Moderation nation

The beer and cider category has endured a bumpy ride of late and it’s the low- and no-alcohol sector that has seen sales soar as more and more consumers dial down their drinking.

By Elena Dimama

Beer and cider are, for many, cornerstones of the convenience retailing world and for good reason: they are all-year-round staples underpinned by a diverse portfolio and strong NPD.

Overall, the beer category is valued at over £6.6bn in UK retail, and over the last 12 months, the total beer category has returned to value growth at +1.4%, according to Nielsen. The category is not out of the woods yet, as it has been down in volume by 4.8% for the same period due to inflationary price increases and it seems there is a long way ahead. Earlier in January, inflation rose surprisingly to 4%, with beer experiencing a 12.8% change in its average price over the 12 months to December 2023.

A wet British summer in 2023 also resulted in a slight value decline with beer sales down by 0.6%, but that did not stop craft beer from enjoying another strong summer – up 3.3% compared to a year ago in the last 12 weeks. Mainstream lagers, on the other hand, saw the largest decline at -3.8% compared to a year ago, according to Nielsen.

The cider factor

While beer might be on a bumpy road, partly due to rising costs in the alcohol category, the cider category is outperforming both lagers (-7.6%) and ales (-10.7%), according to Nielsen.

“However, while the cider market is generally performing well in comparison to Beers, Wines, and Spirits, it’s worth noting that flavoured cider is down -9% and declining ahead of the total market,” Calli O’Brien, Head of Marketing at Aston Manor Cider, notes.

“Cider is the impulse drink of choice, with a third of shoppers only ever buying cider in cans. Therefore, it is important that retailers provide greater choice for consumers by stocking both can and bottle formats.”

Price and convenience

Alcohol tends to see a sales uplift in sales over the spring and summer period, with a specific focus on value and convenience. “Retailers must ensure they can respond to this by offering a 100% chilled range, stocking a wide range of options in cans and bottles,” O’Brien says.

“If a store has limited chiller space, retailers should at least offer a good selection of flavoured ciders that are available chilled alongside top selling ciders. When a shopper buys cider on impulse, having it chilled and ready to drink are often more important than price, however, promotions still play an important role in communicating value for money that will help to win longer term customer loyalty.”

Multipacks are also a key growth driver for the category, with the four-can pack remaining the most important craft beer format throughout 2023, with 47.4% share, according to Nielsen. “Cost of living will continue to be a concern for all grocery categories as we move into 2024, however, based on previous times of hardship, we have identified that shoppers seek premium treats in the off-trade, when finances are challenged,” Caitlin Brown, Category Executive, at BrewDog, adds. “This has been proven by the growth of Craft Beer during this last year and reinforced by our research which places quality (66%), taste (50%) and range (45%) as the top drivers to purchasing BrewDog, with well-priced at 29%.

“These remain a priority as consumers cut back in other areas of their lives, reducing overall store spend in-store,” she adds.

Low and no delight

Low and no-alcohol beers is the best performing sub-category, as people keep reducing their alcohol intake, with sales jumping nearly 20% by value and 7.2% by volume year-on-year. “Convenience retailers should grasp this opportunity and ensure they are catering for the increasing number of consumers who are looking for moderation,” John Price, Head of Marketing at KBE Drinks, says. The brand has recently announced the arrival of Kingfisher Zero, while its Sagres 0.0% comes in packs of 24 x 330ml cans or bottles.