The majority of both new brands and growth-driving brands in the beer category in 2021 were hard seltzers, according to Bump Williams Consulting’s (BWC) latest report on off-premise retail strategy.
Of the 25 best-selling new brands last year, 20 are hard seltzers, according to NielsenIQ data shared by BWC. The top five include Mark Anthony Brands’ White Claw variety pack No. 3, Boston Beer Company’sTruly Punch variety pack, Truly Iced Tea variety pack, Molson Coors Topo Chico Hard Seltzer and Mark Anthony’s Mike’s Hard Lemonade Seltzer variety pack.
The five non-seltzers offerings are concentrated toward the bottom of the top 25 and include a cider, two flavored malt beverages (FMB), a domestic premium beer and a craft offering. They are:
- Boston Beer’s Angry Orchard Peach Mango Cider (No. 17),
- Mark Anthony’s Cayman Jack Cocktail variety pack (No. 18),
- Diageo’s Guinness Nitro Cold Brew Coffee (No. 22),
- Coors Pure (No. 23),
- and Anheuser-Busch InBev’s Wicked Weed IPA variety pack (No. 24).
Of the 25 beer category brands that drove the most incremental dollar sales in 2021, 17 are hard seltzers. The top five are nearly identical to the top five new brands, with A-B’s Michelob Ultra Organic Seltzer variety pack nudging Topo Chico Hard Seltzer down one spot to No. 5.
The eight non-hard seltzer brands that drove growth last year include a Mexican import, two non-alcoholic offerings, a below premium offering, a super premium offering an FMB and two craft offerings. They are:
- Constellation Brands’ Modelo Especial (No. 7),
- A-B’s Budweiser Zero non-alc (No. 14),
- Michelob Ultra variety pack (No. 20),
- Heineken 0.0 non-alc (No. 21),
- Busch Light Apple (No. 22),
- Sierra Nevada Big Little Thing IPA (No. 23),
- Mark Anthony’s Cayman Jack Margarita (No. 24),
- New Belgium Voodoo Ranger Hoppy variety pack (No. 25).
BWC used both lists to detail strategies for off-premise retailers. The consulting firm classified its retailer clients into five groups for achieving growth in 2022 and 2023.
“Some retailers want to use ‘First to Market with Innovation’ as their growth platform while using the power of new brands to drive foot-traffic,” BWC wrote, noting these retailers invest in innovation products. “Other retailers are going to invest in the biggest money-makers (incremental dollar drivers) to increase dollar sales/share of market – even if it means walking away from mature brands and reducing shelf space for those larger brands.”
The second group of retailers rely on brands that drive dollar growth, whether new or established.
“There are some very astute retailers who will use select impact brands that are the largest in size, but perhaps not the fastest growing brands to protect their current [standard operating procedure] for driving market basket rings,” BWC wrote.
Of the 25 top-selling beer category brands, only three grew dollar sales last year when compared to 2020. They include Modelo Especial (+5.4%), Corona Premier (+0.2%) and Coors Banquet (+0.3%). One – White Claw Variety No. 3 – launched in 2021. Risk-averse retailers rely on top-selling brands to drive volume.
“Most are NOT growing vs. [year-ago sales], but they sure do put a lot of dollars in the cash registers at the end of the day,” BWC wrote. “Nothing new here to see, it’s simply retailers who are a bit gun-shy to change their approach to category management and hoping these large, iconic beer brands return to growth through some miracle or ability to deliver product when supply chain disrupts smaller players.”
BWC detailed a two-pronged approach using the firm’s own “mathematical analyses” to create two lists of impact brands that combine large dollar sales drivers and capitalize on emerging brands and styles that bring in incremental revenue.
The first method ranks all brands with year-ago sales that have a volume share of at least 0.1% of the category. This methodology, which includes 114 brands, places emphasis on established but growing brands, such as Modelo Especial (+5.4% vs. 2020), Coronita Extra (+14.6% vs. 2020), Heineken 0.0 (+30.4% vs. 2020), New Belgium Voodoo Ranger Imperial IPA (+21.5% vs. 2020), as well as brands that have declined slightly but still sell well, such as Dos Equis Lager (-1.1% vs. 2020), Michelob Ultra (-1.4% vs. 2020), and Mike’s Hard Lemonade variety pack (-1.3% vs. 2020).
The second method ranks the top 250 brands with year-ago sales. This list includes more non-alc offerings, plus “legacy brands enjoying growth” and “some smaller brands making the [top 30] given their strong growth rates.” Included on the second impact list are Cayman Jack Margarita (+28.2% vs. 2020), New Belgium Voodoo Ranger Juicy Haze (+24.2% vs. 2020), Twisted Tea variety pack (+51.7% vs. 2020) and Athletic Brewing Run Wild IPA (+321.9% vs. 2020).
Bump Williams, founder of BWC, recapped 2021 in the beer industry with a pithy observation.
“The pros didn’t panic,” he wrote.
Along with kudos for distributors (“They always get the job done at retail!”), observations on the tumultuous on-premise (“Consumers were aching to get outside and back into their favorite bars”) and a prediction that the “changing landscape” of alcohol and cannabis “will unfold in a big way” in 2022, Williams noted that the beer industry fired on all cylinders in all forms of innovation in 2021, which will continue into 2022.
“Manufacturers didn’t sit on their laurels and ‘hope’ to break even this year, the best and the brightest of them made big moves with partnerships, acquisitions, innovation, expansion and investment spending,” he wrote. “Long Drinks, Ranch Waters, variety packs, RTDs, NA beer/spirits/wine and spirits expansion is going to make for an interesting ride this year.”