Lone River Beverage Company has come a long way in a short amount of time.
Acquired by Diageo less than two years after launching amidst the pandemic, Lone River’s Ranch Water is now sold nationwide and leads the agave seltzer category in dollar share and rate of sale, according to latest 13-week NielsenIQ data shared by Lone River founder and CEO Katie Beal Brown.
Over the last 12 weeks, Lone River Ranch Water has tripled its dollar share of the total hard seltzer segment, making it the eighth best-selling hard seltzer brand in off-premise retailers, with nearly a 1% share of the segment, according to the market research firm.
Going into Year Three, Diageo-backed Lone River is pushing harder into the agave hard seltzer segment with the nationwide launch of Ranch Rita, a margarita-style beverage inspired by the classic cocktail.
Speaking to Brewbound, Beal Brown described Ranch Rita as a “hybrid between an FMB and a seltzer.”
“With Ranch Rita, we saw a whitespace of consumers looking for that fuller flavor, but also wanting a little bit of the health benefit that you get from a seltzer,” she said. “So, we wanted it to taste like a real margarita, but not be loaded with sugar and calories that you even see a lot of times in restaurant-style margaritas.”
Ranch Rita — made with organic agave nectar, key lime juice concentrate, carbonated water and alcohol — checks in at 6% ABV, 150 calories and 12g of carbs per 12 oz. can — making it a fuller-flavored beverage compared to Lone River’s original Ranch Water (4% ABV, 80 calories and 3g of carbs). The new offering began hitting retailers this month in 12 oz. can 6-packs (suggested retail price of $10.99) and single-serve 16 and 23.5 oz. cans.
Citing NielsenIQ data, Beal Brown said that agave-style seltzers are contributing 97% of the total hard seltzer category growth. And she sees not only an incremental consumer opportunity with Ranch Rita but also incremental occasions for existing consumers.
“If you look at that and the opportunity, I think we’re just at the tip of the iceberg,” she said.” “And it’s something that we want to continue to grow, not only through our core with Ranch Water, but also through innovation like Ranch Rita that we believe we can really authentically own.”
That authenticity comes from the origins of the margarita in Far West Texas, similar to Ranch Water, she added. Beal Brown said Lone River is giving consumers something more to connect with through its storytelling of the product’s origin and the culture of West Texas.
Ranch Rita was being concepted before Diageo’s acquisition of Lone River, Beal Brown said.
“I feel like we’ve pioneered this agave-style space, and what I could have never imagined is going from a single brand and then it developing into a category,” she said. “With Ranch Rita, we see an opportunity to continue growing that category, which I believe is still in its infancy, but contributing a lot of growth to hard seltzer as a whole.”
Ranch Rita’s launch will be backed “by a multi-million dollar advertising campaign” featuring Yellowstone star Ryan Bingham and actress Sulem Calderon that will go across TV, digital, social media, out-of-home and point-of-sale through the summer.
Despite increased competition from several new ranch water brands, Lone River has “continued to be the dollar share leader on a national level, as well as lead in rate of sale,” Beal Brown said. In the company’s home state of Texas, Lone River is still 2.5x bigger than its nearest competitor.
Even as spirits-based canned cocktails have gained traction, Beal Brown said she sees “a lot of growth” opportunities in the agave-style “malt side of the category.”
“It’s exciting when you think about the future growth of not only our brand, but the category itself that we’ve really been driving from our side,” Beal Brown said.