There is quite a buzz around RTD Cocktails and its boom on the scene in 2021. Some analysts are studying social media conversations to predict the growth potential of the new segment. According to Barron’s, Instagram conversations about prepared cocktails is at about 40% of hard seltzer, but higher than the take off period. RTD and other alcoholic beverages continue to see growth in small format independent stores, due to less drinking at bars and restaurants during the pandemic. Some concerns about shelf space and new options on scene have caused people to wonder if this would slow down hard seltzer.
Through the first quarter 2021, that is not the case. Using same store sales, hard seltzer is almost double first quarter 2020, compared to traditional beer sales that are up 5.6%. This has continued to be quite the phenomenon. It goes to show that merchants will continue to make space for what is selling. Across the network of National Retail Solutions (NRS) Stores, the selection of hard seltzer items has increased by 50%.
The hard seltzer gains are the biggest increase across any segment in the stores. In small format stores with limited shelf space, the growth of hard seltzer has compressed some non-alcoholic beverage segments. Even though dollar sales are up, categories like soft drinks, fruit drinks, liquid tea, and sports drinks have seen a decline in the number of items carried.
Not only have merchants taken notice, but everyone seems to want in on the latest seltzer fizz. In 2019, White Claw was 71% of the hard seltzer segment. The number of manufacturers of hard seltzer has almost doubled, and the number of unique items has increased 35% in first quarter 2021 compared to last year. White Claw still owns the lion share of the segment, but in first quarter it is down to 51% of all hard seltzer. It has been a segment where a variety of flavor and innovation have driven sales.
Assorted packages across all manufacturers are up 122%. Brands like Truly have captured consumer purchases launching new line extensions. The lemonade and tea varieties make up two-thirds of Truly’s impressive growth selling two and a half times last year.
Brand Influence
It will be interesting to see the impact of all the moving pieces for the rest of 2021. As traditional brands such as Bud Light, Corona, Coors, and others increase distribution of hard seltzers who will win the taste of consumers and the shelf space battle? Will a potential shift back to drinking at bars and restaurants, cause the small format channel to see a slow down? Typically, as the weather gets warmer, hard seltzer sales drastically increase, will the re-opening of America lead to more drinking at picnics and tailgating? Will the segment continue to bubble up in the NRS Network? Also, it makes sense to understand consumer trends if RTD cocktails will follow the same trajectory.
National Retail Solutions (NRS) operates a point-of-sale (POS) terminal-based platform for independent retailers and bodega owners nationwide. In almost 11,000 individual outlets, the platform provides a robust portfolio of tools to help these retailers compete more effectively in the marketplace including an integrated rewards program, consumer promotions, and DOOH shopper facing advertising screens. From the scanner data collected across its network, these unique insights were gleaned about the Hard Seltzer growth in the Bodega/inner-city C-Store merchant. For more information on your categories and brands, please contact Brandon Thurber, directors of media measurement and scan data insights for NRS, at [email protected]
