RTD Alcoholic Beverages - US - November 2019

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
Top takeaways
The issues
Consumers are drinking less alcohol
Figure 1: Alcohol consumption, September 2019
Desire for customization and sugar reduction challenge RTDs
Figure 2: Consumption barriers, September 2019
RTDs underperform other alcohol types on quality
Figure 3: Perception of flavored alcoholic beverages verses wine and spirits, January 2017-November 3, 2019
The opportunities
RTDs have solid retention and still have room for growth, especially among 35-44s
Figure 4: Interest in RTD alcoholic beverages: “I have not tried and am interested in trying,” September 2019
Preference for drinking at home benefits RTDs; on prem is a growth opp
Figure 5: beverage consumption in the past three months, by location, July 2019
Hard seltzers appeal similarly to men and women
Figure 6: Share of RTD alcoholic beverage consumption – any frequency, by gender, September 2019
THE MARKET – WHAT YOU NEED TO KNOW
FMB sales continue to climb
Prepared spirits-based cocktails post gains, wine coolers could follow
One in five drinkers has reduced alcohol consumption in the past year
RTDs pose the most direct challenge to beer
Preference for drinking at home benefits RTDs; on prem is a growth opp
MARKET SIZE AND FORECAST
FMBs continue to climb
Figure 7: Total US volume sales and forecast of flavored malt beverages, 2014-22
Figure 8: Total US volume sales and forecast of flavored malt beverages, 2014-22
Prepared spirits-based cocktails climb out of slump
Figure 9: Total US volume sales and forecast of spirits-based prepared cocktails, 2014-22
Figure 10: Total US volume sales and forecast of spirits-based prepared cocktails, 2014-22
Wine cooler sales small and shrinking; it doesn’t have to be this way
Figure 11: Total US volume sales and forecast of wine coolers, 2014-22
Figure 12: Total US volume sales and forecast of wine coolers, 2014-22
Growth segments innovate with new products
Figure 13: RTD alcoholic beverages, by launch type, 2017-19*
MARKET BREAKDOWN
Preference for drinking at home benefits RTDs; on prem is a growth opp
Figure 14: beverage consumption in the past three months, by location, July 2019
Figure 15: RTD alcoholic beverages purchase location, September 2019
Room for on-premise branding exists
Figure 16: Opinions toward hard seltzer - vessel, by hard seltzer consumption, September 2019
MARKET PERSPECTIVE
Beer maintains market dominance, spirits sales to overtake wine
Figure 17: Share of US sales of alcoholic beverages, by type of alcoholic beverage, 2014-19 (est)
RTDs post consumption gains while other categories lag
Figure 18: Alcohol consumption, September 2019
Figure 19: Changes in alcohol consumption, September 2019
RTDs pose the most direct challenge to beer
Figure 20: Bon & Viv Spiked Seltzer – “No Lime Needed,” April 2019
Figure 21: Alcohol consumption – any frequency, by RTD alcoholic beverage consumption, September 2019
Figure 22: Changes in alcohol consumption, by age, September 2019
Sparkling wine drinkers are strong targets for RTDs
Figure 23: RTD alcoholic beverage consumption – any frequency, by alcohol consumption – any frequency, September 2019
RTDs outperform other alcohol on flavor, refreshment, and excitement; underperform on natural
Figure 24: Perception of flavored alcoholic beverages verses beer, January 2017-November 3, 2019
Wine losing out on excitement, but outperforming RTDs on quality and value
Figure 25: Perception of flavored alcoholic beverages verses wine, January 2017-November 3, 2019
Figure 26: Perception of flavored alcoholic beverages verses spirits, January 2017-November 3, 2019
MARKET FACTORS 
One in five drinkers has reduced their consumption in the past year
Figure 27: Change in alcohol consumption, July 2019
Flavor is the leading driver of drink choice
Figure 28: Alcohol statements – choice – Net: any agree, September 2019
Figure 29: Alcohol statements – choice – Net: any agree, by RTD alcoholic beverage consumption (Net*), September 2019
RTD drinkers are more likely than average to look at drink nutrition
Figure 30: Alcohol statements – health – Net: any agree, September 2019
Figure 31: Alcohol statements – health – Net: any agree, by RTD alcoholic beverage consumption (Net*), September 2019
The majority of drinkers are making choices in the moment
Figure 32: Alcohol statements – options – Net: any agree, September 2019
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Hard seltzers drive strong MULO gains for FMBs, led by White Claw
RTDs missing out on low/no sugar claims
Big guys play catch up
From seltzer to spritzer
 WHAT’S WORKING
Hard seltzers drive strong MULO gains for FMBs, led by White Claw
Cape Line comes out strong in the premixed cocktail/coolers space
Small brands see the highest percentage of cocktail/cooler growth during the period
Tropical flavors continue to lead
Figure 33: RTD alcoholic beverages, by leading flavors, 2017-19*
Cans take the top spot
Figure 34: RTD alcoholic beverages, by pack type, 2017-19*
WHAT’S STRUGGLING
RTDs missing out on low/no-sugar claims
Figure 35: RTD alcoholic beverages, by leading claims, 2017-19*
Pernod Ricard’s Kahlúa and Malibu lines decline, could retain relevance
WHAT TO WATCH
Big guys play catch up
Own an occasion to inspire trial
Get real
Figure 36: High Noon Sun Sips – “Things Just Got Real at the Tailgate,” August 2019
From seltzer to spritzer
THE CONSUMER – WHAT YOU NEED TO KNOW 
Hard seltzers are driving the increase in RTD consumption
Hard seltzers appeal similarly to men and women
RTDs have solid retention and still have room for growth
Flavor is a strength of hard seltzer, health is a struggle
Desire for customization and sugar reduction challenge RTDs
RTD ALCOHOLIC BEVERAGE CONSUMPTION
Hard seltzers are driving the increase in RTD consumption
Figure 37: RTD alcoholic beverage consumption – any frequency, September 2019
Hard seltzers appeal similarly to men and women
Figure 38: Share of RTD alcoholic beverage consumption – any frequency, by gender, September 2019
4 in 10 hard seltzer drinkers are age 25-34
Figure 39: Share of RTD alcoholic beverage consumption – any frequency, by age, September 2019
Hard seltzers need to diversify their audience
Figure 40: Share of RTD alcoholic beverage consumption – any frequency, by race, September 2019
Hard seltzers households skew slightly higher earning
Figure 41: Share of RTD alcoholic beverage consumption – any frequency, by HH income, September 2019
INTEREST IN RTD ALCOHOLIC BEVERAGES
RTDs have solid retention and still have room for growth
Figure 42: Interest in flavored malt beverages, September 2019
Premixed spirits-based cocktails show the strongest interest in trial
Figure 43: Interest in premixed spirits-based cocktails, September 2019
Hard seltzers have the highest retention, struggle the most with trial
Figure 44: Interest in hard seltzers, September 2019
RTD marketers could widen their lens to include slightly older consumers
Figure 45: Interest in flavored malt beverages, by age, September 2019
Figure 46: Interest in premixed spirits-based cocktails, by age, September 2019
Figure 47: Interest in hard seltzers, by age, September 2019
OPINIONS TOWARD HARD SELTZER
Flavor is a strength of hard seltzer, health is a struggle
Figure 48: Opinions toward hard seltzer, September 2019
Figure 49: Opinions toward hard seltzer, by hard seltzer consumption, September 2019
A third of women think hard seltzer is more refreshing than beer
Figure 50: Opinions toward hard seltzer, by gender, September 2019
25-34s have high opinions of hard seltzers
Figure 51: Opinions toward hard seltzer, by age, September 2019
CONSUMPTION BARRIERS
Desire for customization and sugar reduction challenge RTDs
Figure 52: Consumption barriers, September 2019
The youngest abstainers don’t feel like the drinks represent them
Figure 53: Consumption barriers, by age, September 2019
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Consumer survey data
Abbreviations and terms
Abbreviations
APPENDIX – KEY PLAYERS 
Figure 54: Multi-outlet sales of domestic beer/ale, by leading companies and brands, rolling 52 weeks 2018 and 2019
Figure 55: Multi-outlet sales of premixed cocktails/coolers, by leading companies and brands, rolling 52 weeks 2018 and 2019