Drinkers switch to cheaper stuff
Recession keeps many entertaining at home
NEW YORK – Americans’ love affair with top-shelf booze cooled last year as the recession took a toll on high-priced tipples.
People drank more liquor but turned to cheaper brands, according to a report by an industry group. They also drank more at home and less in pricier bars and restaurants in an effort to save money.
Industry growth slowed in 2009, with the amount of liquor sold by suppliers up 1.4 percent. That’s the smallest increase since 2001 and below the 10-year average of 2.6 percent.
The lowest-priced segment, with brands such as Popov vodka that can go for less than $10 for a fifth, grew the fastest, with volume rising 5.5 percent, after edging up 0.6 percent in 2008. Meanwhile, the most expensive brands, priced roughly $30 or more for a 750 ml bottle (think Grey Goose, owned by Bacardi), fell the most, tumbling 5.1 percent.
Liquor suppliers reported flat total revenue of $18.7 billion last year, the Distilled Spirits Council of the United States said in its report Tuesday.
Sales in stores – which make up three-quarters of liquor sales – rose about 2.1 percent, while sales in restaurants fell 3 percent.
“People still want to entertain themselves, they still want to get together with family and friends, so a lot of people will move from a restaurant to their living room,” to save money, council President Peter Cressy said.
Vodka remained Americans’ favorite liquor. The $4.56 billion spent on vodka accounted for almost a third of all spirits sold.
Sales volume for the cheapest versions of tequila rose 21 percent, the fastest of any type of spirit. That’s most likely because entertainers are using pre-made margarita mixes to serve at home, said David Ozgo, the council’s chief economist. Plus you can mix it before guests arrive, so they don’t know what brand you use, said Joan Holleran, director of research at research firm Mintel.