Based on data from GuestMetrics, the largest brands that accounted for around 25 percent of category volumes at the beginning of 2012 have all lost share since then, though at different rates and for different reasons. The top brands lost the most share in beer, while they held up better in wine & spirits:
Beer
Beer is the most concentrated category, with just three brands (Bud Light, Miller Lite, Coors Light) accounting for 25 percent of on-premise beer volumes. However, comparing the first 9 months of 2013 versus the first nine months of 2012, the roll-up of those three brands has seen share contract, from 27.4 percent to 25.5 percent for a loss of about 2 share points. Comparing the growth performance of those 3 brands versus the long tail of brands that account for the remaining ¾ of category sales, the top 3 saw volumes fall 10 percent, while the tail’s volumes only declined 1 percent. This tail not only includes craft brands but also successful innovation from the big brewers. Innovation continues to play an important role in driving growth but improving core brand performance is also critical. There continues to be a rapid proliferation in the number of beer brands sold, which is up 21 percent thus far in 2013.
Spirits
Spirits is also a very concentrated category, with just six brands (Grey Goose, Jack Daniels, Ketel One, Patron, Absolut, Crown Royal) accounting for 25 percent of on-premise spirits volumes. However, comparing the first 9 months of 2013 versus the first nine months of 2012, the roll-up of those brands has seen share contract, from 25.1 percent to 24.3 percent for a loss of 0.8 share points. Comparing the growth performance of those 6 brands versus the long tail of brands that account for the remaining ¾ of category sales, the top six saw volumes fall 5 percent, while the tail’s volumes only declined 1 percent. Pricing does not appear to be the main driver of this, since price/mix for the top brands increased 3.2 percent versus the 4.2 percent increase from the tail. However, given the top brands have a 31 percent price premium to the tail, part of the share loss could be due to price sensitivity among consumers. Additionally, while less dramatic than in beer, one of the other drivers of the share loss may be the proliferation in the number of brands sold, up 8 percent YTD.
Wine
Wine is significantly more fragmented category, with 150 brands accounting for 25 percent of on-premise wine volumes. However, comparing the first 9 months of 2013 versus the first nine months of 2012, the roll-up of those brands has also seen share contract, from 26.1 percent to 25.3 percent for a loss of 0.8 share points. The top wine brands had seen share hold up a bit better earlier in the year, but lost ground in 3Q13. Comparing the growth performance of those brands versus the long tail of brands that account for the remaining ¾ of category sales, the top brands saw volumes fall more than 4 percent, while the tail’s volumes declined only 0.5 percent. Pricing could be one of the drivers of this, since the price/mix for the top brands increased 4.8 percent versus the 2.7 percent increase from the tail, resulting in near price parity between the top brands and the tail brands. Proliferation in the number of brands does not appear to be an incremental driver (given the high degree of fragmentation is already the status quo), with the total number of wine brands sold in on-premise holding generally flattish compared to yago levels.
