Ready-to-drink cocktails are seeing a spike in demand this summer, fueling a new era of innovation within the alcoholic beverage industry. As more people spend more time sipping drinks outdoors due to pandemic-related restrictions, portable and conveniently packed drinks are dominating the market space.
In the advent of canned rosé brands, hard seltzers and now canned cocktails, major alcohol companies like Bacardi are launching pre-mixed canned drinks.
“We knew we would see an increase in sub-segments of hard seltzer this summer with a focus on lower alcohol by volume, healthy ingredients and bold flavors,” vice president of Bacardí Rum for North America Lisa Pfenning told FOX Business. “And we wanted to be ahead of that curve.”
According to Pfenning, prepared cocktails, a relatively new category, is the fastest growing major spirits segment in the U.S. right now. The category has seen a growth rate of 36% up from last year, and a large portion of that growth in the past three years has been fueled by innovation. Bacardi’s ready-to-drink cocktails launched in May, and the line features three pre-mixed rum cocktails including flavors like lime & soda, limon & lemonade and rum punch and spanning from seltzer-like to flavorful varieties.
Demand and total sales have more than doubled what the international company had forecast.
Bacardi anticipates that demand will only continue to grow. A recent Bacardi survey that polled over 2,000 Americans on summer drinking plans found that this summer more than ever, people are looking for ready-to-drink cocktails, with 30% of participants planning to purchase ready-to-drink cocktails or canned spirits.
Part of what is driving the canned cocktail boom is e-commerce.
Prior to the pandemic, only one percent of spirit sales in the market were online, according to the regional president of Bacardi in North America, Peter Carr. Now global liquor producers like Bacardi are embracing online shopping in order to adapt to new business conventions and means of consumer reach. With a huge loss in sales from restaurants and bars, particularly in the wake of the lockdown, spirits producers and distributors had no choice but to accelerate new channels of revenue.
“Across the globe we saw a tremendous shift from restaurants and bars to buying in the off-trade like retail and in particular, online via e-commerce,” Carr told FOX Business. “Since lockdowns, our U.S. sales via e-commerce have grown 400-500% depending on the outlet and what we would have seen last year in one week of online sales, we are now seeing in just one day.”
According to Carr, before the pandemic hit the U.S., only 1% of spirits sales in this market were online. Shelter-in-place orders provided the impetus for convenience-shopping, prompting more people to discover the ease of buying spirits online or have them delivered right to their door from sites like Drizly, Instacart or ReserveBar. Consumers are also turning to the websites of some of their regular liquor stores and selecting pickup or delivery as a new option.
“We were ready to quickly pivot as soon as we saw that the e-commerce boom for spirits was around the corner,” Carr said. “For the past few years, we have been building the relationships, platforms and talent to focus on e-commerce and, as a result of the pandemic, simply fast-tracked many of our plans.”
The launch of Bacardi’s ready-to-drink cocktail line arrived to the market at the perfect time, right at the pinnacle of demand for easy, transportable cocktails, according to Bacardi’s Lisa Pfenning.
“As we moved into the second phase of coronavirus this summer, more people are imbibing outdoors at barbecues and vacation spots, Pfenning said. “We anticipate the ready-to-drink trend will continue to grow, and that prepared cocktails will be in consumer favor for quite a while.”