rtds

The continued rise of RTDs

23 September, 2021

In the US, a lot of the growth has been driven by the burgeoning hard seltzer segment of the RTD category. That is now starting to fizzle out: Truly producer Boston Beer Company saw its share price tank after weak demand for hard seltzers forced it to pull its earnings guidance. 

However, innovators are already hunting out new avenues for growth. One could be hard kombucha RTDs, which ties in with the growing consumer wellness trend. Kombucha is said to be good for gut health, and it is fermented, so it already has a modest abv. 

The US is likely to serve as the driving force for hard kombucha in the short to medium term. Other markets, such as Australia and the UK, will provide pockets of growth, according to IWSR. “New entrants are driving the diversification of hard kombucha through innovative flavour combinations, differing levels of alcoholic strength and fresh packaging formats – from the slimline cans favoured by hard seltzers to regular cans and bottles traditionally used by beers,” says Rand. 

The first hard kombucha hit shelves back in 2010, but it remained a niche sub-sector of the RTD category until it started to take o in the past couple of years. Volumes are expected to double by 2023. It is mainly the preserve of small producers, but AB InBev, the world’s largest brewer, recently backed the Kombrewcha brand through its incubator arm, ZX Ventures. 

“While hard kombuchas are alcoholic, they still bene¢t from the halo effect of these perceived health benefits – and many brands play upon this by highlighting their probiotic properties, as well as wellness-friendly ingredients such as enzymes, organic acids, vitamins and minerals,” says Rand.

MORE OCCASIONS

ZX Ventures has worked on several RTD brands in recent years. Kendra Kuppin, the ¢rm’s director of incubation for Europe, built the wine-based RTD brand Sincerely Sabella from the ground up before moving to London to launch canned wine brand Babe in the UK. She has recently been working on the European launch of Mike’s Hard Seltzer, and she also talks about the growth of “better-for-you” alcoholic drinks, such as low-calorie hard seltzers, although she stresses the importance of delivering sophisticated flavours. She believes that Europeans will start to increase the range of occasions on which they consume RTDs. “There are more occasions in the US, but it’s early days here and I think we’ll break into a lot more occasions. People tend to associate canned drinks with picnics, camping, parks. That’s too small. You need to expand beyond that. I have a ton of confidence for it to grow beyond that. It’s our job to open up those additional occasions, like at home. It is happening, but it takes a little more time. 

“Besides the calories, people are just looking for better-quality drinks. That helps open up occasions. If people are buying RTDs for convenience, that’s the only time you want to drink these things. They’re not necessarily at the quality standards that would get you to keep them in the fridge to drink at home or bring to a party. When you’re getting better-quality options, that will open up more occasions to RTDs and that’s exciting.”





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Nick Strangeway

Bar food's blurred lines

Once upon a time pubs and bars were somewhere you went with the sole purpose of getting pissed and there wasn’t a knife and fork in sight, just a packet of dry roasted nuts.

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