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InView Q1 2018

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©2018 by M/A/R/C® Research

Q1 2018

General Beverage Industry News and Trends

The John Hopkins Bloomberg School of Public Health modeled simulated daily activities of residents in three cities – Baltimore, San Francisco, and Philadelphia – over seven years to analyze what impact different sugar-sweetened beverage warning label policies had on mean change in BMI and obesity prevalence in each locale. The analysis found that a warning label decreases a person’s chance of purchasing a sugary beverage by 4%. A different analysis by researchers at Duke University looked at the effect a one-cent per ounce soda tax had on reducing calorie intake. The study found much of the cost of the tax was not passed on to consumers and therefore calorie consumption declined only slightly. (Source: Beverage Daily, December 18, 2017; Harvard Business Review, January 10, 2018)

The Craft Beverage Modernization and Tax Reform Act of 2017 which lowers the federal excise tax on beer, spirits, and wine producers will go into effect on January 1, 2018. The reduction in barrel taxes will collectively save small brewers more than $142 million annually. All wineries regardless of production size or if the wine produced is sparkling will qualify for the tax credit. (Source: Beverage Daily, December 21, 2017)

The top-selling beverage flavors in 2018 are predicted to be grapefruit (25% of respondents chose), vanilla (22%), apple (20%), coconut (18%), ginger (18%), orange (18%), and blackberry (18%). The top-selling flavors in 2017 were vanilla (23%), apple (21%), chocolate (17%), ginger (17%), grapefruit (17%), and lime (17%). (Source: Beverage Industry, January 15, 2018)

A new research report suggests Gen Z drinkers prefer wine and spirits over beer which is perceived as inauthentic and unappealing. These young drinkers report drinking 20% less alcohol per capita than millennials and 64% of this group anticipate drinking even less as they age. (Source: Brewbound, February 23, 2018)

Coca-Cola’s Japanese unit plans to experiment with a canned drink which contains alcohol. This popular type of drink, called chu-hai, is often made with distilled grain-based alcohol and flavored, carbonated water. Flavors range from strawberry to ice tea to cream soda. Coca-Cola declined to say whether it would explore selling an alcoholic beverage outside of Japan though last year, Coke’s CEO said he wouldn’t rule it out. (Source: The Wall Street Journal, March 7, 2018)

Edible glitter is popping up in drinks including beer, coffee, and milkshakes. Brewers producing glitter beer include Bold Missy Brewery, Ska Brewing, Three Weavers Brewing, and Minocqua Brewing. For Valentine’s Day, Shake Shack sold a strawberry milkshake with glitter sprinkles called the Love Shack. (Source: Cassandra Daily, March 9, 2018)

The Wine and Spirits Wholesalers of America and the producer-supported Foundation for Advancing Alcohol Responsibility have both expressed support for self-driving cars and are lobbying to get them on the road soon to reduce drunk driving and increase public safety. One analysis predicts that, if drinkers don’t have to worry about driving home, then alcohol beverage sales will increase as much as $250 billion. (Source: The Washington Post, March 13, 2018)


Q1 2018

Beer/Malt Beverages

Dunkin’ Donuts is partnering with Wormtown Brewery to launch DDarkRoasted Brew. The stout-style beer is brewed with Dunkin’ Donuts Dark Roast coffee beans and features a full-roasted coffee flavor. It will be available exclusively at Wormtown Brewery’s Tap Room beginning December 21. Guests at the ceremonial tapping event will have a chance to enjoy doughnut and beer pairings created by Dunkin’ Donuts’ culinary team. (Source: Beverage Industry, December 19, 2018)

New Belgium newly appointed CEO plans to increase the craft brewer’s marketing spend in 2018 to amplify the company’s positioning around quality, sustainability, and employee-ownership. The company also hopes to secure additional retail placements for its Fat Tire Belgian White line extension. New Belgium will introduce two new products in 2018: Voodoo Ranger Juicy Haze in January and Mural in March. Mural is inspired by Mexican agua fresca and is positioned to attract female drinkers. New Belgium also plans to release premium specialty beers and gain placement for them in fine dining establishments. (Source: Brewbound, December 28, 2017)

Anheuser-Busch warned Utah beer wholesalers that it plans to cut back on the production of beer with 3.2 percent alcohol by weight, the strongest beer that can be sold in the state’s supermarkets and convenience stores. Colorado, Kansas, and Oklahoma recently changed their laws in order to allow beer with higher alcohol content leaving only Utah and Minnesota in the weak beer market. If A-B follows through, it will reduce the number of brands from 20 to 12 and the number of available packages from 113 to less than 70. (Source: Progressive Grocer, December 28, 2017)

Stony Creek Brewery plans to launch a new series of India pale ales called Crankenstein. The experimental, hybrid IPAs will merge West Coast and New England influences and a new “Hatchling” will be introduced every other month. Each version will be numbered. The beer will be sold in four-packs of 16-ounce cans. (Source: Beverage Industry, January 2, 2018)

The Boston Beer Co launched Sam ’76, beer which combines the best attributes of a lager and an ale. The brew, which took over a year to develop the formulation, begins with two active fermentations that are combined during a final maturation step. The beer is available nationwide. (Source: Beverage Industry, January 9, 2018)

Baderbrau Brewing partnered with Lyft in Chicago to offer discounted rides as a promotion for its Five Star Lager. Each 12-ounce can will feature a code that can be used in the Lyft app for a 40% to 60% discount, up to $5, on classic Lyft rides. (Source: Mobile Marketer, January 11, 2018)

The countries that spent the most per capita on beer in 2017 were Australia at $452.55, Ireland at $347.59, Finland at $280.19, Austria at $232.92, and the United States at $229.40. In terms of beer volume consumer per capita, the Czech Republic leads the way with 137.38 liters consumed followed by Poland at 98.06 liters, Germany at 95.95 liters, Austria at 95.46 liters, and Lithuanaia at 92.00 liters. The per capita consumption in the U.S. was 74.90 liters (#12 of countries ranked). (Source: Statista, January 12, 2018)


Q1 2018

Anheuser-Busch InBev brand Stella Artois will run a 30-second spot during the 2018 Super Bowl broadcast. The spot will star Matt Damon and will highlight the brand’s ongoing partnership with Water.org, which was co-founded by Damon. In the ad, Damon will remind viewers that they probably take clean water for granted and ask them to purchase a Stella Artois chalice which will trigger a donation that provides five years of clean water for someone in the developing world. Stella Artois is also extending donations for each 12-pack purchased or pint poured at a bar. (Source: Adweek, January 16, 2018)

Total U.S. beer dollar sales through multi-outlet stores including the convenience, grocery, drug, club, dollar, mass-merchandise, and military channels totaled $34 billion in 2017, a 1.2% increase. During the same period, volume sales declined 0.4%. Sales of domestic premium brands declined 2.9% in dollar sales to $13 billion while volume fell 3.8%. The dollar sales of imported beer increased 8.5% to $6.5 billion. Craft beer sales rose 5.6% to $4 billion and volume sales increased 3.6%. Super-premium domestic beers saw dollar sales jump 11.3% to $2.5 billion and volume rise 9.4%. Sales of sub-premium domestic beer, flavored malt beverages, cider, and non-alcoholic beer all experienced declines. (Source: Brewbound, January 16, 2018)

Pabst Brewing announced the elimination of 70 positions across all areas of the company. The cuts were made as part of an effort to reduce its cost basis by 15%. Pabst will also invest less in projects around supply chain and social media and instead focus funds on growing New Holland Brewing and Tsingtao brands. This is the second round of reductions Pabst has made in less than two years, a period which also included a major overhaul of its leadership team. (Source: Brewbound, January 18, 2018)

An analysis of 2017 by BeerBoard, a provider of digital menu displays at on-premise retailers, showed craft beer share of draft lines increased more than 2%. Using proprietary data of more than 50,000 draft lines, BeerBoard calculated domestic beer’s market share at its clients’ locations fell to 49.59% while import beer had a 14.51% share and craft beer a 35.9% share. Craft beer accounted for more than two-thirds of draft handles compared to 17.2% held by domestic drafts. BeerBoard also reported that its clients poured 1,970 different IPAs last year, 34% more than in 2016. Stouts were the second most popular style with 921 variations offered. However, the top selling styles were light lagers (43% of all beer poured) and lagers (18.2%) followed by IPAs. (Source: Brewbound, January 22, 2018)

An industry report revealed the top five beers sold in the U.S. in 2017 to be Bud light, Coors Light, Miller lite, Budweiser, and Corona. (Source: The New York Post, January 23, 2018)

After promising last year to secure all purchased electricity from renewable sources by 2025, Anheuser-Busch InBev said the United States will be the first country to brew Budweiser beer with 100% renewable energy. In conjunction with this achievement, labels of Budweiser will feature a 100% renewable electricity symbol on U.S. labels. The label will roll out to new markets when the goal is reached. (Source: Beverage Daily, January 24, 2018)

Natural Light, an Anheuser-Busch InBev economy brand, plans to announce a new contest during the Super Bowl. Regional ads in ten college towns such as Pittsburgh, Cincinnati, Madison, Dayton, and Kansas City will launch the contest which will result in 25 people winning $40,000 each to payoff student loans. To enter the contest, entrants post a video describing their inspiration for going to college and include a shot of a green pull-tab from a can of limited edition Natty Light. The campaign uses #NattyStories to identify the videos across social media. The winners will be announced during graduation season. (Source: Fast Company, January 24, 2018)


Q1 2018

For Super Bowl LII, Anheuser-Busch InBev beloved Clydesdale

horses will not appear in a broadcast ad for Budweiser but will be part of a new 60-second online video. Instead, the brewer will run a commercial that spotlights how one of its breweries halted production of Budweiser to produce cans of drinking water to send to victims of natural disasters in California, Florida, Texas, and Puerto Rico. (Source: The Wall Street Journal, January 26, 2018)

Michelob Ultra is running two 30-second commercials during the Super Bowl – the first time the 5th largest beer brand will have two spots during the big game. Positioned as a beer for people who are fit yet fun, the ads will star Chris Pratt who will appear alongside some famous athletes during the second spot. (Source: Adweek, January 29, 2018)

Goose Island, a craft beer brand owned by Anheuser-Busch InBev, released a humorous video which shows its founder and presidents traveling to New York to pitch advertising Goose Island during the Super Bowl. The tongue-in-cheek video shows the brand doesn’t take itself too seriously and even speculates that maybe the answer would have been different if their mascot had said “Dilly.” (Source: Adweek, January 29, 2018)

Budweiser announced it will air a five-second bumper ad during the game to highlight its Clydesdale Cam a live feed of what the horses are doing in St. Louis that will stream on the brand’s Facebook page. In addition, Budweiser created an AR Snapchat lens that allows users to get the horses to appear in 3-D, jump over cases of Bud, and kick footballs. Finally, a 60-second spot featuring the Clydesdales as storytellers of an all-American odyssey will air only in digital channels. (Source: Adweek, January 30, 2018)

Heineken introduced a table-top draught system, called Blade, targeted for on-premise accounts that think their beer volume is too low to warrant investment in a regular draught system. The system fits in a 12” x 19” space and weighs 38 pounds. It also does not require a keg deposit, line cleaning, or CO2. The system guarantees brewery-fresh draught or 30 days. (Source: Brewbound, February 1, 2018)

Bud Light goes big with a 60-second spot during the second quarter of the Super Bowl. The new ad picks up where the last one – which will air in the first quarter – left off with the king giving his subjects a pep talk before they go into battle. The new ad shows the battle which features Bud Knight. The “Dilly Dilly” campaign has earned over 2 billion brand impressions through mid-January and improved positive sentiment for Bud Light by 14%. The brand conversation volume spiked as well as the mentions of “Dilly Dilly” in social media. In addition to the commercials, Bud Light will also run three Snap Ads, a Snapchat game, and both animated and geotargeted filters during and after the Super Bowl. (Source: Adweek, February 1, 2018; Digiday, February 1, 2018)

Crispin Cider Co., a MillerCoors entity, introduced Crispin Rosé. The cider is made with fresh-pressed apples and pears from the Pacific Northwest as well as real rose petals and hibiscus. It will be sold in six-packs of 12-ounce bottles as well as on tap at select locations. The launch will be supported with a national campaign featuring traditional and digital media, in-store sampling, and public relations. Drinkers are encouraged to #RoséAllYear by following Crispin on social media. (Source: Brewbound, February 3, 2018)


Q1 2018

Heineken introduced a new flavor of Strongbow Hard Cider. Rosé Apple is a semi-dry hard cider reminiscent of a rosé wine. It also contains 50% less sugar than leading US hard ciders. Strongbow Rosé Apple Cider will be sold in 11.2-ounce bottles and, for a limited time, 5.1-ounce mini-cans designed to drive trial. (Source: Brewbound, February 7, 2018)

MillerCoors Two Hats debut will be supported by a digital-only campaign which asks drinkers to “Stop Your Wine-ing.” The ads also tout the beer’s affordability with a price of $5 per six-pack. Beer as a proportion of alcohol volume consumed by adults age 21 to 27 years fell from 65% in 2006 to 43% in 2017. This demographic group has been drinking more wine and spirits. (Source: Ad Age, February 7, 2018)

Constellation Brands announced a sponsorship agreement under which Corona Extra will become the exclusive import beer of the Kentucky Derby for the next two years. The deal was partially driven by this year’s race being run on Cinco de Mayo (May 5th). The date provides an opportunity for the brand to promote both holidays and let consumers know they don’t have to choose. Marketing efforts will include retail point-of-sale materials, Derby-viewing parties, and an infield “activation zone” at Churchill Downs. (Source: Brewbound, February 9, 2018)

Bud Light launched a multi-channel campaign, “Brewed Deep in the Heart,” which focuses on the beer’s Texas roots. Texas musicians Siggno and Josh Abbott Band will help promote the fact that Bud Light has been brewed in Houston for more than 30 years. The campaign will include out-of-home events as well as English- and Spanish-language ads on television, radio, and digital channels. Special edition cans featuring the Texas Lone Star and a cut-out of the state on the tabs will debut regionally on February 12th. (Source: Marketing Dive, February 13, 2018)

Boston Beer announced its Angry Orchard Rosé will be the official hard cider of the 144th Kentucky Derby presented by Woodford Reserve. The new cider flavor will be available on-site in the Angry Orchard Rosé Club, a lounge with trackside viewing at the Derby. A national sweepstakes, race day broadcast coverage, and retail activations will also be part of the marketing sponsorship. (Source: Brewbound, February 16, 2018)

Anheuser-Busch InBev confirmed Budweiser has officially moved to a project-based model for its US advertising. Rather than having a creative agency of record, Budweiser will now use its entire team consisting of David, VaynerMedia, Mosaic, and Anomaly to develop all content and creative campaigns. (Source: Agency Spy, February 16, 2018)

Pabst Brewing and C&C Group, owner of Vermont Hard Cider, mutually agreed to terminate their strategic partnership whereby Pabst had overseen the sales, marketing, and distribution for the cider. The partnership was formed in December 2015 and took effect in March 2016 and included an option for Pabst to purchase the cider company. However, the cider market has been competitive and Pabst has encountered its own struggles. (Source: Brewbound, February 20, 2018)

Boston Beer Company is rolling out Samuel Adams New England IPA nationally. The juicy, hazy IPA was previously only available in the Boston area where it was the best-selling growler at the Boston Brewing in 2017. (Source: Brewbound, February 21, 2018)


Q1 2018

Boston Beer reported product shipments decreased 6.2% in 2017 driven by lower sales of its Samuel Adams and Angry Orchard brands. The country’s sixth-largest brewer also said revenues fell 4.8% to $863 million. Boston Beer expects a turn-around based on the early positive response to its recently introduced Sam ’76, Samuel Adams New England IPA, and Angry Orchard Rosé products. (Source: Brewbound, February 22, 2018)

Lime-A-Rita’s “Have-A-Rita” campaign features three “legendary ladies” known as “The Ritas.” As part of the campaign, The Ritas are dispensing cheeky-one-on-one advice via Facebook and Twitter to consumers age 21 and older. The Ritas have rich life experience combined with a “life’s a party” attitude. Anheuser-Busch InBev has recruited pop culture personalities to ask The Ritas for advice. The campaign also includes television spots, short videos, and digital advertising that feature the brand characters. A party pack in glass bottles will be introduced as “Party with The Ritas.” (Source: Media Post MarketingDaily, February 24, 2018)

Michelob Ultra Pure Gold is the latest brand extension to the Anheuser-Busch InBev line. Michelob Ultra Pure Gold is made with organic grains, free of artificial colors and flavorings, packaged sustainably. It also has only 85 calories and 2.5 carbohydrates. The Michelob Ultra line targets consumers who enjoy beer in balance with their healthy, active lifestyle. (Source: Beverage Industry, February 26, 2018)

A consultant’s review of the craft beer performance in 2017 predicts harder times are ahead for the category. Factors at play include:

o restricted access to traditional distribution channels as big brewers dominate shelf space, o lack of awareness and loyalty – among retailers, distributors, and consumers – as the number of

breweries tops 6,300 this year, o and the increasing availability of cannabis for recreational use.

The consultant recommends focusing on taproom sales which continue to grow and is the best way to build a brand, avoiding discounting or lowering prices as he believes high prices are not a category deterrent, and developing more super-premium brews which grew 40.9% in dollar sales last year. (Source: Brewbound, March 1, 2018)

Anheuser-Busch InBev reported its global revenue increased 5.1% while its U.S. sales fell 2%. Lower sales and shipments were driven by declines in the Budweiser portfolio including Bud Light. The brewer’s super-premium portfolio showed gains driven by double-digit volume growth for Michelob Ultra, Stella Arts, and craft beers. (Source: Brewbound, March 1, 2017)

Coors Light is shifting its advertising to focus more on its product attributes as it seeks to counter declining sales. The new ads show friends drinking Coors Light while hiking through the snowy Rockies, lists the beer’s credentials and characteristics, and uses the brand’s classic tagline, “World’s most Refreshing Beer.” The shift comes after a campaign that highlighted people who overcame personal challenges to achieve their goals. (Source: Ad Age, March 5, 2018)


Q1 2018

Sierra Nevada Brewing is refocusing on its flagship Pale Ale after a 7% sales decline in 2017 and a 6% drop in 2016. The lagging sales are attributed to increased craft competition at on-premise bars and restaurants and gaps in the distribution. Besides working to regain market share for its Pale Ale, Sierra Nevada will also introduce several new products including Hazy Little Thing, a New England-style IPA; Hop Bullet Double IPA; and Sidecar Orange IPA as well as a reformulated Otra Vez that features lime and agave. To support its efforts, the brewer is hiring brand managers and its first outside agency to help tell the Sierra Nevada story. (Source: Brewbound, March 6, 2018)

Constellation Brands is rolling out Corona Premier, the first Corona-branded drink introduced in 29 years. Corona Premier has 90 calories – nine less than Corona Light. Constellation will spend $35 million to support the launch. In three test markets, more than 70% of the Corona Premier sales were incremental and did not cannibalize its other products’ sales. (Source: The Wall Street Journal, March 6, 2018)

Recent consumer research reports more beer drinkers said they drank less beer in 2017. Among those drinking less beer, 31% said it’s because they are drinking more wine while 23% are drinking more distilled spirits and 21% more cocktails and mixed drinks. Despite changing tastes, per capita consumption has only declined moderately. One reason people may be moving towards other alcoholic beverages is flavor utilization. While craft beers are known for their fermentation and flavors, mainstream beers are trailing in the use of flavors. A flurry of flavored beer launches is expected to fill this void. (Source: Beverage Industry, March 8, 2018)

Anheuser-Busch InBev introduced Michelob Ultra in 7-ounce bottles. Each bottle contains just 55 calories and 1.5 grams of carbohydrates. The package is positioned as a great choice for weeknight drinking when some consumers refrain from drinking. (Source: Brewbound, March 12, 2018)

Anheuser-Busch InBev launched a campaign to support Breckenridge Brewery, a craft brewery it acquired in 2015. The “In Good CO” campaign focuses on the brand’s Colorado roots and culture in the first 60-second spot. A second spot introduces Breckenridge’s Nitro Irish Stout as “Irish inspired, Colorado crafted.” The campaign also uses out-of-home, digital, and social media as well as new packaging. (Source: Adweek, March 13, 2018)

The top craft beer producers based on 2017 sales volume are D.G. Yuengling & Son, Boston Beer Company, Sierra Nevada Brewing, New Belgium Brewing, and Duvel Moortgat. Duvel moved up from sixth to replace Gambrinus Company who switched places. In order to be included in the ranking, the brewer had to make fewer than 6 million barrels annually and be less than 25% owned by an alcohol industry company who is not also a craft brewery. (Source: Brewbound, March 14, 2018)

Heineken launched a new campaign to support Dos Equis. “Keep It Interesante” encourages beer drinkers to entertain their friends with embellished stories. The ads feature outrageous claims such as “the beer Abraham Lincoln kept under his hat” and the tagline “When out with friends, you could tell the truth or a better version of it.” The campaign includes digital video spots, television commercials, social media, retail support, and out-of-home activations. (Source: Marketing Dive, March 15, 2018)


Q1 2018

Bottled Water

Culligan Water retired its “Hey Culligan Man” ads after 59 years. During the Golden Globes, Culligan will debut a new ad featuring Cary Elwes reprising his famous line from The Princess Bride, “As you wish.” The ads hope to get people thinking about water as a way to make the lives of those we love better. Besides the television spot, the multi-year campaign also includes an Amazon Alexa skill that provides information about Culligan Water with answers that begin with “As you wish…” (Source: Adweek, January 5, 2018)

Fiji Water will donate $1,000 to the American Film Institute’s Directing Workshop for Women for every star photographed drinking its bottled water during the Golden Globes, Critics’ Choice Awards, Screen Actors Guild Awards, and Film Independent Spirit Awards red carpet events – up to a total of $100,000. As part of the One Sip Forward program, Fiji Water’s parent company, The Wonderful Company, will feature the works of women who participate in the AFI workshop and support their fundraising efforts. (Source: Adweek, January 7, 2018)

LIFEWTR unveiled its Series 4 which will focus on arts education, which is increasingly disappearing from schools. The new designs are from three young artists and the impact art has had on their lives. LIFEWTR is partnering with Scholastic to provide classroom kits to art education teachers in grades 7-12. In addition, the brand will showcase emerging artists on Sundance TV HQ during the Sundance Film Festival and sponsor a panel on arts education during the event. Between February and December 2017, LIFEWTR sold close to 85 million units and garnered $148.6 million in dollar sales in U.S. multi-outlet chains. (Source: Beverage Industry, January 8, 2018; Beverage Daily, January 25, 2018)

Raw water, which is unfiltered, untreated, and unsterilized water, is generating press and gaining consumer interest. Advocates contend that filtration removes beneficial bacteria and minerals while others are looking for fluoride-free water. The water is expensive but regularly sells out. Purveyors of raw water include Live Water sourced from Opal Spring in Madras, Oregon and Summit Spring sourced from a spring in Cumberland County, Maine. (Source: Cassandra Daily, January 9, 2018; WARC January 12, 2018)

Crazy Water, bottled since 1881, introduced a new glass bottle to answer consumer demand for the option. The glass bottle packaging is also being used for Crazy Fizz, a sparkling mineral water re-introduced last year but originally bottled in the 1930s. Crazy Water is positioned as not “over-manipulated” and with “minerals infused by Mother Nature.” (Source: Beverage Industry, January 12, 2018)

evian plans to make all its bottles from 100% recycled plastic by 2025 thereby creating a circular approach to plastic packaging. Currently, the Danone-owned brand uses 25% recycled plastic in its bottles. To meet this goal, evian will redesign its packaging and partner with Loop Industries on developing new technology that breaks down plastic into building blocks. evian previously set the target to become Danone’s first global carbon neutral brand by 2020, a goal it has already achieved in the U.S. and Canada. (Source: Beverage Daily, January 18, 2018)


Q1 2018

A survey conducted on behalf of the International Bottled Water Association found 63% of Americans identified bottled water as a preferred beverage barely beating out coffee which is a preferred beverage for 62% of Americans. Ninety-four percent of respondents believe bottled water is healthier than soft drinks and 93% say it should be available wherever drinks are sold. Sixty-nine percent of bottled water drinkers say the caloric content of a beverage influences their choices while 72% say the absence of artificial sweeteners is also a determining factor. Thirty-one percent of water drinkers drink only or mostly bottled water while 35% drink only or mostly tap or filtered water. Among all Americans surveyed, 86% had a very or somewhat positive opinion of bottled water. (Source: Convenience Store News, January 24, 2018)

In February, Nestlé Waters North America will introduce a portfolio of sparking waters for its six regional spring water brands: Poland Spring, Deer Park, Zephyrhills, Ozarka, Ice Mountain, and Arrowhead. A total of nine flavors will be available – lemon, lemon lime, lime, orange, triple berry, strawberry, raspberry lime, black cherry, and pomegranate lemonade – as well as an unflavored version called Simply Bubbles. The no-calorie, sparkling waters will use real spring water as the primary ingredient and the flavorings will be natural fruit flavors with no sugars, sweeteners, or colors. Nestlé’s goal is to increase the number of regional spring water sparkling drinkers two-fold by 2020 and plans to invest significantly in advertising and marketing to support the brands. (Source: Convenience Store News, January 26, 2018)

JUST Water launched JUST Infused, a line of certified organic, unsweetened flavored water. Available in three flavors – apple cinnamon, tangerine, and lemon – the waters are made with Adirondack mountain spring water and organic fruit and spices. Like JUST Water, JUST Infused is packaged in paper cartons. (Source: Beverage Industry, February 5, 2018; Beverage Daily, January 3, 2018)

A one-hour eye tracking study using a randomized shelf tool sought to compare La Croix packaging to 11 beverage competitors. Of the 100 opt-in respondents, 84% saw the La Croix cans on the shelf after a single 10-second exposure. It took participants only 2.4 seconds to find La Croix, surpassed only by Tipo Chico at 2.3 seconds. La Croix has the most visually appealing packaging according to 17% of respondents, more than the other brands tested. La Croix ranked fourth on brand recall behind Coke, Pepsi, and Sprite. (Source: Quirk’s Media, February 6, 2018)

PepsiCo is launching a new brand of sparkling water, bubbly. Sold in brightly colored cans, bubbly will be available in apple, strawberry, mango, grapefruit, lemon, cherry, lime, and orange. It has no calories and no artificial sweeteners or colors. The new product will be supported by advertising which will debut during the Academy Awards broadcast. Pepsi is entering the market after sales of domestic sparkling bottled water doubled between 2015 and 2017 to reach $8.5 billion. (Source: The New York Times, February 8, 2018; People Food February 8, 2018)

Pepsi is introducing a new beverage system called Drinkfinity which includes a water bottle and flavored pods. Each pod creates one flavored beverage that contains 30 to 80 calories. Available flavors include Mango Chia Flow, Pineapple Coconut Water Renew, and Mandarin Orange Charge. A total of 12 flavors are available. Like Keurig’s pods, Drinkfinity pods cannot be recycled though Pepsi does provide pre-paid envelopes that can be used to return used pods. Drinkfinity is initially only available through e-commerce. (Source: Food Dive, February 20, 2018)


Q1 2018

Nestlé Pure Life Purified Water is now sold in 100% food grade recycled plastic in the North American market. The new 700mL bottle features updated branding and information about Nestlé’s recycling initiative. (Source: Beverage Daily, February 20, 2018)

Talking Rain Beverage Co. announced Sparkling Ice will sponsor the National Hot Rod Association Top Fuel Dragster driven by Leah Pritchett in 2018. Sparkling Ice branding will be present on Pitchett’s Top Fuel Dragster, fire suit, and crew shirts. Other elements of the sponsorship include VIP meet-and-greets, on-site product sampling, cross-promotion on social media, branded swag, and other customer marketing. (Source: Beverage Industry, February 26, 2018)

A non-peer-reviewed study tested 259 bottles of bottled water from nine countries including Aquafina, Dasani, evian, Nestlé Pure Life, and San Pellegrino and 93% of the time “some sign of microplastic contamination” was present. The study counted roughly twice as many particles in bottled water as in tap water and more in plastic bottles than in glass bottles leading the researchers to conclude that the particles may be a result of the packaging or bottling process. The International Bottled Water Association pushed back on the study citing no scientific consensus on the testing methodology or the health effect of the microplastic particles. (Source: Beverage Daily, March 16, 2018)

Essentia Water, a premium ionized alkaline water, ended 2017 with retail sales of $124 million. It also increased its retail presence to more than 60,000 locations. The brand’s goal is to become the number one premium water. It also plans international expansion in the next year. (Source: Beverage Daily, March 19, 2018)


Q1 2018

Carbonated Soft Drinks

PepsiCo kicked off the Super Bowl marketing season with three former NFL stars featured in the brand’s recurring cooking competition series, Game Day Grub Match, in which contestants create recipes using Pepsi ingredients. Videos from the competition appear on YouTube and Facebook. The winner will have their wings recipe featured at Buffalo Wild Wings at the Mall of America in Minneapolis during Super Bowl weekend and have $25,000 donated to a food bank in the city of their choosing. In conjunction with this contest, fans of PepsiCo, SB Nation, and Eater will have a chance to win a trip to the Super Bowl on February 4 by entering a 60-second video on why they would be the best social correspondent for SB Nation. (Source: Adweek, January 10, 2018)

Diet Coke is being overhauled with four new flavored varieties, a new logo, and new packaging in slim colorful cans. The changes will be supported with an aggressive marketing campaign targeting millennials. The four new flavors are twisted mango, feisty cherry, zesty blood orange, and ginger lime. The formula will otherwise stay the same including the use of aspartame. The slim 12-ounce cans are designed to provide a more contemporary feel but traditional 12-ounce cans will continue to be sold. (Source: Ad Age, January 10, 2018)

Pepsi’s latest global creative campaign, “Pepsi Generations,” celebrates moments in the brand’s 120-year history. The campaign will kick-off during the Super Bowl with a television advertisement, “This is the Pepsi,” which will feature celebrities, past and present, including Cindy Crawford who will present a new take on her famous 1992 Pepsi Super Bowl advertisement. The campaign also includes limited-edition retro packaging, the return of the Pepsi Stuff loyalty program, and a series of pop-up exhibits that show the brand’s history and how it connected with consumers. (Source: Convenience Store News, January 15, 2018)

Coca-Cola announced a goal to collect and recycle the equivalent of all the packaging it produces worldwide by 2030 as part of its “World Without Waste” initiative. The program will include investing in more efficient packaging, local recycling programs, and consumer education. The largest challenge will be in developing countries, especially the one-quarter of countries that do not have any form of formal waste collection. (Source: The Wall Street Journal, January 22, 2018)

Basketball star LeBron James and hip-hop artist Kamalyah star in a new spot for Sprite. The baseball themed ad features James as a pitcher named “Big Taste” who strikes out a batter named “Thirst” by throwing a can of Sprite to a catcher (Kamalyah) named “Ice-Ya.” The TV ad will air in 30-second and 15-second versions throughout baseball spring training. The spot will also appear in social and digital channels. (Source: Media Post MarketingDaily, January 25, 2018)

Dr Pepper Snapple Group announced it has agreed to merge with Keurig Green Mountain in a deal valued at $20 billion. The merger company will have approximately $11 billion in annual sales. (Source: Dallas News, January 29, 2018)

Diet Coke kicked off its new “Because I Can” campaign with five new spots – one 30-second ad starring actress Gillian Jacobs and a series of four 15-second ads. The shorter spots show millennials enjoying the new flavors while the longer ad focuses on product taste and how it makes the drinker feel. In addition, the campaign includes a yet-to-be-released Super Bowl ad and outdoor ads. (Source: Adweek, January 29, 2018)


Q1 2018

Pepsi is partnering with Google on virtual reality activation which allows consumers to experience parts of iconic Pepsi ads either at a pop-up near the Super Bowl site or at home with a VR headset or microsite. At the end of the experience, Pepsi teases that it plans to add more scenes throughout the year. (Source: Adweek, February 1, 2018)

Coca-Cola will run a 60-second spot in the fourth quarter of the Super Bowl featuring a diverse cast and an original poem about Coke. The ad, “The Wonder of Us,” conveys the message that Coke is a suitable drink for everyone no matter race, background, or beliefs. The ad conforms to the brand’s ethos of optimism and inclusion similar to the classic “Hilltop” ad that sought to teach the world to sing in perfect harmony. (Source: Ad Age, February 1, 2018)

SodaStream is focused on social media and video after a successful influencer marketing campaign involved Thor Bjornson, the actor who plays “The Mountain” in Game of Thrones. The “Join a Revolution” project recreates a famous scene from Game of Thrones and incorporates the SodaStream brand in a humorous manner. The campaign has had more than 50 million views and 100,000 shares. The effort focuses on millennials and conveys a message of sustainability, health, and wellness. (Source: CMO (Australia), February 9, 2018)

In back-to-back Super Bowl ads, PepsiCo promoted two of its brands – Mtn Dew Ice and Dorito Blaze. Morgan Freeman promoted Mtn Dew Ice by lip syncing Missy Elliott and shooting frost from his fingertips. Doritos Blaze had Peter Dinklage lip syncing to Busta Rhymes and exploding in flames. After the ads ran, goPuffs – a convenience store delivery service in more than 20 cities – reported sales of Mountain Dew increased 17% within 90 minutes while Doritos saw a 10% sales lift. (Source: Beverage Daily, February 13, 2018)

PepsiCo confirmed it plans to make the aspartame-sweetened version of Diet Pepsi the primary formula rather than a limited variety marketed as “classic sweetener blend.” Pepsi pulled the aspartame formula off the market in 2015 but then brought it back in 2016 due to consumer backlash. Diet Pepsi also intends to add vanilla and lime flavors to its existing wild cherry flavor. The new lineup will be marketed through a television ad that promotes the “Classic Diet Pepsi Taste.” The aspartame-free Diet Pepsi version will only be available via e-commerce. (Source: Ad Age, February 16, 2018)

Mountain Dew named comedian Kevin Hart as it new spokesperson. A new campaign, “Closer than Courtside,” kicks off the year-long partnership with a pop-up experience at the NBA All-Star game. The campaign includes a video series, “Courtside Do’s and Don’ts with Kevin Hart,” and a #CourtSidekickContest on social media whose winner will get to bring a friend and hang out courtside with Hart during the NBA playoffs. Mountain Dew will be integrated into Hart’s latest comedy tour. Television, digital, social, and experiential marketing channels will also be used throughout the year. (Source: Marketing Dive, February 20, 2018)

Coca-Cola has introduced two new fruit-flavored specialty sodas: Coca-Cola Georgia Peach and Coca-Cola California Raspberry. The flavors are made from fruits grown in the two states. The positioning taps into Coca-Cola’s heritage with bottle and packaging design reminiscent of the days when sodas were handcrafted in the drug store. The sodas will be sold individually or in packs of four nationwide. (Source: Beverage Daily, February 22, 2018)


Q1 2018

Pepsi released its 2018 global football campaign, “Love It, Live It, Football.” The 60-second spot features five UEFA champions – Leo Messi, Marcelo, Toni Kroos, Carli Lloyd, and Dele Alli – playing a game of street paintball with soccer balls filled with Pepsi-blue paint. The players, onlookers, and surrounding buildings are splattered with paint. The spot will air in more than 60 markets worldwide. The 2018 campaign also includes artistic creations of each player which will be used in digital and out-of-home content as well as limited edition packaging. Conversations with players and other entertaining content will be available throughout the year. (Source: Media Post MarketingDaily, March 6, 2018)

Dr Pepper has sued Pepsi alleging Pepsi’s Mountain Dew Ice is too similar to 7Up and violates a non-compete agreement that governs a 70-county area where Pepsi-owned bottler distributes 7Up. Dr Pepper is seeking more than $1 million in damages as well as a court ruling which would prohibit Pepsi from distributing Mtn Dew Ice in the specific area. Mountain Dew-branded products have more than $1 billion in annual sales and is the nation’s third-largest soft drink brand after Coke and Pepsi. (Source: Dallas

News, March 7, 2018)

Coffee, Tea, and Cocoa

Nestlé Waters North America sold two ice tea brands, Tradewinds and Sweet Leaf, to Dunn’s River Brands, a private equity firm. The divestiture will allow Nestlé to focus on its core brands and its strategy of healthy hydration. (Source: Beverage Daily, December 19, 2017)

Snapple developed new PET packaging which retains the look and feel of the glass packaging including the “pop” of opening a new bottle and the embossed “S” on the bottle above the label. (Source: Beverage Industry, January 8, 2018)

Tiesta Tea will begin selling a line of ready-to-drink cold brew teas in Target for $2.99 per bottle. Each product in the five-product portfolio will be labeled by function: Energizer, Slenderizer, Eternity, Immunity, and Relaxer. Major ingredients of each tea will be featured on the label. (Source: Beverage Daily, January 8, 2018)

Folger’s launched “Here’s to Coaches” for the 2018 Olympic and Paralympic Games. The campaign recognizes and appreciates the support coaches give to athletes. Two-time Olympic gold medalist alpine skier Ted Ligety, Olympic cross-country skier Jessie Diggins, and Paralympic gold medalist para-snowboarder Evan Strong teamed up with Folgers on the campaign. The campaign will debut January 9 and run through February 25 during which limited-edition Team USA packaging will be available nationwide. (Source: Beverage Industry, January 9, 2018)

Tea of a Kind now offers Eco-4-Packs which consist of one bottle of ready-to-drink tea and three nitrogen pressurized bottle cap refills. The tea and flavors are stored in the bottle cap refills which can be twisted onto the water-filled bottle. The water will be transformed into another bottle of tea. Tea of a Kind hopes the novel system will help cut down on disposable bottles. (Source: Beverage Industry, January 12, 2018)


Q1 2018

Trends in food-service prepared coffee include nitro coffee (cold-brewed coffee infused with nitrogen gas), barrel-aged coffee (porous green coffee beans sit in aged wines or spirits before they are roasted), cold brew (steeping coffee grounds in cold or room temperature water for an extended period), coffee slushies (blending coffee with ice and/or ice cream or gelato), and bulletproof coffee (coffee with unsalted butter and medium-chain triglyceride oil). Overall, 28% of consumers are interested in nitro coffee, 43% in cold-brew coffee, and 28% in bulletproof coffee. Coffee flavors that appeal to consumers include chicory (29% find somewhat or very appealing), smoky (29%), mojito (27%), and spicy (26%). Adding turmeric, matcha, charcoal, algae, or mushroom extracts to “wellness lattes” is another trend that is becoming more popular. (Source: Smuckers, “Rising Stars in Coffee,” January 24, 2018)

Carbonated coffee, also known as coffee soda, is another trend gaining momentum. Available brands include Stumptown, Keepers, Upruit, Matchless Coffee Soda, and High Brew Coffee. Many of these coffees are also blended with fruit juices or citrus flavorings. High Brew contains twice the amount of caffeine compared to regular coffee and positions itself against energy drinks and sodas. (Source: Cassandra Daily, January 26, 2018; Beverage Daily, March 15, 2018)

Starbucks has begun shipping Teavana Craft Iced Teas to retail outlets nationwide. The ready-to-drink line is made up of Unsweetened Strawberry Apple Green Tea, Passion Tango Herbal Tea, Peach Green Tea, Mango Black Tea, Pineapple Berry Blue Herbal Tea, and Unsweetened Meyer Lemon Black Tea. The teas are produced and distributed under a partnership with Anheuser-Busch InBev. (Source: Beverage Industry, January 30, 2018)

Grass Fed Coffee, a ready-to-drink version of bullet coffee that is popular on paleo and keto diets, will be hitting store shelfs following a $86,000 Kickstarter campaign and two years of development. The coffee will be sold in a Tetra Pak that increases the stability and life of the product as well as optimizes the manufacturing process. The company plans to market to fitness-focused consumers through gyms and natural food stores. (Source: Dairy Reporter, February 7, 2018)

Brisk iced tea has teamed up with “Black Panther” star Michael B. Jordan on a 60-second spot which shows the behind-the-scenes work of creating art. In addition, Brisk and Jordan will launch an arts program, Creators Class, which will provide mentors and opportunities to up-and-coming artists in the areas of film, visual arts, and writing. Brisk is the official drink sponsor for “Black Panther” and the brand will host an immersive experience for film fans in Los Angeles. Brisk will also unveil nine can designs created through Creators Class. (Source: Adweek, February 16, 2018)

Folgers, who has been losing share to single-serve coffee pods and gourmet coffee, is launching a higher-end brand of coffee it hopes will win back coffee drinkers and increase sales. The new brand is called 1850 by Folgers. It is made with 100% steel-cut coffee beans which are roasted in perforated drum roasters. The product will be sold in 12-ounce bags as well as in single-serve Keurig pods. (Source: The Wall Street Journal, February 21, 2018)

PG tips, a Unilever tea brand, is introducing plant-based tea bags that are 100% renewable and biodegradable and do not use plastic polypropylene as a sealant. The tea bags will hit UK shelves first but will be used worldwide in the 10 billion tea bags PG tips makes annually by the end of the year. (Source: Beverage Daily, February 28, 2018)


Q1 2018

Shaka Tea, a ready-to-drink iced tea brewed with māmaki, a plant that only grows in Hawaii, has been reformulated to reduce its sugar content. The brand is available in four flavors sweetened with monk fruit: guava gingerblossom, mango hibiscus, pineapple mint, and lemon lokelani rose. Shaka Tea recently closed a round of financing that will allow it to roll-out nationally. (Source: Beverage Daily, March 5, 2018)

Laughing Man Coffee, a Keurig Green Mountain brand, announced a new marketing campaign, updated logo, redesigned packaging, and expanded availability. Laughing Man Coffee was founded in 2011 by actor Hugh Jackman after a trip to Ethiopia where he met coffee farmers and 100% of Jackman’s profits go to a foundation to support coffee farming communities. The “Make Every Cup Count” campaign includes an inspiring digital video series, a national public relations effort, social media amplification, digital ads, and retail activations. The coffee will now be sold in recyclable plastic pods as well as bags of ground coffee nationwide. (Source: Beverage Industry, March 12, 2018)

Distilled Spirits/Liquor Premium spirits account for 55% of total spirits by volume and 62% by dollar sales. Ultra-premium

spirits are growing at the fastest pace with a 5% increase in dollar sales compared to 3.2% growth in dollar sales for all premium spirits. Premium and ultra-premium whiskey and tequila contributed 65% of the total spirits growth. Off-premise consumption of spirits has also experienced rapid growth especially Irish whiskey, cognac, and tequila. (Source: Beverage Daily, December 19, 2017)

The top 25 spirits brands in the U.S. grew in volume by 4.6% in 2017 to 104 million cases and had 46% of the total category, up from 43% share two years ago. Overall, distilled spirits volume rose 2.3% last year to 227 million cases. Of the top 25 brands, 15 saw sales grow, nine saw sales decline, and one was flat. Market leaders Smirnoff and Bacardi both experienced sales decreases. The four fastest growing brands were Tito’s, Hennessy, Jameson, and Sauza – all had double-digit growth. (Source: Shanken News Daily, January 2, 2018)

Irish whiskey exports were valued at $717 million in 2017 while Irish cream liqueurs exports rose 10% to $358 million. In 2017, the U.S. market for Irish whiskey grew 16% to $287 million. Irish whiskey is the fastest growing spirit category worldwide and has seen sales increase 131% in the past ten years. Irish whiskey makes up 36% of beverage exports from Ireland. (Source: Beverage Daily, January 11, 2018)

Astral Tequila released the first three spots in a ten-ad campaign featuring Jonathan Goldsmith who previously played Dos Equis’ Most Interesting Man in the World. Each ad has the same set-up: A butler enters to relay some absurd news (e.g. the sun has been renamed in your honor) and Goldsmith drops whatever wacky activity he is doing and says “This calls for tequila!” (Source: Adweek, January 16, 2018)

In 2017, Hennessy Cognac reached nearly $1.6 billion in sales and overtook Jack Daniel’s as the largest spirit brand by value in the U.S. Hennessey has 68.4% of the U.S. market for cognac but competition is growing from Rémy Martin, Courvoisier, Martel, and D’Ussé. Overall U.S. volume of cognac increased 17% to almost 5.4 million cases. However, the category faces challenges around supply and consumer awareness. (Source: Market Watch, January 17, 2018)


Q1 2018

Pernod Ricard acquired the stake in Avión Spirits that it did not already own. Pernod Ricard took a majority interest in the ultra-premium tequila company in 2014. The brand fits Pernod Ricard’s strategic focus on premiumization and building consumer-passionate brands. (Source: Beverage Daily, January 18, 2018)

Bacardi Ltd is acquiring Patrón Spirits International, a company it has held a 30% stake in for nearly a decade. Patrón is the top-selling tequila brand in the U.S. with $1.6 billion in sales in 2016. However, the tequila segment faces increasing competition. (Source: The Wall Street Journal, January 22, 2018)

Johnnie Walker released the Johnnie Walker Blue Label Year of the Dog limited-edition bottle in celebration of the Lunar New Year. The annual limited-edition series inspired by the Chinese Zodiac is now in its fifth installment. This year’s bottle was designed in collaboration with Taiwanese artist Page Tsou. The bottle is part of the brand’s Pioneering Spirit Series. (Source: Beverage Industry, February 6, 2018)

Actor Ryan Reynolds has purchased an ownership interest in Aviation Gin. Reynolds will appear in brand marketing efforts and be involved in the brand’s strategic and creative processes. Aviation Gin is made with a “unique botanical mix” that makes it different from competitors. (Source: Adweek, February 21,

2018)

Diageo is joining the “Free the Bid” initiative which calls on advertising agencies to put forth at least one female director as part of creative bids for marketing campaigns. The gender diversity program was set up in 2016 and has the backing of HP, Visa, Coca-Cola, Airbnb, and Levi’s. (Source: Marketing Week, February 22, 2018)

In a bid to attract female drinkers, Diageo is introducing Jane Walker, a limited-edition version of Johnnie Walker black label scotch. Jane Walker will feature a logo with a woman in boots mid-stride tipping her hat. For every bottle of Jane Walker sold, Diageo will donate $1 to organizations championing women’s causes, up to $250,000. Recently, Diageo conducted another campaign targeted towards women called #LoveScotch which depicted attractive young women drinking Scotch in print, out-of-home, and social media ads in dozens of countries. Both campaigns are an intentional shift to market its products to women. (Source: The Wall Street Journal, February 26, 2018)

In February, 3,000 Bacardi employees went to bars throughout the world to interact with bartenders and other patrons to generate good will towards their brands including Grey Goose vodka, Dewar’s Scotch, Bombay Sapphire gin, and Bacardi rum. The “Back to the Bar” program including months of training that showed employees how to talk to bar staff and taught them the best ways to take photographs of cocktails. The program helped employees see how customers relate to the brands and it helped build community. (Source: The New York Times, March 4, 2018)

Smirnoff vodka is partnering with Spotify to launch Smirnoff Equalizer. The API analyzes the artists Spotify users have streamed in the past six months then offers a tailored playlist that represents male and female artists equally. Users can also adjust the number of female artists in the playlist as well as hear from female musicians about gender bias in the industry. The API will be available during the summer months in the U.S., Great Britain, Ireland, Australia, Mexico, and Argentina. Smirnoff Equalizer is an extension of the brand’s “Equalizing Music” campaign that has a goal of doubling the number of females headlining music festivals by 2020. (Source: Marketing Dive, March 5, 2018)


Q1 2018

An annual list of “Hot Brands” in the spirits category honors the fast-growing labels with at least 200,000 cases sold. In 2017, 31 brands met one of four sales criteria to qualify for the list. Of these, 11 brands are tequila including Hornitos, Sauza Silver, El Jimador, and Cazadores. The list also includes nine whiskey brands including Jim Beam, Fireball, Jameson, Bulleit, Crown Royal Vanilla, and Woodford Reserve. Hennessy and Rémy Martin VSOP earned honors in the Cognac segment while Tito’s, New Amsterdam, Platinum 7X, and Deep Eddy did so in the vodka category. (Source: Shanken News Daily, March 9, 2018)

Younger legal-drinking-age consumers are driving the cocktail culture trend which involves consumer experimentation and mixologist innovation. It is also driving slow but steady growth in cocktail mixers, about 2% year-over-year. Only 25% of consumers report drinking cocktails at home and of those 35% use cocktail mixers that require the addition of alcohol. The top liquid cocktail mixers and their market share for the past year were Jose Cuervo (14.3%), Master of Mixes (13.8%), Mr & Mrs T (12.8%), Zing Zang (11.1%), and Angostura (3.7%). (Source: Beverage Industry, March 12, 2018)

Diageo acquired Belsazar, a premium aperitif from Germany. Belsazar is made from select grapes, infused with herbs, and finished with a dash of fruit brandy before it ages for up to three months. Belsazar varieties were created to be served with tonic. The aperitif segment is growing as consumers seek cocktails appropriate for more casual occasions that have a lower alcohol by volume. (Source: Beverage Daily, March 15, 2018)

Fruit/Vegetable Juices and Drinks

Ocean Spray Cranberries added two new beverage lines: Ocean Spray Organic 100% Juice Blends and Ocean Spray Unsweetened Pure Cranberry 100% Juice. The organic juices are available in cranberry, cranberry apple and cranberry blueberry flavors and have no added sugars, preservatives, or artificial flavors. Both lines are available nationwide. (Source: Beverage Industry, December 21, 2017)

Dollar sales for juice fell 7.5% to $16.6 billion while unit sales slipped 12%. Juice’s lackluster performance is a result of its high calorie count and sugar content as well as its high price and limited product innovation in recent years. Fewer people eating breakfast at home is another factor for a beverage category associated with morning consumption. Per capita consumption of juice fell from 47 liters in 2002 to 33 liters in 2016. The super-premium juice segment stood out for its 8% growth rate which is attributed to the perception that high-end juices are healthier. Juices with complex mixes and exotic flavors are also growing in popularity as have products with clean labels and functional qualities. (Source: Beverage Industry, January 10, 2018)


Q1 2018

The U.S. juice market is projected to decline 7% between 2016 and 2021. Repositioning juice drinks as a drink appropriate for evening consumption may be one way to lessen the decline. Highlighting ingredients associated with relaxation and stress reduction can help market juice as a way to decompress at the end of the day, similar to herbal teas. Using digestion and health claims could increase the consumption of juice as an after-dinner drink. (Source: Beverage Daily, February 26, 2018)

Tropicana, a PepsiCo brand, is launching two new products: Tropicana Kids and Tropicana Coco Blends. Tropicana Kids are premium fruit juice drinks that are certified by the USDA as organic. The drinks are made with 45% real fruit juice and filtered water. They do not contain added sugars, sweeteners, or artificial flavors. Tropicana Kids are available in Fruit Punch, Mixed Berry, and Watermelon and packaged in clear containers so that the juice is visible. Tropicana Coco Blends combine juice with 10% coconut water. Available in Pineapple and Peach Passion, the blends are free of artificial sweeteners and flavors. Both drinks are available nationwide. (Source: Beverage Industry, March 13, 2018)

Zico Coco-Lixirs combine organic coconut water with organic, cold-pressed juices. The new line from Coca-Cola will be available in three flavors: For Lemon’s Sake, Unbe-leaf-able, and Turn Up the Beet. In addition, two new flavors of Zico Chilled Organic – Natural and Pineapple Mango – are now in refrigerator cases while Jalapeño Mango flavor is a new shelf stable flavor of Zico. Coca-Cola has found consumers are 30% more likely to try a category when a new flavor is introduced. (Source: Food Dive, March 15, 2018)

Milk/Milk Alternatives

In the U.S., plant-based dairy milk alternatives have sales of $2.11 billion, 61% more than five years earlier. Almond milk has a 64% share of the market followed by soy at 13% and coconut at 12%. Despite the growth of dairy milk alternatives, dairy milk also has pockets of growth including flavored milk with estimated sales of $1.74 billion and an 18% growth rate since 2012. Whole milk has seen sales increase 8% since 2012 with sales estimated at $5.36 billion. Whole milk is perceived to be the healthiest milk by 20% of Americans compared to 18% who think skim/low-fat is healthiest and 17% who think almond milk is best. (Source: Beverage Daily, January 5, 2018)

The Farmer’s Cow introduced a limited-edition flavored milk that tastes like coffee. It will be available through early February. This is the eighth flavored offering from The Farmer’s Cow. All flavored milks are produced in small batches. (Source: Dairy Foods, January 5, 2018)

Darigold has added a salted caramel milk to its Old-Fashioned Milk product line. The flavored milk can be used in recipes or consumed on its own. (Source: Dairy Foods, January 22, 2018)

The Milk Processor Education Program (MilkPEP) conducted research with 1,500 children age 7 to 17. The survey found 40% would drink more milk, 20% wished they could drink more milk but their parents steered them to a different beverage, and 15% thought they would drink more milk if their parents encouraged them to do so. (Dairy Reporter, January 24, 2018)


Q1 2018

Sales for the total milk category, including non-dairy milk alternatives, fell 1.1% to $15.8 billion for the 52 weeks ending November 5, 2017. During the same period, unit sales declined 1.6% to 5.7 billion. Dollar sales of skim/lowfat milk dropped 5.2% to $7.8 billion and unit sales decreased 5.5% to 2.8 billion. Among the top 10 brands in this segment, only three posted increased sales: fairlife (64.7% in dollar sales and 58.9% in units), Borden (7.3%/5.7%), and Hood Lactaid (1.9%/0.5%). Whole milk sales gained 3.8% to $4.8 billion and units rose 3.1% to 1.7 billion. Brands that fared well in the segment included fairlife (65.1%/64.9%), Organic Valley (18.8%/16%), Hood Lactaid (13%/11.3%), and Borden (12.9%/11.5%). Brands that experienced declines in the skim/low-fat and whole milk segments included DairyPure, Dean Foods, and Horizon Organic. (Source: Dairy Foods, February 2018)

Silk launched its largest marketing campaign to date to raise awareness of its plant-based dairy alternatives. The “Progress is Perfection” campaign celebrates the little moments in life with spots in 31 markets during the opening ceremony of the Winter Olympics. Additional 15-second videos will appear in digital channels throughout the year as will print ads. Consumers will be encouraged to share their own stories of progress on social media using #progressisperfection. (Source: Media Post Agency Daily, February 9, 2018)

fairlife is introducing DHA Whole Milk, an ultra-filtered cow’s milk with DHA omega-3 fatty acids. fairlife already offered a DHA 2% Milk. The milk is available nationwide. (Source: Dairy Reporter, February 20, 2018)

Califia Farms is launching a line of dairy-free yogurt drinks made with the Califia Culture Blend which includes 10 billion live, active probiotic colony-forming units powered by BB-12. The drinks will be available in Strawberry, Super Berry, Mango, and Unsweetened Plain flavors in two sizes: 8-ounces and 25.4-ounces. (Source: Beverage Industry, March 7, 2018)

Due to a surplus of milk in the U.S., Dean Foods canceled contracts with more than 100 dairies effective May 31st. Other factors that contributed to the decision were declining milk consumption and increased competition in the milk processing businesses. It will continue to purchase milk from 12,000 other dairy farms across the country. (Source: Dairy Reporter, March 13, 2018)


Q1 2018

Nutritional/Functional Drinks

Smart Cups launched a line of energy drinks that are 3D-polycapsule printed. The Smart Cups print flavor materials on the surface of a biodegradable cup. To activate the drink, consumers add water to the cup to make a zero-calorie, sugar-free energy drink without stirring. The line is available in four flavors: Tropical Recess, Nerdy Lemon-T, Pucker Up Brain Boost, and Magna Cum Latte. The brand is currently only sold online. (Source: Beverage Daily, December 21, 2017)

Adaptagens are plant extracts or other non-toxic substances which increase the body’s ability to reduce the effects of stress and promote normal physiological functioning. The most common adaptogens are Ashwagandha, Ginseng, Holy Basil, Eleuthero, Schizandra, licorice, and medicinal mushrooms. Several beverages are incorporating adaptagens including Califia Farms, Rebbl, Four Sigmatic, and GT. Starbucks just launched a latte with turmeric in London. Coke and Pepsi have reportedly done a lot of R&D on the ingredients. Teas and coffee are key categories for adaptagens. Coffees and teas containing ginseng have sales of more than $200 million. (Source: Beverage Daily, December 21, 2017)

Antioxidants are among the functional ingredients that are resonating with consumers. One survey found 60% of consumers are seeking beverages that are good sources of antioxidants which is comparable to the number looking for products with calcium fortification (63%) and reduced sugar content (61%). More fruit juices, fusion waters, sparkling waters, energy drinks and shots, plant-based dairy alternatives, kombuchas, and cold-brew coffees are incorporating antioxidants. The clean-label trend also means consumers are looking for real food antioxidants on the ingredient list not synthetic or highly processed extracts. (Source: Beverage Industry, January 16, 2018)

In 2017, sales of Gatorade totaled $5.9 billion, 0.5% less than the prior year and the first decline since 2012. The iconic sports drink still has a commanding 75% share of the market and accounts for about 20% of PepsiCo’s North American drink volume. The company attributed the lower sales number to a cooler summer and slow sales in the convenience store channel. Both Gatorade and Coca-Cola’s PowerAde have been losing market share to BodyArmor, a relative newcomer to the category that differentiates itself by not using artificial coloring. Sales of BodyArmor doubled to $235 million last year, earning it a 3% market share. (Source: The Wall Street Journal, January 23, 2018)

Free samples of Red Bull will be offered to ride-share customers in Minneapolis for either the Super Bowl or the Red Bull Crashed Ice downhill event in St. Paul. The promotion is being handled by Cargo, a startup that sells snacks and toiletries in ride-share cars in four markets. (Source: Marketing Dive, January 19, 2018)

Endo Water is a premium pH balanced water infused with 99.9% percent cannaboid-rich hemp oil which has been processed using nano-technology to make the CBD particles smaller. The water is sold in berry, acai, lemon-lime, cucumber, and watermelon flavors. It is currently sold online and through 4,000 stores in Southern California. CBD has shown benefits for treating anxiety and depression. (Source: Beverage Daily, February 1, 2018)


Q1 2018

Of all the beverages introduced around the world in 2016, 27.2% featured functional benefits. In 2017, among all functional drinks launched 30.5% were fortified with vitamins and minerals and 22.8% contained high amounts of protein. In addition, 20% promoted energy and alertness, 19% digestive health, and 12.7% antioxidants. (Source: Beverage Industry, February 8, 2018)

KeVita, a line of probiotic beverages, is launching its largest advertising campaign ever. The campaign includes a series of five 30-second videos of KeVita fans – including a ballerina, jam skater, musician, surfer, and yoga instructor – sharing their stories and their passions. The campaign also features an #AliveLikeYouContest which will award three grand prize winners $2,000 to fulfill their passions. Other entrants will receive “Alive Like You” shirts. The campaign will also include targeted out-of-home advertising, digital advertising, influencer integrations, retail promotions, and sample events, and a dedicated campaign website. KeVita was acquired by PepsiCo in late 2016. (Source: Media Post MarketingDaily, February 19, 2018)

Cafecito is a cross between ready-to-drink coffee and an energy shot. Each two-fluid-ounce bottle has an energy blend that contains caffeine, taurine, and ginseng and is sweetened with erythritol. Cafecito is sold in major chains such as 7-Eleven and Walgreens in Florida as well as on Walmart.com. (Source: Beverage Daily, February 21, 2018)

Coca-Cola, an official FIFA World Cup sponsor, will be the presenting sponsor of the Telemundo Deportes Post-Game show for all 64 World Cup matches. It will also sponsor in-game match clocks. Powerade will be a featured brand in social activations throughout the tournament. (Source: Adweek, March 6, 2018)

At SXSW, Gatorade’s activation featured the G-Store, a pop-up shop filled with every Gatorade product. As part of an augmented reality experience, attendees were given iPads and asked to find products in four different categories – hydration, energy, recovery, and endurance. After unlocking all four categories, attendees entered a massive room behind the refrigerators that showed off technology athletes are using to refine their skills. The purpose of the activation was to demonstrate Gatorade is more than hydration. (Source: Adweek, March 12, 2018)

Wine

Lot18, in conjunction with Warner Bros. Consumer Products, has produced a limited-edition collection of wine inspired by “The Lord of the Rings” movies. The collection honors memorable characters in the films including Aragorn (red blend), Frodo (zinfandel), Gandalf (pinot noir), and Galadriel (Bordeaux blanc). The wines are limited to 6,000 bottles each and each has a specially designed label. (Source: Beverage Industry, December 19, 2017)

California vintner, The Setting, is releasing a special-edition wine featuring an embossed outline of skateboarding legend Tony Hawk. Proceeds from sales of the Cabernet blend will support the Tony Hawk Foundation which builds skate parks in impoverished areas. (Source: Wine Spectator, December 21, 2017)

By 2021, the U.S. is projected to consume 20.2 million liters of Champagne, significantly less than the 102.2 million liters that will be used in France. Globally, Champagne sales are predicted to increase 7% this year. Strong demand in the U.S. is expected as well. (Source: Beverage Daily, January 4, 2018)


Q1 2018

E. & J. Gallo has acquired Sicilian winery Tornatore and added it to its Lux Wines division. Gallo will introduce nationwide, the Tornatore line which will include an Etna Bianco, Etna Rosso, Etna Rosso Pietrarizzo, and Etna Ross Trimarchisa. The Tornatore vineyard is located on the northeastern slopes of Mount Etna and produced native grapes. (Source: Market Watch Magazine, January 5, 2018)

The 750ml glass bottle accounts for 50% of wine sales. As soon as it is opened, the five servings it contains begin to deteriorate which is an issue as household size shrinks and consumers gravitate towards drinking less but better wines. As a result, alternative containers that claim to keep wine fresher longer are gaining more traction. Wines sold in Tetra Pak containers saw sales grow 21% in 2016 while 3-liter bag-in-box grew 13% and wine in cans grew 100%. However, these other formats lack the premium appeal of traditional glass bottles and so some manufacturers are shifting to smaller bottles including 187 ml and 375 ml sizes. (Source: Beverage Daily, January 9, 2018)

Yellow Tail plans to market its wine at this year’s Super Bowl. A food truck will tour the country in advance of the big game and serve game-day sandwiches paired with Yellow Tail wines. The sandwiches were created by Food Network celebrity chef Jeff Mauro. The truck will be in Minneapolis for the Super Bowl. Yellow Tail also plans to air a 30-second advertisement during the game. Though it is prohibited from airing national ads due to Anheuser-Busch InBev’s alcoholic beverage exclusivity rights, the Australian wine has purchased local ads in 80 U.S. markets that will reach 100 million people. After a similar maneuver last year, sales of Yellow Tail increased which made the expensive and cumbersome end-run worthwhile. (Source: Wine Spectator, January 18, 2018; USA Today, January 30, 2018)

As more supermarket shoppers are buying wine at the grocery store, private label wines are becoming traffic builders for those chains that develop high-quality products. Some grocers, such as Trader Joe’s, clearly identify the wine as their product. Others, like Whole Foods, do not include the retail name on the label. However, consumers have shown trust in private label brands such as Trader Joe’s, Costco, and Lidl. At the International Wine Challenge, 391 private label supermarket wines received medals. (Source: Beverage Daily, January 22, 2018)

A survey of 1,800 fine wine consumers revealed that 65% make the effort to find rare vintages and unusual wines while 75% wish they could spend more on wine. By generation, Gen X spends the most on wine annually at $5,717 followed by Baby Boomers who spend $4,900 and Millennials who spend $4,163. Gen X respondents were the most likely to spend $70 on a bottle of wine on more than one occasion a month. They are also the most engaged in wine clubs and growing wine cellars. As members of Gen X continue to grow their income, they will become the dominant fine-wine consuming generation. (Source: Beverage Daily, February 1, 2018)

Premiumization is being seen in the wine market as consumers shift their preference for higher quality wines but at an affordable price point. As a result, buyers are willing to purchase premium wines in alternative packaging. The U.S. wine market grew 2.7% to $11.5 billion as measured by sales through retail chains (supermarket, drug, mass, gas, convenience, military, club, and dollar) for the 52 weeks ending December 24, 2017. The fastest growing segment of wine was sparkling wine which recorded 7% growth in dollar sales and 4.2% growth in cases sold. Sparkling wines sales are expected to continue growing as consumers serve bubbly more often than the holidays and special occasions. The top sparkling wine brands sold in the U.S. last year were Korbel, Cooks, La Marca, Barefoot Bubbly, and Andre. (Source: Beverage Industry, February 12, 2018)


Q1 2018

Ste. Michelle Wine Estates introduced a new line of wines crafted by David Merfeld. The Merf range consists of a Chardonnay and a Cabernet Sauvignon, both sourced from Washington’s Columbia Valley. National distribution will occur this summer. (Source: Market Watch Magazine, February 14, 2018)

Cupcake Vineyards launched a new campaign, “Choose Joy.” The marketing effort includes four 15-second spots that show people unapologetically choosing happiness in everyday moments. The ads are also fun with a touch of sass. (Source: The Drum, February 16, 2018)

Treasury Wine Estates introduced an augmented reality app that brings the labels of five of its wine brands to life. After downloading the “Living Wine Labels” app, a consumer can point it at the label and watch an animated version of the label on their smart phone. For instance, the 19 Crimes labels feature photographs of former British convicts who became Australian colonists. The app turns the photograph into a talking head that tells about their crime and other historic tales. Besides 19 Crimes, the app works with Chateau St. Jean, Gentleman’s Collection, The Walking Dead, and Beringer Bros. wine labels. (Source: Beverage Daily, March 5, 2018)

An annual list of “Hot Brands” in the U.S. wine market identified 23 domestic wines and 20 imported wines. Leading the domestic pack is Black Box which added nearly 1.2 million cases to its sales last year. It is followed closely by Bota Box. The two brands together sold a combined 12.6 million cases, up from 7 million in 2014. Other Hot Brand winners in the domestic category are Liberty Creek, Apothic, Dark Horse, Josh Cellars, Meiomi, Duplin Winery, A to Z, and House Wine. The leading imported Hot Brand by volume was Italy’s Stella Rosa with more than 1.7 million cases sold last year. Other imported wines that were honored include La Marca, Mionetto, La Vieille Ferme, Kim Crawford, Oyster Bay, and Matua as well as 19 Crimes which doubled its volume in the past year to surpass one million cases sold. (Source: Shanken News Daily, March 12, 2018)

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