Niq Global Intelligence Plc · NYSE:NIQ

Niq Global Intelligence — NielsenIQ — 2022 Wine & Spirits Daily Summit

32 slides from Niq Global Intelligence's conference presentation, Feb 1, 2022

  1. Slide 1: Top trends by the numbers

    Top trends by the numbers Danny Brager James Restivo Brager Beverage Alcohol Consulting Vice President, Account Development NielsenIQ February 1, 2022 © 2022 Nielsen Consumer LLC. All Rights Reserved.

  2. Slide 2: NielsenIQ retail off premise measurement

    NielsenIQ retail off premise measurement Our off premise measurement Off Premise – Channel Shifting ■ ■ Food (Total US) Drug (Total US) vs 1 YAG vs 2 YAG ■ Mass Merchandiser (e.g. Target) ■ Walmart xAOC ■ Dollar (e.g. Family Dollar, Dollar General) ■ Select Warehouse Club Stores (Sam’s, BJ’s) ■ Whol

  3. Slide 3: 6 broad consumer drivers

    6 broad consumer drivers Total Beverage Alcohol Significant - & growing cross category drinkers Experience Authenticity; exploration/discovery; entertainment Flavors Flavor seekers – traditional + new/different Convenience Shopping Right pack type/size Healthier choices/desire Sustainability/corpora

  4. Slide 4: Most consumers do NOT drink just one category

    Most consumers do NOT drink just one category – they are making occasion by occasion choices Exclusive category drinkers % of category drinkers* that ONLY drink that category 22% 17% 14% 14% 11% Core only Beer only Wine only Spirits only "Other" only *includes…cider, fruit flavored wine, Source: Win

  5. Slide 5: Spirits leads off-premise growth

    Spirits leads off-premise growth Dollar percent change vs year ago and 2 years ago NielsenIQ off-premise channels 2021 vs 2020 2021 vs 2019 28.7% 13.6% 15.8% 11.8% 1.0% -4.9% -3.4% -2.7% Spirits Wine Beer/FMB/Cider Total Alcohol Source: NielsenIQ Scan Off Premise Channels; latest 52 weeks ending 1/8

  6. Slide 6: Online alcohol sales 2.7x pre-COVID levels

    Online alcohol sales 2.7x pre-COVID levels, though down vs the huge increases in the early months of the pandemic Online alcohol sales Share of ecommerce Dollar percent change vs year ago Dollar share of ecommerce & change vs year ago 208% Spirits 18% (+0.6) 173% Beer Wine 10% (+0.6) 66% (-2.3) FMB/

  7. Slide 7: Spirits

    Spirits © 2022 Nielsen Consumer LLC. All Rights Reserved.

  8. Slide 8: Spirits 2021 sales often even with COVID hyped 2020

    SPIRITS – 2021 sales often even with COVID hyped 2020 Total Spirits weekly dollars (millions) NielsenIQ off-premise channels 2021 2019 2020 2021 Off-premise $800 Spirits up Year end 29% $700 holidays $600 Pantry Easter loading 2021 4th of July $500 Labor Day $400 vs 2019 $300 $200 9/18/2021 3/20/202

  9. Slide 9: Prep cocktails & tequila gained share among spirits

    Prep cocktails (incl. RTDs) & tequila gained share among spirits Spirits categories – Dollar % change NielsenIQ 120 off premise channels +183% 100 2021 vs 2020 2021 vs 2019 80 60 40 20 - (20) TOTAL PREPARED TEQUILA WHISKEY COGNAC WHISKEY CORDIALS WHISKEY WHISKEY GIN WHISKEY VODKA RUM BRANDY SPIRITS

  10. Slide 10: High-end price tiers continue to drive growth in spirits

    High-end price tiers continue to drive growth in spirits Spirits price tiers – Dollar % change NielsenIQ off premise channels 2021 vs 2020 2021 vs 2019 100 ■ Spirits ultra price tier up 88% in dollar growth 80 compared to 2019 60 ■ Super premium and ultra 40 price tiers gained 5.8 share 20 points in

  11. Slide 11: Wellness emerging within Spirits; Non-Alc big gains

    Wellness emerging within Spirits but still limited transparency within the category; Non-Alc big gains but on a very small base On Label % Growth $ vs 2 YAG $3.9M Organic Certified +72% $9.1M No/Low -Alc Spirits Free from Artificial +107% $6.0M dollars 2021 Sweeteners +87% vs YA Free from Artificial

  12. Slide 12: Ready to Drink

    Ready to Drink 12 © 2022 Nielsen Consumer LLC. All Rights Reserved.

  13. Slide 13: Spirits-based seltzers and cocktails led growth across all RTDs

    Spirits-based seltzers and cocktails led growth across all RTDs Core consumer drivers: Convenience, Flavor, Better for You Ready-to-drink dollar sales Ready-to-drink dollar growth NielsenIQ off premise channels NielsenIQ off premise channels Spirits Seltzers 142.0% $9.6 B Spirits RTD Cocktails 114.8

  14. Slide 14: Tequila and Whiskey RTDs are high performers in Spirits RTDs

    While still dominated by Vodka base, Tequila and Whiskey RTD’s are high performers in Spirits RTDs Spirits-based RTD dollars by alcohol base Latest 52 weeks absolute $ (in millions) & % change vs. year ago $444.5 $127.0 $48.8 $36.6 $35.3 $31.4 $26.9 $6.4 $5.2 $2.6 $0.2 VODKA TEQUILA RUM MULTIPLE WHI

  15. Slide 15: Spirits based RTD brands then vs now

    Spirits based RTD brands then vs now 2019 2021 Source: NielsenIQ off-premise channels, YTD ending 10/02/21 15 © 2021 Nielsen Consumer LLC. All Rights Reserved.

  16. Slide 16: Wine

    Wine 16 © 2022 Nielsen Consumer LLC. All Rights Reserved.

  17. Slide 17: Wine 2021 sales most often below COVID hyped 2020 levels

    WINE - 2021 sales most often below COVID hyped 2020 levels Total Wine weekly dollars (millions) NielsenIQ off-premise channels 2021 2019 2020 2021 Off-premise $700 Year end holidays Wine up 14% $600 Pantry Easter loading 2021 $500 4th of July Labor Day $400 vs 2019 $300 $200 9/18/2021 3/20/2021 5/1/

  18. Slide 18: Sparkling grew in 2021 while Table wine declined

    Sparkling continued to grow in 2021 while Table wine declined; Cocktails/Flavored Bev Wines both part of the RTD’s surge Total Wine – Dollar % change vs. year ago NielsenIQ off premise channels 125 2021 vs 2020 2021 vs 2019 105 +243% 85 65 45 25 5 (15) Total Wine Sparkling Table Wine Wine Flav Bev N

  19. Slide 19: High end price tiers growing, mid to lower end is not

    High end price tiers growing, but mid to lower end that accounts for most of the category volume is not Table Wine price tiers – Dollar % change vs. year ago NielsenIQ off premise channels 45 2021 vs 2020 2021 vs 2019 35 25 15 5 (5) (15) (25) Table Wine $0-$3.99 $4-$7.99 $8-$10.99 $11-$14.99 $15-$19

  20. Slide 20: Direct to Consumer Shipments

    Direct to Consumer Shipments Total U.S. – 2021 8.5 million Number of 9L cases sold; +1% vs 2020; 2MM more cases than 2019 $4.2 billion +13% vs 2020; +$1 billon more than 2019 $41.16 Average price; +$4.33 vs 2020 Together with carryout, DTC $ now >10% of Wine category $ Source: NielsenIQ Scan Off Pre

  21. Slide 21: Better for you means different things to different people

    Better for you means different things to different people, but brands connected to consumers seeking healthier lifestyles on the rise Selected “BFY” positioned brands On Label % Growth $ Share – Annual $MM sales vs 2 YAG NielsenIQ off premise channels <10% ABV +25% 11.9% $112.9 Gluten Free +110% 1.8

  22. Slide 22: Hard Seltzers hit health attributes, but wine perceived healthier

    Hard Seltzers hit on many specific health related attributes, BUT….Wine perceived as a healthier alternative overall Hard None of Wine Beer Spirits seltzer these Is low calorie 24 Is low carb 21 Contains less sugar 21 Is a good option when dieting or watching what I eat 18 18 Is healthier than most

  23. Slide 23: Top 30 wine growth brands 2021

    Top 30 wine growth brands – 2021 New Repeat Rancho La LaMarca BuzzBallz Stella Rosa Josh Gloria Luc Belaire 19 Crimes Decoy Uptown Chi Chi’s McBride Caymus Meiomi BeatBox Silver Oak Sisters Bread & Santa Daou The Prisoner Bonanza Butter Margherita Laurent Cakebread La Crema Duckhorn Flybird Perrier

  24. Slide 24: Wine: two sides to the coin

    • Higher price tiers • Lower price tiers of mainstream • Sparkling wine WINE table wine • DtC Two sides to the coin • Struggling on • Non-traditional premise wines & packaging, Better for You 24 © 2022 Nielsen Consumer LLC. All Rights Reserved.

  25. Slide 25: A couple comparisons

    A couple comparisons 25 © 2021 Nielsen Consumer LLC. All Rights Reserved.

  26. Slide 26: Wine is a premium adult beverage

    Wine is a premium adult beverage Average price per serving NielsenIQ off premise channels, annual 2021 Premiumization - a good thing generally, but less so when… Size Average ‒ it prices too many out of the market price/serving ‒ competitiveness vs other adult beverages lessens ‒ off vs on premise ‘

  27. Slide 27: On + Off Premise depletion volume

    On + Off Premise depletion volume 27

  28. Slide 28: Price tier performance – a tale of two categories

    Price tier performance – a tale of two categories Table wine high end growth accelerating; mid to lower tiers flat or down sharply Spirits high end growth accelerating; mid to lower tiers flat to up single digits On + Off Premise depletion volume 28

  29. Slide 29: Wine is competitively disadvantaged among 21-34 and multicultural consumers

    Wine is competitively disadvantaged among 21-34 and LDA Multicultural consumers (significant co-mingling of the two) 21-34 and Multicultural share of category volume 21+ Population Spirits Wine Beer 41.1% 39.3% 36.6% 32.3% 33.0% 30.8% 25.3% 19.9% Median Age White: 44 Hispanic: 30 Afr Am: 35 Asian: 3

  30. Slide 30: Material difference by age in preferred alcohol type

    Material difference by age in preferred alcohol type Q: If you were asked to bring an alcohol beverage to share with others at a party, which one type of beverage would you most likely bring? Wine Beer Flav Malt Bev Hard Seltzers Hard Cider Spirits RTD Spirits ~20 point drop in top 49% mindshare fro

  31. Slide 31: Wine vs Spirits

    NEED TYPE Wine Spirits NOTES Consumer Multi-cultural Demographics Age diversity Income diversity Gender diversity Wine more balanced; but some Spirit segments too Price High end tiers Low end tiers per serve Convenience E-commerce Wine dominant; Spirits growing faster Package RTD Cocktails Other Cra

  32. Slide 32: Thank you!

    Thank you! Danny Brager James Restivo Brager Beverage Alcohol Consulting Vice President, Account Development NielsenIQ Bragerdanny@gmail.com James.Restivo@NielsenIQ.com Scan this QR code for the content and to learn more about the NIQ BevAl vertical 32 © 2022 Nielsen Consumer LLC. All Rights Reserve

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