Lead by Style
Consumers are excited to be returning to bars and restaurants, especially to enjoy an ice cold draft beer! This enthusiasm presents an opportunity for the on-premise to regain consumers' share of wallet.
Prior to COVID-19 Craft & Styles accounted for 53% of beer dollar growth and will be a big part of returning the on-premise to 2019 levels1. Offering the right style mix will be essential, especially within your draft lineup, as 77% of all Craft Beers are consumed on draft2.
Based on Euro Monitor projections, Craft Beer is set to return to 2019 dollar levels in 2023. However, Anheuser-Busch believes that by optimizing draft assortment and identifying the right styles in each market, the Craft Beer segment could return to pre-pandemic dollar sales even sooner. If we can return Craft dollars to 2019 levels by 2022, this would be an incremental $1.4 billion in sales for the on-premise industry. To seize this opportunity, operators need to take action to ensure they have the right style assortment available for their consumers.
People who drink more styles of beer, buy more beer.
The more beer styles someone has in their repertoire, the more money they spend on beer. Take people who drink three beer styles—perhaps they are fans of Light Lagers, Wheat beers and IPAs. Those people spend more than twice as much as people who only drink one style of beer. People who drink more styles of beer have more occasions to drink beer, meaning they are an extremely valuable consumer group to the category. Ensuring that bars and restaurants are offering the right styles of beer, on draft and in package, will be critical to returning the on-premise to 2019 levels.
It's also true that bars and restaurants that carry more styles of beer sell more beer.
In short, operators should be focused in on carrying more styles of beer, in order to generate more sales of beer.
The IGNITE strategy is all about Volume + Variety. Bars and restaurants must start by getting the Lagers right, which are the bulk of the volume. From there, they can move on to carrying the variety of styles, which offer the growth opportunity.
Lagers dominate on-premise, making up 54% of dollar sales. When looking at Craft styles specifically, IPAs are #1 in total dollars, closely followed by Wheats. Given this, it is essential to take care of base volume through Lagers, then add incrementality to your assortment by adding Craft styles such as IPAs and Wheats.
The recommendation is simple:
- Start with the high-volume styles, the light and classic Lagers
- Build variety with fast-moving styles to appeal to unique consumer preferences
Anheuser-Busch knows it’s not a one-size-fits-all approach, and there are nuances between markets. With this in mind, the Anheuser-Busch On-Premise Category Team has developed a best-in-class draft optimization tool that can further assist in providing account-specific recommendations on the optimal draft assortment. CLICK HERE for a brief video introducing the tool.