Beer has been losing share to wine and other beverages for years. So it's fitting that as retailers head into the crucial warm-weather months, many will replicate wine-selling strategies to boost sales. They intend to sample and suggest food pairings, and cross merchandise and cut prices.
Byerly's and Lunds stores often conduct beer tastings twice a month during the summer, starting around Memorial Day weekend. Coupled with that, the company offers what it terms "extreme value" on one or two beers each month.
"We'll take a couple of products and sell them at a very, very extreme price," said Kathy Jones, manager of wine and spirits for Byerly's Golden Valley, Minn., store. "Then we'll have someone from the brewery come in and do tastings through the month. It really pushes sales."
Though cross merchandising with food is forbidden in Minnesota, Byerly's and Lunds provide literature on which foods go best with beer, wine and spirits. The chain operates seven liquor stores: one attached to a Lunds supermarket, the rest to Byerly's stores.
Niemann Foods in Quincy, lll., planned to continue its "day-fresh beer" events, in which it promotes Budweiser delivered to its stores from St. Louis for sampling the day it's produced. "We had some success at that last year," said liquor and soda departments buyer Martin Miller. "We're about two and a half hours away."
Last year, the store sampled fresh bottles of Bud Lite on Fridays after 2 p.m. Displays went up in the front of the store. The events were trumpeted in newspaper ads.
"It was a fun program," he said. "You wouldn't think the beer would taste that much better, but I think I can attest to it: It certainly does."
Some will benefit from beer makers' special pricing during summer months. "A couple of times a year, they'll have an extreme push. But you have to buy 100 or 200 cases," Jones said. POP material is available, though Byerly's corporate philosophy precludes using much of it. "We don't like to put up a bunch of junk. Our stores are very streamlined, very clean."
Many beer drinkers, of course, just want a cold one. To that end, Caputo's Fresh Markets, a seven-store chain based in Addison, Ill., turns down the temperatures on coolers in summer and advertises having "the coldest beer in town." It'll also try to capitalize on a local resurgence of retro-brand beers. "Pabst Blue Ribbon, Meisterbrau, Blatz, Hamm's -- all the beers that our fathers used to drink while we were growing up are becoming popular again, not only at retail, but also the bars," said Dale Ohman, marketing director. "In fact, it started with the bars."
This summer, beer sales will revolve around continued interest in pricier imported, light and craft beers aimed at an increasingly sophisticated beer drinker. Caffeine-spiked varieties will be highlighted as well.
"I don't know if this summer will see anything hugely different from what's been going on, which is continued growth in light beers," said Gary Hemphill, senior vice president of consulting firm Beverage Marketing Corp., New York.
Hemphill said there has been "reasonably decent strength among the imports as people continue to trade up to products they perceive to be higher quality." Low-carb beer "is not going away, per se, but it's definitely moved to the back burner in most consumers' minds. You did see a lot of innovation around low-carb, and I would speculate that you will probably have a few brands that will survive that were really built around the low-carb concept."
Light beer represented more than 47% of the total beer market in 2004, compared to 44% in 2000, according to the Brewers Association. New in that subcategory is Heineken Premium Light. It will compete with domestic brands like Bud Light, Michelob Ultra and Miller Lite, as well as Amstel Light, which Heineken also owns.
America's craft brewers -- mostly microbrewers and specialty brewers of all-malt beers -- sold 7% more beer in 2004 vs. 2003, making craft beer the fastest-growing segment of the U.S. beverage alcohol industry, according to data gathered by the Brewers Association, an organization representing craft brewers.
Volume growth of craft beer outpaced that of imports, large brewers, wine and spirits in 2004 for the second year in a row, according to the association. "This reverses the trend seen between 1996 and 2002, when import volume grew at a faster rate," said Paul Gatza, association director. Sales of imported beer in the United States increased by 1.4%, or 4.6 million cases in 2004, according to U.S. Department of Commerce figures.
"The craft beer market is becoming huge," said Kathy Jones of Byerly's. "Also, your craft beers are generally more expensive, so they are a little higher of a ring at the stores. Some of the big guys are starting to feel the effects of that, and are losing volume."
Critics contend that the beer industry has been complacent for the past several years in the face of share losses to wine and spirits and their corresponding loss of shelf space at retail.
One way beer makers are trying to regain share is to revive beer's appeal with young drinkers, who are increasingly turning to spirits. To that end, brewers are spiking beer with guarana, a South American berry plant said to be a natural source of caffeine. Budweiser's B-to-the-E, introduced this past fall, uses guarana and other ingredients to give it a kick. It comes in a slim, 10-ounce can similar to the one used by many energy drinks, such as Red Bull.
In March, Canada's two biggest manufacturers, Molson Coors and Labatt, began marketing guarana-infused beers. Molson debuted its new Kick brand March 21 in central and western Canada. Labatt planned to introduce Shok in Canada this month.
Malternatives, another youth-aimed beverage, may be down from their peak, but beer companies continue to roll out new flavors.
Made with a malt base and topped off with vodka, rum and other spirits flavors, malternatives -- or flavored alcoholic beverages -- include the well-known Smirnoff Ice Original, Mike's Hard Lemonade and Seagram's Smooth.
"I think you're also probably going to see more flavored beers, the malt beverages, which are so hot," Jones said.
In mid-March, Miller Brewing began test-marketing a fruit-flavored malt beverage imported from South Africa, called Brutal Fruit, in Seattle, Tampa, Fla., and Richmond, Va. The product is fruit juice with 5% alcohol, much like beer. It comes in four flavors: strawberry, mango, kiwi and raisin-like litchi. "In the flavored 'malternative' beverage category, it's kind of the flavor-of-the-month club," Niemann Foods' Martin Miller said. "Watermelon is coming out from everybody, and you have to keep that part of the cooler exciting with new flavors."
Of course, the addition of the new stockkeeping units is a double-edged sword for retailers. "It's difficult to determine whether that space should come from other Budweiser categories, or if it really needs to come from other, slower-moving items," Miller said. "You have to look at what they're going