Following today’s news (21/04/2020) that the Bavarian state government has taken the decision to cancel the two-week-long Oktoberfest;

Kevin Baker, Head of Beer & Cider Research at GlobalData, a leading data and analytics company, offers his view on the challenges that brewers face during the current pandemic:

“This is a further blow to the beleaguered beer industry, which is already reeling from the effects of the lockdown. In many areas, the sector has seen the virtual disappearance of around half of its market, with the closure of all pubs, bars and restaurants. According to GlobalData’s COVID-19 Market Impact Model, global beer and cider volumes are expected to decline by around 7% between 2019 and 2023, compared to a previous forecast of 3% growth over the same period*. 

“Concern over COVID-19 is high in Germany, despite the country having lower infection and death rates than many other countries. According to GlobalData’s COVID-19 Week 3 Consumer Survey, 71% of German consumers are concerned about the effects of the virus, while 61% believe the outlook for the next month is going to be worse²*. The virus and attendant lockdown has had a profound effect on consumer behavior. 

“The same survey further reveals that 29% of consumers say they are shopping on a tight budget and are retreating to trusted brands, with 33% of respondents stating that they will only buy products from their favourite brands^2*. This trend is also manifested in a preference for local products with 74% of consumers saying that they trust German brands compared to just 19% who say they believe brands from China to be trustworthy.^2*”

“While there are clearly significant challenges for the industry, especially in the short term, companies and brands can also take advantage of the opportunities, such as a renewed interest in local and trusted brands.”

* GlobalData Market Data: COVID-19 Impact Market Model – Consumer Goods – April 20^th Update

[2]* GlobalData Coronavirus (COVID-19) Tracker Consumer Survey – Germany – Week 3