Mexican Beers Fuel the Growing American Taste for Imported Brews

Imported beers have long carried a mark of sophistication. They fired the imagination of American beer lovers years before homebrewing became legal and decades before the craft beer movement emerged. In fact, imports paved the way for the future popularity of both.

In the dull beer years of the last century, the import shelves at retail stores offered novel flavors to those in the know. The selections were limited, and the stock sometimes far from fresh, but at a time when U.S. brewing was at its most homogeneous, the imported brands introduced drinkers to the great brewing traditions beyond our shores.

Today, the sheer number of imported brands, coming in a dizzying range of styles, mirrors the diversity of domestically produced beers. But, like American brands, the import market is dominated by a relatively small number of beers that are widely available and well-supported by advertising and promotions. And, like the leading American brands, most imports are of one general style—the modern pale lager.

BD16JAN-Imports-Chart-BeerYet imports as a category are enjoying healthy growth—5.4% in volume growth last year—whereas the similarly styled American majors are stalled or losing share (figures from the Beverage Information Group). Clearly, the import identity itself still has some cachet. After all, analysts still talk about the phenomenon of consumers “trading up.”

Bridget Lasda, VP National Accounts at Heineken USA, explains why imports can fill that desire. “Consumers today, specifically Millennials, want the best. They have a strong appreciation for higher quality products that elevate their experiences and are willing to spend more on brands that complement their lifestyle,” she says. “We expect import share to continue to improve as more Millennial and multicultural consumers reach legal drinking age. These consumers are more likely to equate cost with quality and shop the upscale import segment where quality, variety and image play a key role.”


Southern Success

Imports as a whole appear robust, but one segment leads the rest. “The story of imports has been the story of Mexican beer for the past several years—they’re really driving the bus, so to speak, in that segment,” says Dan Wandel, Principal, Beverage Alcohol Client Insights with IRI. “For the last five years,
including year-to-date this year, the Mexican imports have consistently outpaced all other imports.”

Mexican brands account for six out of the 10 top-selling imports; the other four brands come from four different countries. And five of the Mexican six have grown in volume in the past year, compared with only one of the four non-Mexican top brands.

Constellation Brands in Chicago is the dominant player, now dealing exclusively in Mexican brands. According to Jim Sabia, chief marketing officer in the company’s beer division, “Our portfolio accounts for more than half the growth in the import category. If you think about the growth of imports, the seven brands in our portfolio are driving a lot of that growth.”

Number one brand Corona Extra continues four years of steady growth. Corona in cans opened a new market last year; Corona on draft opened on-premise possibilities. But Constellation’s run-away success, boasting 22% growth, is Modelo Especial, “obviously and arguably the hottest brand in the category,” according to Wandel. The brand was supported with television advertising this year for the first time.

Corona Light, lagging behind its full-calorie sibling, will be promoted next year for both its Mexican qualities and its light character. “Corona Light continues to evolve our new platform of ‘Light Cerveza,’” Sabia says. “We are a light beer, but we are a light cerveza, which gives us a little more of that Latino attitude.”

Negra Modelo, arguably the most “craft-like” of the Mexican imports (being a darker, more deeply flavored beer), continues its culinary partnership with Chef Rick Bayless, who offers recipes online for dishes to pair with the Vienna-style lager.

Constellation does not hold the field alone when it comes to Mexican brands. Heineken USA imports Dos Equis, which has ridden its meme-worthy ad campaign, “The Most Interesting Man in the World,” to another year of double-digit growth. The campaign’s urbane, bearded spokesman has advised an aspirational audience to “Stay thirsty, my friend” for ten years now, and shows no sign of losing his mystique.

With a different approach, Tecate Light, now the number one beer in Mexico, is successfully reaching domestic audiences. “Tecate Light is outperforming the category with YTD growth of 45.3% [Nielsen],” Lasda says. “Unlike other brands in the light beer segment, Tecate is connecting with its target consumers—bicultural Mexican-American men—emotionally through digital and social campaigns that speak to their bold, independent and masculine character.”

Anheuser-Busch InBev, usually the leader in any story about large-volume brands, is a minor player in Mexican imports, despite having a large hand in Mexican breweries. Last year, the company began importing its sole Mexican brand, Montejo, into 11 U.S. states, all home to substantial Hispanic populations.

The conspicuous success of Mexican imports defies any single explanation. Constellation’s Sabia tends to look to the individual brands and the company’s record of connecting with consumers. “Everything begins with the liquid and what is the consumer looking for in the liquid,” he says.

“But after they say, ‘OK, I want this type of product,’ then it’s all about the branding of that product: the marketing and the emotional connection. All those consumer touch points along the way that make them proud to drink this product.”

Population changes and demographics have also put Mexican beers in a golden position as Hispanic numbers grow in the U.S. Mexican imports do not have to be marketed narrowly to Hispanic audiences to benefit. “Hispanic culture is having a profound effect on America, influencing everything from food and beverages to music, sports, film, fashion and more,” Lasda notes.  “As this influence continues to grow, so too do Mexican beer brands. They have strong appeal among young Hispanic/multicultural consumers—a demographic projected to account for 70% of future beer category growth.”

IRI’s Wandel acknowledges what he calls “focus” on the part of both Constellation and HUSA for their success in placing their dozen Mexican brands in the top 20-plus ranks in imported beer sales. And he points out another quality: Mexican beers offer an alternative to the higher-alcohol craft beers. “My theory is that you can’t expect someone to sit there all night with four or five 8 to 10% ABV craft beers!” he laughs. “Clearly the Mexican imports play in that sweet spot. They offer a sessionable beer while still offering the image of trading up.”



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