As the Summer Selling Season Begins, Inflation is Still Top of Mind
Grilling on the back patio with neighbors. Spending a day at the beach with friends. Going to a summer music festival. Cheering on your favorite team at the ballpark. What pairs best with these long-standing American traditions? A cold, refreshing beer. Memorial Day marks the beginning of summer, a critical time for the beer industry. Beer sold between Memorial Day and Labor Day accounts for nearly 40% of total annual beer volume in the U.S.[1] Americans often think of the Super Bowl as the most significant beer holiday, but Memorial Day and July 4th are by far the most popular American holidays to enjoy your favorite lager, IPA, or even a refreshing and flavorful hard seltzer.
However, as we look to the official kick-off to summer, inflation remains top of mind for so many American consumers who have cited the cost of living as their top concern, even above other concerns like healthcare, crime, jobs and unemployment.[2] According to the Bureau of Labor Statistics, price increases are at a near all-time high, up 8.3% over the last 12 months compared to the year prior, and even higher for food items, up 9.4%. While beer similarly experienced substantial price increases in recent months, it still lags far behind inflation of all items, with the latest 12-month increase of 5%.[3] For decades beer has been an affordable luxury for Americans, particularly in tough economic times. Today, brewers and beer importers of all sizes are working hard to manage their increasing input costs while still providing an affordable treat to beer fans across America. The Beer Institute has been working to combat inflation, including advocating for the removal of Section 232 tariffs on aluminum – the single most significant input cost for brewers.
Memorial Day weekend is not exempt from consumer concerns about inflation. In an online survey conducted this month, 70% of beer drinkers said they plan to adjust their Memorial Day weekend plans this year due to inflation. More than 4 in 10 beer drinkers said they will adjust their plans by staying home instead of normally going away. If they still plan to host an event this weekend, more than one in four (28%) beer drinkers say they plan to purchase less alcohol than usual and close to one in four (24%) say they plan to buy less food than usual. These numbers are even higher for younger legal-drinking age consumers, with 80% of beer drinkers aged 21-34 claiming they plan to adjust their Memorial Day plans and 36% saying they will purchase less alcohol than usual.[4]
So, does this mean all doom and gloom for beer this summer? Absolutely not. I am approaching this summer with hopeful optimism based on the resiliency and ingenuity I see every day in the beer industry. The same resiliency and ingenuity brewers showed as they flipped their business models nearly upside down in 2020 despite massive on-premises shutdowns and supply chain issues while still supporting their communities through community fundraisers, hand sanitizer production and more. This same grit and resiliency generates more than $331 billion for the U.S. economy annually and supports more than 2 million jobs across the industry.[5]
Beer helps bring people together, and after two years of COVID-19, I know many of us are hoping to do just that this summer. In the same survey that asked about Memorial Day celebrations, we also asked about Americans’ favorite summer beer-drinking occasions. It’s no surprise that our favorite summer beer occasions are about gathering with friends and family. The top two favorite summer drinking occasions among regular beer drinkers are (1) enjoying a beer at a cookout or picnic, and (2) hanging out in a backyard with friends and family. For more than half (55%) of beer drinkers, a summer holiday gathering (like Memorial Day or July 4th) is their favorite beer occasion, and nearly five in ten (49%) beer drinkers say they enjoy a beer most at an outdoor patio at a bar or restaurant. What other occasions make the list as favorite times for enjoying a beer? Forty-five percent of respondents say at the beach or by the pool, and about one in three say at a music concert, festival, or sporting event.[6]
Like you, we in the beer industry are excited to gather in backyards and around pools this weekend as we kick of the summer beer season. We also hope you will take a moment to remember the reason for Memorial Day and join us in raising a glass to those who selflessly gave their lives in service to our country. Happy Memorial Day, and happy summer.
[1] Source: Beer Institute
[2] Source: Bully Pulpit Interactive online survey conducted on behalf of Beer Institute. 800 age 21+ respondents across six battleground states. January 10-15, 2022
[3] Source: U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index April 2022 News Release
[4] Source: Online survey conducted by The Harris Poll on behalf of Beer Institute, May 19-23, 2022 among 1,983 U.S. adults ages 21 and older, among whom 1,097 drink beer several times a year or more often.
[5] Source: Beer Serves America 2020
[6] Online survey conducted by The Harris Poll on behalf of Beer Institute, May 19-23, 2022 among 1,983 U.S. adults ages 21 and older, among whom 1,097 drink beer several times a year or more often.
