RTD category is all grown up
The term ready-to-drink hardly seems adequate these days to describe a category that has fractured and fragmented into almost as many style variations as there are brands.
Originally coined way back to avoid the trade having to adopt the awkward epithet “alcopop” – foisted on seminal brands such as Two Dogs and Lemonhead – the category settled into a broad but reasonably clear definition in the late 1990s.
RTDs were essentially party-oriented, student targeted, bottled long drinks that weren’t beer or cider and avoided the faff of making a proper cocktail.
Many had a recognised spirit brand at their core – Smirnoff and Bacardi most notably – though some, such as VK and WKD, were stand-alone brands with their own personalities.
Then the 2002 Budget hit, with Gordon Brown whacking on a 65% duty hike aimed at stifling what had become a politically problematic category that many critics blamed for under-age drinking.
And that appeared to be that. Sales plummeted and – although a smattering of brands soldiered on through the carnage – the drinks industry love for what had been a significant growth engine faded away.
Yet here we are, less than two decades later and once again RTDs are hot property and a fertile breeding ground of innovation.
The gin craze has effectively created a subcategory of premixed G&Ts in its own right.
A generation of entrepreneurs who did their formative drinking in swish, dawn of the 21st century cocktail bars, has put its experiences and knowledge into grown-up versions of ready-to-go cocktails.
The influence of the US market has brought a rash of so-called “hard seltzers” with spring water bases and a low-calorie hook, though the Portman Group’s recent survey that showed only 7% of British consumers had actually heard the term suggests this segment still has a long way to go to justify the hype.
Wine-based spritz-type RTDs are a further segment, with some crossover into hard seltzers, and the hardcore party/student RTD brands live on, predominantly in high energy on-trade – until 2020 happened – and the convenience off-trade.
There’s even an emerging micro-sector of RTD versions of alcohol-free spirits and mixers coming into focus on the horizon.
All of this has been possible through a combination of more adventurous drinking habits, improved production and packaging
technology, the relative levelling of the marketing playing field brought about by social media, and a softening of the conservative attitudes that used to prevail in big retail’s drinks buying teams.
The idea of an RTD getting a foot in the door at Harrods or The Ritz would have been, frankly, ridiculous, back in the day, but those are two of the places that Rob Wallis’s Buveur premixed cocktail brand originally got listed in.
The brand has just been reinvented as Moth, with a more accessible £3.99 price point and a move from glass to cans, in a bid to go mainstream, albeit at the premium end.
The four drinks are authentic-tasting takes on popular cocktails at 14.9% abv and in 10cl serves – a world away from the RTDs of yesteryear. The suppliers of the constituent ingredients are named on the cans – Tarquin’s gin and Asterley vermouth in the Negroni, for example – reinforcing Moth’s quality credentials.
“One Christmas I made up a big batch of Old-Fashioned and because I didn’t have to go and make it fresh every time I found myself choosing it over beer or wine,” says Wallis. “It was a lightbulb moment. The missing link was just the ease-of-use. When you get in on a Friday night after a hard week at work you’re not necessarily going to get out you shaker, your muddler and six bottles to make yourself one drink.”
He sees the pitch as being to two types of consumers. “It’s not really around gender or age,” he says. “It revolves more around lifestyles. There are those who can make cocktails but might not always want to do it, and those who love drinking cocktails on a night out but might not have the confidence or means to spend £100 on spirits to start a home bar.”
Spirits agency Mangrove UK has also moved on the ready-made cocktail market, taking on Bloody Drinks’s canned Bloody Mary and a quirky range from Empirical in Denmark.
Mangrove managing director Nick Gillett says: “If you look at places like the US and Australia, RTDs are huge. The way they’re consumed is that tailgate party, barbecue occasion which historically our weather hasn’t lent itself to – and the UK is a beer and wine market primarily.
“I think the gin explosion and music festivals becoming a huge thing helped change that, and built that sort of picnic and garden gathering drinking occasion.
“The big retailers have responded with different strategies. The likes of Waitrose and Marks & Spencer have gone for full-strength cocktails in cans, but if you walk into a Sainsbury’s or Tesco they’ve got huge numbers at the lower-abv end of the market with four-for-three deals.
“Generally the market is moving away from high-in-sugar and not-natural colourings and flavouring.
“In the younger market there is a noticeable element of people who are interested in what is going into their bodies and lower-sugar, premium quality, lower-alcohol serves are gaining popularity.
“I think the big casualty will be those underwhelming cocktails – flavours with sugar in. That’s possibly not going to be where the market ends up. I hope it isn’t.”
Gin mixes are just the tonic
The ready-made G&T market is dominated by Gordon’s with its premix listings in the major grocery accounts.
But smaller producers have also entered the category in recent times, making such products a more attractive proposition for independent retailers.
Slingsby gin has relaunched its Slingsby Solo G&T range in cans instead of bottles. Marcus Black, co-founder of Slingsby producer Spirit of Harrogate, says RTDs came into their own in the past year.
“Individual canned drinks have facilitated the perfect way for consumers to enjoy a drink with friends and family without sharing bottles and mixers, and with minimal touchpoints,” he says.
Kirker Greer Spirits is releasing a Jawbox Irish gin RTD range this year, including one for its signature serve with ginger ale.
It’s also lining up a Ginato Spritz RTD for the Ginato Italian gin brand.
Chief executive Steven Pattison says: “We noticed that consumers are looking for premium, craft, convenient drinks which they can enjoy on the go, especially in a lockdown era where meeting outside has become the norm.”