On a recent episode of the Tapped In Sales Podcast, we were joined by Lester Jones, Chief Economist and Vice President of Data Analytics at the National Beer Wholesalers Association, for a timely conversation about the beer consumer, the economy, on-premise and off-premise trends, THC, retailer behavior and where distributors should be looking for opportunity.
One of Lester’s biggest points was simple but important: the beer consumer has not disappeared. The consumer has changed occasions.
As Lester put it, “Just because we’re drinking differently doesn’t necessarily mean we abandoned a category. It just means we’re trying to enjoy these beverages in different places, at different times and in different circumstances.”
That distinction matters. When grocery store velocity softens or certain off-premise accounts slow down, it is easy to jump to the conclusion that the beer consumer is gone. But that may not be the full story. In many cases, the consumer has not left beer. The consumer has moved to restaurants, bars, events, stadiums, festivals, travel and other experience-driven occasions.
A consumer who buys a 12-pack at retail creates very different volume than a consumer who has one or two beers at dinner. Both consumers may still be engaged with beer, but the channel, package, margin, selling motion and account strategy are completely different.
Sentiment and behavior are not always the same
In today’s market is that consumer sentiment and consumer behavior can move in different directions. People may say they feel pressure from inflation, uncertainty, gas prices, insurance, housing or labor costs. At the same time, many are still spending on experiences, dining out, travel and entertainment.
Lester described this disconnect clearly during the conversation. A consumer may say things feel bad, even when the core components of their life — employment, income, household stability or spending ability — are still relatively strong. That same pattern can show up in beer, where overall sentiment may be more negative than the actual underlying behavior.
For distributors, this creates a planning challenge. A negative headline does not always equal a negative opportunity. Consumers may be more selective, but they are still spending. The question is where, why and on what occasion.
That means sales teams need to move beyond broad assumptions like “the consumer is weak” or “beer is down.” A better question is: Which consumer, in which account, during which occasion and with which package or brand?
Away-from-home spending changes the beer volume story
A key insight from Lester’s analysis is the growing importance of away-from-home spending. He noted that, for the first time in the data series he reviewed, consumers were spending as much or more on food and beverage away from home as they were at home. His point to distributors was direct: “If you’re a beer distributor, you’re going to the grocery store and your velocity is down… the money’s just not in that grocery store.”
That does not mean beer demand is gone. It may mean the occasion has shifted.
This is especially important because beer volume behaves differently by channel. A consumer drinking beer at home may purchase a six-pack, 12-pack or larger package. A consumer drinking beer away from home may buy one or two servings. The consumer may still choose beer, but total volume can look very different.
That is why distributors should be careful about interpreting lower off-premise velocity as a simple demand problem. It may be a channel-mix problem, an occasion problem or an account-strategy problem.
The on-premise still builds brands
The on-premise has always played an important role in beer. It is where many consumers discover brands, try something new and build emotional connections around food, friends, sports, music and hospitality.
That role may be even more important today.
As distributors have become more efficient by segmenting accounts, reducing service frequency or shifting smaller accounts into lower-touch models. Those decisions may make sense operationally. But if the market is shifting toward away-from-home occasions, distributors should be careful not to ignore the on-premise accounts that influence consumer behavior.
Lester said it well: “If you want to build a brand, you start in your on-premise, in your local accounts. You figure out what matters to people, and then you take the success of those brands and those products and those innovations to your larger off-premise.”
Not every account needs the same level of service. However, the on-premise should not be treated only as a low-volume burden. It can be a brand-building engine.
A small draft account may not move the same number of cases as a large-format retailer, but it may introduce a brand to the consumer who later buys it elsewhere. That connection between on-premise trial and off-premise purchase is where distributors can create value for suppliers and retailers.
More beer drinkers can still mean lower per-capita consumption
Another important nuance is that the industry can have more beer drinkers while still seeing lower per-capita consumption.
That sounds contradictory, but it is not. If more legal-drinking-age consumers are participating in beer but drinking fewer servings per occasion, total consumption per person can decline even while the drinker base expands.
This is especially relevant in an environment where moderation, wellness, premiumization and experience-driven consumption are all influencing behavior. The goal for the beer industry should not be fewer people drinking more. It should be more people participating responsibly across more occasions.
Lester captured the opportunity this way: “The consumer is here, is willing, and just winning those occasions is what our priority should be.”
That framing matters. It shifts the focus from chasing volume alone to winning occasions. A consumer may choose beer at a restaurant, a concert, a golf outing, a backyard gathering, a convenience store stop or a grocery trip. Each occasion requires a different account strategy.
Retailers are rationalizing
Retailers are facing the same cost pressures as everyone else. Labor, insurance, rent, utilities and financing costs all affect how they think about inventory. As a result, many retailers are becoming more disciplined about what they carry.
That does not mean they are rejecting innovation. It means innovation has to earn its place.
As Lester explained, retailers are increasingly asking for “the brands that move, create velocity, make money for me.” He added that he still sees new brands and innovations performing well, which suggests retailers are not afraid of new items. They are simply thinking more carefully about what deserves space.
For distributors, this raises the bar. It is no longer enough to walk in with the same rotation, the same seasonal story or the same supplier priority and expect the retailer to make room. Retailers want products that create velocity, margin, traffic or differentiation.
The distributor’s job is to connect the recommendation to the retailer’s business.
That may mean showing why a brand works in similar accounts, how it fits a specific occasion, what package meets the shopper’s need or how the item supports the retailer’s broader strategy. The best sales teams will bring sharper account-level thinking, not just more items.
The distributor opportunity
The beer consumer is not dead. The consumer is still willing. But the consumer is making more deliberate decisions about where to spend, what to drink and which occasions matter.
For distributors, that creates a clear opportunity:
Look at accounts differently.
Look at channels differently.
Look at occasions differently.
Look at retailer value differently.
A case dropped at one account and a keg placed at another may both matter, but they matter for different reasons. The distributors that understand those differences will be better positioned to help suppliers build brands, help retailers make money and help consumers continue choosing beer.
The market is changing, but change does not mean decline is inevitable. It means the playbook needs to keep evolving.
Beer still has a place at the table. The challenge is making sure distributors know which table the consumer is sitting at.
Want to Learn More?
For a deeper dive into this topic, listen to Episode 106 of the Tapped In Sales Podcast: “The Beer Consumer Isn’t Dead, They’re Just Out to Dinner.” In this episode, Bud, Mike and Ross are joined by Lester Jones, Chief Economist and Vice President of Data Analytics at NBWA, to discuss why declining grocery velocity does not necessarily mean the beer consumer has disappeared. The conversation explores how consumer occasions are shifting, why away-from-home spending matters, how the on-premise continues to build brands, and what distributors can do to rethink accounts, channels and retailer value.
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