Inside Big Beer and college football’s Gen Z playbook

Dive Brief:

• In search of sales growth, Big Beer has begun partnering with college football programs, where alcohol sales have long been banned inside stadiums, The Wall Street Journal reported.
• West Virginia was one of the first to sell alcohol in a college stadium. It was followed by Ohio State and Oregon, and then more recently, Texas A&M, Louisiana State, Missouri and Arkansas. The football program at the University of Arkansas recently signed a $400,000 sponsorship deal with Anheuser Busch, according to the Wall Street Journal.
• Alcohol sales in college football stadiums — often coupled with prohibiting attendees from leaving and drinking at a tailgate during halftime — have both cut down on drinking problems in the stadium and proved to be a source of revenue generation for football programs where game attendance is dwindling.

Dive Insight:

Young consumers are the coveted group that both beer and football seem to be falling out of favor with. While the NCAA reports that Division I Football Bowl Subconference game attendance has fallen for five years straight, the beer industry is seeing similar trends, with sales slumping over multiple years. According to trade group data, AB InBev’s volume share of the U.S. beer market, by far its largest, has fallen from 49.8% in 2009 to 41.5% in 2017. MillerCoors has seen its position erode during the same period to 25%, a drop of 5.1%.

Much of this decline can be attributed to younger consumers who have moved away from mass-produced beer in favor of alcoholic seltzers, cocktails, craft beer and wine. And Big Beer knows it. By partnering with football programs around the country to sell beer on-site, companies are not only gaining access to a captive audience, but they are also in an ideal position to gain insight into what exactly younger consumers are drinking.

Millennials, Gen Zers and other adventurous beverage drinkers are looking for something different, and aren’t loyal to legacy brands. So as major beer companies look to lure this demographic, they could use college stadiums as a sort of market research test and adjust their offerings according to sales data. Outside of the stadium, sales data is already pointing to hard cider and seltzer, sparkling booze and malt beverages as popular trends. 

Big companies like AB InBev have already been adjusting portfolios to be more in line with younger audiences’ palates. The alcohol giant is introducing Natural Light Seltzer later this month and recently acquired a full stake in the social-media-forward canned beverage brand Babe Wine. Selling these brands during games would be a good way to test their popularity and get them in front of a young audience.

Putting Natural Light Seltzer in stadiums could be a shrewd move as AB InBev looks to compete with White Claw, the brand which currently dominates the hard seltzer market. Hard seltzer is quickly getting more popular, especially with younger consumers. UBS expects the hard seltzer category to reach $2.5 billion by 2021, which would mean a 66% annual growth rate.

Beyond simply selling beverages, the major beer companies would do well to collaborate with university football programs to sponsor events that both hype the team and generate on-site involvement to get more fans at games. This could benefit both the school’s football program and the beer companies — and the activities would not have to involve alcohol. Beer companies could even partner with the campus police to sponsor public safety campaigns and initiatives, including those about responsible drinking.

Wrapping up a beer brand in messaging that is associated with a consumer’s alma matter would be a change of pace, but one that is likely to resonate deeply, especially with football fans. This kind of messaging would also take the focus off the calories and ingredients in the alcohol itself and focus on becoming part of an experience — something younger consumers are looking for from brands.

Local craft brewers could even get involved with college football. The Wall Street Journal reported that the University of Louisiana at Lafayette partnered with a craft brewer in 2015 to create Rajin’ Cajuns ale. This approach might pay off as the younger generation is not especially brand loyal but is interested in local, craft brews. Craft brews have been a lone bright spot in the beer space, with sales up 2.9% from January through mid-July of this year, according to IRI.

At the very least, selling alcohol on site is an ideal approach to create a fond association between a beer company’s brands and college football. For fans who drink certain beverages as they watch the ups and downs of their teams, it will be difficult for them to divorce the memories of the good times from the taste of a certain beverage later in life. By creating this marriage between beer and ball, Big Beer has a chance to create a new generation of lifelong fans.