Though we can trace hard seltzer’s roots back to 2013, by most measures it wasn’t until 2019’s summer of seltzer that the spiked, lightly flavored, low-cal fizzy drink really took off. Since then, keeping up with the hard seltzer craze has been less akin to a roller coaster ride and more like a jaunt in Willy Wonka’s great glass elevator, with sales and popularity seeming to defy gravity.
It’s still hard to quantify exactly what a “normal” year looks like for seltzer, given its nascency and the category’s “meteoric” rise, not to mention the anomalous nature of drinking and spending habits in 2020 because of the pandemic. But in considering many of the events that have defined the last 12 months for seltzer, 2021 begins to look like the year the category went a little crazy, much like the lauded chocolate factory owner himself.
The slew of surprisingly successful flavor extensions that lit up 2020 gave way this year to new and quite perplexing innovations, with brands finding themselves short on runway for logical new product lines. (Hard seltzer hard soda, anyone?) Where high-profile shortages have defined summers gone by, 2021 saw one of the nation’s leading producers dump millions of cases of product, the result of overzealous growth predictions that would also see shares in the publicly traded company slump 26 percent in one day.
Finally, amid a rise in celebrity endorsements, we also witnessed a class-action lawsuit unfold against a high-profile star-backed brand. Based on misleading information and a lack of transparency, those who have followed seltzer’s rise might appreciate the irony of the situation, with transparency (of nutritional information) being an oft-cited factor in the category’s breakout success.
Yet, even these events and unfoldings could not justify erroneous headlines declaring hard seltzer’s bubble being burst. But it has been a wacky year within the realm of White Claw et al.
Hard Seltzer Big Picture (2021 Edition)
Most notable in the narrative for seltzer in 2021 have been continued proclamations of the category’s demise. Upon viewing the sales data, headlines such as “Hard seltzer boom goes flat” seem to be nothing more than media outlets trying to offer a new hot take on the seltzer narrative.
Hard seltzer sales totaled $4.9 billion in the 52-week period ending Nov. 28, 2021, according to IRI data for multi-outlet, convenience, and liquor stores. While it pales somewhat in comparison to the $2.5 billion that the category grew between 2019 and 2020, the $800 million increase compared with last year’s numbers still represents a 20 percent sales bump. Not bad for a space that’s “fizzled out.”
“Despite all the sensationalist headlines about hard seltzer dying, the category is still healthy and growing – it’s just evolving like mature categories do in their lifecycle,” Brandy Rand, COO of the Americas at IWSR Drinks Market Analysis, writes in an email.
The picture regarding the category’s biggest brands remains largely unchanged. White Claw continues to lead the way with a 40 percent market share and 2021 sales of $2 billion. That said, White Claw’s grip on the seltzer throne is slipping slightly, with its market share and dollar sales having dropped 9 percent and 1 percent respectively this year.
Despite a rollercoaster 2021 for Truly, more of which we shall explore, the Boston Beer-owned perennial second runner would ultimately grow 38 percent, with sales hitting $1.3 billion by the end of November.
Meanwhile, propelled by the most adventurous range of brand extensions and flavor explorations, Bud Light Seltzer remains a distant third with an unchanged 9 percent market share, following 18 percent dollar sales growth.
Corona Hard Seltzer rounds out the top four — for now. But with sales already slipping to the tune of 8 percent this year, and High Noon, Vizzy, and Michelob Ultra all within striking distance, don’t be surprised if the Constellation brand loses its (fourth-placed) crown this year. Hardly helping matters for Corona is that High Noon and Vizzy are riding high on triple-digit growth, while Mich Ultra’s seltzer didn’t even hit the market until March 2021. Ominous signs indeed for La Seltzer Mas Fina.
Flavor Extensions and Seltzer Pops
Last year saw the category evolve unexpectedly, via successful product extensions such as lemonade and iced tea hard seltzers. Truly led the way on both innovations, and by the beginning of this year the brand’s tactics had been matched by all of its major competitors.
Seemingly, this spurred an arms race to introduce the next big thing. AB-InBev-owned Bud Light Seltzer proved most willing to forge this new path. Hot on the heels of a not-quite-so-hot “Ugly Sweater” seasonal release pack at the end of 2020, which would introduce drinkers to flavors like Ginger Snap and Peppermint Pattie seltzer, Bud Light Seltzer continued to target seasonal opportunities, with Fall Flannel and Retro Tie Dye variety packs. By the close of the year, reports emerged that Bud Light would introduce a line of Hard Seltzer Sodas, though this has not been officially announced by the brand at time of publication.
Meanwhile, Truly matched some of these moves with the introduction of Truly Punch, a concept aimed to offer fuller flavors via four new fruity combinations, all arriving with the same nutritional values as its core line of seltzers. The brand also offered a seasonal release, via the Holiday Party Pack, and pushed the boundaries for fizzy alcoholic beverage producers when it introduced a line of boozy Freeze Pops early in summer. The release sparked a separate question: Does a product need to carry carbonation to categorize it as seltzer, or is seltzer simply a way of life?
“Beyond brand line extensions, the seltzer lifestyle is really what resonates,” Rand notes. “Consumers who are in the category want to experiment and all of these variations are twists on the core attributes that make seltzer popular: flavor and refreshment.”
For its part, White Claw proved relatively prudent, matching main competitor Truly only on the higher-alcohol seltzer front, with a duo of new 8 percent ABV single-serve releases. These 2021 developments could be a great opportunity for further growth, according to analysts.
“There’s not a lot of players in that space right now, but when you talk about trying to expand your reach to consumers, dialing up the ABV is certainly one way to appeal to certain people,” says Dave Williams, vice president of analytics and insights at BUMP Williams Consulting.
While the onslaught of new products might have some questioning how much rope is left for these line extensions, Williams argues that they make a lot of sense for all parties.
“This is true with just beverage alcohol in general, but anytime you get something new out, it builds excitement for the consumer. It’s something that they see on the shelf and it might cause an impulse purchase,” he says. “It gets excitement for the distributor or the retailer to promote something and try to drive up sales on their end as well.”
With 2021 came the inevitable arrival of A-lister hard seltzers. Big fish Travis Scott made the biggest splash. His and AB-InBev’s all-caps, tequila-inspired — emphasis on that last word — CACTI Hard Seltzer “sold out completely” following its March launch. One could question whether this was the product of a clever hype campaign ahead of its release or careful manipulation of product stocks by parent company and producer to engineer headlines. All we know for sure: IRI data had Scott’s seltzer posting $45 million in sales as of Oct. 31. This left it two places below the similarly hyped Topo Chico Hard Seltzer family, and one place below the Mikes Hard Seltzer family.
Meanwhile, “No one is just one flavor,” Dua Lipa would proclaim as part of a multi-year campaign with Truly that also touted her credentials as a bilingual dog mom and pop star. The deal’s value was not published publicly, but with over 75 million followers on Instagram and the No. 1 song on Billboard’s Hot 100 track for 2021, the star would appear to be a big coup for the brand.
This year also brought us Gordon Ramsey’s “unapologetically bold” Hell’s Seltzer. With flavors including “That’s Forked” and “Knicker Twist,” the brand hit shelves in 25 states in May. As of Nov. 20, year-to-date sales in Nielsen- tracked channels amounted to $376,000 — or $24K less than Ramsey pockets for every two episodes of Hell’s Kitchen he films.
Though not a singer or celebrity chef, another high-profile name joined the party early this year. In March, Sonic Drive-In announced it was partnering with Oklahoma’s COOP Ale Works to put out a line of slushie-inspired seltzers, which eventually hit shelves in May. While the fast food chain has restaurants in 46 states, the seltzer had gained distribution in just seven as of November.
“Sonic has built in brand awareness around it, so I’m curious to see how they grow and how they’ll resonate with consumers next year, having crossed into the space from a non-beverage alcohol background,” Williams says.
Class Action Lawsuits and Crystal Balls
Beyond new flavors, celeb endorsements, and false proclamations of the category’s demise, seltzer hit the headlines for other reasons this year.
Anheuser-Busch, the parent company of Travis Scott’s CACTI seltzer, faced false advertising claims in September, after a class-action lawsuit was filed against the brand. Touted as being inspired by Scott’s love of tequila and made with “100 percent premium blue agave,” drinkers were shocked to discover the product contained no distilled spirits whatsoever, and that agave appears in its recipe for sweetening and flavor purposes only. The implications of the lawsuit, as one alcohol lawyer told this reporter earlier in the year, will ultimately amount to little more than “bad press,” if there is indeed such a thing.
More jarring was the fallout from a weak quarterly earnings report from publicly traded Boston Beer Company in July. Shares slumped 26 percent following the news, knocking $2.5 billion off its market value in one day. Boston execs cited an overestimation of the growth of the category as the reason. The overly ambitious projections would also lead to the brand dumping “millions of cases” of product in October.
“We were surprised at the sharpness and the suddenness of the change in trajectory,” founder Jim Koch said in July. “So it’s a really, really murky crystal ball. It’s more like looking into a bowling ball. You can’t see much.”