Anyone faintly tuned in to the times has spent the last few years watching Seltzer’s meteoric rise. Brands like White Claw and Truly reign supreme, as the category has grossed US sales of $ 4.3 billion.
But the hard seltzer is dying out, experts say. Boston Beer Co. SAM has withdrawn its advice and Molson Coors TAP has withdrawn its Coors brand beer seltzer.
While the hard seltzer remains on the move, the global RTD category is booming. Innovative products such as hard kombuchas and canned cocktails are gaining popularity and involving large investments.
So what’s next for the hyper-convenient canning category? The experts intervene.
Small brands come out to play
The seltzer industry is largely dominated by the white label of Truly and Mark Anthony Brands, who collectively control 75% of the category. But consumers are increasingly influenced by new sub-categories; beer-seltzers, premium canned cocktails, natural canned sparkling wines and spiked kombuchas.
“As the market becomes saturated with companies exploring ways to move their products, smaller brands are finding ways to gain market share by delivering better quality products than some of the larger producers,” advises Gary Wallach, Director of Food and Beverage at Arlo SoHo. . “Fun new canned wines, plus a long list of exceptional bottled cocktails.”
“We have seen people looking for better quality products,” says Zach Kameron, beverage manager for Peak at 30 Hudson Yards. “For RTDs, this has led to an increase in products made with quality ingredients such as excellent base alcohol and natural blends and not overloaded with sugar. As a result, RTDs have become very regionalized, with an increased interest in artisanal RTDs from local businesses, as opposed to big hard seltzers.
Spirits brands enter the fray
The global RTD category is experiencing the tremendous growth that Hard Seltzer saw in 2019 – RTD products on Drizly have grown 60% in 2021 to date compared to the same period in 2020. Smaller brands like Cutwater, Crafthouse and Volley are leading the pack, with major spirits producers entering the market with their own iterations. For example, Taylor Fladgate makes an excellent canned port and tonic; a play to enter a new market (ready-to-drink) and introduce a young drinker to port, a drink often associated with munchies after long meals.
“Decades ago, the RTD category was much smaller and consisted of options that were higher in sugar and made up of less natural ingredients that paled compared to traditional cocktails,” said Ignacio Llaneza, vice president of marketing for the trademark and trade at Disaronno International LLC. “The RTD category is now booming with a wide variety of new players and explosive product development. The category is moving towards higher quality, on par with premiumization trends. Instead of going the seltzer route, Disaronno stuck to the brand’s philosophy, moving towards a hit of iced coffee in a can.
Bigger Lean the Better for You
“We will see a growing demand for well-designed, ‘better for you’ alcoholic beverages made with simple, whole ingredients,” said Kenny Richards, CEO / Founder of Halyard Brewing Company. “Canned cocktails are convenient, not innovative, and seltzer water is starting to level off. Craft beer is on the decline overall, and recent analysis data suggests the same is true for wine and spirits. The growing trends right now are dominated by innovation, and in this innovation, I think we are going to see consumers continue to look to products with transparent ingredients, artisanal processes, low sugar content and a delicious crushable liquid. “
Julian Penuelas, Nautilus’ food and beverage manager at Arlo SoHo, predicts that the standard healthy drink fare will seep into RTDs. “Mexican kefir and tepache will hit the market because they contain more diverse probiotics that help strengthen the immune system and aid digestion.”
A recent Drizly survey found that health is becoming a major influence on the purchase of alcohol, which is why options adjacent to health are becoming common. Recent success stories include Owl’s Brew tea-based seltzer and hard kombucha offerings fortified with probiotics and naturally fermented canned wines.
Three Spirit co-founder Dash Lilley is hedging his bets on wellness-fueled drinks. “Functional drinks will continue to grow and become more common with the shift to the non-alcoholic space. Products that can help with mood swings, health, and socialization will become standardized, providing consumers with options away from alcohol and cannabis. The key ingredients for the revolution will be things like L-theanine (a green tea extract and nootropic that promotes calm focus – this is already used by PepsiCo PEP in their new product DriftWell), clean caffeine from new sources such as yerba mate, guayusa or green tea, cocoa, terpenes found in cannabis, including other forms of cannabidol. The feature will infiltrate existing categories such as beer, wine, and RTDs. “
“As retailers and consumers of packaged consumer products continue to focus and pay increased attention to products that differentiate themselves from mainstream / traditional products, the market share of the segment’s products is likely to improve. for the health “of alcohol, in particular, will continue to grow in the retail space as well as the general dollar share,” said Jon Carpenter, the chief brewer at Soonish.
That said, brands need to be careful when walking around this space. “It no longer seems sufficient to simply bring nuance to the table,” he continues. “Consumers are constantly increasing their desire for multi-faceted beverages that offer both functional value and social lubrication. drink a product. “
Brands have spread and more and more brands aimed at health-conscious drinkers are entering the market. “Ultimately, while growth continues among the ‘functional’ or ‘best-for-you’ segments of the beverage industry, so does the number of brands available, dollars spent both in the beverage industry. development and marketing and consumer contacts – all major to an ever-increasing fickleness in consumer habits, ”says Carpenter. “Those brands capable of developing sustainable and profitable businesses will be the ones that can execute brand development in all arenas.).”
One of the most rated takeout towards the pandemic? The past two years have prompted a more mindful approach to alcohol consumption. “I believe that the pandemic brought with it a force of introspection, where we had to question ourselves, our habits and our choices and see how they affect us, us, the people around us and our environment”, explains Daniel Bedoya, Beverages Director of the Gilded Group.
Carpenter continues, “While we have seen a rapid proliferation of strong brands in segments such as kombucha, gluten-free beer substitutes, functional energy drinks, low calorie seltzer, etc., we also have found an almost equal dramatic leveling and decline. for many. This raises the question of sustainability – how does a new product both gain a piece of mind upon activation and remain relevant long after its initial appearance? In my opinion, one answer is a range of offers. “
“Personally, the last year has inspired me to take a more mindful approach to drinking alcohol,” says Bedoya. “What do we put in our drinks? How do they affect us and the environment? “