As we look toward the remainder of the year, we wanted to revisit consumers' celebratory mood. Overall, consumers have not been in a festive mood this year. In the first half of the year, our Placer.ai Nightlife Index was down 2%-3% year-over-year. However, since July, momentum has improved, with activity up around +5% in both September and October.
Examining specific regions across the country, Deep Ellum in Dallas saw a spike in activity, while East 8th Street in Austin has been bustling since spring. This fall, East Williamsburg in Brooklyn is a popular spot, and Chicago’s Fulton Market has shown strong performance for over two years.
Interestingly, we also see similar regional trends in visits to liquor stores. Texas's local favorite, Spec's, has been on an upward trend since August, and Chicago’s Binny’s Beverage Depot has seen similar growth. However, nationwide and California trends for Total Wine & More show a slight increase in temperance—at least at home—as consumers shift away from extreme weather.
We suspect that Total Wine & More and similar retailers are facing increased competition from heavy promotions in the grocery channel and lower prices in the club channel, which may be drawing visits away from them. This perspective is informed by Pernod Ricard's comments on Q3 2024, noting that the market is stabilizing with a return to modest growth (+1%), though price and mix were impacted by “aggressive promotions” at retail. A negative mix indicates that lower-priced spirits brands are capturing more consumer attention, taking market share from higher-priced brands—a shift from the pandemic trend of at-home indulgence in premium cocktails. Pernod Ricard’s negative price/mix results also reflect consumers' preference for lower prices, both in terms of brand selection and purchase channels (more discount clubs, fewer neighborhood stores). This focus on value-seeking behavior is a recurring theme for us. Competitor Rémy Cointreau reported that retail sell-out volumes in the Americas region declined by 15%, with dollar sales down 23%, seemingly suggesting that households are still well-stocked with VSOP for now.
