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while the advertising growth of RTDs, spirits and beer was driven by independent retail and chain stores. Contrary to popular belief, advertised beer and RTD prices have actually increased over the past year. The average advertised unit price for beer climbed 2% to $23.29 while RTD prices rose 5% to $20.22. “This reflects the ongoing trading up of consumers into premium and craft beers, and the movement into larger pack sizes for RTD products”, says LIPS director, Sean Jowers. Advertised spirits prices fell 3% to $34.36 and wine prices decreased by 5% to $13.65 compared with the previous 12 months. “There has been a lot of discounting from retailers and suppliers to soak up the wine glut over the past few vintages,” says Jowers. “This has led to the fall in average promoted wine prices. With a reduced 2012 harvest, you should start to see some upwards movement in advertised prices over the next year with limited supply driving up costs.” The drop in advertised spirits prices is across the board. Brandy’s average promoted price is down 31% over last year to $35.87. Rum, scotch and tequila have all experienced reduced advertised prices by 2%, while gin and vodka are in line with last year. Bourbon is the only spirit type with a higher average advertised price, up 3% to $41.35. So, which sales channels are responsible for the price changes? In grocery, advertised beer prices have risen 6%, but are still lower than all other outlets at $22.45. Wine prices in grocery are also advertised at the lowest average price across all channels at $12.89, down 2% on last year. “This is slightly above the average selling price in grocery, which indicates the influence of in-store promotions, display, merchandising and other factors on purchasing decisions as well as advertising,” says Jowers. Advertised prices for wine (-7%), beer (-4%) and spirits (-2%) all fell significantly in retail chains with only RTD prices rising over last year (+6%). “With tough economic conditions set to continue, I think the retail market will fragment further and competition will intensify among chain stores, supermarkets and independent operators. We may also see advertised prices increase across all categories as consumers choose quality over quantity and rising costs are passed on.” LIPS monitor alcohol prices advertised in print and electronic media throughout New Zealand. Pricing data and reviews can be obtained by subscription at www.lipsltd.co.nz. For further information, contact Sean Jowers, phone (021) 547 583. 66 www.drinksbiz.co.nz june / july 2012