-premise data also
showed that a staggering 12,766 neighborhood bars have closed over the last 12 years (as of Jan. 2017 there
are 58,678 neighborhood bars in the US).
Meanwhile, 60,906 new restaurants have opened in the same time frame, and those outlets aren’t necessarily
making up for the lost drinking opportunities. Over 52 percent of restaurant-goers reported drinking a beer while
out. Conversely, 70 percent of consumers who visited a neighborhood bar had a beer.The average drinking
establishment sells 91 percent more beer than the average restaurant. According to, outlets that the research
group classifies as “drinking” establishments sell 827 pints per week. “Eating” establishments, however, sell just
434 pints per week.
Restaurant-goers also appear to be giving up on domestic premium beers, where the biggest disparity between
bars (461 pints per week) and restaurants (175 pints per week) is evident. The “high end” beer segment ($25 per
case and above) fares much better, however, maintaining velocity of 211 pints per week in bars compared to 179
pints per week in restaurants.
Imports are driving the on-premise growth of the “high end,” despite craft beer accounting for the most volume.
High end beer volume performance grew by 2.3 percent during the 52-week period ending February 25.
Meanwhile, non-high end beer volumes declined 6.3 percent, driven by poor domestic premium sales.
Not surprisingly, the largest and most established brands were the hardest hit. Beer’s top 10 brand volumes
declined 3.3 percent. Similarly, volume sales for the top 10 craft brands declined 3.4 percent on-premise.
Meanwhile, the “long tail” of craft brands grew 2.5 percent,. This presents a great opportunity for craft brands to
come in and get a part of it, but where the real challenge is sustaining that growth and making sure people stick
Want further proof that brands near the end of the long tail are performing well on-premise? Dollar sales for the
newest breweries grew 5.9 percent, according to a Nielsen survey, while sales of maturing brands grew 1.3
percent over the last 52 weeks. However, established brands struggled, as dollar sales declined 2.1 percent.The
lesson here is clear: when you are small and when you are new, the growth is there. The real challenge comes
when you want to mature and you want to establish.
Additionally, sales of draft craft beer is driving category growth, accounting for 84 percent of all craft sales,. On-
premise sales of packaged craft beer declined 8.8 percent during the same period, however. One reason for this
might be that the experience of getting a draft beer, which most people cannot replicate at home, along with
quality and price is driving the growth.
Craft beer consumers are willing to pay more. The survey found that craft beer drinkers are willing to pay more
than they are being charged for 12 oz. bottles ($5.73 vs. $4.60/bottle) and 16 oz. draft beer ($6.35 vs. $5.30).
Especially in the larger markets, it could then be argued that the more mainstream accounts, there is perhaps an
area there where the craft prices could be increased.
Millennials are finding different places to drink beer: 23 percent of millennials surveyed said they visited a
brewpub or taproom; 13 percent said they visited a “grocer-aunt”; 12 percent took a brewery tour; and 25 percent
visited a “premium bar. Millennials are also making more purchases in so called “third space channels,” which
include sporting events, music festivals and tasting rooms. Millennials made 23 percent of the craft beer
purchases and 23 percent of the import buys outside of the off-premise and on-premise channels.
The survey also asked consumers what is and isn’t craft: Consumers polled said beer with “unique flavor” and
“high quality ingredients” that isn’t mass produced is what they considered to be craft beer. What isn’t craft? A
beer that is “mass-manufactured” by a “large company” and lacks taste and flavor. According to the data,
Consumers are “sophisticated, promiscuous and have an unprecedented demand for choice”: High end beer
drinkers have about 26 go-to brands. On a night out, 27 percent of consumers drink two or more categories; 39
percent of consumers drink two or more beers; and 8 percent of millennials only drink beer. In contrast, 31
percent of 55-year-old drinkers only drink beer. All of which means the days of being a beer guy, like my father
was and many other people’s fathers were, where they just drink beer, those days are long gone.
Finally, according to Nielsen data through April 2017, off-premise volume sales of beer are down 0.2 percent
while sales of wine are up 1.5 percent and spirits are up 2 percent. On-premise, it’s a similar story. Volume sales
of beer are down 1.9 percent while volume sales of wine are up 1.2 percent and sales of spirits are up 1.4 percent.
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