Hard Seltzers Slayed it on Super Bowl

Dear Client:

What were people drinking more of during the Super Bowl?

Not beer. At least, not traditional beer. It was down 0.3% in volume.

Apparently, the stereotype watching The Big Game with a pizza and beer is waning somewhat.

Among bev alc, it seems spirits won the Super Bowl: that category was up 6.2% in volume, and 9% in dollars.

That’s per IRI’s read, which measures the 2 weeks surrounding The Big Game.*

But guess what was super popular in the beer category? That thing that tastes nothing like beer: Hard seltzer. That was up 263.7% for this two-week period.

And hard seltzer “umbrella” segment, FMBs, were up 22.2%.

Still: “when Hard Seltzers are removed FMB, the segment was still up 2.3%,” per IRI’s bev alc insights chief, Patrick Livingston.

And of course super premiums, driven by Michelob Ultra, were up around 16% in volume and dollars.

Meanwhile, premiums and sub-premiums were down. Domestic premium volumes were down 5.3%, dollars down 4%.

Craft was up only 0.4% in volume, but almost 2% in dollars.

(“This includes the week of the Super Bowl and week after the Super Bowl, which contains lift for features that carry over into the days following the game,” per Patrick.)


Plenty of upbeat talk on Constellation’s fourth leg, cannabis, during the company’s CAGNY presentation earlier this week.

Constellation chief Bill Newlands said they view this “rapidly evolving market” as a “huge opportunity,” still holding on to the projection that cannabis can become a “$200 billion over the next decade or so.”

They remain certain in their horse in the cannabis race too, Canopy Growth.

“We think their technology, their science and their management is primed to succeed,” Bill said of Canopy. “And I can assure you, we are working aggressively to leverage all those strengths so that one Canopy plus one Constellation equals three.” Indeed, Bill noted several times that Constellation is offering up their expertise in “brand building” to Canopy, as “branded products are becoming critically important” in the space.

Bill went on to add that the “deployment of capital that has been done so far is just the first step in Canopy’s winning the global cannabis market worldwide.” Walking the audience through Canopy’s acquisition of German vape manufacturer, Storz & Bickel; its purchase of cannabis research company, ebbu; as well as Canopy’s recent announcement to build a hemp production plant in New York, a facility that “can easily be translated into THC production when and if it’s legal on a national basis,” Bill said.

As for Canopy’s results thus far, Constellation CFO David Klein said Canopy’s Q3 earnings, which hit last week, indicate that they’re “completely on track both top line and profitability trajectory as we require as part of our investment model.”

Indeed, Bill shared that Canopy is on “track to deliver a run rate of $1 billion by 2020 at the top line.”

Constellation believes Canopy will be accretive to their earnings in fiscal 2021.


Right after A-B announced the acquisition of Cutwater Spirits, from the former Ballast Point founders, the largest independent A-B wholesaler in the nation made a fitting announcement of its own.

Houston-based Silver Eagle distributors has announced the addition of four craft spirits brands to its portfolio, a new category for the company.

Two of them, Highway vodka and 8th Wonder Distillery, are Texas grown. And in fact, Silver Eagle was the first distributor for 8th Wonder, which is a craft brewery; they’ve more recently started producing gin and vodka.

But Silver Eagle is also peddling Midwestern brands as well. They’ll carry Boone & Crockett Club Whiskey from Indiana, and Tattersall Distilling of Minneapolis, which offers gin and Orange Crema Liqueur.

The wholesaler, which distributes to Houston and San Antonio, said that the items will be added by the end of the first quarter.

Seems like they’re creating the infrastructure for the future.

Coincidentally, A-B sales chief, Brendan Whitworth, told BBD earlier this week, after the Cutwater Spirits acquisition announcement, that they wouldn’t adjust the producer’s distributor lineup in the near term, “especially in core markets.”

However, he said: “our overall preference … is to be with A-B wholesalers” in the longer term.


Kraft Heinz, owned by 3G Capital (which shares shareholders with ABI) and Berkshire Hathaway, announced SEC regulators are investigating them over allegedly dubious procurement practices, sending its shares down 17% after hours, according to the WSJ.

They also announced a write-down of brands in the Kraft and Oscar Mayer divisions totalling over $15 billion, amid tough times for processed foods.

A BRAVE NEW WORLD. Jorge Paulo Lemann, the billionaire co-founder of 3G Capital admitted at a conference last year, “I’m a terrified dinosaur” when it comes to technology and disruption, “I’ve been adjusting — I’m 78.” Lemann orchestrated the Kraft – Heinz merger in 2015 and InBev’s takeover of Anheuser-Busch in 2008.

“I’ve been living in this cozy world,” he said. It used to be that industry trends changed only gradually, and management could “just focus on being very efficient and you’ll do OK. And all of a sudden we’re being disrupted.

The days of Dean Metropoulos and others riding on the equity of old brands appear to be drawing to a close, but only as other aggressive financiers bet on up-and-coming brands. More on that later.

Kraft Heinz said that it is cooperating with the SEC and that it had conducted an internal investigation into accounting practices.

MEANWHILE, Molson Coors is also under fire for allegedly dubious or sloppy accounting practices. More on that Monday.

Until then,

Harry, Jenn, and Jordan

“Put up with it and you will get more of it.”
-Lynne Deal