Beer Consumption in the US Hits Lowest Level Since 1999 Amidst Boycott and Changing Consumer Preferences
In a surprising turn of events, beer consumption in the United States has reached its lowest level since 1999, with Americans drinking less beer in 2023 than in any other year this century. This decline in demand has been spearheaded by a widespread boycott against Bud Light, although analysts believe that the boycott alone does not account for the entire decline.
The boycott against Bud Light was initiated due to the brand's sponsorship agreement with transgender influencer Dylan Mulvaney. The controversy began in the spring when Bud Light partnered with Mulvaney to celebrate her first year identifying as a woman. The company released special cans featuring Mulvaney's face, which were heavily promoted on social media. This move ignited anger among conservatives and loyal beer drinkers who felt that Bud Light was prioritizing far-left identity politics over its customer base.
However, David Steinman, the vice president and executive editor of Beer Markets Insights (BMI), suggests that the boycott only accelerated a more general decline in demand for "domestic premium" brands like Bud Light, Miller Light, and Coors Light. BMI's analysis indicates that beer consumption is on track to fall below 200 million barrels in the US, with Anheuser Busch leading the decline in sales.
Brendan Whitworth, the CEO of Anheuser-Busch, addressed the controversy surrounding Bud Light's sponsorship agreement in April, stating that the company "never intended to be part of a discussion that divides people" and that their goal is to bring people together over a beer. However, by May, Anheuser-Busch had suffered a loss of $27 billion in market value, and sales were down nearly 30% compared to the previous year.
While Bud Light garnered significant attention, the decline in beer consumption goes beyond a single brand. Industry group Beer Marketer's Insights (BMI) reports that overall beer consumption in the US reached its lowest level in a generation. Consumers are shifting away from traditional beer favorites and exploring other forms of alcohol, or in some cases, avoiding alcoholic beverages altogether.
Steinman explains that Anheuser Busch's decline is part of a broader trend in the long-term decline of "domestic premium" brands. This category includes Bud Light, Miller Light, and Coors Light. Anheuser Busch, owned by global conglomerate AB InBev, has also faced challenges in the hard seltzer market, which it previously dominated.
Lester Jones, the chief economist at the National Beer Wholesalers Association, highlights that the beer industry now faces competition from a surge of new alcohol products, including those from non-traditional producers such as soft drink and energy companies. These new products are vying for the same consumer occasions as traditional beer.
Despite the decline in overall beer volume consumption, large beer makers have remained financially resilient due to rising prices. Beer drinkers are also shifting towards more expensive brands, particularly imports like Modelo Especial, which became the top-selling beer in America in 2023. Additionally, beer sales in other parts of the world continue to remain strong.
However, the beer industry still faces significant challenges. The craft beer boom of the 2010s has slowed down, and the market is now saturated with a wide variety of alcoholic beverages, potentially overwhelming consumers.
Overall, the beer industry had a tumultuous year in 2023, with a declining market, boycotts, and increased competition from new alcohol products. While the US market experienced a decline, beer sales in other parts of the world and the profitability of large beer makers have remained relatively stable. The industry will need to adapt to changing consumer preferences and find new ways to engage customers in order to regain momentum in the coming years.
