Beverage Handbook

Beer Handbook 2015 Teaser

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Beer Handbook 2015 48 The Beer Market FMBs Flavored Malts Beverages Flavored malt beverages (FMBs) added 6.2 million 2.25-gallon cases in 2014, a 6.5% increase in volume. With a total category volume of 101.4 million 2.25-gallon cases, the flavored malt beverage category's share of the beer market increased from 3.3% in 2013 to 3.6% in 2014. Since 2007, when the FMB category held a 2.3% share of the market, the category added over 34.5 million 2.25-gallon cases on a 6.1% annual compound growth rate. Looking at 2015 projections, the FMB category is projected to increase on a 6.7% growth rate as marketers aim to seek out consumers looking for a flavorful alcoholic experience. After overtaking the leading position from the Mike's Hard Beverage line last year, the Bud Light Rita franchise remained engaged with consumers through innovative flavor extensions. As a result, the Bud Light Rita's line propelled to 30.5 million 2.25-gallon cases on a 47.0% growth rate. The Bud Light Ritas added 9.8 million 2.25-gallon cases, which increased the brand's category share from 21.8% in 2013 to 30.1% in 2014. AB InBev supported the Bud Light Rita range of products with $19.1 million in advertising spend, which was $7.7 million more than its 2013 spend. The majority of the money was allocated to Bud Light Lime-A-Rita, which was supported through both print and broadcast mediums. Internet spend for the franchise totaled $478,400 last year, which was actually a decrease from the $587,200 that supported the launch in 2013. In the summer of 2015, AB InBev extended its Bud Light Rita franchise with a summer seasonal, Lemon-Ade-Rita, which joined other seasonal flavors Apple-Ahh-Rita and Cran-Brrr- Rita in addition to the year-round flavors Lime-A-Rita, Mang-O-Rita, Raz-Ber-Rita and Straw-Ber-Rita. The second leading brand, Mike's Hard Beverage line, posted a 5.5% increase in sales, which allowed the brand to surpass 20 million 2.25-gallon cases for the first time. Mike's Hard Beverage ended 2014 with a 19.9% share of the category. Interestingly, the Mike's Hard Beverage line went from being supported by a $6.2 million campaign in 2013 to a mere $114,800 campaign in 2014. However, the brand's Internet spend grew from $213,400 to $609,000 in the same time period. Twisted Tea, the third leading FMB brand, added 400,000 2.25-gallon cases to the market on a 5.2% growth increase to take a 7.9% share of the category. Twisted Tea received more than $1 million in additional advertising support with Boston Beer spending $6.7 million in the broadcast medium. Seagram's Escapes is another line that posted volume growth. The line totaled 6.4 million 2.25-gallon cases, a 14% increase. After recording $0 in advertising spend in 2013, Seagram's Escapes received advertising support through a $3.5 million print campaign. Four Loko rounded out the top five with a 13.5% decrease that brought the brand down to 4.8 million 2.25-gallon cases. Collectively, the top five leading FMB brands increased at an average rate of 18.2%, adding 10.8 million 2.25-gallon cases to bring their category share up to 68.9%. Among the remaining 12 leading brands tracked, nine posted decreases, two increased volumes and one brand remained flat. AB InBev has been investing more in this category beyond the Rita franchise as they have launched Bud Light Mixxtail this year. Mixxtail is a range of malt-based cocktails meant to be served over ice and comes in flavors such as Long Island, Firewalker and Hurricane. Each of these offerings, as well as other new entries to the category, are being sold in different size cans which relates to how the products themselves are meant to enhance the occasion. The accessibility of these ready-to-drink products is a selling point because malt-based products are allowed to be sold in more outlets than spirit- or wine-based products. In addition, many are sold in cans and can be taken to places like beaches, festivals and other places where glass bottles are not allowed. Since the products are packaged in 8-ounce cans rather than the typical 12-ounce beer cans, the brands offer less liquid at a higher price and that makes them very strong financial performers. n

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