Even though the uncertain economy has forced consumers to cut back on discretionary spending, beer consumers have remained loyal.
Prices for the fizzy beverage have shot up in recent months, but experts at Bump Williams Consulting, which offers customized analytics and shopper insights across all tiers of the Beverage Alcohol industry, says that doesn't mean beer drinkers are holding off on buying booze. Instead, they're changing their buying habits.
Dave Williams, vice president of analytics and insights at Bump Williams Consulting, said the average case price for beer jumped 7% to 8% between October through December 2022. Normally, the increase in a typical year is anywhere between 3% to 5% for the beer category, he said.
Williams said the industry has done a good job at insulating consumers from a lot of the rising costs and pressures from manufactures and wholesalers but eventually, "it got to the point where a move had to be made."
The fourth quarter was one of the largest prices hikes Williams saw in the category in recent memory given the rising costs from production to delivery and front-door sales.
Williams said dollar sales for beer showed moderate gains, increasing 5.2% during the three final months of the year. However, volume of beer sold declined 2.3%.
This is a telling sign that the higher prices was pumping up dollar sales, but consumers were becoming more cautious about the amount they were buying.
Regardless, "consumers will always find a way to meet a beverage alcohol occasion that they want to meet," he said.
Some of the recent survey work they have done suggests that consumers are at least maintaining their consumption of beer.
The biggest trends he noticed is that people may be trading down in package sizes, cutting down on volume and reducing the number of trips they are making to the store.
"What I think is happening is that that volume per occasion is being reduced," he added.
This is also why there has been a rise in single serve across the board in the industry, according to Williams.
"I think single serve has been a beneficiary of consumers doing that math…when looking for value and minimal spend for each trip to the store," he said.
It's not the first time industry leaders have expressed optimism for the beer industry amid the tumultuous economic period, either.
In September, Anheuser-Busch CEO Brendan Whitworth expressed confidence in the brewing company, a subsidiary of Belgium-based AB InBev, and its ability to weather economic challenges in part because of its expansive portfolio ranging from higher to more economical price points.
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