Trends in '10 - Trading down

Beverage Companies Fiscal Fitness: Trends in '10 - Trading down
By Bill Anderson, CEO of First Beverage Capital in Los Angeles, CA

Trading down will likely increase as American consumers continue to move away from most premium, luxury brands. The steep decline is on-premise sales due to this consumer preference also will likely continue.

The opportunity for brands in this environment is to provide meaningful value – and thereby accelerate a gap with consumers. Brands with an authentic story are standing out because as consumes may want to trade down, they still want a brand with some integrity, nobility, history and character.

As a recent report on 2010 Wine Sales from Silicon Valley Bank said, “The wine industry now finds a humbled consumer still wanting luxury products, but products made by real people, and not just expensive brands without a soul. Each producer has to figure out new ways to touch every one of its consumers in an authentic manner.”

The associates of Bend, OR, branding agency, tbd, confirmed this in a report on consumer brands recently when stated that the new value is value, and that consumers are looking for meaning and meaningful connections with the product they purchase.