It is legend that in good times people drink (alcohol) a lot and when times are bad they drink even more.  Yet, for the first time in recent memory, alcohol sales dropped in the fourth quarter during the holiday season.

According to Jerry Hirsch of the LA Times in the December 25, 2009 issue, preliminary results show total sales dollars are down about 1.4% over the same period last year.

Does this mean people are drinking less? Not necessarily. It appears that they have downgraded to the “cheap stuff”. Discounting and coupons are coincidentally at an all time high.

The lesson to all marketers is that substitutes exist and that customers will reach for them if the incentives are high enough. True brand loyalty resides in a small group. The rest can be teased away by a lower price or other incentives.

John Bradley Jackson

The BirdDog Group

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