USBevX 2016: Key Takeaways
The inaugural US Beverage Industry Expo (USBevX) in Washington DC (February 16-18) brought together beer, cider, spirit and wine industry professionals for an event aimed at breaking down category silos and encouraging cross-sector inspiration. Stylus spotlights the key takeaways.
- Forest of Choice: Over the past two years, New York-based market research firm Nielsen has logged more than 10,000 new beer, wine and spirit products globally, according to Danelle Kosmal, Nielsen's vice-president of Beverage Alcohol Practice. Kosmal attributes this explosion to the millennial generation – 40% of which claim to regularly consume beers, spirits and wine. Around 4% claim to only drink wine.
- Flavour Fatigue: Fifty-seven distinct brands now sit on the average US back bar, according to Jon Collins, president of Nielsen CGA (on-premises division). Noting that global drinks brand Diageo had recently launched its 42nd flavoured vodka, Collins urged brands to stop contributing to "flavour fatigue". "When you put that forest of choice in front of people, how are they supposed to make an informed decision?" he asked. "They either default to major brands, or need to ask for guidance." Highlighting how flavour trends are now crossing categories, Collins also said that grapefruit-flavoured beer saw a 550% dollar growth rate in 2015, while grapefruit-flavoured spirits also grew by 62%. Despite this huge rise, Collins noted the importance of not jumping onto flavour fads, which might not have longevity.
- Drinking Occasions Shift: "We are in a new era of complexity," said Collins. He noted a 40% increase in new licensed restaurants (excluding fast-casual) opening across the US in the past 10 years, while one in six (12,309) neighbourhood bars – where you might have a 'regular' drink – have shuttered.
- Retail Treasure Hunt: In contrast to on-premises flavour fatigue, Doug Bell, global beverage buyer at Austin-based Whole Foods Market, believes the retail experience should be a "treasure hunt" where shoppers can always discover new and seasonal products. Whole Foods is bringing this mentality of discovery to its unique proprietary product collaborations, including a new first-to-market 'Prosecco' in a can, which will launch as a four-pack in spring 2016.
- Wine Premiumisation: "If you look at [Whole Foods], Trader Joe's and Krogers, the lower price point for wine is dead in the water; people are trading up and millennials will spend twice that of a boomer per bottle," said Bell. In line with a more taste-driven driven approach, Nielsen found 82% of US consumers would prefer to try wines on-premises rather than blindly seek one out based on price point, grape or region in a grocery store.
- Hard/Soft Formats: Bell and Mark Barden of US-based consultancy Eatbigfish both tipped hard sodas such as American brand Jane St – the world's first ready-to-serve hard vodka soda – as a category to watch. Barden also noted recently launched Californian spiced cola and red wine Motxo, which comes in a can and evokes Kalimotxos – a popular drink in the Basque region of Spain.
For more on millennials' drinking habits, see: Alcohol's New Female Focus, Beer & Millennials, Gen Y: New Wine Consumer and Reframing Wine. For more on-premises innovations, see: Raising the Bar and New Cocktail Culture.