Hard seltzer dollar sales topped $4.14 billion in 2020, increasing 160.4% compared to 2019, according to Bump Williams Consulting (BWC), citing NielsenIQ all-outlet, plus convenience and liquor data through December 26, 2020.
BWC, citing NielsenIQ data, shared several key takeaways for the year in hard seltzer. Among them, hard seltzer finished last year with 8.6% share of the beer category and was the primary share gainer in the beer category, increasing its share of the category by 4.8 share points, BWC noted.
That made hard seltzer the sixth largest beer category segment by dollar share in 2020, trailing domestic premiums (28% share of the category), imports (20.6%), craft beer (12.5%), below premiums (12.4%) and domestic super premiums (8.9%).
The majority of those sales — two-thirds — were from variety packs, with 12-packs being the preferred packaging format, making up more than 75% of sales, BWC reported. However, single-serve cans and 24-packs gained share last year, at the expense of 6-packs.
From 2017 through 2020, hard seltzer sales have doubled year-over-year, and that’s led to retailers increasing space for the product and expanded distribution, BWC said. Hard seltzers have grown from less than 50% category weighted distribution to a nationwide reach in 2020.
Segment leaders White Claw (Mark Anthony Brands) and Truly Hard Seltzer (Boston Beer Company) combined accounted for 75% of the segment’s total sales. However, both companies lost share in 2020, with White Claw losing 8 share points. Nevertheless, White Claw posted more than $2 billion in sales (+124.8%) and held a little more than half of the segment’s share.
Despite the high double-digit growth in 2020, the hard seltzer segment’s trends decelerated as the year progressed, posting year-over-year growth of 92.7% in Q4. BWC noted that there remains a seasonality to hard seltzers, not unlike core beer, peaking in the summer months and trailing off in the winter.
Through the first two weeks of 2021 (week ending January 9, 2021), hard seltzer sales are up 84.7%, a slight increase over the latest four-week period (+77.6%), according to data from NielsenIQ.
However, a slew of new product introductions could provide a winter boost. Within the last week, some of the hard seltzer segment’s largest players have launched new offerings.
Boston Beer Company, having a head start with its Truly Lemonade Hard Seltzer in 2020 — which became the company’s top-selling seltzer SKU and remains among NielsenIQ’s top 10 growth brands — has launched Truly Iced Tea Hard Seltzer.
The Truly Iced Tea mix pack features four flavors — Peach Tea, Strawberry Tea, Lemon Tea, and Raspberry Tea — and boasts the same bonafides as the original Truly line: 5% ABV, 100 calories and 1 gram of sugar.
The launch of Truly Iced Tea follows a 2020 in which the Truly brand family sold more than $975.3 million (+143%) of product in off-premise retailers, and held 23.8% share of the segment, according to BWC, citing NielsenIQ data.
With Lemonade and now Iced Tea, Boston Beer has plans to double its Truly business in 2021, Boston Beer CMO Lesya Lysyj told Brewbound.
“We think it’s realistic, but it is on the aggressive side,” she said. “And we’re set to deliver that, so we feel pretty good about it.”
To help Truly get there, Boston Beer will invest $100 million in media this year, with a heavy focus on the first quarter of the year on social, digital, and streaming, as well as sports.
“We’re kind of going big on sports and big in all other [mediums to meet] younger consumers where they’re at,” Lysyj said. “Also, we’re doubling down on multicultural. It’s kind of new for us; we have not had a big focus on the multicultural consumer. So 20% of our total spend is against multicultural.”
The early returns on Truly Iced Tea from retailers and wholesalers has been “incredible,” Lysyj said.
“It’s doing better than lemonade did out of the gates even, which we’re like … this is incredible,” she said.
Lysyj explained that Truly Iced Tea builds off of 2020’s learnings from its lemonade launch that consumers are seeking more flavor. For that reason, Lysyj said she’s not concerned about iced tea possibly cannibalizing other Truly brands. In fact, she said several large retailers told Boston Beer that Truly Lemonade was “the most incremental launch last year in the category.” Those incremental sales, she said, came from attracting more younger male consumers with the product.
“What we found was lemonade brought in a more male consumer and a younger consumer, so a little younger than 28,” she said.
As far as Truly Iced Tea crossing over with Boston Beer’s Twisted Tea consumers, Lysyj said Truly drinkers differ from Twisted Tea consumers, who care more about flavor and like the added sugar but aren’t as concerned about calorie counting.
As Boston Beer takes Truly to the next frontier, the largest beer manufacturers are readying their lemonade hard seltzers.
On Monday, Anheuser-Busch InBev launched a lemonade line extension of its Bud Light Seltzer brand. Bud Light Seltzer Lemonade launched in variety 12-packs of slim cans with four flavors: Original Lemonade, Black Cherry Lemonade, Strawberry Lemonade and Peach Lemonade.
The lemonade line extension has all of the attributes of the Bud Light Seltzer line: 5% ABV, 100 calories and less than one gram of sugar. To support the launch, A-B rolled out a pair of ads featuring young drinkers saying Bud Light’s lemonade seltzer is better than their grandmothers’ lemonade.
A-B’s Bud Light lemonade offering comes on the heels of the world’s largest beer manufacturer expanding its portfolio of hard seltzers with the release of Michelob Ultra Organic Seltzer in variety 12- and 24-packs and 25 oz. single-serve cans.
According to BWC, Bud Light Seltzer ($394 million in off-premise sales) held a 9.6 % share of the segment, followed by Corona Hard Seltzer ($183.3 million in sales) with 4.5 share points, Smirnoff ($89 million in sales) with 2.2 share points and Vizzy Hard Seltzer ($76.2 million) with 1.9 share points.
Molson Coors last week announced last week that it would launch its own lemonade line extension of its Vizzy brand, slated to hit retail in April.
Vizzy Lemonade Hard Seltzer will come in a variety 12-pack of four flavor combinations: Strawberry Lemonade, Watermelon Lemonade, Raspberry Lemonade and Peach Lemonade. Each 12 oz. serving checks in at 5% ABV, 100 calories and is certified gluten free. The differentiator, for Vizzy Lemonade, much like its core offering, is antioxidant vitamin C.
The lemonade variety pack will give Molson Coors three Vizzy variety packs on the market, with a second core Vizzy variety pack slated to hit retail in March.
Also getting in on the lemonade hard seltzer trend will be Constellation Brands, with a Corona branded lemonade hard seltzer, Limonada, slated to hit retail in the spring, according to reports by Beer Business Daily and Beer Marketer’s Insights.
RBC analyst Nik Modi had alluded to the line extension during Constellation Brands’ third quarter 2021 earnings call. Although Constellation Brands CEO Bill Newlands didn’t address a potential lemonade line extension, he did say the company would more than double its capacity for the Corona Hard Seltzer franchise in 2021.
And segment leader Mark Anthony Brands will lean on its Mike’s lemonade brand to launch Mike’s Hard Lemonade Seltzer, along with a White Claw branded iced tea line in March.
Beyond the established brands, the hard seltzer segment will see several new entrants expected to enter the fray including major craft breweries New Belgium (Fruit Smash) and Sierra Nevada (Agua Azul), energy drink makers Bang and Monster, non-alcoholic drink brands Topo Chico (via Molson Coors) and AriZona (via Heineken).
FIFCO USA is also trading on the brand equity of its top-selling Seagram’s Escapes FMB line by launching a Seagram’s branded hard seltzer.
Seagram’s Hard Seltzer (5% ABV, 100 calories) features four flavor combinations: Tropical Pineapple, Mango Peach, Mixed Berry and Watermelon Lime. Variety 12-packs of slim cans will begin hitting select national markets in February.
“We know that 61% of consumers believe great taste is lacking from hard seltzers. We’ve made
it our mission to change that,” Jennifer McCauley, Seagram’s Hard Seltzer brand director, said in a press release. “Our team embraced our expertise in flavor development across beer and flavored malt beverages to create a seltzer uniquely positioned to deliver on taste and flavor.
“Seagram’s Hard Seltzer malt base was specifically designed to preserve the brightness of the flavors, resulting in a softer, smoother, more flavorful experience that’s delicious but not too sweet.”
Meanwhile, non-alcoholic beer maker Athletic Brewing launched DayPack, a non-alc “premium hop seltzer” line, similar to Lagunitas Hoppy Refresher, H2OPS Hop Water and Hop WTR.
The DayPack line of fruit flavored seltzers infused with hops comes in four flavors: Lemon Lime, Mango, Blood Orange and Black Cherry.
Athletic co-founder Bill Shufelt told Brewbound that DayPack is meant to be “an anywhere, anytime beverage” with zero calories.
“For DayPack, we’re just thinking about the sheer size of the $250B+ non-alcoholic beverage market and how few options there really are,” he said. “Between water, sugary soda, kombucha, and coffee, there is a ton of wide open space. There are still so many hours in the day, and a lot of areas beer isn’t necessarily ‘permissioned’ yet. Also, more than 50% of our NA beer drinkers are people from outside the beer category (lifestyle drinkers of other beverages who want a great NA beverage). This gives them a way to find us in another aisle and be additive to beer occasions and populations overall.”