With the RTD category at peak saturation, retailers and distributors want to know brands can bring incremental consumers – otherwise they’re not taking any chances, shared Cassie Finley, VP of customer development at Southern Glazer’s Wine and Spirits during the 2024 Winter BevNET Live conference in Marina Del Rey.
That means brands need to scale by growing where they are planted and focus on their customers, rather than splitting velocities.
“Be very targeted, start with the consumer, always,” she said. “And then if you grow in those markets and really get your velocity up, you’re going to find you’re not beating down the buyer’s door, they’re actually calling you.”
Finley discussed the opportunities and challenges when an RTD brand starts to scale alongside Forrest Dein, co-founder and CMO of JuneShine, the 14th largest beyond beer and spirits-based RTD brand family in the country; and Adam Kost’s Dirty Shirley which turned a nostalgic bar call into a canned cocktail that’s grown 800% over last year with coverage in 25 states.
But how these brands moved into new markets depends: As the first hard kombucha, JuneShine took a wide approach by opening 30 states in two years, and Dein advised that if brands have the opportunity to build a category they should raise the money to do so. But he echoed other panelists to own their own backyard first if entering a crowded space.
For Dirty Shirley, the RTD earned a social media-built demand from Gen Z, giving the brand “market validation” so scaling quickly was risky but was about “giving the people what they want,” said Kost.
“You have a very short period of time to meet consumer demand, and you’ve got to explore that as fast as you can,” he said.
There are other lessons learned too about how to spend for growth: JuneShine went from looking at its full profit and loss statement to splitting it up with specific margins for each region, aiding the company to cut back and get profitable. Kost operates with the philosophy that “one person in the market is not scalable” and instead invests in incentives, display activity, marketing and relying on his distributors’ salesforce.
Rewatch the full panel to hear more from the group, including how brands should cross over into a new category, when innovation is necessary, and why founders may have to say no to big “shiny” opportunities.