Seltzer is an equal opportunity category disruptor, stealing share most notably from beer, but from cider, spirits, and wine as well. The category has successfully capitalized on larger trends of health and wellness, enticing consumers with its low-cal, low-alcohol proposition. The hard seltzer segment is now swarming with clones honing in on a formula: sugar fermentations filtered to taste neutrality, infused with “natural flavors,” such as black cherry, and packaged at 5 percent ABV and 100 calories (or even less). Financial advisory firm Evercore ISI recently predicts hard seltzer will grow 144 percent this year, and reach 11 percent of the beer industry’s total volume by 2022. According to Nielsen, 2019 sales of hard seltzer in off-premise channels rose more than 300 percent, topping $1.5 billion in sales. Hard seltzer, a carbonated beverage typically made by fermenting sugar, burst onto the scene in 2013 with Spiked Seltzer (which became Bon & Viv), and seemingly overnight morphed into a pop-culture phenomenon, powered by the twin engines of White Claw, from Mark Anthony Brands, and Truly, from the Boston Beer Company. Gallo’s Barefoot Hard Seltzer is new this year, and based on wine. As the category matures and consumers become more demanding, which direction will the category take? How does a brand gain a competitive edge when the objective is flavored, bubbly water that cloaks the taste of alcohol?
It’s a branding arms race, as beverage companies try to break away from the pack with new flavors, fresh fruit infusions, sports partnerships, and alternative sources of alcohol.īut even rapidly growing categories can become too crowded, and many of these beverages will fail. Hard seltzer is still in a rush-to-market phase, and though Bud Light Seltzer may be the most significant new player, it’s but one of dozens of new brands: Nielsen predicts the players to double in 2020 alone. He does not see hard seltzer as a soon-to-fade beverage trend such as alcoholic sodas or root beer: “It’s a reestablishment of the industry.” Goeler hopes it has a halo effect on the entire company, reengaging Bud Light drinkers. Facing declining sales for its workhorse, Bud Light, Anheuser-Busch InBev (ABI) has leaned hard into seltzer, with Bon & Viv Spiked Seltzer, Natural Light Seltzer, and now Bud Light Seltzer, which was in development for 18 months. Because the federal Alcohol and Tobacco Tax and Trade Bureau (TTB) classifies malt- and sugar-based hard seltzers as beer, they are taxed and distributed like beer (rules vary by state). Recently launched Bud Light Seltzer is already the third largest hard seltzer brandīrewers large and small are beginning to see seltzer’s potential to “bring people back into beer from spirits and wine,” says Bud Light’s Goeler. Instead of simply surfing the wave, he said, “we’re bringing our biggest brand into the category to really help it grow.” “The seltzer craze is on,” says Andy Goeler, vice president of marketing for Bud Light.
Within weeks of its launch, the Bud Light–branded seltzer became the third largest brand in the exploding hard seltzer category. “If you don’t love Bud Light, you’ll love Bud Light Seltzer,” promises the mayor. Surprise! It’s Bud Light Seltzer, a 100-calorie spinoff sold in four fruity flavors that “taste great,” irrespective of your opinions on low-calorie lager. This winter’s National Football League playoff season featured a different kind of Budweiser commercial: Randy Diaz, the fast-talking fictitious mayor of Seltzer, Pennsylvania, professing affection for Bud Light, as well as another beverage inside a slim, lanky can. Photos courtesy of Truly, White Claw and Barefoot Hard SeltzerĪs brands proliferate, beer and wine companies push the category in new directions to gain a competitive edge
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