Beverage Dynamics July 2023 | Page 18

The consistent trend over the past few years has been towards cleaner options without a lot of additives and sweeteners .

– Bryce Morrison , Co-founder and CEO of Mom Water and Dad Water

actively involves himself in the ongoing strategy and decision-making of the company ,” says Duan . “ This level of commitment has resonated with the public and played a significant role in the resounding success of Teremana .”

RTDS REMAIN POPULAR

Recently , hoping to pare down my embarrassingly large whiskey collection , I brought two superb bottles ( Compass Box No Name No 2 , Remus Repeal Reserve VI ) on their final pours to a friend ’ s birthday party . Ten people attended , all Millennials , mostly lawyers . But only one other person drank whiskey . Everyone else had canned cocktails or hard seltzers ( between many , many cigarettes , of course ; lawyers .)

Which is to say that the trend of convenient , canned alcoholic beverages is still strong in 2023 . Often at the expense of wine and beer .

“ RTDs , spirit-based in particular , allow for varied flavor combinations , product stability and ingredient quality that can ’ t be matched with a fermented product like wine or beer ,” says Bobby Rohla , Insights , Innovations & Distillery Manager , Devils Backbone Brewing Company . “ For example , an orange sparkling RTD will taste like orange without having to mask or complement some underlying flavor profile , while offering greater shelf stability over time . This makes it much easier to focus on developing thoughtful brands , purpose-built for variety , to address consumer preferences and key occasions .”

Try as we may in the media , enough cannot be said about the convenience of RTDs .

“ RTDs are great when you want ease-of-use options . The beach is one of these places , which is why Fourth of July weekend , Memorial Day and Labor Day are top-performing weeks for RTDs in the off-premise channel ,” says Scott Moore , Southern Glazer ' s SVP National Accounts Off Premise . “ Regardless of holidays and special occasions , 73 % of RTD drinkers consume at home , and of those , 24 % prefer RTDs over making cocktails from scratch .”

As elsewhere , premiumization and younger LDA consumer trends shape the RTD category .

“ I think like anything else in the alcoholic beverage world , consumers are choosing quality products and brands that they can relate to ,” says Bryce Morrison , Co-founder and CEO of RTD brands Mom Water and Dad Water . “ The consistent trend over the past few years has been towards cleaner options without a lot of additives and sweeteners . Lower ABVs seem to be growing in popularity as well , so people can enjoy a few drinks .”

But with the continued growth of RTDs comes an awkward fit on the retail floor .

“ The primary importance is cold box space for RTDs ,” says Moore of Southern Glazer ’ s . “ Wine and spirits-based products need to have their proper share of space , specifically in what has been previously dominated by beer , which will be important to ensure our retailers maximize their financial potential .” How much growth is left for this category ? “ Over the next five years , a 10 % CAGR in value is plausible for the U . S . spirit-based RTD segment ,” suggests Rohla of Devils Backbone . “ This will be driven by flavor quality , variety , and demographic shifts . RTDs over-index with women , Millennials and Gen Z consumers , and more importantly , the category resonates with a more racially and ethnically diverse consumer base relative to conventional beverage alcohol , especially wine and beer .”

What ’ s clear is that RTDs are here to stay , thanks , in part , to a Covid-caused shift in consumer perception .

“ The pandemic took our whole industry and put it in a box , shook it up , and then poured it back out , and the pieces are now

18 Beverage Dynamics • July 2023 www . beveragedynamics . com