Canned cocktails are having a moment.
Americans consumed over 62 million cases of ready-to-drink spirits in 2023, an increase of almost 25% from 2022. They were the second-largest spirit category by volume, behind vodka.
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Back in 2016, White Claw launched and took the U.S. by storm. The malt-based drink provided an alternative to light beer, and sales soared over the next five year — but the market quickly became saturated.
"You had a plethora of new brands coming in, an oversaturation of new flavor sophistication initiatives, so many flavors that it essentially started devaluing the core proposition of the brands. Consumers started getting confused, and they started taking a step back," said Spiros Malandrakis, head of alcoholic drinks research at Euromonitor International.
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Canned cocktails, drinks that include spirits like vodka, tequila or gin rather than the malt liquor base of popular seltzers, have begun to take market share in the ready-to-drink alcoholic beverage category. From 2021 to 2023, malt-based drinks fell 8%, while spirits-based grew 8% in share of market volume.
More than half of the U.S. ready-to-drink spirits market is controlled by three brands, according to data from Nielsen and the National Alcohol Beverage Control Association. The biggest player, High Noon, is owned by Gallo, a winery that also owns brands like Barefoot and Andre. The other largest players, Cutwater and Nutrl, are owned by beer giant Anheuser Busch InBev.
Still, the beyond-beer segment, which includes both malt- and spirits-based beverages, represents less than 5% of U.S. sales for AB InBev. It represents about 7% for Molson Coors.
Money Report
"You have a 5-year, 6-year, 7-year trend of beyond beer growth, which has been pretty exponential. But these companies' stock prices have done very little during that timeframe. So you know they're not participating in it," said TD Cowen Managing Director Robert Moskow.
And it's not just the beer giants who are now vying for share of the spirits industry. Coca-Cola has ventured into the alcoholic beverage space with a number of its popular soft drinks, including a partnership with Brown-Forman's Jack Daniels whiskey to make a canned version of a bar classic.
Watch the video to learn more about the rise of canned cocktails in the U.S.
