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RTD Alcoholic Beverages - US - December 2015

Published By :

Mintel

Published Date : Dec 2015

Category :

Alcoholic Beverages

No. of Pages : N/A

RTD (ready-to-drink) alcoholic beverages are in a time of transition, and, as such, are seeing both ups and downs. FMBs (flavored malt beverages) experienced strong volume sales growth of 57% from 2010-15, due to a Millennial consumer base with a bit of a sweet tooth, as well as to innovation that

Table of Content

Overview

What you need to know
Definition

Executive Summary

The issues
A third of consumers are drinking less RTD alcoholic beverages
Figure 1: Statements related to RTD alcoholic beverages – Change in consumption, September 2015
RTD alcoholic beverages appear pigeonholed when it comes to consumption occasions
Figure 2: RTD alcoholic beverage occasions, September 2015
Boosting perception of products in the category is in order
Figure 3: Correspondence analysis – Opinions toward alcoholic beverages, September 2015
The opportunities
Premiumization can enhance permissibility
Figure 4: Statements related to RTD alcoholic beverages – Innovation, September 2015
RTD alcoholic beverage formulations could stand to lighten up
Figure 5: RTD alcoholic beverage formats – Light/low-calorie, by generation, September 2015
Opportunity exists to expand chilled varieties
Figure 6: RTD alcoholic beverage formats – Format, by generation, September 2015
What it means

The Market – What You Need to Know

FMBs see strong gains, while prepared spirits-based cocktails and wine cooler declines continue
RTD alcoholic beverages are losing out to other alcohol types for share of stomach
The category has failed to transform alongside an increasingly savvy drinking public
Less than a quarter of respondents say products in the category are appropriate for drinking on-premise

Market Size and Forecast

Volume sales of FMBs grow 57% 2010-15
Figure 7: US volume sales and forecast of flavored malt beverages, 2010-20
Figure 8: US volume sales and forecast of flavored malt beverages, 2010-20
Prepared spirits-based cocktail decline slows
Figure 9: US volume sales and forecast of prepared spirits-based cocktails, 2010-20
Figure 10: US volume sales and forecast of prepared spirits-based cocktails, 2010-20
Wine coolers continue to struggle
Figure 11: US volume sales and forecast of wine coolers, 2010-20
Figure 12: US volume sales and forecast of wine coolers, 2010-20

Market Perspective

RTD alcoholic beverages are losing out to other alcohol types for share of stomach
Figure 13: Alcoholic beverage consumption, September 2015
Figure 14: Alcoholic beverage consumption, by generation, September 2015
Category could grow appeal by capitalizing on traits of other alcohol types
RTD appears as a limitation among consumers interested in customization
Figure 15: Preferences for mixing own drinks versus using RTD products, by generation, September 2015
Less than a quarter of respondents say products in the category are appropriate for drinking on-premise

Market Factors

Alcohol sales continue to rise; patterns favor on-premise consumption
Figure 16: Alcoholic beverages, total expenditures, 2000-13
Pop culture and on-premise trends can inform category innovation
Interest in health drives call for natural, less sugar
Millennials and Hispanics influence taste preferences
Figure 17: Population by generation, 2015
Figure 18: Population growth by race and Hispanic origin, 2010-20

Key Players – What You Need to Know

Party brands make way for a bit of sophistication
Premium claims are on the rise
Fruity flavors and familiar cocktail varieties wane
A focus on health is taking shape

What’s Working?

Spirits- and wine-based cocktails see strong new product launch activity
Figure 19: Share of prepared spirits-based cocktail launches, by launch type, 2010-15
Figure 20: Share of wine-based cocktail launches, by launch type, 2011-15
Premium claims on the rise
Figure 21: Share of FMB launches, by top six claims, 2011 and 2015
Figure 22: Share of prepared spirits-based cocktail launches, by top five claims, 2011 and 2015
Figure 23: Share of wine cooler launches, by top six claims, 2012 and 2015

What’s Struggling?

Fruity flavors and familiar cocktail varieties are on the decline
Figure 24: Share of prepared spirits-based cocktail launches, by top five flavors, 2011 and 2015
Packing a different kind of punch
Party brands make way for a bit of sophistication
Figure 25: Share of prepared spirits-based cocktail launches, by top 10 brands, 2011 and 2015
Figure 26: Share of FMB launches, by top nine brands, 2011 and 2015
Figure 27: Share of wine cooler launches, by top 10 brands, 2011 and 2015

What’s Next?

Premiumization may boost permissibility
Figure 28: Alcoholic beverage consumption, by consumption occasion, September 2015
Brand cache
Clean label
Imported quality
Sophisticated format
Bringing health to an indulgence category
Low alcohol
Promoting produce, not parties
Being both RTD and customizable
Choice may be one form of customizability
Recipes on pack
Shots for trial, not over-indulgence
Spirits selection to match larger drink trends

The Consumer – What You Need to Know

39% of consumers aged 22+ drink RTD alcoholic beverages
A third of respondents say they are drinking less products in the category than they were in the past
Boosting perception is needed, particularly among Millennials and men
Premiumization leads category innovation of interest

RTD Alcoholic Beverage Consumption

39% of respondents drink RTDs; FMBs lead
Figure 29: RTD alcoholic beverage consumption, September 2015
Men are more likely to participate in the category
Figure 30: RTD alcoholic beverage consumption, by gender, September 2015
Millennials are the prime audience
Figure 31: RTD alcoholic beverage consumption, by generation, September 2015
More than half of Hispanics drink RTDs
Figure 32: RTD alcoholic beverage consumption, by Hispanic origin, September 2015
High-income earner and foodie-centric consumer base suggests room for premiumization
Figure 33: RTD alcoholic beverage consumption, by household income, September 2015
Figure 34: RTD alcoholic beverage consumption, by interest in food, September 2015
A closer look at some key targets
Figure 35: Wine cooler consumption – CHAID – Tree output, September 2015
Figure 36: Alcoholic beverage consumption – CHAID – Table output, September 2015

RTD Alcoholic Beverage Formats

Bottles lead over cans
Figure 37: RTD alcoholic beverage formats, September 2015
Container
Millennials open to less-traditional formats
Figure 38: RTD alcoholic beverage formats – Package type, by generation, September 2015
Cans appeal to men; women and Hispanics open to pouches
Figure 39: RTD alcoholic beverage formats – Package type, by gender, September 2015
Figure 40: RTD alcoholic beverage formats – Package type, by Hispanic origin, September 2015
Format
Women and Millennials exhibit interest in multiserving varieties
Figure 41: RTD alcoholic beverage formats – Container, by gender, September 2015
Figure 42: RTD alcoholic beverage formats – Container, by generation, September 2015
Variety represents value
Figure 43: RTD alcoholic beverage formats – Container, by household income, September 2015
Storage
Opportunity exists to expand chilled varieties
Figure 44: RTD Alcoholic beverage formats – Format, by generation, September 2015
Figure 45: RTD Alcoholic beverage formats – Format, by gender, September 2015
Figure 46: RTD alcoholic beverage formats – Format, by Hispanic origin, September 2015
Light/low-calorie
Light/low-calorie varieties find greater appeal among Millennials and Hispanics
Figure 47: RTD alcoholic beverage formats – Light/low-calorie, by generation, September 2015
Figure 48: RTD Alcoholic beverage formats – Light/low-calorie, by Hispanic origin, September 2015

Change in Consumption

A third of consumers are drinking less RTD alcoholic beverages
Figure 49: Statements related to RTD alcoholic beverages – Change in consumption, September 2015
Prepared spirits-based cocktail drinkers exhibit greatest increase in consumption
Figure 50: Statements related to RTD alcoholic beverages – Change in consumption, by segment, September 2015
Expanding flavor varieties grows consumption among category participants
Figure 51: Statements related to RTD alcoholic beverages – Change in prepared spirits-based cocktail consumption, September 2015
Figure 52: Statements related to RTD alcoholic beverages – Change in prepared spirits-based cocktail consumption, September 2015
Figure 53: Statements related to RTD alcoholic beverages – Change in wine cooler consumption, September 2015

Consumption Occasions

Outdoor events lead for RTD alcoholic beverages
Figure 54: RTD alcoholic beverage occasions, September 2015
FMBs appear slightly more casual among category participants
Figure 55: RTD alcoholic beverage occasions, by consumption, September 2015
Millennials and Hispanics are open to a wide range of consumption occasions
Figure 56: RTD alcoholic beverage occasions, by generation, September 2015
Figure 57: RTD alcoholic beverage occasions, by Hispanic origin, September 2015

Opinions toward RTD Alcoholic Beverages

RTD alcoholic beverages segments experience similar limitation
Figure 58: Correspondence analysis – Opinions toward alcoholic beverages, September 2015
Figure 59: Opinions toward alcoholic beverages, September 2015
FMBs lead for flavor among women; prepared spirits-based cocktails are convenient
Figure 60: Opinions toward alcoholic beverages – Women, September 2015
A third of men say they’d be embarrassed to drink RTD alcoholic beverages in public
Figure 61: Embarrassment related to drinking RTD alcoholic beverages, by gender, September 2015
Figure 62: Opinions toward alcoholic beverages – Men, September 2015
Boosting perception among Millennials is in order
Figure 63: Embarrassment related to drinking RTD alcoholic beverages, by generation, September 2015
Figure 64: Opinions toward RTD alcoholic beverages – Millennials, September 2015
Negatives may outweigh the positives for Hispanics and prepared spirits-based cocktails
Figure 65: Opinions toward alcoholic beverages – Hispanics, September 2015
Figure 66: Embarrassment related to drinking RTD alcoholic beverages, by Hispanic origin, September 2015
Non-drinkers say products lack in taste, quality
Figure 67: Opinions toward wine coolers, by wine cooler consumption, September 2015
Figure 68: Opinions toward prepared spirits-based cocktails, by prepared spirits-based cocktail consumption, September 2015
Figure 69: Opinions toward FMBs, by FMB consumption, September 2015

Purchase Drivers

Flavor leads purchase drivers, followed by brand
Figure 70: RTD alcoholic beverage purchase drivers, September 2015
Women are particularly driven by flavor
Figure 71: RTD alcoholic beverage purchase drivers, by gender, September 2015
Millennials less brand/flavor loyal, exhibit interest in health
Figure 72: RTD alcoholic beverage purchase drivers, by generation, September 2015
Higher alcohol content finds appeal among Hispanics
Figure 73: RTD alcoholic beverage purchase drivers, by Hispanic origin, September 2015

Innovation of Interest

Nearly half of consumers interested in RTDs made with premium brands
Figure 74: Statements related to RTD alcoholic beverages – Innovation, September 2015
RTD innovation may find particular appeal among men
Figure 75: Statements related to RTD alcoholic beverages – Innovation, by gender, September 2015
Innovation is key to appealing to Millennials and Hispanics
Figure 76: Statements related to RTD alcoholic beverages – Innovation, by generation, September 2015
Figure 77: Statements related to RTD alcoholic beverages – Innovation, by Hispanic origin, September 2015
Category participants want more
Figure 78: Statements related to RTD alcoholic beverages – Innovation, by consumption, September 2015

Appendix – Data Sources and Abbreviations

Data sources
Sales data
Fan chart forecast
Consumer survey data
Consumer qualitative research
Correspondence map methodology
CHAID methodology
Abbreviations and terms
Abbreviations

Appendix – The Market

Figure 79: US volume consumption of beer by category, 2010-14
Figure 80: US volume consumption of distilled spirits by category, 2013-14
Figure 81: US volume consumption of wine by category, 2013-14

Appendix – Key Players

Figure 82: Share of prepared spirits-based cocktail launches, by launch type, 2010-15
Figure 83: Share of FMB launches, by top six claims, 2010-15
Figure 84: Share of prepared spirits-based cocktail launches, by top five claims, 2010-15
Figure 85: Share of wine cooler launches, by top six claims, 2012 and 2015
Figure 86: Share of consumption by month, by segment, 2014
Figure 87: Share of prepared spirits-based cocktail launches, by top five flavors, 2011-15
Figure 88: Share of FMB launches, by top nine brands, 2011-15
Figure 89: Share of FMB launches, by top nine brands, 2011-15
Figure 90: Share of wine cooler launches, by top 10 brands, 2011 and 2015

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