Todd Randall, the president of Randall’s Wines & Spirits in Fairview Heights, Illinois, believes the next few months will be telling for spirits-based, ready-to-drink cocktails. “I think this summer will tell us how big this market will be based on how much customers embrace or don’t embrace spirits-based RTDs compared to seltzers,” he says.
For now, Randall says his store is “embracing the variety of the selection and letting customers have more options,” a move that can be overwhelming for retailers. The number of new spirits-based RTDs launched in the past five years is astonishing, and along with new brands there is a constant churn of new flavors from existing brands, making for a crowded and sometimes daunting marketplace.
“This has quickly become a very crowded category,” says Hannah Venhoff, group product director at Heaven Hill Brands, which is launching a new range of RTDs this year for both Pama Pomegranate liqueur and Heaven Hill whiskey. The company already markets its Deep Eddy vodka ready-to- drink line, which launched in summer 2021 with Ruby Red and Lemon, and will add a Lime flavor soon. Deep Eddy carries a suggested retail price of $12 a 4-pack of 12-ounce cans and is rolling out nationally this spring.
Heaven Hill is not alone in its push for more brands in the sector. Many of the world’s biggest spirits brands—whiskies like Jack Daniel’s, Jim Beam, and Jameson; vodkas including Cîroc, Absolut, and Ketel One; and Tequila brands such as 1800 and Jose Cuervo—are trying to capture a slice of this burgeoning category. And along with those established brand-focused labels are spirits-based RTD brands that aren’t tied to a particular base spirit. It’s a crush of brands and products, all eager to capture the attention of consumers who’ve embraced the format.
The enthusiasm from brand owners isn’t surprising given the volume numbers that leading brands in the category are racking up. Seventeen leading brands combined for a 73% increase to 27.43 million 9-liter cases in 2021, according to Impact Databank. About half of those brands have launched just in the past five years, and beyond them there are plenty of others jockeying for retailer and consumer attention.
Among the 17 leaders, only two lost volume, and both are long-standing brands that have been somewhat eclipsed by newer entrants. That said, one of those brands, Jose Cuervo Margaritas, remained the second-largest spirits RTD cocktail in 2021, second only to Spirit of Gallo’s High Noon Sun Sips Seltzer.
High Noon hit the market in 2019 and by 2021 had risen to 8.84 million cases, by far the largest brand in the sector, according to Impact Databank. After High Noon and Jose Cuervo, there were four other brands whose case volume exceeded 1 million cases last year: Cutwater, Monaco, 1800 Ultimate Margarita, and Devils Backbone.
Product Push
Those brands are being challenged by the slew of new entrants, many of which carry the names of some of the market’s biggest brands. Diageo offers a range of branded spirits-based RTDs, from whisky to vodka to gin. Crown Royal launched an RTD line last year and is expanding this year with a Whisky Lemonade ($13 a 4-pack of 12-ounce cans) variant. Whisky Lemonade joins a lineup that includes Peach Tea, Washington Apple, and Whisky & Cola. Elsewhere, Diageo—in collaboration with Cîroc brand partner Sean “Diddy” Combs—launched Cîroc Vodka Spritz RTD cocktails this spring. At $17 a 4-pack of 355-ml. cans, the line is available in four flavors: Watermelon Kiwi, Sunset Citrus, Pineapple Passion, and Colada. In addition, Ketel One and Tanqueray RTDs remain a priority for Diageo. The company’s presence in the sector expands beyond its well-known national brands, however. Last year, Diageo acquired Loyal 9 Cocktails from Sons of Liberty Spirits Co., and its national expansion began earlier this year.
Pernod Ricard USA also entered the ring recently with Jameson Ginger & Lime ($15 a 4-pack of 12-ounce cans). “For a few years, consumers abroad have enjoyed our refreshing Jameson Ginger & Lime cocktail in a can offering, so it was a natural next step for Jameson Irish whiskey to be the first Irish whiskey RTD available to consumers in the U.S.,” says Jameson senior brand director Kelly Suhr, noting the triple-digit growth of whisk(e)y-based RTDs, in particular, as a driving force behind the move. Currently the Jameson RTD is only available in the single flavor, but Suhr says the brand is “constantly looking for opportunities to innovate” and will continue to “find new ways for consumers to enjoy Jameson.”
Brown-Forman is also capitalizing on the demand for whisk(e)y-based RTDs, having launched an RTD line in 2020 that includes Jack Daniel’s Tennessee Whiskey & Cola, Jack Daniel’s Tennessee Honey & Lemonade, and Jack Daniel’s Tennessee Apple Fizz. The line, which first debuted in test markets in 2020 and 2021, was expanded nationally earlier this year.
Kelley Kerger, association brand manager for Jack Daniel’s RTDs, says the format offers opportunity to expand brand reach. “We know there is overlap between two audiences: whiskey drinkers in a ready-to-drink occasion and ready-to-drink occasion shoppers looking for a whiskey offering,” Kerger says. “We want to bring Jack Daniel’s whiskey to RTD consumers. We know RTD consumers are exploratory and want to try new things. We want those drinkers to experience the quality of Jack Daniel’s whiskey in a convenient, perfectly mixed whiskey cocktail.”
Early Education
Along with the line extensions from a slew of national brands, there’s a broad array of spirits RTDs whose branding is either tied to a craft distillery or unique to the RTD line. Some of these brands did the heavy lifting for the category, educating both the trade and consumers about spirits RTDs.
Virginia-based Devils Backbone Distilling is one that has broken through the clutter, with Devils Backbone RTDs ($13 a 4-pack of 12-ounce cans) surpassing the 1-million-case threshold last year, according to Impact Databank. The brand has regional distribution mainly on the East Coast of the U.S. Its initial flavors were Orange Smash, Grapefruit Smash, and Lemonade Smash when the line launched in 2018, and since then, Key Lime and various seasonal flavors have joined the mix.
Devils Backbone COO Hayes Humphreys notes that being early to the trend meant some education was necessary. “There’s a lot of consumer education that’s required, especially around the notion that when you buy these products you’re buying real spirits, real vodka in a can,” he says.
Fishers Island Lemonade has an even longer history in this nascent category. “When Fishers Island Lemonade debuted in 2014, we were the only canned cocktail brand being sold in the Northeast,” says founder Bronya Shillo. “I had to do an exorbitant amount of education around our product. Ironically, eight years since first launching Fishers Island Lemonade, I find myself still having to do much of the same education to retailers, distributors, and consumers.”
Capitalizing on the enthusiasm for the brand and category, the Fishers Island line was expanded last year to include Spiked Tea, Pink Flamingo, and Fizz, all of which have the dual vodka-whiskey base ($16 a 4-pack of 355-ml. cans). The company also launched Fishers Spirit Pops, a frozen option, in 2021. BuzzBallz is another pioneer of the current spirits RTD sector. Merrilee Kick, CEO and founder of Southern Champion and BuzzBallz, recalls that she was warned 12 years ago that her product would have a short life cycle. That turned out to be wrong. “Business is expanding into more stores and we’re available in every state now,” says Kick. “It took some time to get buy-in from chain stores. The customers also were a bit confused when they saw BuzzBallz for the first time, wondering what it was and if they had to mix it [with something]. Now, pre-mixed cocktails are very popular.”
The BuzzBallz line is a mix of wine-based and spirits-based options, with malt-based cocktails on the way. Kick says there are 15 flavors currently with more likely coming. The packaging is unique. BuzzBallz are sold in round, plastic bottles and are priced at $3-$4, while its Biggies are 1.75-liters for $15-$20. BuzzBallz’ unique packaging sets it apart, and many other brands are looking for a point of differentiation as well. Some brands are tapping into the health and wellness trend, with messaging focused on simple ingredients, low alcohol, or other attributes.
Volley Tequila Seltzer ($13 a 4-pack of 355-ml. cans) is one such brand. “The goal is to build the cleanest seltzer possible,” says cofounder Chris Wirth. Volley is made with Tequila, sparkling water, and juice. “We’re excited because natural flavors are the fourth most common ingredient in seltzers after sugar, salt, and water,” he says. “By using juice instead, we’re a completely different product from what’s out there.”
Saturation Point
There are, of course, many other spirits RTD brands, both national and regional, that are vying for consumer attention. The proliferation of brands and flavors is exciting but poses some logistical barriers. “I won’t sugar-coat it, it’s challenging,” says Heaven Hill’s Venhoff of the current competitive environment. “Shelf and floor space are limited.”
That said, some retailers are enthusiastic about the plethora of options. “I don’t feel overloaded with this category and abundance of brands and flavors,” says Kent Starr, owner of Liquor World in Fayetteville, Arkansas. “It’s hard to say what too many brands is. What will the next hot brand be?”
Tobin Sharp, creative director at Costa Mesa, California-based Hi-Time Wine Cellars, says his store has had to reorganize to accommodate all the new entrants. “There may be too many brands but the market ultimately will decide that,” he says. “We try to carry all that we can.”
Popular brands at Hi-Time include Ketel One Spritz ($14 a 4-pack of 355-ml. cans), Juneshine Spirits ($12 a 4-pack of 12 oz. cans), and Cutwater Spirits ($11). Sharp adds that customers are also showing interest in some higher priced RTD options. “High West’s offerings—Old Fashioned Barrel Finished Cocktail and Manhattan Barrel Finished Cocktail (both $37 a 750-ml.)—definitely have some fans in our store,” he says. “The Knob Creek On The Rocks Old Fashioned ($12 a 375-ml.) has also been received favorably.”
Cheers Liquor Mart in Colorado Springs, Colorado had to reset store shelves, too. “We’re in a bit of overload but we have made more room because of their popularity,” says owner Jack Backman. “We’re starting to phase out older brands that aren’t selling. We pride ourselves on variety so new brands are welcome in most cases.” However, a shake- out is occurring. “Name brands like Tanqueray, Bombay Sapphire, Jack Daniel’s, Bacardi, and Crown Royal are doing the best,” he notes. “Off-brands that started the trend are now struggling.”
In fact, retailers advise that strong support may be necessary to get consumer attention. “Eventually, you have to be a bit more selective as time goes on or you end sup with dead inventory and possibly out-of-date product,” Starr says. Tastings, displays, and marketing efforts from brand owners and distributors can greatly enhance the chance of success, he adds.
Randall of Randall’s Wine agrees, noting that distributor representation doesn’t automatically result in strong sales. “I wish there was a bigger push from the brands to want to sample their product, which shows they want to not only get the product on the shelf but also sell it though the registers,” he says. “This will also help them against the brands that have been here for a while.”