The Top Non-Alc Seltzer Brand is Getting Spiked

November 13, 2020

The Top Non-Alc Seltzer Brand is Getting Spiked

Dear Client:

Sparkling Ice — the top non-alc flavored sparkling water brand — has just announced the launch of their new hard seltzer line, Sparkling Ice Spiked.

Soda sleuths may know that Sparkling Ice is owned by a 33-year-old private beverage company, Talking Rain, headquartered in the Pac Northwest. The company has grown into a formidable player in the carbonated water space: Yes, believe it or not, it’s the top sparkling water brand in the U.S., after private label offerings (probably owing to all the volume it does in chains like Walmart).

Not only is Sparkling Ice the top sparkling/seltzer non-alc water -it’s also the top grower. YTD in Nielsen xAOC+Convenience (ended 10/31/20), it’s up 26% in dollars. “It’s also the top brand in terms of actual dollar growth for latest 13 weeks,” Nielsen’s VP Bev Alc, Danelle Kosmal, shared with BBD. By contrast, Topo Chico is no. 4 brand for actual dollar growth. And so, opening its tab in the hard seltzer space is a move to watch.

The company introduced Sparkling Ice Spiked in August of this year as part of a soft launch in test markets across the U.S. It’s launching nationally, now through 2021, in a phased manner.

A few things to note about this big, new entry:

IT’S GOT LOWEST-IN-CLASS CALORIE COUNTS. Sparkling Ice Spiked comes in four flavors: Cherry Lime Cooler, Lemonade Refresher, Ruby Fizz and Strawberry Citrus Smash. Each clocks in at 4% ABV, zero sugar and 80 calories. The seltzer line is available now in a variety 12-pack of 12 oz. slim cans featuring all the flavors.

IT’S GOING THROUGH MOSTLY MOLSON COORS-AFFILIATED BEER DISTRIBUTORS. Spokespeople told BBD that the product will go through some beer distributors, including: Columbia Distributing (Pac NW); Classic Distributing (Southern California); Pepin Distributing (Tampa, Florida; the only A-B house); Wright Beverage (Rochester); and Capital Distributing (Oklahoma City). Most of these houses also carry non-alc.

IT BOASTS A “FULLER FLAVOR.” Like its near-zero-cal, sucralose-sweetened flagship non-alc product, the hard seltzer offering promises to boast fuller flavor than the competition. Spokespeople told BBD that “initial feedback we’ve received in test markets was positive overall both from retailers and distributors. The fuller flavor is shattering expectations of what everyone has come to expect from a hard seltzer.”

Indeed, that seems to be a talking point: Sparkling Ice CEO Chris Hall said in the official company announcement that the company is “thrilled to introduce a new alternative to the adult beverage world that delivers the taste our consumers are looking for while ‘shattering’ the expectations of what everyone has come to expect from hard seltzer,” he said.

In addition to the new product, Sparkling Ice Spiked is launching a nationwide sales and marketing campaign featuring in-person (hmm) and at-home activations, including “in-store POS and holiday promotions, earned media outreach and mailers, influencer programming, targeted digital media and banner ads, paid social, and more.”

And now, with this announcement, maybe every potentially large player with some sort of “right to play” claim in the hard seltzer world has jumped in? Perhaps? Oh, right, Pepsi. Maybe next time this year we’ll all be getting jacked up on Mountain Dew seltzer, our troubles behind us.

We do have to note, we talked to at least one Spiked distributor who says the retailer buy in on this product — and their willingness to display — has been significant. Makes sense, considering Sparkling Ice (non-alc) does so much volume in chain. Source said Talking Rain is being “careful not to link their N/A item to the Spiked version due to responsibility. No display near the Sparkling Ice section nor social media links between the two brands.”

Stay tuned.

RTDs BECOMING A BFD

Just how big is the roaring RTD category becoming in the U.S.? Here’s a telling stat that’s sure to knock your socks off.

In its latest Drinks Market Analysis, IWSR said it expects volume consumption of RTDs – which includes hard seltzers, flavored alcohol beverages, and pre-mixed cocktails – to “surpass that of spirits consumption in the US by the end of the year.”

Yep, you heard that right… IWSR believes more RTDs will be consumed in the U.S. than spirits by year’s end.

Needless to say, the RTD category has turned into a BFD (big effin deal). In fact, IWSR believes RTDs are one of the main reasons why the U.S. bev alc market has proved to be “relatively resilient throughout the pandemic” (they’re talking absolute volume here).

Indeed, despite all the hardship this year, IWSR believes total US bev alc volumes will increase by about 2% this year.

Of course, value or dollars are a different story. While there’s been a double-digit jump (13.6%) in bev alc retail purchases, it’s not enough to offset the 44.5% drop in on-premise sales, per IWSR. As a result, the firm expects total bev alc value to be down almost 12% for the year.

So dollars will be down for the year, but volume will increase (thanks to RTDs and the “dominant retail channel”), which is no small feat. IWSR shared that they observed trends for 19 “key markets” across the globe, and the U.S. and Canada are the only ones “to expand consumption during the year.”

Elsewhere in IWSR’s analysis, the firm highlighted a “key trend” that accelerated during COVID – category-switching. “The category-switching story during Covid-19 is in fact a category expansion story, in which consumers increased their drinking habits across all categories,” including beer, wine, whiskey, vodka (to a lesser degree), and hard seltzer, “which rose the most.” In fact, only a few categories have seen a net decline in consumption overall.

And the firm also labeled ecommerce as “the clear winner of 2020 for beverage alcohol sales.” IWSR anticipates that e-commerce value across 10 key global markets, including the US, will grow by more than 40% this year, reaching $17 billion in 2020 and growing to over $40 billion by 2024.

GREAT BAY DISTRIBUTORS’ TRUCKS ROLLING AGAIN, AFTER HURRICANE ETA SCARE

BBD understands that at least one beer distributor in northern Florida made the call to keep their trucks parked yesterday, as Hurricane Eta swept through the area.

Great Bay Distributors, an A-B house located in St. Petersburg, announced on its Instagram account Wednesday evening that it was suspending sales and service on Thursday.

Once Eta headed offshore yesterday, we checked in with Great Bay’s chief of operations, Scott Penland, for an update.

Scott shared that “some of our employees’ homes were hit hard with flooding, wind damage, and the like,” but “nothing catastrophic.” Thank God.

He also noted that, fortunately, their “facilities/fleet had no damage whatsoever.”

That said, Great Bay “will commence deliveries [on Friday] and Saturday to complete our week,” according to Scott. Adding, that they are “confident that the majority” of their retailers are “opening back up and can resume business,” and “anticipate minimal closures at this point.”

Though he noted that “a few coastal areas experienced flooding and surge from the storm… Treasure Island, Madeira Beach, John’ Pass, Gulfport, and others are trying their best to get back to normal.”

Geez, can’t catch a break this year. Hope all of you in the area stayed safe.

BEER BRIEFS:

IN-PERSON SUMMIT CANCELLATION. We regret to announce that we have made the tough decision to cancel our in-person Beer Wine & Spirits Summits in January at the Hotel Del Coronado, in favor of an interactive virtual conference. After speaking with colleagues, our vendors, the Hotel Del and San Diego County, and given that Covid-19 cases nationally continue to climb while the chance of a vaccine to be widely available by the end of the year is slim, it is clearly the right decision for the health and safety of our attendees.

If you have already registered, look for an email from Jessica Lopez shortly to ask for your preferences for a refund or a credit against the virtual conference version.

NOT YOUR AVERAGE VIRTUAL MEETING. We are working very hard with the best vendors in the business to create a virtual version that will be a more interactive and engaging experience. Just like our previous Summits were a little different than the average conference, so will be the online version.

PRICING THE VIRTUAL SUMMITS. After consulting with several readers, we figure that about 50% of our Summits’ value is the networking opportunities, while 50% of the value is based on the content and information garnered from the presentations. With that in mind, we have priced the virtual Summits accordingly — a 50% discount to the in-person Conferences. The dates, times, and speakers will remain the same, and you can watch them live or on-demand at your leisure.

ANNOUNCING: MICHEL DOUKERIS AT THE BEER INDUSTRY SUMMIT

We are pleased to announce that Michel Doukeris, CEO of Anheuser-Busch, is joining the Beer Summit program, to be held virtually on January 18, 2021.

It’s hard to argue with the results this U.S. captain has delivered for global mothership Anheuser-Busch InBev, in its most profitable — and most competitive — market.

Under his leadership, A-B has seen some of its best trends in many years. In fact, A-B was the only global brewer to pull out both shipment and depletions growth in the U.S. for the latest quarter, amid the staggering pandemic.

Since 2018, Michel has led the execution of A-B’s new commercial strategy, with a focus on above premium, innovation and Beyond Beer.

That has meant more big bets getting to market, faster, around the country. If that sounds like corporate speak, well, it’s worked: Bud Light Seltzer disrupted the seltzer category in 2020, wringing 15 share out of the cut-throat category immediately when it splashed into Super Bowl spots. It’s now the no. 3 seltzer brand.

Babe Wine, acquired on Michel’s watch, is now a top canned wine. And Cutwater is a top RTD spirits brand.

In other words, Michel is helping to modernize the seemingly unmodernizable.

He recently made some bold comments during NBWA: COVID has hurtled consumer trends a decade into the future. And there is “no such thing” as going back to normal, he’s said.

Hear us put him on the spot about exactly what he means by that, and more — like the rumors that he may be destined for even greater heights at the world’s largest brewing company.

BREWPIC: New Sparkling Ice Spiked.