Convenient Alcohol

Part
01
of seven
Part
01

Convenient Alcohol: Spirits Companies, Part 1

The required information (if available) for Diageo and Bacardi have been provided in columns C-D, rows 4-8 of the attached spreadsheet. Over the past 24 months, Diageo and Bacardi have launched several ready-to-drink products under their existing brands.

Selected Findings

  • In fiscal 2020, Diageo recorded $1,284 million (£966 million) in net sales for its ready-to-drink category, which represented 7% of the company’s total net sales.
  • In May 2019, Bacardi partnered with Tesco Group to launch ready-to-drink brand Breezer in the United Kingdom.
  • From 2019 to 2020, the sales volume of Bacardi’s ready-to-serve cocktail products increased by 11% to 88,000 cases.

Research Strategy

Bacardi is a privately-held company and has not published any annual reports. Diageo and Bacardi have not made any investments/acquisitions or launched new ventures into the convenient alcohol space over the past 24 months. Diageo also does not own any brands that focused solely on ready-to-drink products and has not launched any new brands in the convenient alcohol space during the same period.

To identify the required information, we first examined the content published by Diageo and Bacardi. An examination of the companies’ websites, press releases, social media pages, and the 2020 annual report of Diageo did not provide any information on investments/acquisitions/ventures in the convenient alcohol space for both companies. These sources also did not reveal any information on Diageo launching any new brands in the convenient alcohol space.

Next, we conducted a press search for the required information. An examination of alcohol/beverage publications and general media outlets did not provide any information about investments/acquisitions/ventures for both companies and new brand launch for Diageo. It is only known that Diageo increased its stake in a company (Seedlip) that went on to launch ready-to-drink products and itself introduced several new ready-to-drink products under its existing brands over the past 24 months. Bacardi has recently launched a new ready-to-drink brand (Breezer) and several ready-to-drink products under existing brands (Bombay Sapphire and Bacardí).
Part
02
of seven
Part
02

Convenient Alcohol: Spirits Companies, Part 2

Pernod Ricard's five-biggest overall portfolio brands (in terms of sales in 2019) are Imperial Blue, Royal Stag, Absolut, Jameson, and Ballantine's. Beam Suntory's five-biggest overall portfolio brands (in terms of sales in 2019) are Jim Beam, De Kuyper, Pinnacle, Maker's Mark, and Sauza. Columns E and F of the attached spreadsheet have been populated with the requested information.

Pernod Ricard

  • According to the international spirits magazine 'The Spirits Business,' Imperial Blue (Indian whisky) was the biggest-selling brand of Pernod Ricard in 2019 with 26.3 million nine-liter cases sold. The other top-selling brands were Royal Stag (22 million nine-liter cases sold), Absolut (11.2 million nine-liter cases sold), Jameson (8.1 million nine-liter cases sold), and Ballantine's (7.7 million nine-liter cases sold).
  • Even though Pernod Ricard has made several acquisitions over the past 24 months, most have been in the gin, whisky, and bourbon categories. None have been in the convenient alcohol space.
  • In July 2020, Pernod Ricard launched the Kahlua Nitro Cold Brew RTD, an 80-calorie-per-can cocktail, in the US. In May 2020, Pernod Ricard launched new Absolut Vodka Soda RTDs in three new flavor combinations in the US: grapefruit and rosemary, lime and cucumber, and raspberry and lemongrass. The company also launched Absolut cocktail RTDs in the flavors Grapefruit Paloma, Mango Mule, and Berry Vodkarita.
  • In February 2020, Pernod Ricard launched a sparkling malt RTD beverage called Malibu Splash in the US. The drink was launched in four flavors: lime, strawberry, pineapple, and passion fruit.
  • In September 2018, Pernod Ricard launched RTD Kahlua espresso martinis in 200 ml cans. In May 2018, Pernod Ricard launched two different flavors of Malibu coconut rum for the market in the United Kingdom: passion fruit and pina colada.

Beam Suntory

  • According to the international spirits magazine 'The Spirits Business,' Jim Beam was the biggest-selling brand of Beam Suntory in 2019 with 10.4 million nine-liter cases sold. The other top-selling brands were De Kuyper (3.5 million nine-liter cases sold), Pinnacle (2.5 million nine-liter cases sold), Maker's Mark (2.4 million nine-liter cases sold), and Sauza (2.2 million nine-liter cases sold).
  • On September 2, 2020, Beam Suntory acquired the premium RTD cocktail brand called 'On The Rocks' for an undisclosed amount.
  • In August 2019, Beam Suntory launched a shochu-based RTD range called Koyomi Highball for the Australian market. The drink was launched in three flavor combinations: yuzu and lime, mandarin and grapefruit, and blood orange and bitters.
  • Since the RTD segment of Beam Suntory is present only in select markets (like Japan, Australia, Germany, the US, and New Zealand), none of the RTD brands under Beam Suntory has found mention in the top-150 list of the biggest selling alcohol brands of 2019 published by 'The Spirits Business.' However, Beam Suntory has plans to launch a wide range of low-alcohol and low-sugar RTDs starting from 2021.

Research Strategy

We started our research by trying to find out the biggest-selling overall portfolio brands under Pernod Ricard and Beam Suntory. Even though we searched in their websites, annual reports, presentations, and other links, we could not find the top-selling brands by sales. We eventually found a list of the top 150 biggest selling alcohol brands of 2019 published by the international spirits magazine 'The Spirits Business.' This list mentions the biggest-selling alcohol brands of 2019 by number of nine-liter cases sold in 2019.

To find out how Pernod Ricard and Beam Suntory are operating in the convenient alcohol (Ready-to-drink) space, we searched their websites. While Pernod Ricard has not made any acquisitions in the convenient alcohol space in the past 24 months, Beam Suntory has acquired 'On The Rocks' in September 2020. However, Pernod Ricard has introduced several new products in the convenient alcohol space in the past 24 months. On the other hand, most of Beam Suntory's offerings in the convenient alcohol (RTD) market were launched more than 24 months ago and in select markets. Even the sales of these brands do not fall under the top-150 list. Consequently, we could not identify the extent of involvement of Beam Suntory in the convenient alcohol space. However, Beam Suntory has plans to launch a wide range of low-alcohol and low-sugar RTDs starting from 2021 to improve its standing in the convenient alcohol market.
Part
03
of seven
Part
03

Convenient Alcohol: Beer Companies, Part 1

In the past two years, both AB InBev and Molson Coors have taken steps to increase their presence in the convenient alcohol space. Both of them have made investments in the space and have launched new products to expand their presence beyond beer. Further details are provided below and in the attached spreadsheet.

AB InBev

Five Biggest Portfolio Brands

  • AB InBev identifies Budweiser, Stella Artois, and Corona as its global brands, and Castle, Beck's, Leffe, Hoegaarden, and Michelob Ultra as its international brands. The rest of AB InBev's more than 500 brands are local brands.
  • AB InBev does not report the revenue or sales volume of each of its brands, but given the way it categorizes its brands, its biggest brands appear to be Budweiser, Stella Artois, Corona, Castle, Beck's, Leffe, Hoegaarden, and Michelob Ultra. It is therefore likely that its five biggest brands are Budweiser, Stella Artois, Corona, Castle, and Beck's.

Major Investments, Acquisitions, and Ventures in the Convenient Alcohol Space

  • In February 2019, AB InBev announced that it will acquire Cutwater Spirits, a San Diego-based company that manufactures canned cocktails and spirits. At the time, Cutwater Spirits had 7 premium mixers, 14 canned spirits-based cocktails, and 16 spirits encompassing gin, rum, vodka, and whiskey.
  • In July 2019, news surfaced that AB InBev had bought the remaining stake in Babe Wine, a company that sells canned wine. At the time, Babe Wine had three flavors, namely, Red, Pinot Grigio, and Rosé.
  • In November 2019, there was news that AB InBev will be investing USD 100 million in the booming canned hard seltzer category.

Major Convenient Alcohol Brand Launches

Extent of Involvement in the Convenient Alcohol Space

  • AB InBev has not shared the revenue or sales volume of its convenient alcohol business, but in its recent press release, it reported that its share of the market beyond beer had increased by 90 bps in the second quarter of 2020. The increase is largely the result of the company's launch of the Bud Light Seltzer brand. AB InBev claims the brand is the biggest innovation in the 'beyond beer' category by volume.
  • AB InBev started its Beyond Beer Brands category in November 2019 only. At the time, AB InBev's share of the category was only 10%. Now, its share of the category is almost 20%.

Molson Coors

Five Biggest Portfolio Brands

  • Molson Coors does not report the revenue or sales volume of each of its brands, but given the way it categorizes its brands, its biggest brands appear to be Blue Moon, Coors Banquet, Coors Light, Miller Genuine Draft, Miller Lite, Belgian Moon, Coors Original, and Staropramen.
  • These brands are Molson Coors's global priority brands. Below are Molson Coors's global priority brands by region or operating segment.
    • United States: Blue Moon, Coors Banquet, Coors Light, Miller Genuine Draft, and Miller Lite
    • Canada: Belgian Moon, Coors Original, Coors Light, Miller Genuine Draft, and Miller Lite
    • Europe: Blue Moon, Coors Light, Miller Genuine Draft, and Staropramen
    • International: Blue Moon, Coors Light, Miller Genuine Draft, and Miller Lite
  • Given that the U.S. accounts for around 68% of the company's net sales, it is likely that Molson Coors's five biggest brands are Blue Moon, Coors Banquet, Coors Light, Miller Genuine Draft, and Miller Lite.
  • The rest of Molson Coors's brands are national champion and other regional brands, craft and import brands, beer cider brands, licensed premium import brands, and flavored malt beverages. Molson Coors has 107 brands in total.

Major Investments, Acquisitions, and Ventures in the Convenient Alcohol Space

  • In November 2019, there was a report that Molson Coors will be investing "several hundred million dollars" in its production facility in Golden, Colorado to allow for the production of new products.
  • In July 2020, news surfaced that Molson Coors was investing millions of dollars in its Fort Worth brewery to increase its hard seltzer capacity by over 400%.

Major Convenient Alcohol Brand Launches

  • In February 2020, Molson Coors also announced that it will launch Vizzy in March. Vizzy is a canned hard seltzer that is made with Vitamin C-rich acerola cherry.
  • That same month, Molson Coors announced that it will launch its canned hard seltzer brand Coors Seltzer in July. Available in four flavors, namely, Black Cherry, Grapefruit, Lemon Lime, and Mango, Coors Seltzer come in packs of twelve 12-ounce slim cans and single 16-ounce or 24-ounce slim cans.
  • In April 2020, news surfaced that Molson Coors launched its canned wine spritzer brand Movo. Movo, which comes in 8.4-ounce cans, has three flavors, namely, Blood Orange Sangria, Peach White Blend, and Raspberry Rosé.
  • In July 2020, Molson Coors launched its Bodega Bay Hard Seltzer brand across the United Kingdom. Sold in 250 ml cans, Bodega Bay comes in two flavors, namely, Apple, Ginger & Acai Berry and Elderflower, Lemon & Mint.

Extent of Involvement in the Convenient Alcohol Space

  • Molson Coors has not shared the revenue or sales volume of its convenient alcohol business, but in its Q2 2020 earnings call, it reported the growth of its hard seltzer business. Its hard seltzer brand Vizzy, which was just launched nationally in April, already ranks third in several markets.
  • Molson Coors's recent rebranding indicates the company's serious involvement in the convenient alcohol space. In November 2019, news surfaced that Molson Coors had rebranded itself as Molson Coors Beverage Company to reflect its strategy of expanding beyond beer.

Research Strategy

A number of strategies were employed in finding the desired information. Among these strategies were the examination of the websites, annual reports, earnings calls, investor presentations, and press releases of AB InBev and Molson Coors, the review of news articles about AB InBev and Molson Coors, and the review of alcohol industry reports. Both AB InBev and Molson Coors have not shared details about the revenue or sales volume of each of their brands and of their convenient alcohol business. As can be seen from the annual reports of AB InBev and Molson Coors, both companies do not report brand-level revenues or sales volumes.
Part
04
of seven
Part
04

Convenient Alcohol: Beer Companies, Part 2

Carlsberg Group's five biggest overall portfolio brands are 1664 Blanc, Tuborg, Carlsberg, Feldschlösschen, and Grimbergen. We have populated the attached spreadsheet with some of the requested information and other helpful findings. Below is a summary of our findings.

Carlsberg Group

  • In the last two years, Carlsberg Group has made several acquisitions, but none had to do with convenient alcohol. In September 2019, Carlsberg completed its acquisition of Cambrew, one of the biggest beer brewers in Cambodia.
  • According to the company's 2019 annual report, its biggest overall portfolio brands (across all products sold based on sales) are 1664 Blanc, Tuborg, Carlsberg, Feldschlösschen, Beerlao, and Grimbergen.
  • Carlsberg's ready-to-drink alcoholic brands are Eve Litchi, Eve Strawberry Mojito, Sinebrychoff Classic Long Drink Cranberry, and Sinebrychoff Classic Long Drink Grapefruit. The company only publishes the sales volume of its biggest brands, so we could not establish how much the company is involved in these RTD brands.

Boston Beer Company

  • According to the Boston Beer Company, its biggest overall brands are Truly Hard Seltzer, Samuel Adams, Twisted Tea, Angry Orchard, and Dogfish Head.
  • Boston Beer Company has not made any acquisitions, investments, or ventures into the convenient alcohol space. However, the company has completed other acquisitions including acquiring Dogfish Head Brewery on May 8, 2019.

Research Strategy

To identify how Carlsberg Group and Boston Beer Company are operating in the convenient alcohol space, we first searched through the companies' most recent annual reports, quarterly reports, investor presentations, among other internal company presentations. All these are potential sources where the company highlights its operations, financial performance, business segments, among many other issues on their business. While we found lots of information on the two companies, we could not identify anything to do with convenience alcohol, ready-to-drink, or ready-to-serve alcoholic brands. Both companies dive into details about their businesses in their 2019 annual reports, but they do not provide any information that could lead us to conclude that they own convenient alcohol brands.

Next, we scoured through the respective companies' websites, press releases, news sections, media rooms, and through social media. When a company launches a new brand or a new business line, they usually report such ventures on these sources. While there was a lot of information on new brands, limited-edition releases, and new investments/acquisitions, there was no information on convenient alcohol brands from either company.

Lastly, we searched through third-party advertisement sites such as Moat and iSpot TV for any TV commercials surrounding new product launches to determine if either of the two companies had launched a new convenient alcohol brand. Typically, companies run advertising campaigns to raise consumer awareness of new product offerings. This strategy yielded nothing since most of the commercials were not related to convenient alcohol.


Part
05
of seven
Part
05

Convenient Alcohol: Wine Companies

The attached spreadsheet has been filled with the requested information on E&J Gallo and Constellation Brands.

Findings and Research Strategy

  • The information on the biggest brands owned by each of the companies, based on sales or a comparable metric, was not readily available.
  • Therefore, for Constellation Brands, we chose the five brands that were mentioned as the major sales drivers in the latest annual report. Those brands are Corona, Modelo, Kim Crawford, Melomi, and The Prisoner.
  • Since E&J Gallo is a private company, the information on best-selling brands was even more scarce. We looked through multiple articles, analyses, and reports. We decided to choose the two top-selling wine brands - Barefoot and Carlo Rossi, the top selling premium brand - Dark Horse, the most popular prosecco brand in the US - La Marca, and the company's frequently mentioned flagship brand - Family Vineyards.
  • While the above strategy doesn't use a consistent metric, the lack of quantitative information on the performance on each brand in the company materials and industry media made it impossible to rank Gallo's brands based on one metric.
  • In the last 24 months, E&J Gallo launched High Noon Seltzer, a spirit-based seltzer, and Barefoot Seltzer, which is based on wine. It also revived its wine cooler brand, Bartles and James.
  • In the same period, Constellation Brands launched Corona Refresca, a premium alcohol-infused refresher, and Corona Hard Seltzer. Both products are based on its flagship Corona beer.
  • The companies have only recently launched their major products in the convenience alcohol space and so far, quantitative data on their involvement is scarce. Still, we pulled together the available findings.
  • For instance, Corona Hard Seltzer had a 6% market share in the hard seltzer market shortly after launching.
Part
06
of seven
Part
06

Convenient Alcohol: Soft Beverage Companies

Introduction & Research Strategy

Coca-Cola and PepsiCo, the two major soft drink giants in the U.S. and around the world, are not currently involved in the alcoholic beverage industry, nor the convenient alcohol space. While Coca-Cola does have future plans to enter this market, PepsiCo does not. Data related to each of their respective positions within the convenient alcohol market in the U.S. and globally can be found in columns P-Q of the attached spreadsheet.

Sources used in order to complete these respective columns for Coca-Cola and PepsiCo largely included each brand's respective website and annual reports. In other instances, reputable news articles and press releases were also utilized to provide additional context on this topic. A brief overview of these findings are listed below, but please review columns P-Q of the attached spreadsheet for more specific data.


Coca-Cola: Convenient Alcohol

  • The top 5 selling products manufactured and owned by Coca-Cola are listed in row 4 of the attached spreadsheet.
  • The first convenient alcoholic beverage manufactured and sold by Coca-Cola was a "fizzy lemon-flavored alcoholic drink" available only in Japan. This drink was called "Lemon-Do Chu-Hi" but is no longer on the market.
  • In July 2020, Coca-Cola made the public announcement that their sparkling water brand Topo Chico would be launching an alcoholic sparkling seltzer in the U.S. within the next year.
  • According to Coca-Cola's webpage for Topo Chico, the alcoholic version of the sparkling water is not yet available in the U.S. The actual Topo Chico website also does not have any alcoholic beverages listed as products.
  • No other alcoholic brands have launched within the past 24 months, nor are any others aside from Topo Chico expected to launch in the near future. Sources used to determine this can be found in row 6 of the attached spreadsheet.
  • No financial data for the sales revenue or units sold were located for Coca-Cola's "Lemon-Do" alcoholic beverage in Japan. This was determined after scouring the company's website, annual reports, and news articles. Sources used to determine this can be found in row 7 of the attached spreadsheet.
  • All sources used to locate information related to Coca-Cola's position in the convenient alcohol space have been listed in row 8 of the attached spreadsheet.

PepsiCo: Convenient Alcohol

  • The top 5 selling products manufactured and owned by Coca-Cola are listed in row 4 of the attached spreadsheet.
  • PepsiCo has never manufactured any alcoholic beverages over the lifetime of the company, nor do they have any plans to do so in the future. Sources used to determine this are listed in rows 5-7 of the attached spreadsheet.
  • PepsiCo has only ever considered getting involved in the alcoholic beverage industry once, in 2012. However, the company did not move forward with these plans. Sources related to this are listed in row 7 of the attached spreadsheet.
  • All sources used to locate information related to PepsiCo's position in the convenient alcohol space have been listed in row 8 of the attached spreadsheet.
Part
07
of seven
Part
07

Convenient Alcohol: Other Alcohol Companies

Mark Anthony Brands' five biggest overall portfolio brands are White Claw Hard Seltzer, Mike's Hard, Cayman Jack, MXD Cocktail, and Bearface. We have populated the attached spreadsheet with some of the requested information and other helpful findings. Below is a summary of our findings.

KEY FINDINGS

  • White Claw Hard Seltzer, Mike's Hard, Cayman Jack, MXD Cocktail, and Bearface are the five biggest portfolio brands of Mark Anthony.
  • The company invested $250 million to ramp up the production of Hard Seltzer to meet the growing demand.
  • Mark Anthony Brands recently acquired Glendalough Distillery.
  • Mark Anthony Brands launched White Claw in Australia on the 26 of May 2020.
  • The company has an estimated revenue of $62 million.

Research Strategy

The research team searched through the official websites, press releases, and databases involved with collecting the financial data of companies, but found that the financial details of Mark Anthony Brands and Phusion Projects are not disclosed. Both are private companies and are, therefore, under no obligation to disclose their financials to the public. Since Mark Anthony Brands and Phusion Projects do not disclose their financials, we could not identify sources that rank their overall portfolio brands based on sales or a comparable metric. However, we found that Mark Anthony Brands has only six portfolio brands and Phusion Projects, five. As such, we listed the five for the latter and listed five for Mark based on those mostly mentioned in reliable media sites and industry reports.




Sources
Sources

From Part 03