The summer of 2021 saw a number of headlines proclaim that the hard seltzers trend had finally fizzled out after years of growth. These were mostly based on Boston Beer overestimating demand for its hard seltzer products and taking a major hit to its stock price as a result.
Already reeling from the attack from hard seltzers, the beer industry has mounted a tough defence against the spirit industry’s push to get spirit-based RTDs taxed based on ABV rather than facing an inherently higher tax bracket because of their base of spirits instead of a malt or wine base. How this fight ends up will be decisive for the future of spirit-based RTDs, a category that is growing strongly now, but is finding it difficult to compete against the larger RTD categories because of the higher tax rate it faces.
There were few categories sleepier than wine-based RTDs in alcoholic drinks in the US until relatively recently. After the wine cooler era ended decades before, a small number of brands continued to be active, but little happened.
Hard seltzers has proven to be a permanent fixture in the alcoholic drinks industry, displaying a longevity that various other beer alternatives, such as Zima or hard sodas, were never able to achieve. However, the category is undoubtedly staring down a new level of maturity.
Part of the appeal of RTDs since the pandemic began has been their single-serve nature. When social gatherings did resume, people were still often uneasy about sharing food and drinks, making RTDs in individual cans more appealing then mixing drinks at a party would be for many.
Hard coffees, kombuchas, lemonades and teas are all seeing rapid growth from a small base at the moment, stoking hopes amongst some that one or more of them is on the verge of a hard seltzer-like breakout. This is highly unlikely to happen, however, because there is the problem of hard seltzers themselves acting as a roadblock.
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RTD stands for ‘ready-to-drink’. Other terms which may be used for these products are FABs, alcopops and premixes. The RTDs sector is the aggregation of malt-, wine-, spirit- and other types of premixed drinks. These drinks usually have an alcohol content of around 5% but this can reach as high as 10% ABV. Premixes containing a high percentage of alcohol of around 15%+ combined with juice or any other soft drink are included here. RTDs are usually marketed as products to be drunk neat, with ice, or as a cocktail ingredient. Fruit-flavoured, vodka-based spirits with an alcohol content of between 16-21% are classified here. Examples: Alizé, Ursus Roter, Berentzen Fruchtige, Kleiner Feigling.See All of Our Definitions
This report originates from Passport, our RTDs research and analysis database.
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