Driven by Convenience, Accelerated by COVID, and Here to Stay

August 17, 2020

Hard seltzer’s premium image sits in juxtaposition to the adjacent canned malt beverages of the past. Drinkers think of it as a new category, marked by its premium image & convenience: “a convenient way to have a cocktail” is why over 50% of drinkers opt for the product, says Nielsen.

The category’s growth has been fueled by taking wallet share largely from beer and wine, with Nielsen data seeing beer/wine losing 5.6/4.0 points of this consumer group’s market share in March and April 2020, vs 2019. While beer is being challenged, drinkers shifting into the beer/FMB/cider market from wine should be a positive for brewers if they capitalize. 75% of hard seltzer drinkers also buy beer, and the rollout of brand extension hard seltzer names (Bud Light, Coors, Corona) should lead to the opportunity for brand cross-pollination.

The COVID lockdown and related shift to off-premise alcohol sales (hard seltzer’s current strong suit) have accelerated hard seltzer’s rise. It’s dollar share of total beer/FMB/cider now exceeds over 10%, up from 4.4% of share during the 52-week period ending February 29, 2020. 44% of hard seltzer purchasers from March 1 through April 25 were new buyers, and sentiment/purchasing statistics show that these new drinkers are not going anywhere.

Nearly 75% of on-premise buyers state that they believe the sub-segment will continue to grow in popularity, and brands are experiencing higher-than-average repeat purchase rates. Corona Seltzer posted almost 80% in Q2.