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    Millennials Seek New Tastes, Pay Premiums for Alcoholic Beverages: Study

    SCHAUMBURG, Ill. -- Millennial consumers (21 to 30 year olds) often seek new tastes and are willing to pay a premium for alcoholic beverages, according to a new study by Progressive Grocer parent The Nielsen Co.

    SCHAUMBURG, Ill. -- Millennial consumers (21 to 30 year olds) often seek new tastes and are willing to pay a premium for alcoholic beverages, according to a new study by Progressive Grocer parent The Nielsen Co.

    According to "Millennials and Beverage Alcohol," consumers in the 21 to 30 year old age group have dramatically changed their alcoholic beverage preferences over the past decade. While beer accounted for 59 percent of this group's alcoholic beverage spending; 10 years ago, this number has shrunk to 47 percent today, as their wine and spirits purchases have grown in relatively equal proportions.

    "The Millennials are primed to be an extremely influential group," said Richard Hurst, s.v.p. of beverage alcohol at ACNielsen, a service of The Nielsen Co. "At the beginning of their careers, they are discovering the world and have control over their money and time in ways their predecessors never did. They are a sizeable group with many purchasing years ahead of them, and understanding what they're buying, why they're buying, where they're buying and how they're buying represents an enormous opportunity for today's manufacturers and retailers."

    Despite the decline over the past 10 years, Millennials still show a preference for beer. On a dollar basis, the category represents the majority (47 percent) of their alcoholic beverage spending, compared to spirits (27 percent) and wine (26 percent). On a volume basis, beer accounts for 83 percent, compared to 11 percent for wine and 6 percent for spirits. Among Millennials who drink different types of alcoholic beverages, beer is most often cited at their "favorite," according to the study.

    Millennials also have different drinking preferences than older generations, and are much more likely to experiment with a variety of beer types and flavors. While domestic premium beers are still their dominant choice, they are much more inclined than older consumers to purchase imported beers (28 percent of Millennial beer spending
    versus 15 percent for other age groups) or craft beers (15 percent of Millennial beer spending versus 6 percent for other age groups).

    Among imported beers, Millennials tend to look more favorably to Mexican beer than older generations do. Mexican beers account for nearly one half (46 percent) of Millennials' import purchases compared to 35 percent for older consumers, who show greater interest in imports from Holland, Germany, and Canada.

    "One might expect that as consumers grow older and their income levels rise, they would naturally trade up," said Hurst. "In fact, economy beer purchases are much more common among older generations. Craft and import beers have a receptive audience in Millennials who clearly are open to new tastes in beer, and are willing to pay more to try something different."

    Millennials also show a preference for premium over value when it comes to spirits, according to the study. Premium and ultra-premium spirits rank highest among the group, while value-priced spirits dominate among consumers over age 50.

    When it comes to wine, Millennials tend to prefer red (51 percent of volume) more so than older consumers (approximately 44 percent). Among red wines, Cabernet and Pinot Noir have the most distinct skew towards Millennials while Chardonnay remains the most popular white wine across all ages. Pinot Grigio, Sauvignon Blanc, and Rieslings account for a higher share of Millennials' wine purchases compared to the over 30 population.

    As with the beer category, Millennials are more open to trying imported varieties and also contribute more to sake sales than Gen Xers and Baby Boomers. While most consumers in this group consider themselves novices or only slightly knowledgeable about wine, approximately one-third (34 percent) are interested in learning more, which suggests an "education" opportunity for retailers.

    The study was based on data collected via a triangulation of Nielsen's Homescan consumer panel information and online survey and fieldwork from a sample of
    nearly 900 consumers 21 years old and older who drink beer, wine, and spirits at least once every two months.

    The full study is available at www.nielsen.com.

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