This is a guest post by Brian Trivitt.
How about a cold one? Oh, wait, I didn’t mean to ask if you would like a beer, I was actually referring to the different flavors of hard seltzers in my refrigerator. Considering that beer overall as a category has been losing market share for years and hard seltzer as a category is up 193% year over year (source: San Francisco Chronicle, “Hard Seltzer is the Summer’s Biggest Scam,” Mobley, Esther) it may be more appropriate to ask “how about a flavored carbonated water that contains alcohol?”
Hard seltzer’s growth is, indeed, absolutely staggering, with some select markets reporting being up several hundred percent year over year. What’s more, supposedly only about 1/3 of millennials and Generation Z said they have recently drank hard seltzer (source: Yahoo Finance, Millennial drinking habits show why White Claw and Hard Seltzers are just getting started,” Guzman, Zack), leaving lots of potential young customers who have probably already heard from some of their peers that “beer makes you fat,” or “just isn’t cool to drink anymore.” So, needless to say, executives at the major hard seltzer players, which include Mark Anthony (White Claw), Boston Beer Company (Truly), Anheuser Busch InBev (Bon and Ive), and other existing players in alcoholic beverages scrambling to keep up with the demand and continue to capitalize on the momentum.
In my opinion, it’s too early to say with confidence that hard seltzer is going to have sustainable growth for years to come, and it’s highly unlikely that the extreme growth referenced earlier will continue that much longer. Still, this present growth presents extensive business opportunity for not only companies currently making hard seltzer, but also other beverage producers who have been making anything from craft beer to hard cider and beyond. While hard seltzer looks to be a sure thing sale (at least for now), I believe that unlike the growth of other craft beverages, such as cider, meade, wine, and spirits, there are some things that could work against hard seltzer continuing to grow for years to come:
-Its history goes back to 2012, when a gentlemen by the name of Nick Shields was at a bar in Connecticut marketing Haffenreffer, a historic brand that his great-grandfather created in 1870 (source: “How the Brand that Started the Hard Seltzer Craze is Trying to Keep it’s Edge).
During his visit, he observed women ordering vodka sodas (which are actually the best selling mixed drink in the U.S.), and gave him an idea to introduce a similar, convenient beverage that could be sold in a can that was basically as light as a vodka drink but fermented. He named it “Spiked Seltzer,” and as the article goes onto point out, the rest was history, as sales took off and Mr. Shields ended up selling to Anheuser Busch InBev who took the brand national in the summer of 2017.
-For the past several years, there seems to have been a “new” beverage that takes the world by storm, whether it’s hard soda or Rose, and although some continue to see growth while others have pretty much been phased out, I foresee another beverage being able to unseat hard seltzer in the near future.
Of course, anything can happen, but here are some things I see that could challenge hard seltzer’s exceptional growth in the near future:
-While some craft breweries are starting to get into the hard seltzer game, I really do wonder if the ones that are have any genuine interest in being that involved with hard seltzer? Even though this generation of craft beer enthusiasts are more opened minded to different things, a craft brewery (or distiller or cider maker) could still be looked upon as somewhat selling out when they try and jump into making hard seltzers.
-They are essentially a marketing phenomenon, as they are low calorie, gluten free, essentially flavorless means to consume alcohol. While people now are much more health conscious arguably than they have ever been, hard seltzer seems to have many similarities of many diets on the market that people follow only temporarily, such as the keto diet and other low carb diets.
Hard seltzers are virtually void of any type of real flavor characteristics or substance that craft beverage enthusiasts look for in a craft beer and other fermented beverages, and even for people who enjoy beverages on the lighter side, hard seltzer is so lifeless that they leave something to be desired when somebody is consuming an alcoholic beverage. I understand that people said similar things when light beer was invented ~45 years ago, but light beer, is still, beer.
Hard seltzers are for the most part, nothing more than fermented sugar water with a slight amount of flavoring added and of course, highly carbonated.
Incidentally, when I went out and did a search on “how is hard seltzer made,” an article came up in “Beer and Brewing” in which a brewery up in Massachusetts provides instructions on how you can “homebrew” your own hard seltzer (source: beerandbrewing.com/hard-seltzer-at-home).
In this article, Christian McMahan, the president of Wachusett Brewing Company, goes on to explain the process of simply fermenting sugar water, but also discusses how you could just blend a spirit with water and carbonate it. While I was reading this, I couldn’t help but think of things like how much a marketing phenomenon bottled water has proved to be and that while these hard seltzers are looked at as “healthier” than drinking beer, wine, or spirits, the reality is they are still alcoholic beverages that have calories.
Everybody (hopefully) know that consuming too much alcohol is not healthy, regardless of how many calories you are saving. So, while hard seltzer has become the “drink of summer” for 2019, I would question if people really want to drink flavored alcoholic water as their drink of choice for years to come.
-Because of how flavorless they are, hard seltzer arguably somewhat, even if it’s in a roundabout way, encourages irresponsible drinking. This issue will only be brought to light more as now some producers are releasing versions with double digit ABV! Any business that produces any type of alcoholic beverage has to be careful with messaging and craft (as well as big beer) beer companies over the years have gone out of their way to encourage moderate, responsible drinking, mostly by encouraging people to drink at a slower pace and try to appreciate each sip.
As I mentioned in my previous point, I’m not sold on the fact that people in the middle of the winter are going to sit around and be satisfied with drinking a beverage this flavorless, just for the sake of saving calories, but I do foresee potential negative PR, similar to what marijuana companies are facing with edibles, considering hard seltzer looks and drinks just like sparking water.
Above all, I see many several challenges that lie ahead for alcoholic beverage companies as hard seltzer continues to grow. One of the most significant is that most beverage companies likely aren’t too crazy about one of their best selling beverages being flavorless water with alcohol. Just like major beer companies would not want their malt liquors to be the first thing that pops into people’s minds, there is a reason that the major producers who make hard seltzers market them under a completely different brand name and seem to go out of their way with separating themselves from their parent company. How do you successfully advertise them to really set yourself apart from the competition? The websites for all the current major players pretty much say the same thing, which is more or less that spiked seltzer is a refreshing alternative to other beverages, low calories, gluten free, and convenient and easy to drink.
Despite all the challenges I outlined above, by no means am I necessarily a beverage expert or have a crystal ball. As I pointed out earlier in this article, the growth statistics and potential are exceptional at this point in time, and even these stellar numbers aside, here are some of the reasons hard seltzer could stick around:
-Because they are basically just carbonated alcoholic water with a bit of flavor, they can act as a base to build off for other flavors people want to mix and kicking up the alcohol content. Of course, this likely end up negating a lot of the saved calories, but, in people’s minds, they will tell themselves, “it’s only 70 calories in the can, so it must still be “healthy.”
-More and more people are obsessed nowadays with health. Although I am not a dietitian, one ironic think about hard seltzer is it lacks some of the naturally healthy ingredients in red wine such as resveratrol that comes from the grapes or the silicon (promotes bone health) and multiple benefits of the hops found in beer. Despite these benefits that have proven in multiple studies for decades for beer and wine, the fact is, most people care a lot more about calorie and sugar content when they are trying to get “healthy.”
-As marijuana continues to grow and edibles more popular, more makers could infuse beverages and make it hard marijuana water.
Can Hard Seltzer Have Sustainable Growth For Years To Come?
I’m usually a bit more decisive when it comes to what I think the future of a the latest beverage or flavor is, but as you can probably tell, I’m kind of on the fence about hard seltzer’s future. As primarily a beer writer and enthusiast, I have to be careful not to let any of my own bias influence my outlook for hard seltzers. It would be easy to say “these hard flavorless waters will be gone in the next two years and more people will be back to drinking craft beer.” While there may be some truth to that, the days of craft beer growing double digits year over year are almost certainly long gone, and these hard seltzers may just evolve into a bigger player for generations to come.
Brian Trivitt is a beer enthusiast who enjoys writing, debating, analyzing and of course drinking good beer. As a Missouri native, residing in Austin, Texas for many years and having the privilege of meeting many people in the local and regional craft scene, he has some very unique views and opinions about various topics in the beer industry. Anything beer related is fair game for his writings.
When he isn’t writing about beer, he spends his free time with his lovely wife and two wonderful daughters. Follow him on Twitter @TrivittBrew.
