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With Economy in Decline, Drinkers Turn to Cheap Beer
May 19, 2008

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News Summary

Sales of premium beers are down and more drinkers are buying cheaper brands as economic woes hit Americans in the wallet, according to Miller Brewing Co.

The Associated Press reported May 15 that Miller CEO Tom Long said that sales of Miller Genuine Draft, a premium brand, were down 10.6 percent so far this year, while sales of Miller Light and Miller High Life were up 1.1 percent

"We think it's primarily driven by decline of disposable income and pocket money that American consumers are feeling right now," Long said. Overall beer sales remain steady, and Miller's profits rose 22.7 percent in the last year. But Long said that the company plans to sell more lower-cost beer going forward, and also expects Americans to spend less money in bars and restaurants.

COMMENTS ON THIS ARTICLE:

Posted by Gerrit on 21 May 08 03:09 PM EDT
So, Jeff, following your logic, you would recommend keeping the price as low as possible so that fewer and fewer people would "forgo the purchase of necessities"?? Then free beer becomes the ultimate solution to the problem, right?

Posted by Joaquin Murieta on 20 May 08 06:04 PM EDT
A "we think" statement has no validity and I am surprised it was published. The statements by Mr. Tom Long sound much closer to a marketing strategy than a concrete analysis of purchasing behavior.

Posted by Jeff on 20 May 08 04:37 PM EDT
Perhaps you're right, David. Then again, perhaps those who drink would still do so but forgo the purchase of necessities in order to buy alcohol. A tax may not be the best strategy to reduce consumption. It might only reduce healthy behavior.

Posted by David Rosenbloom on 20 May 08 10:28 AM EDT
Price matters. This consumer behavior is further proof that raising beer and other alcohol taxes to an appropriate level will reduce excessive consumption, especially among young people who have less money to spend.

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