Beverages: Beer, Wine and Spirits: U.S. Advertising Spending Analysis: 1Q18
Source: CITI
Wendy Nicholson
24 May 2018
1Q Ad Spending for the Alcoholic Beverage Categories Was Up 3% YoY
Looking across the major alcoholic beverage categories, U.S. advertising spending was up 3% YoY in 1Q18, with the majority of the spending increase coming from light beer (+10% YoY), vodka (+40%) and brandy (+153%), while spending decreased for regular beer (-6%), bourbon whiskey (-36%) and wine (-31%). Some other notable categories showing a spending increase were Canadian whiskey (+275% YoY) and rum (+20% YoY). These increases were partly offset by lower spend for tequila (-53% YoY) and scotch whiskey (-26% YoY).
Total Ad Spending Was Mostly Up for Our Coverage
For the four alcoholic beverage companies that we analyzed (SAM, BFB, STZ and MillerCoors), we mostly saw increases in ad spending during 1Q18.
SAM’s U.S. advertising was up 33% YoY in 1Q18 (to $16 mm), which is above the +5% CAGR in 1Q ad spending over the last four years. SAM’s advertising spending increase was driven by increases for Sam Adams, Twisted Tea and Angry Orchard, while spending for Sam Adams Fresh As Helles and Sam Adams Boston brands declined.
BFB’s U.S. advertising was up 12% YoY in 1Q18 (to $10 mm), which represents a 12% CAGR in 1Q ad spending over the last four years. 1Q18’s spending increase was mainly attributable to higher ad spending for the company’s whiskey portfolio, which was up $1 mm, or +11% YoY.
STZ’s U.S. advertising was up 43% YoY in 1Q18 (to $34 mm), which represents a +26% CAGR in 1Q ad spending over the last four years. This quarter’s increase was attributable to higher ad spending for the company’s regular beer segment, as well as higher spending for light beer, while spending for wine decreased.
MillerCoors’ U.S. advertising was down 13% YoY in 1Q18 (to $80 mm), which represents a flat CAGR in 1Q ad spending over the last four years. The decline was driven by lower ad spending behind Coors Light, Coors Banquet, Miller High Life and Blue Moon, which was partly offset by higher spending for Miller Lite and Blue Moon Belgian White.
Television Remained the Preferred Media Channel
For the alcoholic beverage companies that we analyzed, TV represented 85% of the total spend, although we note that the total spend does not capture the majority of digital ad spend.
Our Methodology
While these absolute figures may be incomplete and/or partly inaccurate, we nonetheless consider the relative changes to be relevant, and, as such, we have attempted to compare ad spending and market share trends to determine whether changes in dollars spent are reflected in market shares.