Heineken USA (HUSA) showed off a slate of innovations that will begin rolling out in retailers this spring — including what CEO Maggie Timoney called its latest crown jewel, Dos Equis Ranch Water Hard Seltzer — during its spring meeting with wholesalers this week.
“When you think about ranch water, you think about Texas, and you think about Dos Equis,” Timoney said. “It really is a match made in heaven.”
Timoney’s bullishness didn’t stop at Ranch Water. She’s high on AriZona SunRise Hard Seltzer, as well as the Heineken and Dos Equis brands. In her usual candor though, Timoney admitted that there is “work to do” on Tecate.
The 60-minute meeting Thursday with the company’s central region wholesalers reinforced much of HUSA’s plans that were first articulated last October during its national sales meeting, with a few additions.
Timoney’s ask of HUSA’s wholesalers was to focus on both the company’s core brands — Heineken, Dos Equis and Tecate — as well as innovations such as the Dos Equis Ranch Water, AriZona SunRise Hard Seltzer, Dos Equis Lime & Salt and more.
“We have to do it all,” she said, emphasizing that this isn’t an either or proposition for the company.
Among the biggest 2021 plays for HUSA is its partnership with AriZona Beverages on the SunRise Hard Seltzer brand. HUSA sees an opportunity to bring existing AriZona drinkers, including multicultural and urban consumers, into the hard seltzer segment with the product, Jenna Behrer, VP of marketing innovation and activation, said.
“One of the reasons we really believe we can win here is all about the AriZona brand,” she added. “Massive brand reach nationally throughout the country, massive brand in convenience, where hard seltzer hasn’t been able to massively penetrate. And so, we know that there’s a lot we can drive. And finally anchoring on our real point of difference, which is our splash of real fruit.”
The word “real” will be omnipresent in the marketing of SunRise through digital media, in-store branded items, sampling, influencer partnerships and, when possible, events.
“Our communications campaign is all about ‘for the real,’ which really nicely ties in the real fruit in AriZona Sun Rise to the real content that consumers are looking for in a brand for the 21st Century,” Behrer said.
HUSA chief sales officer Jim Sloan shared that SunRise will be produced in Europe and imported into the U.S. due to Europe not facing the same aluminum supply crunch as North America. As such, SunRise will rely on the supply chain in the Netherlands and then move into the Heineken wholesaler network in about 97-98% of the markets.
“It’s by far the most efficient way for us to get product into your barn,” Sloan said.
HUSA chief marketing officer Jonnie Cahill rolled through the slate of innovations, while acknowledging that not all of them would stick.
“We want to give ourselves multiple opportunities to win, multiple opportunities to have the home run,” he said.
A big home run thus far has been Heineken 0.0, which is now the No. 1 non-alcoholic beer in the U.S., topping 2.5 million cases in 2020. All of that was done in 6-packs to get consumers to try the product, Cahill said.
“We’ve said this 100 times, there is limitless upside opportunity on this product,” he added. “The wellness trend continues; 30% of people who try this come back and buy it. So we’ve just got to get it into people’s hands.”
As such, HUSA is launching 12-packs cans of 0.0, which Cahill called the “workhorse of the non-alc segment.”
Meanwhile, Heineken original sleek (slim) can 12-packs are rolling out in the Florida market “at scale,” Cahill said.
“We’re gonna get firm facts, firm data on rate of sale, incrementality, and then we will be back to you in the summer to say what’s the play for next year,” he said. “Whether we introduce this in addition to, instead of, in partnership with in certain channels.”
Those efforts are all about making the right decisions “with a can that we know drives equity, but we also want to make sure that it drives volume sales on the floor.”
As for the details on Dos Equis Ranch Water Hard Seltzer, the product will launch in mid-April in Texas in one flavor, classic lime, in 12 oz. 6-pack and 24 oz. single-serve cans. The company described the product as inspired by “the classic West Texas drink: tequila, sparkling mineral water and lime.”
“It’s ready to go,” Cahill said. “Bringing together something that’s quintessentially Texan with a brand that’s truly loved in the market. And let’s not B.S. each other. There are other ranch waters in the market, and they are good products. But we’re bringing a massive loved brand to the category and that’s a game changer for your customers.”
Other Dos Equis innovations include a Lime & Salt line extension, which is now on the market in 12 oz. 6-pack and 24 oz. single-serve cans as primarily a convenience play.
“We will make sure you have the format’s you need to win and convenience,” Cahill assured wholesalers.
Lime & Salt is just the start. A variety 12-pack also features three additional flavors: watermelon, cucumber and pineapple. Each of those flavors are potential candidates for single-serves in the future if they gain traction, Cahill added.
HUSA is also refreshing Dos Equis Ambar Especial, with a goal of challenging Modelo Negra. The brand is being tested in cans in the west and the southeast, Cahill said.
The plan for Tecate remains to challenge Michelob Ultra with the new brand Alta, which is 85 calories and 2.4 grams of carbs. Cahill highlighted the 10 calorie difference between Alta and Michelob Ultra.
“It is a beautiful functional beverage,” he said. “The beer is terrific, wrapped in a Mexican soul. And we’re very excited by what this might do. But let’s also be honest: Everything we sell here is upside because this will source volume directly from Michelob Ultra. That’s where consumers are going to come from. So in most cases that’s a win for many of us.”
Canijilla, HUSA’s other play in the FMB and seltzer space, has performed well in the Southern California and southern Texas test markets, including outselling Truly Hard Seltzer in 6-packs in HEB stores, Cahill said. That test is being extended through the Dallas market, and the company is adding 24 oz. single-serve cans.
“We know that this is resonating, and we know that it’s turning, and we think that the 24 oz. can is going to blow the doors off,” he said.
Cahill added that the early returns are good for Merchant’s Hard Lemonade and Peach Tea, which are being tested in the southeast and Connecticut.
Finally, Almazul, a line of ready-to-drink canned cocktails (three flavors: margarita, paloma, cantarito), and Comb & Hive sparkling honey wine will be launching in test markets in the second quarter.