Nearly every industry experienced unprecedented changes during the coronavirus pandemic, and the alcoholic beverage industry was no exception. Ready-to-drink alcohol was trending in 2019, but pandemic-related lockdowns and hospitality business closures in 2020 helped the canned hard seltzer and cocktail category to flourish.
According to data and analysis firm IWSR Drinks Market Analysis, RTDs grew +26.4% globally last year, while every other beverage alcohol category declined.
“Hard seltzers and many of the innovative new RTDs launching in various markets are satisfying consumer demand for refreshment, flavour, convenience and in some cases, dietary attributes like lower-calorie, gluten-free and no-sugar,” said Brandy Rand, COO of the Americas at IWSR. “The RTD category lends itself to rapid adaption of local market consumer needs and trends.”
A general shift toward health and wellness in the food and beverage industry has prompted consumers to favor lower-ABV alcoholic drinks, which many brands in the RTD category fit into. Another change in consumer behavior since the pandemic is that more people are prioritizing outdoor events, making the single-serve, portable aspect of RTD alcohol even more appealing.
This is why we see so many new flavors and canned cocktail offerings, which are the top reasons why people migrate to the RTD category,” said Rand.
Several major beverage brands broke into the hard seltzer category last year. Molson Coors launched its Vizzy brand across the US in April 2020 and Bud Light debuted its hard seltzer in January 2020 followed by lemonade varieties earlier this January. Nonalcoholic drink brands have even entered the market: AriZona Beverages and Heineken partnered to create the AriZona SunRise hard seltzer line that launched this spring.
“AriZona’s credibility in the juice space and huge appeal, makes this a winning partnership as both companies are well-positioned to win in the hard seltzer category by introducing the first hard seltzer made with a splash of real fruit,” said Karla Flores, director of innovative commercialization at Heineken. “They bring premium and iconic non-alcoholic products to diverse consumers across the United States and worldwide while Heineken brings strong relationships with the distributor network and brand building expertise in alcohol.”
Flores added that the companies finalized brand development through 2020 and the start of 2021, meaning that the product debut came when many places had begun to lift pandemic-related restrictions. However, the focus of SunRise is in off-premise markets — especially convenience stores — so any restrictions have not had a critical effect on the launch.
As lockdowns caused consumers to spend more time at home, this also meant that alcohol consumption changed as well. Rather than relying on foodservice and hospitality channels for alcoholic beverages, people turned to RTD options for quality drinks.
“Consumers have continued to adapt the ‘where’ and the ‘when’ of consumption as part of a growing desire for an experiential lifestyle, and canned cocktails allow for consumption in any location and at any time,” Josh Meyers, co-founder of wine-based canned cocktail brand Picnic Brunch. “Our brand slogan is #brunchanywhere, and we really feel that Picnic Brunch makes it easy for consumers to enjoy brunch anywhere they want — be it a park, a ski lodge, lakeside, on a beach, or from the comfort of their own home”
He added that Picnic Brunch’s launch in March 2020 caused the brand to focus its marketing efforts on digital strategies, and the company plans to debut a direct-to-consumer platform in the near future.
“The pandemic also forced consumers to think different about how they consume alcohol, and gave brands like Picnic Brunch an opportunity to make its way into the shopping carts of open-minded consumers,” said Meyers.
Legacy brewery Anheuser-Busch has also dedicated a substantial amount of its business to canned beverages outside of beer. The company’s Beyond Beer segment saw significant sales increases both in e-commerce and stock-up formats such as off-premise during the pandemic, according to Monica Rustgi, vice president of marketing for Anheuser-Busch’s Beyond Beer portfolio.
“At one point in time, canned cocktails were presumed to be lesser quality,” said Rustgi. “Now that there are premium, high-quality options on the market — like Cutwater Spirits — more and more consumers are gravitating towards RTD products as convenient and enjoyable options.”
Anheuser-Busch also offers hard seltzers and canned wines to cater to many types of alcohol drinkers. Rustgi said that the company’s Cacti Agave Spiked Seltzer — made in partnership with rapper Travis Scott — was created for younger (21+), multicultural customers at high-energy events while its Babe Wine brand appeals to consumers looking for the convenience of an RTD beverage who may not enjoy liquor.
“There is not a one-size-fits-all approach to our portfolio,” said Rustgi.
Like many other food and beverage trends that started before coronavirus became a dominating force, RTD alcoholic beverages have only become more popular and relevant for consumers throughout both lockdowns and easing of restrictions.
“Consumers are choosing their drinks based on convenience and taste,” said Flores. “They are looking for interesting and sessionable, low carb beverages for their drinking occasions — on the go and at home.”
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