Hard Seltzers: Let's get this settled
The Brits and the Americans can’t even agree on the differences between the words chips, French fries and potato crisps, so it’s not surprising that food and drink producers tend to proceed with extra caution when introducing a consumer trend from one nation to the other.
Cider is a good example in beverages. Cider as we know it in the UK is popular in both countries and both have a thriving industry of domestic cider production.
But the words “cider” and “apple cider” in the US can refer to non-alcoholic versions of the apple-based drink, with alcoholic variants known instead as “hard cider”.
This historic use of the word “hard” to refer to alcoholic drinks in the US, and also “spiked”, as in “spiked lemonade”, has no doubt helped the seamless transition from sparkling water in the US – known as seltzers – to alcoholic versions of these, typically known as hard seltzers, or sometimes spiked seltzers.
Netflix still has some work to do to help these messages travel across the pond because, for most UK consumers, this is not a combination of words we readily understand.
Hard water? Yes, you can’t find that down south usually. Seltzers? Great for settling an upset stomach. Spiked drinks? Definitely negative connotations with this one. Alcoholic water? Umm, that’s a new concept too.
So while there is a lot of talk about the success of the hard seltzer category in the US, and rumours that it is tipped to take off soon in the UK, clearly there is a language barrier which
the industry needs to make sense of before a genuine category can grow and evolve.
The success of America’s hard seltzer category is hard to believe and it’s clear that many producers – big and small – are poised for it to spill over into the UK.
Sales passed the $1 billion mark in the US in the year to August, and the category is expected to reach $2.5 billion by 2021, according to Nielsen data. The category leader, White Claw, now holds more than 50% share of the market, followed by Boston Beer’s brand Truly, which has just over 30%. White Claw is owned by private Canadian company Mark Anthony Brands, which is reported to have been looking at the UK with plans to launch the brand soon.
Hard seltzers have been stealing share from America’s beer market as consumers have sought out the same refreshment that beer can offer but without the calories or carbs. As a result, brewers have been fighting back and AB-Inbev is the latest to announce it has a hard seltzer version of its Bud Light beer brand (Bud Light Seltzer), which is expected to launch there in early 2020. It will have 100 calories and less than 1g of sugar a can, according to the brewer.
In September 2016 the brewer also bought Boathouse Beverage, producer of Bon & Viv Spiked Seltzer, which has a fairly small share of the market at just over 7%, but a very clear millennial female target market.
Constellation Brands is also expected to roll out a Corona-branded version in 2020, while Miller Coors has Henry’s Hard Sparkling Water.
AB-Inbev, via its ZX Ventures arm, has already moved on the UK market with the recent launch of Mike’s Hard Sparkling Water, with the hope that “hard sparkling water” will be a label UK consumers can easily understand.
Other newcomers in the UK market indicate the language challenges though, with very little consistency between producers on what these products should be called.
From Bodega Bay comes a range of low- sugar and low-calorie “hard seltzers”, whereas the team behind Drty has chosen both “hard seltzer” and “alcoholic water” as descriptors. Kopparberg, meanwhile, has chosen a different route altogether, with its Balans brand described as an “aqua spritz”.
Online craft beer retailer Honest Brew is about to bring US brands H2 Roads, a “craft hard seltzer”, and Wild Basin, a “boozy sparkling water”, to the UK. Balans has secured listings with Tesco and Asda, while Drty is available through Ocado, Amazon and 31 Dover, so it’s clear there is interest in this market from retailers.
Earlier this year Kopparberg head of marketing Rob Salveson told DRN: “We came up with the name aqua spritz for the category in the UK as you have to adapt to regionality. Seltzer is understood by many in the UK to be associated with the word to settle your stomach. We wanted people to understand it is made with sparkling water.
“Looking back to when we brought fruit cider to the UK market, we feel a similar sense of opportunity for this new category and we would expect to see replication in the UK as consumer trends focus increasingly on health and wellbeing.”
Many also expect to see some crossover from the RTD market with these (often younger) consumers seeking out lower-calorie options which still tick the boxes of convenience, canned and flavoured drinks.
If this is the case it would clearly be a good space for producers to align themselves with, although competition is fierce. The UK’s RTD market is one of the only sectors seeing consistent and strong growth, with sales up 5% in volume and 10.4% in value to £94 million during the 12 weeks to August 10 (Nielsen).
For now, it’s a matter of whether a clearer description for this sector might emerge, or whether for retailers it’s a case of flying by the seat of their pants (trousers or underwear) until consumers help decide the fate of this category.