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News Constellation Brands beer sales up 13%

Discussion in 'Beer News & Releases' started by jmdrpi, Oct 9, 2017.

  1. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

    http://money.cnn.com/2017/10/05/inv...brands-earnings-corona-beer-mexico/index.html

    This article on CNN focuses on Corona and Modelo, but Constellation also owns Ballast Point. Also Pacifica, Victoria, and Funky Buddha but I would guess those are less of a factor.

    Anyone know how much of the increase is due to the Mexican brands vs. Ballast Point? There is also an article on the online Wall Street Journal that might have more details, but it's behind a pay wall.

    I've always found it very odd that Corona seems to be go-to lager for a lot of yuppies and middle aged drinkers that think they are getting a better "Import" product than other Adjunct Lagers like Bud, Miller, or Coors. But in my opinion, it's basically the same quality, just costs more. My local Total Wine website lists a 24 pack of Corona bottles for $27. A 24 pack of Budweiser is $18. Stick a lime wedge in a Bud and I bet most Corona drinkers wouldn't tell the difference.

    On the other hand I think Negra Modela is a decent beer, that's my go-to at any Mexican restaurant.
     
    ICTguy21 likes this.
  2. EvenMoreJesus

    EvenMoreJesus Devotee (437) Jun 8, 2017 Pennsylvania
    Supporter

    Although I do not know the answer to your general query, Negra Modelo, is, indeed, a fine beer.
     
  3. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

    I found this article with more info. Surprisingly, it's Modelo that apparently boosted their sales:

    Also of note:

     
  4. JackHorzempa

    JackHorzempa Poo-Bah (3,017) Dec 15, 2005 Pennsylvania
    Supporter

    “I've always found it very odd that Corona seems to be go-to lager for a lot of yuppies and middle aged drinkers that think they are getting a better "Import" product than other Adjunct Lagers like Bud, Miller, or Coors. But in my opinion, it's basically the same quality, just costs more.”

    From my perspective the popularity of beers like Corona make sense to me:

    · The vast majority of beer drinkers worldwide prefer AAL type beers; beers that are very light in color and very light in flavor. Corona definitely meets these criteria.

    · A person who purchases a beer like Corona is ‘stating’ I am a person who has ‘distinctive’ taste and I enjoy the ‘best’ (i.e., a premium priced beer)

    It would be interesting to obtain better insight as to who are typical consumers of beers like Modelo Especial. The best that I can report from an anecdotal perspective is that this beer appears to be popular with Hispanics in my area.

    Cheers!

    P.S. The best that I can report anecdotally concerning Ballast Point is that there is lots of old beers like Sculpin on my local beer retailers’ shelves. Old beer is an indicator to me that these beers tend to ‘sit’ vs. sell popularly. Maybe because at 15 bucks a 6-pack they are priced too high to move?
     
    dennis3951 likes this.
  5. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

    Yeah, the beer is marketed that way. It just seems very transparent to me, and in my opinion the product doesn't back it up.

    I did find this article from 2013 that was written when there was the potential merger, that analyzed the different demographics of Corona vs. Budweiser.
    https://www.forbes.com/sites/annema...ona-bellying-up-to-the-same-bar/#9908a0e78094

    There is definitely a "premium pricing" factor going on:

     
  6. BeanBump

    BeanBump Aspirant (233) Dec 14, 2016 California

    I think there is a discernible difference in flavor between the two but, that said, most big beer lagers are made better with a lime in my opinion. Cheers.
     
    surfcaster likes this.
  7. EvenMoreJesus

    EvenMoreJesus Devotee (437) Jun 8, 2017 Pennsylvania
    Supporter

    [​IMG]
     
    BeanBump likes this.
  8. BeanBump

    BeanBump Aspirant (233) Dec 14, 2016 California

    Ha! Not to be confused with an El Salvadorian lime.
     
    ICTguy21 and EvenMoreJesus like this.
  9. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

  10. Squire123

    Squire123 Poo-Bah (1,543) Jul 16, 2015 Mississippi
    Supporter Subscriber Beer Trader

    That's my take on it as well though I can understand why lime is often added to Corona.
     
  11. donspublic

    donspublic Meyvn (1,217) Aug 4, 2014 Texas
    Beer Trader

    Not sure if any of the articles mentioned this, but I believe they might be finished with the deal for AB to supply them with some of the beer for sale in the states. I believe the most recent enhancements to the Nava brewery were going to allow them to supply most of the US market themselves. I know they are still expanding the brewery in Nava but could have sworn they would be close to done with their dependence on AB by now. Also curious to know what is going to be coming out of their Mexicali brewery. It might be that demand is outreaching the Nava site and this brewery is going to produce the same beer.
     
  12. meefmoff

    meefmoff Disciple (305) Jul 6, 2014 Massachusetts
    Beer Trader

    Interesting stuff, thx for posting.

    I'd be curious how well Corono's "premium" reputation tracks with the onset of their beach-paradise ad campaign. It seems particularly effective to me, especially as something that sets it apart from the jabronis-at-a-party vibe that a lot of other AALs emphasize in their advertising. And there's something about those clear bottles that is very enticing, UV light be damned (I'm smitten with Miller High Life bottles as well).

    And I agree that Negro Modelo is a tasty beer but I was surprised to find that Especiale finished last in a small blind tasting of AAL's I did a while back. I really didn't care for that beer at all.
     
    jmdrpi likes this.
  13. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

    Probably a mix of that, and confirmation bias about how the beer "must be better" since it's more expensive.

    http://www.winespectator.com/blogs/show/id/New-Study-Wine-Price-Bias
     
    Ranbot, dennis3951 and meefmoff like this.
  14. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

    No, nothing in the two articles I read.

    @jesskidden is often up on that type of info
     
  15. meefmoff

    meefmoff Disciple (305) Jul 6, 2014 Massachusetts
    Beer Trader

    If you'll excuse the pedantic note, that's not really a confirmation bias phenomenon. That's something more along the lines of what's referred to as trying to minimize cognitive dissonance. We don't want to feel like we've wasted our time or money (dissonance) so we convince ourselves that the thing we spent a lot of money on or endured a lot of hardship to possess must be worth it. A common example is fraternity hazing: if I went through all that to get in here then it MUST be a great place!

    Also, this is completely off topic but that MRI study referenced in the article is a great example of dressing up fairly mundane (if still interesting) data with some "neuroscience" trappings to make it seem more important. Psychology is rife with it these days unfortunately.
     
    drtth likes this.
  16. jmdrpi

    jmdrpi Poo-Bah (4,434) Dec 11, 2008 Pennsylvania
    Subscriber

    A common example is fraternity hazing: standing in line for beer: if I went through all that to get in here then it MUST be a great place!
     
    Ranbot, TomFoley, Norica and 4 others like this.
  17. drtth

    drtth Poo-Bah (3,197) Nov 25, 2007 Pennsylvania

    Which is a nice example of cognitive dissonance being reduced.
     
  18. eldoctorador

    eldoctorador Zealot (502) Dec 12, 2014 California

    Corona on tap is not that bad. I prefer bottled bud light compared to Corona by a wide margin
     
  19. Pantalones

    Pantalones Devotee (479) Nov 14, 2014 Virginia

    I had the same experience with Modelo Especial -- had it as part of a blind tasting, my other two beers were Narragansett and Miller High Life. The Modelo was by far the worst, we ended up dumping out the majority of the 24-ounce can because nobody wanted any more of that after taking their first drink. Definitely thought it was a little odd how Negra Modelo is so good while the lighter beer of the same brand is so, so bad.
     
    donspublic and meefmoff like this.
  20. jesskidden

    jesskidden Meyvn (1,280) Aug 10, 2005 New Jersey
    Subscriber

    Constellation bought a second Grupo Modelo brewery from ABInBev in November, 2016.
     
    #20 jesskidden, Oct 10, 2017
    Last edited: Oct 10, 2017
    donspublic likes this.
  21. Oktoberfiesta

    Oktoberfiesta Aspirant (288) Nov 16, 2013 New Mexico
    Beer Trader

    This brew bound article from the Q1 reports suggests that BP is negatively affecting Constellation Brands. There is nothing to suggest that that has changed. BP was a bad apple. Modelo is their prize winner out of all of this.

    Had Constellation Brands not bought BP, their upward trajectory would be mammoth. While AAL are losing sales and ground, it is very interesting to see the Import Lager market triumph over American Craft sales and AAL sales.
     
  22. jesskidden

    jesskidden Meyvn (1,280) Aug 10, 2005 New Jersey
    Subscriber

    "Mammoth" ? According to the Brewbound article you linked:
    So, ½%. Sure, they overpaid, but Ballast Point still was up 55% for 2016, and if still independent, they'd be the 6th largest "Craft" brewer with a barrelage of over 430k bbl.
     
    #22 jesskidden, Oct 10, 2017
    Last edited: Oct 10, 2017
  23. Bitterbill

    Bitterbill Poo-Bah (5,176) Sep 14, 2002 Wyoming
    Supporter Beer Trader

    Only way I can drink a Corona. The light, which has popped up recently at many places in town, I can drink neat.
     
  24. Oktoberfiesta

    Oktoberfiesta Aspirant (288) Nov 16, 2013 New Mexico
    Beer Trader

    I'm considering a solo increase without the $billion dollar anchor. The quotes are basically saying they are better off without them. I just feel CTZ could be at an even higher level if it didn't have the American craft segment hurting them. 1/2 pt increase without the billion dollar debt? I think they'd trade it back if they could. Modelo and CTZ could be even bigger imho. But they will go on like the CBA. KONA is their saving grace while widmer and redhook suffer big time. I guess that's why you diversify but honestly, way too much spent for Bp. A company that was seeing enroumous growth for years. This baby growth is not what they wanted. So now you bring in funky Buddha and ride with them for awhile. See what sticks.

    I think it's troubling they aren't exactly sharing how good BP is doing for Q2 2017. Beers were still moving in 2016 for Bp around here. 2017 it's been a complete stall. They seem to lump all beer sales as a whole and unless you are in on the conference calls, all signs lead to growth ( which we know is 90% driven by their imports).

    That BB article does mention them needing and wanting more distribution points. So that's where growth may go for a few more years. Everyone who over grows pushes this angle. I guess I'm just trying to look down the line and say this isn't sustainable. For now, I do own some CTZ stock and am sitting happy. But I'm happy about the modelo and corona crowd. Iffy about craft
     
    #24 Oktoberfiesta, Oct 10, 2017
    Last edited: Oct 10, 2017
  25. Kman_Colorado

    Kman_Colorado Initiate (131) Aug 17, 2014 Colorado


    Doesn't this mean shipments of BP are down? If so that's not a good trend for their investment.
     
  26. oldbean

    oldbean Aspirant (230) Jun 30, 2005 Massachusetts

    Corona is to good beer what premium vodka is to scotch. It's for people who want to pay a lot of money for something that actually has no real reason to be expensive.
     
    jmdrpi and Squire123 like this.
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