Here's a breakdown of the key information from the article "Hard seltzer started a new category, but will canned cocktails sustain momentum long term?":
Findings:
Category Evolution: The hard seltzer boom has evolved into a broader canned cocktail category, driven by consumer preferences for convenience and variety.
Shift Towards Spirits: The market is shifting towards spirits-based canned cocktails, with increased demand for premium options made with real spirits like vodka and tequila.
Blurring of Category Lines: Traditional beverage categories are becoming blurred, with new products catering to various drinking occasions.
Challenges for Malt-Based Hard Seltzer: The popularity of malt-based hard seltzer is declining as consumers seek more premium options.
Opportunities for Niche Brands: Brands that can tap into specific consumer needs and trends have the potential for success, especially local players with strong followings.
Potential Cannibalization: The growth of canned cocktails could lead to decreased sales of traditional spirits.
Key Takeaway:
The canned cocktail market is evolving rapidly, with a shift towards spirits-based options and premiumization. Brands need to adapt to changing consumer preferences and find their niche to succeed.
Trend:
The rise of ready-to-drink (RTD) canned cocktails, particularly those made with real spirits, is a significant trend in the beverage alcohol industry.
Consumer Motivation:
Convenience: Canned cocktails offer a ready-to-drink solution for various occasions.
Variety: The market offers a growing range of flavors and spirit options.
Premiumization: Consumers are seeking higher-quality canned cocktails made with real spirits.
Health Consciousness: Some consumers are looking for low-sugar or natural ingredient options.
Driving Trend:
Changing consumer preferences towards convenience and premiumization.
The influence of Gen Z purchasing habits.
Blurring of boundaries between traditional beverage categories.
Innovation in flavor and product offerings.
People Referred to:
Spiros Malandrakis: Head alcohol industry researcher at Euromonitor International
Matt Hughes: Operating partner at beverage incubator Franchise Equity Partners
Britt West: Executive vice president of High Noon parent company Spirit of Gallo
Products/Services:
Ready-to-drink canned cocktails: Made with various spirits like vodka, tequila, and whiskey, often combined with soda, fruit juice, or other mixers.
Hard seltzers: Carbonated alcoholic beverages typically made with malt alcohol and fruit flavors.
Hard tea and lemonade: New entrants in the RTD category, often made with vodka or other spirits.
Age Groups:
Younger Consumers (Gen Z): Are driving the trend towards functional beverages and blurring category lines.
Older Consumers: Are also embracing canned cocktails, particularly those made with real spirits.
Conclusions:
RTD Market is Dynamic: The RTD market is rapidly changing, with a shift towards spirits-based cocktails and premiumization.
Adaptability is key: Brands need to stay attuned to consumer trends and innovate to meet evolving demands.
Niche opportunities exist: New brands can find success by catering to specific consumer needs and building strong local followings.
Cannibalization risk: The growth of canned cocktails could impact sales of traditional spirits.
Implications for Brands:
Innovate: Develop new and unique flavors and combinations.
Premiumize: Offer higher-quality products made with real spirits.
Target Specific Audiences: Identify and cater to niche consumer groups.
Build Brand Awareness: Utilize effective marketing and branding strategies to stand out in a crowded market.
Implications for Society:
Increased choice and convenience for consumers.
Potential for greater alcohol consumption due to accessibility and variety.
Possible shift in social drinking habits towards RTD cocktails.
Economic impact on traditional spirits industry.
Big Trend Implied:
The rise of canned cocktails reflects a broader trend towards convenience, personalization, and premiumization in the beverage alcohol industry. Consumers are seeking high-quality, ready-to-drink options that cater to their individual preferences and lifestyles. This trend is likely to continue, driving further innovation and competition in the market.
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