Brands Invest in Ready-to-Drink Cocktails as Consumers Opt for at-Home Experiences

Brands Invest in Ready-to-Drink Cocktails

While the majority of consumers now feel comfortable going to bars and restaurants, with contagion concerns no longer having the impact on consumer mobility that they did in earlier stages of the pandemic, social habits have nonetheless changed.

Many consumers have grown used to the experience of enjoying social occasions from the comfort of their own homes, and others have become accustomed to a degree of flexibility not typically found in the bar or restaurant experience. As such, the market for premium packaged drinks that can be enjoyed at home has grown, with canned cocktails especially gaining in popularity.

On a call with analysts Thursday (April 7) discussing the company’s fourth-quarter and fiscal-year 2022 earnings results, Constellation Brands, parent of a range of popular beer, wine and spirits brands including Modelo Especial and Svedka Vodka, among others, shared its increased focus on ready-to-drink (RTD) cocktails.

“We’ve been increasingly focused on upping our game in the spirits-based RTD space with unique and compelling new brands,” said Constellation Brands President and CEO Bill Newlands, highlighting the example of the company’s recent collaboration with Coca-Cola.

Read more: Coca-Cola Commences Canned Cocktail Creation

In early January, the company announced that it is launching canned cocktails with the soft drinks giant in partnership with Coca-Cola’s Fresca brand. The beverages are to be distributed by Constellation Brands, and they are expected to hit shelves at some point this year.

The company also announced Thursday that it has acquired the remaining interest in Austin Cocktails, an RTD cocktail company creating premium bottled and canned beverages, including margaritas, mojitos and more.

“Austin cocktails is a leader in the fast-growing premium RTD segment of the U.S. beverage alcohol market,” Newlands said. “It currently is distributed in 28 states and posted depletion growth of 135% in calendar ’21 as RTD trends continue to rise in popularity among consumers.”

Constellation Brands is far from the only beer, wine and spirits giant looking to make moves into the quick-growing space. Last month, Diageo, parent company of Guinness, Don Julio Tequila, Johnnie Walker, Ketel One Vodka and others, announced a new canning facility with the goal of growing its RTD business, including its premium canned cocktails.

“The new canning facility will … accelerat[e] our strategy in the ready-to-drink category,” said Diageo North America Vice President of Convenience Keara Funck in a statement. “As we continue to build on this opportunity in the convenience space to deliver premium delicious bar-quality cocktails and malt-based beverages, we are excited about the innovations and possibilities this could bring to our consumers.”

Also last month, the publication Food Engineering reported that spirits company Beam Suntory, is launching four new Mexican-inspired canned cocktails, and beverage industry news outlet Just Drinks reported that beer, wine and spirits giant Anheuser-Busch InBev is launching a handful of new RTD cocktails from Cutwater Spirits.

It is not only beverage brands aiming to capture the rising demand for these sorts of beverages either. At the end of March, Hard Rock International, parent company of Hard Rock Cafe, announced the launch of a line of RTD cocktails in partnership with Stewarts Enterprises.