RTD Alcoholic Beverages - US - December 2016

RTD Alcoholic Beverages - US - December 2016

Dec 2016 Mintel Alcoholic BeveragesN/A Price :
$ 3995

RTD (ready-to-drink) alcoholic beverages make up a small share of alcohol sales. Fortunately, declines among prepared spirits-based cocktails and wine coolers may be slowing. The category delivers on convenience, with the highest percentage of participants turning to RTDs over other alcohol types because they don’t require preparation. Addressing consumption barriers, including the lack of customizability and concerns over sugar/calorie/artificial ingredient totals will be necessary to retain interest.

Table of Contents

OVERVIEW
What you need to know
Definition

EXECUTIVE SUMMARY
The issues
FMBs continue to lead the market, but a slowdown can be seen
Figure 1: US volume sales of flavored malt beverages, 2011-21
Prepared spirits-based cocktails have struggled, but are poised for a boost
Figure 2: US volume sales of spirits-based prepared cocktails, 2011-21
The category is limited by lack of customization, high sugar content
Figure 3: Consumption barriers, September 2016
The opportunities
Ease of use leads reason for consumption of RTD alcoholic beverages
Figure 4: Reasons for consumption of RTD alcoholic beverages, September 2016
Consumers are adopting a wider range of format sizes
Figure 5: RTD alcoholic beverage format – Size, September 2015 and 2016
Leading drink types on-premise can inform CPG innovation
Figure 6: Leading cocktail mentions on menu, Q3 2016
What it means

THE MARKET – WHAT YOU NEED TO KNOW
FMBs continue to lead the market, but growth slows
Prepared spirits-based cocktails are poised for a boost
Wine coolers continue downward trajectory
Beer leads alcohol consumption

MARKET BREAKDOWN
FMBs continue to lead market, but growth slows
Figure 7: US volume sales of flavored malt beverages, 2011-21
Henry’s Hard Soda allows for a double splurge
Figure 8: “Live Hard-ish: Hard Orange | Henry's Hard Soda,” February 2016
Prepared spirits-based cocktails are poised for a boost
Figure 9: US volume sales of spirits-based prepared cocktails, 2011-21
Smirnoff Sourced offers perception of quality, customizability
Wine coolers continue downward trajectory
Figure 10: US volume sales of wine coolers, 2011-21
Barefoot launches wine spritzers

MARKET PERSPECTIVE
Beer leads alcohol consumption
Figure 11: Alcohol consumption – Any drink*, October 2015
Figure 12: Correspondence Analysis – Perceptions of alcoholic drink types, October 2015
Figure 13: Perceptions of types of alcoholic drinks, October 2015

KEY PLAYERS – WHAT YOU NEED TO KNOW
Bottles dominate launches
Premium claims are up in most segments
Standard FMB flavors are on the decline
Leading drink types on-premise can inform CPG innovation

WHAT’S WORKING?
Bottles dominate launches
Figure 14: FMB launches, by pack type, 2012-16*
Figure 15: Prepared spirits-based cocktail launches, by pack type, 2012-16*
Premium claims are up in most segments
Figure 16: FMB launches, by leading claims, 2012-16*
Figure 17: Prepared spirits-based cocktail launches, by leading claims, 2012-16*
Figure 18: Wine cooler launches, by leading claims, 2012-16*

WHAT’S STRUGGLING?
Standard FMB flavors are on the decline
Figure 19: FMB launches, by leading flavors, 2012-16*
Figure 20: Prepared spirits-based cocktail launches, by leading flavors, 2012-16*
Figure 21: Wine cooler launches, by leading flavors, 2012-16*

WHAT’S NEXT?
On-premise inspired innovation
Figure 22: Leading cocktail mentions on menu, Q3 2016
Craft focus can stretch into RTD
RTDs lighten up

THE CONSUMER – WHAT YOU NEED TO KNOW
Slightly over a third of respondents consume drinks in each of the measured segments
Consumers are adopting a wider range of format sizes
Supermarkets lead as RTD alcoholic beverage purchase location
Ease of use leads reason for consumption of RTD alcoholic beverages
The category is limited by a lack of customization, sugar content
Standard liquor-based drinks find appeal among younger drinkers

RTD ALCOHOLIC BEVERAGE CONSUMPTION
Slightly over a third of respondents consume drinks in each of the measured segments
Figure 23: RTD alcoholic beverage consumption – Any consumption, September 2016
Men make up a larger share of RTD alcoholic beverage consumers
Figure 24: Share of RTD alcoholic beverage consumption – Any consumption, by gender, September 2016
Millennials make up the vast majority of RTD alcoholic beverage drinkers
Figure 25: Share of RTD alcoholic beverage consumption – Any consumption, by generation, September 2016
Millennials earning $75K+ are most likely to be high-volume consumers
Figure 26: Consumption – CHAID – Tree output, September 2016
Figure 27: Consumption – CHAID – Table output, September 2016
Figure 28: RTD alcoholic beverage consumption – Any consumption, by age and income, September 2016
Mean consumption of flavored alcoholic beverages is on the decline
Figure 29: Mean # flavored alcoholic beverages consumed, 2012-16

RTD ALCOHOLIC BEVERAGE FORMAT
Package
Bottles continue to lead RTD alcoholic beverage format, cans gain
Figure 30: RTD alcoholic beverage format – Package, September 2015 and 2016
Men are stronger targets for cans than are women
Figure 31: RTD alcoholic beverage format – Package, by gender, September 2016
A quarter of Millennial drinkers use pouch formats
Figure 32: RTD alcoholic beverage format – Package, by generation, September 2016
Size
Consumers are adopting a wider range of format sizes
Figure 33: RTD alcoholic beverage format – Size, September 2015 and 2016
Men are the strongest targets for individually portioned shots
Figure 34: RTD alcoholic beverage format – Gender, September 2015 and 2016
Small sizes and variety appeal to Millennials
Figure 35: RTD alcoholic beverage format – Generation, September 2015 and 2016
Storage
Frozen usage stalls
Figure 36: RTD alcoholic beverage format – Storage, September 2015 and 2016
Frozen formats have the potential to resonate with younger consumers
Figure 37: RTD alcoholic beverage format – Storage, by generation, September 2015 and 2016
Light/low-calorie
Use of light/low-calorie versions increase
Figure 38: RTD alcoholic beverage format – Light/low-calorie, September 2015 and 2016
Nearly one quarter of men drink light/low-calorie versions
Figure 39: RTD alcoholic beverage format – Light/low-calorie, by gender, September 2015 and 2016
Light versions may also appeal to Millennials
Figure 40: RTD alcoholic beverage format – Light/low-calorie, by generation, September 2015 and 2016
Flavors
Tropical drink options lead consumption
Figure 41: Alcoholic cooler flavors consumed, 2012-16

PURCHASE LOCATION
Supermarkets lead as RTD alcoholic beverage purchase location
Figure 42: RTD alcoholic purchase location, September 2016
Men are a stronger audience for online, on-premise sales
Figure 43: RTD alcoholic purchase location, by gender, September 2016
Millennials are open to a range of purchase channels
Figure 44: RTD alcoholic purchase location, by gender, September 2016

PERCEPTION OF RTD ALCOHOLIC BEVERAGES
Strongest association with pre-mixed spirts-based cocktails is positive
Figure 45: Prepared spirits-based cocktail terms, October 2016
FMBs are strongly associated with convenience
Figure 46: Flavored malt beverages terms, October 2016
Wine cooler perception mixed, associated with low alcohol/young drinkers
Figure 47: Wine cooler terms, October 2016

REASONS FOR CONSUMPTION
Ease of use leads reason for consumption of RTD alcoholic beverages
Figure 48: Reasons for consumption of RTD alcoholic beverages, September 2016
Ease of use is an especially strong driver for women
Figure 49: Reasons for consumption of RTD alcoholic beverages, by gender, September 2016
Promotion of convenience may help drinks appeal to older consumers
Figure 50: Reasons for consumption of RTD alcoholic beverages, by generation, September 2016

BARRIERS TO CONSUMPTION
Category limited by lack of customization, sugar content
Figure 51: Consumption barriers, September 2016
Health is the strongest barrier for women, men are aware of perception
Figure 52: Consumption barriers, by gender, September 2016
Barriers vary across generations
Figure 53: Consumption barriers, by generation, September 2016

IDEAL RTD ALCOHOLIC BEVERAGES
Standard liquor-based drinks find appeal among younger drinkers
Pushing flavor boundaries can attract savvy explorers

BEVERAGE CLASSIFICATION
Consumers don’t have a strong ability to discern between RTD alcoholic beverage types
Figure 54: Correspondence analysis – Beverage classification, September 2016
Figure 55: Beverage classification, September 2016

APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Consumer survey data
Consumer qualitative research
CHAID methodology
Correspondence analysis methodology
Abbreviations and terms
Abbreviations

APPENDIX – MARKET
Figure 56: US volume sales of flavored malt beverages, 2011-21
Figure 57: US volume sales of spirits-based prepared cocktails, 2011-21
Figure 58: US volume sales of wine coolers, 2011-21
Figure 59: US volume consumption of beer, by category, 2014-15
Figure 60: US volume consumption of distilled spirits by category, 2014-15
Figure 61: US volume consumption of wine by category, 2014-15

APPENDIX – KEY PLAYERS
Figure 62: FMB launches, by leading claims, 2012-16*
Figure 63: Prepared spirits-based cocktail launches, by leading claims, 2012-16*
Figure 64: Wine cooler launches, by leading claims, 2012-16*
Figure 65: FMB launches, by leading flavors, 2012-16*
Figure 66: Prepared spirits-based cocktail launches, by leading flavors, 2012-16*
Figure 67: Wine cooler launches, by leading flavors, 2012-16*
Figure 68: FMB launches, by pack type, 2012-16*
Figure 69: Prepared spirits-based cocktail launches, by pack type, 2012-16*
Figure 70: Wine cooler launches, by pack type, 2012-16*
Figure 71: FMB launches, by packaging material, 2012-16*
Figure 72: Prepared spirits-based cocktail launches, by packaging material, 2012-16*
Figure 73: Wine cooler launches, by packaging material, 2012-16*
Figure 74: FMB launches, by launch type, 2012-16*
Figure 75: Prepared spirits-based cocktail launches, by launch type, 2012-16*
Figure 76: Wine cooler launches, by launch type, 2012-16*
Figure 77: Leading cocktail mentions on menu, Q3 2016

APPENDIX – CONSUMER
Figure 78: Mean # flavored alcoholic beverages consumed, 2012-16
Figure 79: Alcoholic cooler flavors consumed, 2012-16

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