Despite the overall volume decline of the U.S. beer market, competition from spirits, and the category’s difficulty appealing to emerging legal drinking age (LDA) consumers, a number of brands posted impressive rates of growth last year and demonstrated that with the right product attributes and marketing, share gains are achievable. Impact’s “Hot Brands” for beer, cider, and flavored malt beverages (FMBs) comprise a mix of returning labels and first-time honorees, all of which dramatically outperformed the at-large beer category last year and brought excitement to marketers, distributors, retailers, and consumers alike.
Hot Brand honors are awarded to established brands with double-digit growth in 2020, 2021, and 2022; established brands with at least 15% growth last year; brands among the top ten in their respective categories with at least 5% growth in 2022 and at least 15% growth since 2019; and significant new products. Twenty-seven beer, cider, and FMB brands met the Hot Brands criteria last year, including 18 returnees and ten first-time winners.
Not surprisingly, FMBs led the charge in number of honorees, accounting for half of the lot. But in a nod to the trendiness that defines the category, FMBs were also prominent among the 19 brands that dropped off the list from 2021. Several marketers boasted multiple winners for 2022, including Anheuser-Busch InBev (A-B InBev) and Constellation Brands—both with five awards—Diageo Beer Co. with four, and Molson Coors Beverage, Mark Anthony, and New Belgium Brewing, each with two.
Mexican Beers Dominate
Mexican beers, led by Constellation Brands’ Modelo Especial, remain on fire. All six of the imported brews named Hot Brands hail from south of the border; five are marketed by Constellation and one is from A-B InBev. Combined volume for the six brands increased 13.7% last year, an acceleration over both 2020 and 2021.
For the second year in a row, Modelo was the top volume label among beer Hot Brands, reaching 179.7 million (2.25-gallon) cases in 2022. Indeed, the perennial award winner is ten times the size of the second-largest imported Hot Brand, portfoliomate Pacifico, and accounts for nearly 80% of the segment’s Hot Brand volume. With such huge volume figures—2022 marks its 29th consecutive year as a Hot Brand—it was just a matter of time before Modelo’s growth rate slowed, and last year it slipped to a single-digit rate, with volume up 9.3%. Still, the Mexican brew jumped into the No. 3 position among all beers sold in 2022, according to Impact Databank.
Vice president of brand marketing for Modelo Greg Gallagher attributes the brand’s phenomenal run to its focus on growing its consumer base and advertising efforts. “Modelo Especial continued to expand our reach within the general market while keeping the core Hispanic consumer top of mind,” he says. Gallagher also points to successful marketing campaigns aiding the brand’s growth, including its continuation as the official beer sponsor of the College Football Playoff and Cinco de Mayo programming.
Sibling Modelo Especial Chelada once again posted the highest rate of growth among imported Hot Brands—and an accelerated one at that—as volume surged 46% last year to 16.7 million cases from 11.5 million in the previous year. “We continue to launch new flavors and formats and strengthen our media investment, which has helped Modelo Chelada maintain its ranking as the No. 1 ready-to-drink michelada brand in the category,” Gallagher notes. In 2022, for example, the company launched the Naranja Picosa expression, combining the Mexican brew with the zesty flavors of orange and a hint of spice. Packaging has also been expanded with new 12-packs of the Limón y Sal variant, as well as variety packs. Yet another Modelo family member, Negra Modelo, joined its siblings as a Hot Brand, with volume surging 19% to 6.3 million cases last year.
Constellation’s Victoria was just behind Modelo Especial Chelada in growth with a 41% jump in volume to 4.4 million cases last year, and the label—new to Hot Brands in 2022— appears to be benefitting from a push similar to the one that has worked for years for Modelo. “We’re advertising more with Spanish language and expanding our reach in that market with our new partnership with Grupo Firme, one of the most popular acts in Latin music today,” explains Ryan Anderson, senior director of brand marketing for Pacifico and Victoria. The launch of the brand’s first line extension, Vicky Chamoy, featuring chamoy and tamarind, is also contributing to Victoria’s performance, Anderson notes.
Growth for Pacifico, meanwhile, accelerated last year, soaring 30% to 17.7 million cases. Anderson attributes the performance to the brand’s growing popularity with young LDA consumers, a group that has befuddled many beer brands. “We’re focused on the LDA ‘Zillennial’ consumer and leaning in even more in the digital and social space since that’s where they’re spending their time,” he says, noting that marketing for the brand promotes outdoor living.
A-B InBev’s Estrella Jalisco is the sixth imported beer on the list for 2022, with volume jumping 38% to 1.7 million cases, an acceleration versus the year earlier. Available in the U.S. since 2015, the brand partnered with Mexican soccer player Alexis Vega last year to promote watch parties during the FIFA World Cup.
Cream Of The Crop
Unlike Mexican brews, domestic brands in the U.S. have found growth challenging in recent years. Large, mainstream brews have faced competition from imports, craft beers, FMBs, spirits, and most recently RTDs. Even craft beers—particularly long-established brands—are struggling, victims of an over-saturated market and a consumer base pushing back on high-abv brews, not to mention lingering impact from the Covid-19 pandemic. As a result, just five domestic beers were named Hot Brands for 2022, with A-B InBev’s Michelob Ultra the only national, mainstream brew of the group. The brand had another strong year with volume rising 8% to 169.8 million cases, and it moved into the No. 4 position among beers in the U.S. from No. 5 in 2021. Michelob Ultra continues to be marketed with tie-ins to sports and fitness; this year, the brand has signed on as the first major sponsor of the Women’s Sports Network.
While much smaller in volume, Yuengling Flight is another light beer that returned as a Hot Brand in 2022. The D.G. Yuengling & Son product saw volume jump 25% to 1.9 million cases. “We spent more than a year perfecting Flight by Yuengling, and it has since become the fastest growing beer in our portfolio,” notes Wendy Yuengling, chief administrative officer at the Pennsylvania brewery.
Among craft brews, New Belgium’s Voodoo Ranger franchise continues to distance itself from the competition. Voodoo Ranger Imperial IPA returned as a Hot Brand in 2022 and was joined by the newly introduced Juice Force Hazy Imperial IPA. “2022 was Voodoo Ranger’s best year ever for both our new and existing beers,” says brand manager Michelle Robertson. Voodoo Ranger Imperial held its position as the company’s top-selling brand, Robertson continues, while “the launch of Juice Force surpassed expectations,” recruiting both existing and new consumers to the brand family.
Athletic non-alcoholic craft beer rounds out the roster of domestic Hot Brands for 2022. Capitalizing on the no- and low-alcohol movement, Athletic saw volume more than double last year to 2.3 million cases. Unlike licensed beverages, non-alcoholic brews like Athletic can be easily sold in all manner of trade channels, including health clubs, delis, and state parks, as well as online, and Athletic co-founder and CEO Bill Shufelt says the company will leverage the opportunity. “Awareness is still low,” Shufelt notes, and as a result, the company is focusing on “awareness and distribution” in 2023.
Twisted Tea Party
FMBs continue to redefine themselves, and that’s evident from the group of 14 brands from seven suppliers named as FMB Hot Brands for 2022. The collection includes not just hard seltzers, but hard teas, hard sodas, ranch waters, and even a malt-based version of a popular spirits brand. Nine brands repeated as Hot Brands while five new labels were added. Among the labels honored are four brands from Diageo Beer Co.—Smirnoff Ice Smash, Lone River ranch water, Smirnoff Ice Neon, and Smirnoff Ice pink lemonade—and three from A-B InBev—Bud Light seltzer hard soda, Karbach ranch water, and Margaritaville.
While Truly hard seltzer dropped off the list in 2022, Boston Beer’s Twisted Tea returned as volume surged 27% to 33.1 million cases. That followed growth of more than 30% in 2021. Indeed, the brand accounted for nearly half the volume of all FMB Hot Brands combined. “We’re driving continued growth by welcoming more people to Twisted Tea than ever before,” says brand director Erica Taylor. “Broadening our reach to introduce the brand to new drinkers, increasing our media and sponsorship investments, and supporting the brand all year long has allowed us to expand our footprint and drive significant awareness across the country.”
FMB rival Mark Anthony Brewing had two Hot Brands with the returning Cayman Jack and first-time honoree White Claw Surge. Cayman Jack jumped 46% last year, and the company sees continued opportunity. “We believe there’s a long runway for growth on Cayman Jack by expanding our core distribution and awareness, along with innovation that drives incrementality,” Mark Anthony chief commercial officer David Barnett recently told Market Watch sister publication Shanken News Daily. White Claw Surge, meanwhile, with a higher abv than its parent brand, reached 5.9 million cases in its second year on the market.
The FMB category continues to attract the attention of major beverage companies, among them Molson Coors, which most recently has partnered with Coca-Cola for spiked versions of non-alcoholic drinks. Topo Chico hard seltzer returned as a Hot Brand in 2022 and was joined by the new Simply Spiked. Among the other FMBs to return to the list was Sazerac Co.’s malt-based Fireball Cinnamon, which has enjoyed expanded distribution in recent years.
Two hard ciders also repeated as Hot Brands—Vintage Wine Estates’ Ace and 2 Towns Ciderhouse’s 2 Towns. According to Ace senior vice president Tracey Mason, in 2022 the brand benefitted from the company’s “focus on driving efficiencies in production to improve output and eliminate out-of-stocks,” as well as emphasis on chain distribution and growth of its sales team. Lee Larsen, CEO and co-founder at 2 Towns, meanwhile, points to strong trends for its Original Cosmic Crisp Imperial cider and its variants for helping the company “meet the market demand of consumers looking for authentic fruit-forward ciders at a higher abv.”
Given the overall trends for U.S. beer, the performance of these 27 Hot Brands is cause for celebration and an example to all beverage alcohol marketers that quality brands with the right focus can succeed no matter the environment.