This is an interesting development:
Fewer booze buyers are reaching for the top shelf.
Americans aren’t thirsting for for the high-end tequila that once flowed freely, spirits companies said, as demand for $100 spirits has dropped off. Consumers appear to be trading down—or selecting less expensive versions of their preferred beverage—said Lawson Whiting, CEO of Brown-Forman (BF.A, BF.B), on Thursday, as sales of more affordable bottles fell less.
“We are seeing some weakening, for the first time, in terms of trade down,” Whiting said on a conference call, according to a transcript made available by AlphaSense. “When you look at $100 and above or $50-to-$100 [segments], those price points have weakened considerably.”
Industrywide, the number of $100-plus bottles sold has fallen 18% in the past three months, according to the market research firm NielsenIQ.
I’m not surprised. All that high-end stuff, at the end of the day, delivers not much more in terms of taste and shall we say “knockdown power”, for a premium price. And that would be okay, in isolation.
But when you have to spend $120,000 for an “economy” car — think I’m joking? see how much you end up paying in total when you finance $45,000 over seven or ten years — and the cost of even the cheapest meal for two in a non-fast food restaurant will set you back well over $60, and your grocery bill rockets from $30 per week to $140… it doesn’t take a Nostradamus to predict that things are going to change when it comes to spending your money on what is after all an indulgence.
And the change can come with reduced consumption (as above) or simply learning to live with cheaper merchandise.
In earlier, less fucked-up times, I would now have been on my second or maybe even third car after the Tiguan; instead, I now know that barring some kind of miracle, the Tiggy is going to be my lifetime vehicle.
I can’t remember the last time I bought a bottle of single-malt — years, I suspect — and it doesn’t matter because I seldom drink the stuff unless friends show up for dins, and a single after-dinner cocktail is called for.
It’s not just me, either: the Son&Heir drinks maybe 10% of what he used to drink, booze-wise, and even my rowdy friends have cut back.
But spare me the sob stories of what this means for the manufacturers of high-end bling. If ever there’s a case study in ripping people off for the “status” of using their products, vendors like Louis Vuitton, Glenfiddich, Porsche and Swarovski are headed for bleak times; and I care not a fig for their predicament.
