2020 gave us the “summer of seltzer.” Now halfway through the new year, it’s clear that the seltzer craze is here to stay. An already $4 billion industry, hard seltzer is projected to keep on growing at a rapid-fire pace; in fact, experts at Goldman Sachs expect the category to reach a whopping $30 billion in sales by 2025—yep, that’s a lot of White Claw!
Of course, the question remains: as competition heats up and the category continues to evolve, what lies ahead? How will brands stand-out in an already crowded market?
Well, if the explosion of hard seltzer has taught us anything, it’s that there’s a strong demand for “better-for-you,” lower ABV alternatives to traditional beer, wine, and spirits. With hard seltzers now dominating the mainstream, there’s plenty of opportunity for beverage companies to diversify their offers with new and innovative twists on other hard alternatives.
That’s right, hard seltzer might be the star of the show right now, but they make up just one aspect of the hard alternatives market—here’s 5 other segments in the category worth watching:
1. Hard Lemonade
When life gives you lemons, add alcohol! That’s right, hard lemonade seems to be the next frontier for the hard alternative market. While not new to the beverage alcohol sector, hard lemonade has been getting more attention as big brands seek out additional avenues of differentiation.
A refreshing beverage in its own right, hard lemonade has grown up from the sugary and syrupy concoctions of the past. Modern adaptions of hard lemonade are now much lighter on the palate and waistline, prioritizing flavor and ingredient quality over sweetness.
Big brands like Truly and Bud Light released their collections of hard lemonade and many other beverage companies—big and small—have since followed suit.
The sweet spot in ABV and calories for these products tends to mirror that of hard seltzer, with most hard alternatives clocking in at around 5% ABV and 100 calories per can. Flavors also model many of those popularized by hard seltzer—think black cherry, peach, and mango.
2. Hard Tea
It’s hard to talk about lemonade without mentioning iced tea—that’s what a lot of beverage brands think, too. Inspired by the success of hard lemonade products, companies are now giving hard tea a facelift.
Like its sweet and sour cousin, hard tea products have historically been defined by a one-note sweetness, but that seems to be changing. Evolving with consumer tastes, modern hard tea products are focused on flavor and quality first, often with multiple options of sweetness available to fit any palate.
Twisted Tea is a popular boozy black tea-based product that got a boost of attention during the pandemic for a viral video. It comes in a variety of flavors—blueberry, raspberry, blackberry, and even a half-tea, half-lemonade version. It also offers a “slightly sweet” expression that halves the sugar and sweetness of the original recipe. Other brands—like rivals White Claw and Truly—have their own hard tea products in all of the standard hard seltzer flavors.
While black tea has been the go-to base for many of these products, green tea is emerging as another area of innovation for the hard tea sector. Arizona Iced Tea recently released their hard green tea—a boozy version of their beloved original tea recipe with ginseng and honey.
3. Hard Kombucha
With the success of hard tea, it only seems natural that the emerging kombucha category would follow suit. Kombucha has entered the mainstream in recent months as more consumers become educated about the ancient beverage and its functional properties.
In the US, kombucha is a fermented and sweetened drink often made with black or green tea. Naturally, the drink contains trace amounts of alcohol from the fermentation process—an attribute that many brands have embraced for use in the adult-beverage market.
By increasing the alcohol content of this tangy-sweet and bubbly tea, hard kombucha is quickly becoming a product of intrigue for consumers. Drizly, a popular alcohol delivery app, shared that in 2020, hard kombucha sales grew a staggering 2,134% over the previous year. While hard kombucha, hard tea, and hard lemonade only accounted for less than 3% of Drizly’s 2020 beer sales, the relative gains of each segment indicate a bright future for the hard alternatives category, overall.
Products like JuneShine and BoochCraft stand out in the hard kombucha sector. With unique flavors like chili mango, acai berry, apple jasmine, lemon maple, and blood orange mint, as well as functional ingredients like probiotics and activated charcoal, hard kombucha brands are shaping a new generation of beverage alcohol offers.
4. Hard Coffee
Like the rest of the categories on this list, the idea of combining coffee and alcohol together isn’t new—Irish coffee, White Russians, espresso martinis, and other cocktails dripping in coffee liqueur have long laid the groundwork for the innovation we’re experiencing today. Craft brewers have also played a significant role, using coffee beans to create roasted, nutty, and chocolatey flavors in porters and stouts. Ready-to-drink (RTD) varieties of hard coffee are just the next evolutionary take on this match made in heaven.
According to Nielsen data, retail sales of canned cocktails are up 95.3% from November 2018 to 2019; meanwhile, sales of RTD coffee are also continuing to grow, with retail sales hitting over $3 billion—a cash cow of caffeine-infused opportunity.
In 2019, two notable companies entered the growing niche with the launch of Pabst Hard Coffee by Pabst Blue Ribbon and Hard Cold Brew Coffee by La Colombe. Other brands have since followed suit with great success.
Rebel combines cream, malt, natural flavors, and Arabica coffee to create its three flavors (Mocha Hard Latte, Hard Cold Brew, and Vanilla Hard Latte), plus a seasonal Hard Pumpkin Spice Latte. Another brand, Bomani, offers a 5.7 percent ABV Cold Buzz that was described by Beverage Daily for “marrying two of the fastest growing subcategories in the beverage industry: cold brew coffee and sugar fermented alcohol (the same alcohol found in many hard seltzers).”
As the hard coffee sector continues to develop, we’re sure to see more variety in the form of new flavors, cold brew and nitro-infused formulations, and carbonated varieties.
5. Hard Punch
The punch segment is understood vaguely as a type of beverage, either non-alcoholic and alcoholic, that generally contains fruit or fruit juice. This definition gives beverage creators the rare opportunity to truly craft their own special take on this “casserole of the beverage world.”
Another classic beverage staple, punch is getting new life as beverage brands pursue it as an additional avenue for development in the hard alternatives space. Yes, there are already a number of hard punch products out there—some of the historic Jack Daniel’s Country Cocktails flavors come to readily to mind; however, fresh takes on hard punch liken more to that of a flavored hard seltzer.
In May, Truly rolled out their latest addition to the hard alternatives category—a mixed pack of “hard seltzer and punch.” With four vaguely descriptive flavors (fruit, berry, tropical, and citrus), Truly’s products are quite different than the hard punch you might be familiar with, clocking in at the standard 5% ABV and 100 calories of hard seltzer.
It remains to be seen whether hard punch will experience the growth of other segments on this list, but nonetheless, the addition demonstrates another show of strength for the hard alternatives category, overall.
If you’ve got a great idea for a hard alternatives product, The Beverage Architects at Flavorman can help you bring it to life. Just fill out this web form or give us a call at (502) 273-5214 to get started. Let’s change what the world is drinking, together.