Alcohol companies

Underage Alcohol Use: Alcohol Companies Make Billions In Profits From Behavior They Do Little To Prevent

Alcohol remains the drug most consumed by high school students. According to the Centers for Disease Control and Prevention, approximately 3,500 people under the age of 21 die each year from alcohol consumption.

I have studied the relationship between alcohol marketing and the drinking behavior of young people over the past 20 years. In 2011, my colleagues and I conducted what, to our knowledge, was the first and only survey of specific brands of alcohol that underage drinkers. We surveyed 1,032 young drinkers of 898 alcohol brands to find out what the underage alcohol market looks like.

In a new article published on June 9, 2021, my colleagues and I combined our survey data with the latest available information on adult alcohol consumption to estimate the percentage of all alcohol sold in the United States that was consumed by young people. Then we were able to calculate how much money underage drinkers spend and, most importantly, which companies are making that money.

Who makes money drinking underage?

In 2016, the most recent year for which market research and government data were available, the total value of alcoholic beverage sales in the United States was approximately $ 237.1 billion. Using our 2011 youth market model and our alcohol price database, we were able to estimate the retail sales of youth consumption for 2011 and project them to 2016. In total, we estimate that young people under the age of 21 accounted for 8.6% of consumption and 7.4% of dollars spent, since young people buy less expensive alcohol. This translates to $ 17.5 billion. While underage alcohol consumption has been steadily declining since 2002, it remains a substantial source of income for these businesses.

According to our 2011 survey, the 10 most popular alcohol brands among underage drinkers were Bud Light, Budweiser, Smirnoff Malt Beverages, Smirnoff Vodkas, Coors Light, Jack Daniel’s Bourbons, Corona Extra, Mike’s, Captain Morgan Rums and Absolut Vodkas .

Three companies own most of these drinks and account for almost half – 44.7% – of alcoholic beverages consumed by young people. Anheuser-Busch InBev accounted for 21.2% of those drinks, from which they earned $ 2.2 billion. MillerCoors sold 11.1% of the alcohol, making $ 1.1 billion. Spirits and beer maker Diageo also sold 11.1% of the drinks young people drank – and, as alcohol tends to be more expensive per drink than beer, earned $ 2 billion from the alcohol consumption by minors.

Income from underage alcohol consumption could be put to good use

The brewing industry’s trade association, the Beer Institute, said that “the US brewing industry has been dedicated to preventing illegal underage alcohol use for more than three decades.” They go on to say that companies are doing their part to ensure advertising is directed at adults, educate parents and students about underage alcohol use, and encourage stores not to sell alcohol to adults. minors.

However, many studies have shown that the actions of alcohol companies to prevent alcohol-related harm are ineffective. Our research clearly shows a conflict of interest: these companies literally earn billions of dollars from the very behavior they say they want to prevent.

In response to a congressional request, in 2003, the National Research Council and the Institute of Medicine released a major report on reducing underage alcohol use. They recommended that all segments of the alcohol industry that profit from underage alcohol consumption donate 0.5% of the company’s total revenue to an independent, non-profit foundation dedicated to the reduction. and the prevention of alcohol consumption among minors. In 2016, that would have amounted, for example, to $ 78 million from Anheuser-Busch InBev. This money could go a long way to support community groups trying to implement evidence-based strategies such as reducing the density of stores that sell alcohol, increasing taxes on alcohol and increased repression of illegal sales to minors.

But no independent fund has ever been established, and the alcohol companies themselves continue to monitor the money they contribute to the prevention of underage alcohol use, spending much of it on social media. “corporate social responsibility” efforts that do more to promote their products than to prevent harmful consumption.

Meanwhile, federal funding specifically dedicated to preventing underage alcohol use is minimal. The most recent presidential budget recommended only $ 10 million for grants to community coalitions working on underage drinking. In addition, following a significant reduction in the alcohol tax adopted in 2017 and made permanent in 2020, alcohol companies are contributing less than ever to the federal budget.

I believe that due to their conflict of interest, alcohol companies cannot be trusted to effectively spend prevention dollars. The billions these companies make from underage alcohol consumption is money that the prevention field could actually use. An industry-independent system that would collect and allocate such unwanted income may be a better way to channel it to local communities and help reduce and prevent underage alcohol use.