Alcoholic

Beverage Consumption Trends

Washington and United States



This report was completed on: July 15, 2015

Information provided by:

Export Readiness Center
Washington State University
1235 N. Post Suite 201
Spokane, WA 99201
www.export.wsbdc.org
Spokane Export Readiness Center - 509.358.7765
Seattle Export Readiness Center - 206.439.3785

Executive Overview

The following report covers the consumption trends of alcoholic beverages in Washington State
and the United States. While the overall consumption of alcohol is not increasing by a
significant amount, certain types of beverages including wine and ciders are experiencing a
growth in per capita consumption.

Specific questions addressed in this report:

1. Is per capita consumption of all alcoholic beverages increasing? Or,
2. Is per capita consumption shifting between types of craft beverages?
3. In addition to wine trends< previously requested, trends in craft beers, hard ciders, and craft
spirits.
4. Most craft beverages are sold locally or on a regional basis where market information may
be limited. What information can the State Liquor Control Board provide to give insight to
county or city level of beverage sales?

Disclaimer: By using the information in this report, you understand and agree that although the
Washington State Small Business Development Center (SBDC) has made significant effort to provide
accurate information in this report, data sources are time sensitive and the accuracy of the information
will diminish over time. THE SBDC PROVIDES THE INFORMATION IN THIS REPORT AS IS. SBDC MAKES
NO WARRANTY, EXPRESS OR IMPLIED, INCLUDING THE WARRANTY OF FITNESS FOR A PARTICULAR
PURPOSE, AND DOES NOT WARRANT THE ACCURACY, COMPLETENESS, OR USEFULNESS OF THE
INFORMATION. SBDC ASSUMES NO LIABILITY FOR ANY DIRECT OR INDIRECT DAMAGE CAUSED BY
RELIANCE ON INFORMATION CONTAINED IN THE REPORT.

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Executive Summary

Infographic on Alcoholic Beverage Consumption in United States and Washington- Piktochart Link

Total alcoholic beverage consumption has not changed tremendously, the national average remaining
between 94-96 liters per capita in the last five years. Beer is the beverage with the highest volume of
consumption but has been decreasing in growth for the past 6 years. Total value growth percentage for
national beer sales was 1.9% CAGR from 2009 to 2014 which is growing slower than both Wine and
Spirits among other beverage categories. The highest growth is in the market for Cider/Perry at 46.7%
CAGR since 2009 and nearly 58% growth in 2014. Within the beer market, craft beer is in the highest
demand and now accounts for about 11% of the total beer consumption volume in the U.S. According to
a Gallup poll, the largest drop in preferred drink was for beer with 11% less popularity with males and
9% fewer females reporting beer as their preferred drink from 1994-2013. Wine, on the other hand
gained 9% popularity votes from females and 5% increase in males who prefer wine over any other
drink. Preference for liquor increased by 6% for males and decreased by 1% for females. In recent years,
consumers have increased interest in craft beers and spirits amounting to nearly 20 billion dollars
(22% dollar sales growth). Although there are no specific classifications, craft distillers produce usually
produce fewer than 100,000 proof gallons a year. Craft brewers are small, independent and traditional
and produce less than 3% of total volume of national beer sales.

A report by the National Institute on Alcohol Abuse and Alcoholism (NIAAA) found the national average
for alcohol consumption of 2.33 gallons of ethanol in 2012. The most recent data collected for
Washington state consumption presents an average of 2.34 gallons of ethanol per capita, not far off
from the national average. Washington produces 2.5 gallons of beer per 21+ adult and has five
breweries per 100,000 adults over 21 which ranks 7th compared to national statistics. Washington
consumption added up to about 0.6 pints per day per capita of beer (103.6 liters per year), and about
0.7 ounce shots per day per capita of spirits (7.6 liters per year), and 1.7 ounces of wine per capita per
day (18.35 liters per year). In comparison to the volume of U.S. consumption per capita, Washington
State has a lower consumption level of beer, a higher consumption of wine and just barely lower than
the U.S. average consumption of Spirits.

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Table of Contents
Executive Overview ............................................................................................... 2
Executive Summary ............................................................................................. 3
Table of Contents ................................................................................................. 4
Notes ................................................................................................................... 5
Alcoholic Beverage Consumption ......................................................................... 6
Washington State ............................................................................................................................................ 6
National ........................................................................................................................................................... 7

Per Capita Consumption by Beverage Type .......................................................... 8

Washington State ........................................................................................................................................ 8
Per capita consumption in Washington State .............................................................................................. 10
National ......................................................................................................................................................... 12
Change in Market Share 1994-2011 (%) ....................................................................................................... 14
Trends in the Alcoholic Beverages Industry ................................................................................................... 17
State Liquor Control Board ........................................................................................................................... 21

Suggested Readings ........................................................................................... 22

Trends in the Spirits Industry: ....................................................................................................................... 22
Trends in the distilled/hard cider industry ................................................................................................... 22
Trends in the U.S. Beer Industry ..................................................................................................................... 22

Research Resources ........................................................................................... 23

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Notes
Craft Beer Market Segments1

Microbrewery: A brewery that produces less than 15,000 barrels (17,600 hectoliters) of beer per year
with 75 percent or more of its beer sold off-site.
Brewpub: A restaurant-brewery that sells 25 percent or more of its beer on site.

Contract Brewing Company: A business that hires another brewery to produce its beer.

Regional Craft Brewery: An independent regional brewery with a majority of volume in traditional or
innovative beer(s).
Regional Brewery: A brewery with an annual beer production of between 15,000 and 6,000,000 barrels.

Large Brewery: A brewery with an annual beer production over 6,000,000 barrels.

Brewers Association, Craft Beer Market Segments,

https://www.brewersassociation.org/statistics/market-segments/

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Alcoholic Beverage Consumption

Washington State

2014 Consumer Expenditure (Average Household Annual)

Alcoholic Beverages
Beer and Ale

$531.17
$152.58

Beer And Ale at Home

$96.10

Beer And Ale away from Home

$56.47

Whiskey

$18.10

Other Alcoholic Beverages

$110.79

Other Alcoholic Beverages at Home

$41.09

Other Alcoholic Beverages away from Home

$69.70

Wine

$174.69

Wine at Home

$145.28

Wine away From Home

$29.42

Alcohol Purchased on Trips

$75.00

Washington per Capita ethanol consumption in gallons (based on population 14 and older)

Source: US Department of Health and Human Services

The most recent data collected for Washington state consumption presents an average of 2.34 gallons
of ethanol per capita. Washington consumption added up to about 0.6 pints per day per capita of beer
(103.6 liters per year), and about 0.7 ounce shots per day per capita of spirits (7.6 liters per year), and
1.7 ounces of wine per capita per day (18.35 liters per year).

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Beer

Wine

Distilled spirits

30

Gallons

National
25

Average
national alcohol consumption has dwindled around 95 liters per capita for the past five years

with an overall
growth of 1.1% in the 2013-14 Euromonitor statistics. Looking at the per capita
20

consumption
of alcohol from 1994 through 2011, there is a downward trend in beer consumption as

15
compared to the upward trend in wine and spirits. Over the last 10 years, the volume of U.S.

consumption
has seen a 2% decrease in beer, 1% increase in wine and spirits at a fairly consistent value

10
around
6% of consumption.

0
94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

10

11

Per capita consumption of beer, wine, and distilled spirits in the U.S. from 1994 to 2011 (in gallons)

Source: Beer Institute; ID 224565

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Per Capita Consumption by Beverage Type

Washington State

2013 Alcoholic Beverage Consumption

5%

9%


10%

Beer (less than 2% alcohol)

Domestic Dinner/ Table
Wines

26%

Imported Dinner/Table
Wines

50%

Port, Sherry & Dessert

Wines

Source: Alteryx

2013 Beverages - Alcoholic - Household Percent: Washington State

Beverage Type

Wa.

Entire U.S.

Beer - No Alcohol/Low Alcohol (less than 2%) - Drink

3.6%

3.8

Domestic Dinner Wines - Type Summary Red

28.6%

26.5

Domestic Dinner Wines - Type Summary White

23.0%

21.1

Domestic Dinner/Table Wines - Drink

38.8%

36.2

Imported Dinner Wines - Type Summary Red

13.5%

12.1

Imported Dinner Wines - Type Summary Rose

3.0%

2.8

Imported Dinner Wines - Type Summary White

10.9%

9.5

Imported Dinner/Table Wines - Drink

20.3%

18.4

Port, Sherry & Dessert Wines - Drink

7.7%

7.2

Prepared Cocktail Mixes With Liquor - Drink

6.8%

7.3

Prepared Cocktail Mixes-No Liquor - Drink

9.9%

9.8

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Washington State

Industry NAICS units 2014

BEER & ALE (424810) Units: 148

Per Capita Beer Consumption

2014 Revenue:
$925,375,600
Washington Craft Beer Sales Statistics

Source: Brewers Association 2

Brewers Association, Washington State Craft Beer Stats,

https://www.brewersassociation.org/statistics/national-beer-sales-production-data/

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Per capita consumption in Washington State3

v There has been little published about the in state consumption data, but there is
validated data available from 2012. It is employed in the following section to serve as a
general idea of in state wine consumption. There will be a difference between the exact
consumption and this result.
v According to Danny Braeger, Vice President Group Client Director on the Beverage
Alcohol Team at Nielsen, at Washington Association of Wine Grape Growers annual
conference in 2012, 36% of the WA wine sale happens within the border of the state.
The total number of taxable withdrawals over the last 12 months is 2,497,763 gallons.
Among them, about 36% was sold to WA consumers, which is 899,194 gallons =
3,403,819 liters.
Total wine consumption by Washington residents
v The following report shows how much wine is consumed by Washington residents as a
whole, regardless the origin of production4.
v The following map shows the number of 5 ounce glasses consumed in Washington per
capita per day. Multiply this number by the population of Washington and 365 days will
generate a rough idea of how much wine was consumed by all Washington residents
last year.
v Washington consumed 0.3 glasses per capita per day according to the map
v 0.3 * 5 ounce * 7,061,530 people * 365 day = 3,866,187,675 ounce = 114,336,815 liters.
This presents a general consumption level for 2014 in Washington State.

http://www.wawinereport.com/2012/02/should-washingtonians-be-drinking-more.html

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/07/29/where-the-biggest-beer-wine-and-
liquor-drinkers-live-in-the-u-s/
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WA Wine Production
3

2.82

Consumption per resident in gallons

2.73
2.68
40,000,000.00
2.53
2.45
35,000,000.00
In 2013, per capita w2.5
ine consumption
2.4 in W2.46
ashington
State 2.49
was 2.82 gallons per resident according to
2.34
30,000,000.00
Wine Institute.
25,000,000.00

2
20,000,000.00

15,000,000.00

1.5
10,000,000.00

5,000,000.00

1
0.00

2009
2010
2011
2012
2013
2014
2015

Total P roduction 25,650,286 0.5

22,238,431 28,751,784 27,392,053 37,472,984 34,762,404 12,561,311

0
2005

2006

2007

2008

2009

2010

2011

2012

2013

Source: Wine Institute; ID 233734

Washington Wine Production

Washington Industry NAICS units 2014

WINE & DISTILLED ALCOHOLIC BEVERAGES (424820) Units: 757

2014 Revenue: $3,509,979,244
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U.S. Alcoholic Drinks Market

National

3%

Beer

10%

6%

Cider/Perry

1%
RTDs/High Strength
Premixes
Spirits
80%

Wine

Liters per Capita

Source: Euromonitor

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U.S. Alcoholic Beverage Consumption: Year-on-Year Growth (%)

Sales of Alcoholic Drinks by Category: % Total Value Growth 2009-2014

% local currency, current value growth

2013/14

2009-14 CAGR

2009/14 Total

Cider/Perry

57.9

46.7

579.6

RTDs/High-Strength Premixes

2.0

7.4

43.2

Wine

3.0

4.3

23.3

Spirits

4.6

4.1

22.1

Alcoholic Drinks

3.5

3.3

17.5

Beer

2.4

1.9

9.7

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks,
trade interviews, trade sources

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89%
88%

87%

12%

Change in Market Share 110%

994-2011 (%)

8%

86%
85%
84%

Beer%

83%
82%
81%

6%

Wine %

4%

Spirits %

2%

0%

U.S. Beer Consumption liters per Capita

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U.S. per Capita Consumption of Spirits (liters)

U.S. per Capita Consumption of Wine (in liters)

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Hard Cider Consumption

Number of consumers in the United States from autumn 2008 to spring 2014 (in millions)

Source: United States; Nielsen Scarborough; 2008-2014; approx. 207,000; 21 years and older

Base total population (18 years and older):

2014:
2013:
2012:
2011:
2010:
2009:

241.53 million
238.56 million
236.61 million
235.02 million
232.96 million
230.98 million

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Trends in the Alcoholic Beverages Industry

Craft Beer growth
Old Fashioned Cocktails popularized by the hit TV series, Mad Men
Skinny Girl drinks
Premium category drinks
Beer has seen the steepest drop in popularity, with per capita consumption dropping nearly 20% since
the 1990s. Beer is also far less popular with the growing population of young and nonwhite drinkers.
Even with the steady decline in beer consumption, the demand for craft beer continues to grow. The
Brewers Association counted 2,530 operating breweries in the United States, the highest number since
the 1880s. Of these, 98% are micro-breweries, brewpubs and regional breweries. The craft beer
category has seen a 9.6% growth in the most recent market data, craft beer now accounting for
approximately 7% of the total beer volume. 5

Source: Gallup 6

USA Today, Overall beer production down, but craft beers thrive,
http://www.usatoday.com/story/money/business/2014/02/09/beer-down-craft-beer-continues-growth/5341199/
6
Gallup, Consumption Habits Poll, http://www.gallup.com/poll/163787/drinkers-divide-beer-wine-favorite.aspx

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Preference by Gender

Gender plays a major role in beverage preference, the most recent statistics showing that 53% of men
prefer beer over any other drink and only 20% of women will choose beer. Although beer is the most
popular drink among men, its popularity has dropped by nearly 11 percent since the early 1990s.

Mad Men Effect

In 2013, bartenders in New York noticed a sudden craze for cocktails they referred to as the Mad Men
effect. 7 More people are ordering Manhattans, and other classic drinks like Old Fashioned cocktails and
Martinis. 8

NPR, Drinking With 'Mad Men',

http://www.npr.org/sections/thesalt/2015/04/05/397352082/drinking-with-mad-men-cocktail-culture-
and-the-myth-of-don-draper
8

NY Post, Ill take Manhattans!, http://nypost.com/2013/04/03/ill-take-manhattans/

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2012 Beer Category Shares by Type

Source: U.S. Beverage Alcohol Forum

Trends in the cider industry: 9

Ciders grew by 65% from 2011 to 2012 and they are still seeing a significant growth especially with
young millennial consumers and the market for gluten-free products.

Packaging Innovation is a key contributor to growth in cider

Both Non-Flavored Cider and Flavored Cider are growing, up 64 percent and 68 percent
respectively.
The top Non-Traditional Flavors are Pear, Hard Apple and Raspberry

Trends in the Distilled Spirits Industry

Total volume sales of spirits grow by 2% to reach 1.9 billion liters in 2014

Spirits will experience a total volume CAGR of 2% over the forecast period, with 2019 sales of
2.0 billion liters

Average unit price increase of 2% in 2014 driven by an interest in premium and craft alcoholic
drinks

Nielsen Syndicated Beer Database, small cider category poised for big growth
http://www.nielsen.com/us/en/insights/news/2012/small-cider-category-poised-for-big-growth.html
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Vodka

Whiskey*

Rum

Tequila

Gin

Sales volume in million 9 liter

cases

200
180
160
Total market
share gains versus beer since 2000 totaled 6.4 points with each point of market
140
share equaling
120 approximately $650 million in supplier sales.
100
Strong Consumer
Interest in cocktails
80
Innovations in
60flavors- especially flavored whiskeys
40
Growth of small
distillers, which expanded grassroots and overall interest in the spirits category
20
0
2010
2011
2012
2013
2014

Euromonitor statistics signify that the fastest growth in the U.S. market for Spirits came from
blended malt scotch whiskey, which increased by 20% in volume growth in 2014.Many whisky
categories have experimented with alternative and new flavors in hopes of increasing sales.
The Craft Spirits market, though only 2% of total spirits volume continues to grow reaching about
31.5 million liters in 2014. There is currently no specific classification for Craft Spirits, but the
general idea is based on factors such as size, ownership and production methods. The Distilled
Spirits council of the United States (DISCUS) runs a program for small distillers who produce fewer
than 40,000 cases a year in total. The American Distilling Institute (ADI) offers membership to those
who sell fewer than 100,000 proof gallons a year or around 42,000 cases. It also requires members
to be independently operated. Under these specifications, today there are over 400 small distillers
in the U.S.

Sales volume of the U.S. spirits industry from 2010 to 2014, by category (in million 9 liter cases)

Source: DISCUS; ID 233527

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State Liquor Control Board 10

Number of Licensed Businesses by Regional Enforcement Office

2014 Washington State Liquor Related Income (from taxes and fees collected in FY
2014)

10

Washington State Liquor Control Board, Annual Report Fiscal Year 2014,
http://www.liq.wa.gov/publications/annual_report/2014-annual-report-final-web.pdf

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Suggested Readings


Trends in the Spirits Industry:
Distilled Spirits Council of the United States- Spirits Category Highlights

2014 U.S. Market Report: Distilled Spirits Industry Delivers Steady Growth

Trends in the distilled/hard cider industry:

USA Today- Hard cider m ounting 'massive com eback

Time- Fastest-Gro wing Alco ho lic Bev erage Category? Its Not Craft Beer

Chicago Tribune- Alcoholic Cider Sales Booming Across U.S.

Trends in the U.S. Beer Industry:

USA Today- Overall beer production down, but craft beers thrive

The Atlantic- Why Are American Drinkers Turning Against Beer?

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Research Resources

Curtis, Wayne. "What Exactly Defines a Craft Spirit?" PUNCH, 21 Apr. 2014. Web. 23 June 2015.
Euromonitor International. Alcoholic Drinks in the US. Industry Overview, Passport, 18 June 2015.
Ferdman, Roberto A. "Where the Biggest Beer, Wine, and Liquor Drinkers Live in the U.S." Washington
Post. The Washington Post, 29 July 2014. Web. 15 July 2015

Jones, Jeffrey M. "U.S. Drinkers Divide Between Beer and Wine as Favorite." Gallup.com. Gallup, 1 Aug.
2013. Web. 06 July 2015.

Sean Sullivan - Washington Wine Report: Should Washingtonians Be Drinking More Washington Wine?
(n.d.). Retrieved June 15, 2015, from http://www.wawinereport.com/2012/02/should-
washingtonians-be-drinking-more.html

Spirits Category Highlights. Distilled Spirits Council of the United States, n.d. Web. 23 June 2015.
Washington State Liquor Control Board, 2014 Annual Report. Web. 26 June 2015.
WHO. "Distribution of Alcohol Consumption in The United States in 2010, by Beverage." Statista - The
Statistics Portal. Statista. 23 Jun 2015. http://www.statista.com/statistics/216262/distribution-
of-alcoholic-beverages-consumed-in-the-us/

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