An onslaught of new products has given Impact’s annual list of ready-to-drink (RTD) and cider “Hot Brands” a dramatic makeover. Unlike the Beer Hot Brands, nearly all this year’s cider and RTD Hot Brand winners are new to the list, and 10 of last year’s 15 honorees have been displaced.
With its rapid growth in 2014, Anheuser Busch InBev’s (A-B InBev) Bud Light Lime Ritas range dominated that year’s RTD list with four entries. But in 2015, the line shed well over 2 million cases, and none of the offerings made the current list. Only one RTD from A-B InBev—Bud Light Mixxtail—earned Hot Brand recognition this time, and a repeat appearance doesn’t look likely. The line features 8-percent abv offerings that blend Bud Light with popular cocktail flavors, such as Hurricane and Long Island Iced Tea. After selling nearly 3 million cases in 2015—its first year on the market—Mixxtail is quickly losing ground. In the 12 weeks ending April 17th, 2016, the brand’s sales fell by more than 50 percent from the year-earlier period in IRI channels, which account for more than half of its business.
MillerCoors’ Redd’s range was also unable to sustain its past Hot Brands performance, as Redd’s Apple ale and Redd’s Strawberry ale both declined in 2015. However, Redd’s came back this year with three flavors on the Hot Brands list: Wicked Apple ale, Wicked Mango ale and Green Apple ale. The Wicked offerings boost alcohol content to 8-percent abv, compared to 5-percent abv for the core brand. Meanwhile, Green Apple ale appears to have offset the decline endured by the original Apple ale, getting off to a strong start in 2015. Two other 8-percent abv product ranges cracked the list: MillerCoors’ Steel Reserve Alloy Series and Prestige Beverage Group’s Extra Kinky, an extension of the 5-percent abv Kinky Cocktails line. The products were spun off from former Hot Brands Steel Reserve malt liquor and Kinky liqueur, respectively, and both offer an array of flavors.
Mike’s Hard Beverage Co., whose Mike’s Hard Lemonade has been one of the top RTD sellers for years, saw its new Palm Breeze line earn Hot Brand honors after selling more than 1 million cases in 2015. While Mike’s has traditionally been a hit with male drinkers in their 20s, Palm Breeze—which includes Pineapple Mandarin Orange and Ruby Red Citrus variants—has enjoyed early success with millennial female consumers due to its alignment with the hard seltzer trend.
Hard Sodas Bring Heat As Cider Cools
Hard sodas have become all the rage in the U.S. market, as evidenced by the two Hot Brands debuting on the current roster. Not Your Father’s Root Beer from Wauconda, Illinois–based Small Town Brewery was a runaway success in 2015, selling nearly 3 million cases. Early last year, Small Town inked an exclusive distribution deal with Pabst Brewing Co., and the 5.9-percent abv Not Your Father’s Root Beer is now available nationwide, with a 10.7-percent abv version and a Vanilla Cream Ale currently rolling out.
Not surprisingly, other players have quickly followed on Small Town’s heels. A-B InBev entered the hard soda space last fall with the launch of Best Damn Brewing Co. Meanwhile, The Boston Beer Co. subsidiary Alchemy & Science has had success with its Coney Island Hard Root Beer, which debuted in August and sold nearly 800,000 cases in 2015 despite limited availability. The new product has been among the few bright spots for Boston Beer, along with established RTD player Twisted Tea, which was up 16.5 percent to 9.8 million cases in 2015. Longtime Hot Brand Seagram’s Escapes and newcomer Jack Daniel’s Country Cocktails both showed solid gains. Also new to the list is Crabbie’s, a range of alcoholic ginger beer products from Scotland that’s shown an impressive rise since entering the U.S. market in 2012.
After years of outstanding growth driven largely by its Angry Orchard cider, Boston Beer hit a wall in the early months of 2016. The craft brewer’s overall depletions fell by 5 percent in the first quarter of the year, exacerbated by the struggles of the core Samuel Adams beer line and Angry Orchard’s slowdown. A flood of new entrants has reshaped the cider category over the past few years, led by A-B InBev’s Johnny Appleseed and Stella Artois Cidre brands and MillerCoors’ Smith & Forge. But cider’s growth slowed markedly in 2015, as Angry Orchard’s advance slid to low single-digits and other top-sellers declined. Still, three ciders earned Hot Brand nods: Strongbow, Ace and McKenzie’s. Both Strongbow and Ace were in the market years before upstarts like Angry Orchard took cider on a wild ride, and they continue to expand. McKenzie’s, meanwhile, is a promising new brand from upstate New York.
It remains to be seen whether the hard soda boom will last. But one thing is nearly certain: Next year, the Hot Brands list will look much different than it does now.
A full report on the latest list of beer “Hot Brands” appears in the June issue of Market Watch. Subscribe here today.