Beverage Bulletin September 2010

California Beverage Retailers Association

P.O. Box 56686

Sherman Oaks, CA 91413

(818) 788-8120

www.cbraliquor.org

 

September 2010

 

Anheuser-Busch— whose Budweiser brand sales and image have taken a serious licking — today will announce plans to push free beer and a hipper Bud image to younger beer drinkers over the next several weeks.

To appeal to the under-30 set that has ignored the brand — but is a prime consumer group for beer — Budweiser will unleash its biggest-ever national free-sample effort in trendy bars and eateries. The campaign begins Monday, with the slogan "Grab some Buds."

The hype culminates on Sept. 29, when the brand hosts the "Budweiser National Happy Hour," a bid by Bud to nudge folks to at least try a free brewski. The free samples for those 21 and up range from 6 ounces to 12 ounces, depending on state and local rules.

At issue: a brand that's lost mojo. Bud unit sales were down 9% last year and are down the same this year, says Beverage Marketing Corp. Beer drinkers have lost loyalty to Bud for the past seven years, research firm Brand Keys reports. Bud's ranking among national product brands slipped from 16th in 2003 to 220th in 2010.

 

High in the sky! What kind of wine do you get in First Class seating on an airline? Your seat could cost as much as $7,000, but what will you drink? United pours Davis Bynum Sonoma Pinot Noir ($22). Delta serves Burgess Napa Merlot ($22) or Piper Heidsieck Champagne NV ($25) while Air Singapore and Air Emirates pour Dom Perignon. Most airlines buy their wine and cellar it for one to seven years before putting it on the flight line.

 

Chateau Lafite Rothschild 2009 pre-release sales opened at $19,000 per case. The price has already risen to $23,000 per case. Making it the priciest vintage ever even though the wine will not be bottled until 2012. The reason behind this and other increases in Bordeaux prices is the emergence of China as a huge wine market. Last year China passed the U.S. as the biggest export market for Bordeaux wines outside of Europe. Typically top Bordeaux wines increase in value after release. A good portion of the 2009 pre-release may have been purchased by speculators. Are we looking at another investment bubble?

 

Major liquor companies including Diageo PLC and Pernod SA are opposing a proposal in Thailand to require graphic warning labels on bottles. Thailand may be small, but its influence in this area is major. In 2005 Thailand required tobacco companies to add graphic warning labels to cigarettes. These labels include things like pictures of diseased lungs. Since adoption the regulations have been duplicated in several other countries including UK. The liquor labels would cover 30% of the bottle and depict traffic accidents, injured and maimed victims, and other horrific subjects. Liquor companies have been lobbying their own governments to pressure Thailand not to require these labels as well as pressuring the WTO (World Trade Organization) to try stop the labels as “an obstacle to trade.” The US government is one that has taken this seriously. The US is paying to bring Thai authorities here to discuss other alternatives to the labels.

 

Some new trends are sweeping foodservice in Europe. 1) handheld order devices are used almost everywhere. Servers use them to take orders and to settle the bill. Customers like them because their credit card never leaves the table. 2) Foodservice is becoming a big part of department stores in the UK. Harrod's has 37 restaurants and Selfridges has 18 restaurants.

 

The Restaurant Industry continues to feel the effect of the recession. US foodservice sales were $580.1 billion in 2010. Up 2.5% from 2009. After accounting for inflation. That is actually a 0.1% decrease in tonnage. The Wall Street Journal reports that many affluent customers have traded down to fast food and are sticking with it as the economy improves.

 

A counter-trend in the Restaurant Industry is the growth of “Healthy Alternatives.” In 2010 menu items labeled “healthy” grew 65%. Items labeled “vegetarian” grew 12%. And items that contained fresh fruits and vegetables grew 10%.

 

Tasting Notes

 

We attended two quite different wine tastings in recent weeks. One featured winners of the San Francisco International Wine Competition. The other featured “Unexpected Grapes from Unexpected Places.” The contrast was unbelievable.

 

The first tasting showed gold medal winners in a 25 categories. For all the gold medals, the tasting left us feeling empty. There were a few wines that showed reasonable taste profiles, but most were too young or had serious faults. One of the buyers at the tasting said “If these were the gold medal winners, what was the competition.”

 

The tasting of Unexpected Grapes showed a lot of good to superlative wines from all over California. The one requirement was that the wines had to be from grapes grown in places that were not the norm for the variety. The promoters of the tasting held to that and it turned out to be a good theme. We tasted wines that ranged from $10 to $90. All were good, many were outstanding. Among the best we tasted were Star Lane 2005 Cabernet Sauvignon($80) from Santa Barbara County. A really great wine! It had all the right notes in all the right places! We also tasted Pedroncelli Cabernet Sauvignon. An outstanding wine at an outstanding price($16). Between the two cabs, we could drink Pedroncelli at dinner every night and die happy! It rates a “Best Buy.” And if you put some down for 4 years it might just be as good as the Star Lane. Another “Best Buy” was Delicato 2009 Loredonna Reisling ($11). It was clean, clear and refreshing. Another outstanding wine was Rancho Sisquac 2009 Sylvaner($14). It comes from the last Sylvaner vineyard in California. It was very pleasant with a hint of sweetness and apricots.

 

Industry Calendar

CBRA members are able to attend most of the trade shows and tastings at no cost. Email ron@cbraliquor for information.

 

11/6-7 Health and Nutrition Show Long Beach

11/7 Daylight Saving Time Ends

10/21 Argentine Wine Tasting Hollywood

10/28 Wines of Navarre Spain Beverly Hills

11/6-7 Health and Nutrition Show Long Beach

11/7 Daylight Saving Time Ends

11/11 Veteran's Day

11/11 Stars of Cabernet tasting Beverly Hills

11/25 Thanksgiving Day

12/1 Chanukah

12/25 Christmas

12/31 New Years Eve

Legislation

Our industry is more controlled by laws than most others. The State Legislature and the ABC give us license privileges and take them away. More than 100 new alcoholic beverage laws have been introduced, passed, and sign by the Governor since this session started. Many critical issues are still pending. Is your business safe? Members are encouraged to look through the Legislative Bulletin. If there is a new law that is a problem for your business, call the association office now. The CBRA is your voice in Sacramento. If you are not a member, join today. The CBRA is your only voice when it comes to new beverage laws.

Brands and Comments

The CBRA Newsletter has not accepted any payment from any of the brands mentioned in this edition. The editor, Ron Ziff, welcomes comments at ron@cbraliquor.org

CBRA Membership Remains Open

Now, more than ever, access to your industry is important. The CBRA is California's only statewide association of licensed retailers, and our membership continues to be open for the first time in 20 years.

At CBRA we deal with licenses and regulations that affect the beverage business on a daily basis. That's why CBRA offers practical solutions, unique products, services, information, and timely advice for both large and small beverage businesses. With reasonable fees, superior service, and associates that are easy to reach, CBRA helps you to run your business better and easier.

California Beverage Retailers Association – We know how to get it done.