Boozing through the recession

The current recession has seen some marked changes in consumer behaviour. This has generally been a move towards austerity, so much so that a number of well-known American retailers have been unable to weather the economic storm.

Too expensive for me!

It would appear that there are some “necessities” that people just cannot give up and one of these is booze. The Distilled Spirits Council of America have just released consumption figures for the last year. These show that Americans are drinking more than ever with overall consumption up by 1.4 percent.

But this desire to continue drinking does not come with brand loyalty; there has been a “trading down” from premium brands to bulk buying of cheaper product in bigger bottles. This has been most noticeable in the premium vodka market where sales of Grey Goose, for example, have dropped by 5.1 percent while the lowest-priced segment, with brands such as Popov vodka, grew the fastest, rising 5.5 percent.

Cheap tequila has been the biggest winner, however, with sales rising by 21 percent.

This move to cheaper product has meant that more drinking now takes place at home (2.2 percent volume growth in the off-premise sector) rather than in bars and restaurants (three percent volume decline).

All class!

Readers’ feedback at a number of websites to this drinking information shows the implementation of several recessionary survival strategies. These include drinking premium brands at home but buying cheaper product if going elsewhere, to a party or dinner, for instance. Others offer hints for supposedly turning cheap vodka into a premium-tasting product by passing it through water filters a couple of times (Has anyone tried that?). Several barmen point out that cheap vodka is the way to go if you add a mixer as it is impossible to tell the difference between cheap and premium vodka as soon as you add the mixer.

Distilled Spirits Council CEO Peter Cressy does point out, however, that this behavioral trend to cheapness is not likely to last, as “long-term analysis of prior recessions showed a strong trend back to premiumization as the economy improves.”

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