With consumers having grown accustomed to more premium at-home alcoholic beverage options during the pandemic, cocktail brand Bols is seeing the ready-to-drink (RTD) cocktail category only continuing to grow. In an interview with PYMNTS, Gilles Bensabeur, marketing director at The Lucas Bols Company, noted that the major growth of the category in recent years began in the […]
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With consumers having grown accustomed to more premium at-home alcoholic beverage options during the pandemic, cocktail brand Bols is seeing the ready-to-drink (RTD) cocktail category only continuing to grow.
In an interview with PYMNTS, Gilles Bensabeur, marketing director at The Lucas Bols Company, noted that the major growth of the category in recent years began in the United States, with consumers looking for more novel at-home beverage options during lockdown.
“People had more time on their hands. They were prepared to experience something a little bit more out of their usual routines at home, and they were wanting to evolve and bring in different experiences,” Bensabeur said. “That’s really where things really started to kick off a lot faster.”
He noted that the space has been evolving dramatically. Where once the main RTD options on shelves were, for example, massive containers of low-quality, pre-mixed margaritas, now demand has grown for smaller-sized, more premium containers.
As demand has grown, larger companies have entered the space, bringing with them major marketing budgets, making it harder for smaller brands to hold their own. Now, in order to remain competitive, Bensabeur argued, players in the space must have a strong focus on publicity.
“A lot more will be invested into building an actual brand universe, a brand world — that will be the next big shift,” he said.
Indeed, many of the largest players in the beer, wine and spirits space have entered the ready-to-drink market. Earlier this year, category giant Molson Coors noted growth in the RTD cocktail space, and competitor Constellation Brands observed on its most recent earnings call that it has seen double-digit sales growth across multiple RTD product lines. Additionally, Diageo described RTD as the quickest-growing category in the spirits space, noting that consumers are looking for higher-quality options.
Retailers are looking to capture this demand for quick, convenient cocktail options as well. For instance, Target announced last year the launch of private-label RTD cocktails. These moves come as consumers look for more easy options for home drinking, as consumers’ alcohol consumption behaviors increasingly shifts towards the at-home channel.
In the face of all this competition, Bols has been looking to gain a foothold with college and university students, selling its products at sporting events. Last month, the company announced a partnership with University of Central Florida Athletics to sell its RTD cocktails in sporting arenas.
Bensabeur noted that this move comes as NCAA stadiums and arenas loosen their alcoholic beverage restrictions, welcoming spirits where once only wine and beer were permitted, creating “a lot of opportunity” for RTD cocktail brands to “engage with large crowds.”
Now, given the tight competition, one of the challenges is that it is harder to gain shelf space, Bensabeur explained, because the less popular products are sticking around, unsold.
Distribution overall is the largest challenge going forward, Bensabeur said, especially with small brands forced to compete with major providers that have the infrastructure move millions of cases.
Still, he predicts rapid growth in the space going ahead.
“Our subcategory, which is the smaller-sized PET RTD bottles, the current business, at the moment, is about two to three million cases,” Bensabeur said. “We will see more than double that number within the next few years. So, you’re looking at a 6 million, 7 million [case] category here in the U.S.”
The post Bols: RTD Cocktail Space Continues to See Pandemic Tailwind first appeared on PYMNTS.com.
