America’s thirst for alcohol on the rise

Bartender at the barAmerica’s thirst for alcohol shows few signs of tempering despite continued high unemployment and a weak economy. On-premise sales of wine, spirits, and beer at bars and restaurants rose 4.9 percent to $93.7 billion in 2011 compared to the previous year, according to a report from Technomic, and the outlook appears strong for 2012 as well.

Beer accounted for more than four-fifths of adult beverage sales in 2011, driven in part by increased consumer interest in imports and craft beer brands. Spirits, meanwhile, generated about one-third of all on-premise alcohol sales as drinkers and mixologists alike are redefining the cocktail scene for a new generation. In a nod to the weak economy, domestic wine sales outpaced more expensive imported labels by three to one.

Strong demand for adult beverages is obviously a good sign for bars and nightclubs, but also for restaurants: Alcohol can account for about 15 percent of sales at full-service dining establishments. Having signature drinks on the menu can also be a way for restaurants and bars to set themselves apart from the competition. Chains such as Applebee’s, Chili’s (part of Brinker International), and T.G.I. Friday’s all offer seasonal or specialty drinks on their menu. Another popular trend, especially in the fine dining segment, has been to pair food and alcohol in new and creative ways.

Beyond dining and drinking establishments, the report is good news for alcoholic beverage producers and wholesalers. About 20 percent of domestic wine, for example, is sold through restaurants. This trend could also present some new opportunities for brewing companies, distilleries, and wineries. Partnering with a restaurant to promote a drink label could be a way to build or expand  brand awareness. The Boston Beer Company, for example, joined with the Red Robin chain to offer milkshakes made with Samuel Adams Octoberfest beer.


Photo by Beatrice Murch, used under a CC-Share Alike License

Joe Bramhall

Joe Bramhall has been researching and writing about companies and industries for Hoover's for more than a decade. He joined the First Research editorial team in 2010. He specializes in the leisure and entertainment industries.

Read more articles by Joe Bramhall.

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