Beer Here! A Summer Heads-Up for Hops

Beer Here! A Summer Heads-Up for Hops

Nick Lake is VP, Group Client Director, The Nielsen Company

Summer’s coming. Beer season. And as grocery retailers develop strategies to help maximize their sales during the 2009 summer selling season, it’s clear there are a number of unanswered questions about the economy that could impact your business: Have job losses begun to stabilize? Which way will the stock market go today? Have we hit rock bottom yet?

If we had a crystal ball, it would be easy to determine the answers to those and other questions about our economy. But it’s impossible to predict the future. If you’re a grocery retailer hoping to entice consumers to increase the size of the basket at the checkout this summer, statistics tell an interesting beer story with two very different main characters — the cautious consumer and the affordable-luxury-seeking consumer.

The Cautious Consumer

For anyone in retail, consumer confidence remains a critical issue. Consumers today are cautious, and with good reason. More than 3.6 million jobs have been lost since the recession started, and more than half a million people have become unemployed just since January. The stock market has not only declined significantly since the crash in September, it also has exhibited extreme volatility in the months that have followed. And the housing market looks like it has a long way to go before it regains full health.

Nielsen’s research shows that with consumer confidence at its lowest level in years, consumers’ wallets seem to be as frozen shut as the credit markets. They’re just not letting go of their money like they used to.

The impact of the cautious consumer can be seen across the beverage alcohol sector.

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