There seems to be no end to the hard seltzer saga. In the UK, BrewDog et al were slammed by the watchdog over misleading hard seltzer claims
The Advertising Standards Authority (ASA), on 7 July, took objections to hard seltzer ads which appeared between December 2020 and January 2021, including BrewDog’s Clean & Press range, London-based brand Drty Drinks, and Wild Drinks Group’s Whisp.
Meanwhile, over the in the US, Molson Coors killed off its Coors Seltzer
Touting “Drink A Seltzer and Help Save a River” was not enough to sway consumers. As hard seltzer sales move into the crucial summer season, Coors Seltzer is getting out of the game. Molson Coors’s chief marketing officer, Michelle St. Jacques, and US sales president, Kevin Doyle, told wholesalers that there would be no more deliveries of Coors Seltzer, the website BrewBound reported on 9 July 2021.
AB-InBev’s new guard – CEO Michel Doukeris and North America chief Brendan Whitworth – have their work cut out. In his farewell interview with the Financial Times (FT) newspaper, on 4 July 2021, former CEO Carlos Brito, who stepped down at the end of June, said that the age of megadeals is over. This, analysts said, will put more pressure on AB-InBev to build brands and grow organically, although its scale has sometimes stood in the way of agility.
The world’s largest supplier of hop products and services, BarthHaas, is reshuffling its executive board. Stephan Barth, Executive Managing Partner, will resign from his position and join the Board of Directors. The 60-year-old manager fell seriously ill with covid in the spring and has not yet fully recovered. His cousin, Regine Barth, will become sole Managing Director of BarthHaas.
Covid turned off beer taps in Spain: sales declined 12 percent in 2020. The closure of bars and restaurants during the months of lockdown, and the restrictions on hotels and tourism have hit the beer industry hard. Consumption fell 12 percent to 36 million hl, a loss of 5 million hl over 2019, thus putting an end to seven consecutive years of growth.
The Brewers of Europe, an industry body, has added its name to a new EU-wide pledge to support the shift towards sustainable food systems. By signing up, Europe’s brewers pledged to pursue and build upon their six-year long commitment to label ingredients and energy on beers across Europe. By the end 2022, all beer bottles and cans will list ingredients and energy per 100 ml, just as all other non-alcoholic beverages legally have to do.
Test-and-trace rules wreak havoc at English pubs and restaurants. In recent weeks, pubs and restaurants across England have had to close at short notice, as staff are forced to self-isolate after being alerted by the NHS test and trace app over coming into contact with someone with covid.
Even before the pandemic struck, the London pub company Fuller’s was a very different business from the one founded in 1845. In 2019, it had sold its beer operations, including the London brewery in Chiswick, to Japan’s brewer Asahi for GBP 250 million (USD 330 million). In those days, the pubs proved far more profitable. What remained of the original Fuller’s was the pub and hotels business, comprising 212 directly managed pubs, 176 pubs leased to tenants and 1,028 boutique hotel rooms. Little did the stock market listed firm know that covid would hit one year later.
Staff call on UK pubco Wetherspoon to double bank holiday pay. By early July 2021, more than 50,000 people had signed the petition, which is open to customers, staff, and members of the public. The organisers argue that employees at the UK’s largest pub chain (860 venues) deserve extra wages for tough bank holiday shifts, when hospitality has to deal with “many difficult customers”. Annually, there are eight bank holidays in England and Wales, nine in Scotland and ten in Northern Ireland.
BrewDog is making headlines, but not as designed. A winner of one of BrewDog’s “solid gold” beer cans in the UK has asked the advertising watchdog to investigate its claim the prize is worth GBP 15,000 (USD 20,700), the BBC reported on its website.
Was the hype over cannabis beverages just a fad? Because of a lingering fear that legal cannabis would eat into beer sales, brewers have openly embraced cannabis companies. Constellation Brands was the first major alcohol producer to break the taboo. In 2017, it took a USD 4 billion stake in Canadian producer Canopy Growth. Other brewers followed suit. But in Canada, things have not panned out as expected for the Big Brewers. Sales of cannabis beverages are unexpectedly low.
The US beer industry enters into the summer selling season with a stiff wind at its back, at least in terms of shipments. Brewers had a very solid start to 2021. Was 2020 just a passing storm with no lasting impact? In the short term, some of the changes stemming from the pandemic year, when people stayed at home and off-premise beer sales surged, will persist. As said Michael Bellas of the Beverage Marketing Corporation, New York: “At home consumption should ebb but stay strong; off-premise channels will continue to benefit. However, the channel mix will not resemble its pre-pandemic state – when the on-premise represented 50 percent of beer sales by value but the off-premise for the bulk for volume sales – until next year.”
Covid will cast a long shadow. In the Czech Republic, once buzzing city centre microbreweries are eerily quiet, due to a lack of tourists. In Poland, craft breweries are struggling because an archaic alcohol law makes direct-to-consumer shipping illegal. In Russia, meanwhile sales of non-alcoholic beers are ticking up nicely. But any return to some type of “normal” depends on Russia, Poland, Ukraine, and Czechia avoiding the next wave of infections. In June already, they recorded the highest number of coronavirus cases within Europe.
As the pandemic hampered tourism and the lockdown hit draught beer sales hard, Czech brewer Plzeňský Prazdroj (Pilsner Urquell) saw its 2020 profit decline 20 percent to CZK 3.8 billion (USD 180 million). Revenue dropped more than CZK 1 billion year-on-year to CZK 16 billion (USD 750 million). The largest Czech brewery sold 11.2 million hl beer last year, a decline of 4.2 percent over 2019. Sales in the Czech Republic fell 8 percent to 6.7 million hl, while export volumes grew 1 percent to 4.5 million hl beer.
Polish Craft brewers were caught between a rock and a hard place during the pandemic, when the Polish government put the country under two lockdowns, lasting from March to May 2020 and from October 2020 to May 2021. As hospitality venues were forced to shut, craft brewers could not pivot to e-commerce as they did elsewhere in Europe because of an ancient alcohol law from 1983, which does not mention internet sales (unheard of then). Despite their best lobbying efforts, the government insisted that this omission means e-commerce is illegal and refused to amend the law. Making matters worse, craft brewers did not qualify for government support to see them through the crisis. Some schemes even expressively excluded alcohol producers.
Heineken ups stake in United Breweries in India. As in the old adage “everything comes to him who waits”, Heineken, on 23 June 2021, bought 39.6 million shares in United Breweries (UBL), which pushed its holding to 61.5 percent from 46.5 percent previously. UBL is the brewer of India’s best-selling Kingfisher lager and was once owned by Indian tycoon Vijay Mallya, whom India wants extradited from the United Kingdom, where he has been holed up for the past five years. Indian banks had argued he owed them more than USD 1.4 billion in loans, which he had no intention of repaying. The banks took possession of the stake and India’s Competition Commission, on 21 June, approved Heineken’s proposed acquisition.
Beer consumption in Italy drops 11 percent in 2020. The covid pandemic hit Italy’s economy earlier and more severely than other large eurozone economies. In 2020, Italy’s economy shrank 8.9 percent, the second-largest contraction after Spain, and it still has further to go than Germany and France to recover its pre-pandemic scale. Due to various restrictions and bans, tourism only contributed EUR 116 billion or 7 percent to Italy’s GDP in 2020 – whereas in 2019 the figures were twice as high. All this has boded badly for beer sales. In fact, they dropped by about 2.5 million hl (11 percent) to 18.8 million hl in 2020, dragging per capita consumption down to 31.5 litres from 35 litres in 2019, Assobirra, an industry body, said.