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Spirits Industry Update - September 7th

Posted by Evan Prish on

Spotlight: Direct to consumer sales reshaping the alcohol retail market

Influenced directly by the Covid-19 pandemic, direct to consumer (DTC) alcohol sales have surged around the world. 

The largest brewer in the world, Anheuser-Busch InBEv, reported that sales through its e-commerce channels quadrupled in the first quarter of 2021, while the second largest brewer in the world, Heineken, reported sales doubled for its DTC platform in Europe.

DTC wine sales in the United States topped $223 million in June, up 18% from last year, despite a strong bounce back in on premise sales – underscoring the continuing trend of home consumption of alcohol in the US.

The spirits industry, on the other hand, has lagged with DTC sales compared to beer and wine, as currently only nine states allow DTC spirits sales. In contrast, 46 states permit DTC wine sales.

The Distilled Spirits Council of the US, the American Craft Spirits Association and the American Distilling Institute have all come together to lobby the federal government to pass new DTC shipping laws for spirits, arguing that the DTC avenue provides a valuable source of revenue for smaller craft spirits producers, especially during the ongoing pandemic.

News Briefing: 

After seeing a decrease in 2020, American rye whiskey is rebounding in 2021 – with YOY growth of just under 20% for the 52 week period ending August 14th, compared to 13% for bourbon. Diageo owned Bulleit Rye leads the American rye market by a landslide, with 525,000 9-liter cases depleted in 2020. The number two American rye brand, High West, saw depletions of 60,000 9-liter cases in 2020.

Anheuser-Busch is bringing Natural Light into the spirits market with ‘Natural Light Vodka’ – a new line of lemonade-flavored spirits. Coming in at 30% ABV, the lineup will consists of three flavors – Traditional Lemonade, Strawberry Lemonade and Black Cherry Lemonade. Natural Light Vodka is now available in ten states, including Ohio, Illinois and Florida.

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