BevAlc Insights’ 2021 Hard Seltzer Forecast
Despite increasing competition and blurred lines from the ready-to-drink category, new and established hard seltzer brands are still experiencing wild success
There’s no question that hard seltzer has become one of the most successful new beverage alcohol categories over the past five years, driving sales and overtaking light lager as the best-selling beer subcategory on Drizly. Now established and holding its own, how will the onslaught of new brands and competition from the rising ready-to-drink (RTD) cocktail category impact future hard seltzer sales?
From Offbeat Obscurity to BevAlc Staple
Though the hard seltzer category as we know it today debuted in 2013 with Bon V!V, then known as Spiked Seltzer (though some argue that Zima, which launched in 1993, was really the first hard seltzer), it didn’t really take off until the summer of 2019, when it first surpassed light lager as the best-selling beer subcategory on the Fourth of July. On Drizly, hard seltzer held 14 percent of beer share that year, compared to just five percent in 2018.
The category was already poised for rapid ascent, but the impact of Covid-19 set hard seltzer on a skyrocketing trajectory, holding 21 percent of share in 2020. That year-over-year growth has slowed a bit, but still, hard seltzer remains strong as the top-selling beer subcategory, with 23 percent of share.
Over the past two years of rapid growth, the category has transformed. “Innovation and new brand and product entry has drastically changed the hard seltzer landscape over the past few years,” says Liz Paquette, Drizly’s head of consumer insights.
Until 2019, a few big hard seltzer brands dominated sales: White Claw, Truly, and Bon V!V. Now, everyone’s trying to get a piece of this lucrative pie, from other big beer brands trying to compete as hard seltzer lures away light lager drinkers, to traditional seltzer brands, to craft breweries and independent brands.
Many spirits and wine companies have also launched canned, liquor- or wine-based beverages marketed as hard seltzer, one of the most successful of which has been the uber-popular High Noon, which debuted in 2020 from wine conglomerate E. & J. Gallo. Drizly defines hard seltzers as fermented malt beverages, classifying brands like High Noon (which is vodka-based) as RTD cocktails.
As hard seltzer has taken share from light lager, RTD cocktails may be poised to steal share from hard seltzer — and indeed, they are likely a contributing factor in the category’s slowing growth. Currently, hard seltzer holds four percent of share across all subcategories on Drizly, while RTD cocktails hold two percent.
“Share is still growing but slowing growth shows that saturation may be a possibility in the not so distant future, particularly as ready-to-drink growth skyrockets,” says Paquette. RTD share growth is up 15 times the rate of hard seltzer share growth in 2021 to date, she adds.
According to Drizly’s recently published 2021 consumer report, only 32 percent of respondents correctly identified what hard seltzer is; 54 percent selected responses that were the definition of a ready-to-drink cocktail. “There is a clear blurring of the lines between the two categories as innovation continues, and the majority of consumers do not know the difference,” says Paquette.
Which Hard Seltzer Brands Are Selling in a Competitive Landscape?
The number of hard seltzer brands on the market today has skyrocketed, with new ones debuting regularly. Many of last year’s new launches came from well-known beer brands like Bud Light and Corona, which ranked third and fourth among Drizly’s best-selling hard seltzer brands and have maintained those positions so far this year. Michelob Ultra’s USDA-certified organic hard seltzer, which was introduced in January 2021, has also performed well year-to-date and now ranks No. 6 among Drizly’s best-selling hard seltzer brands.
Other 2021 launches like CACTI and Topo Chico Hard Seltzer have also ranked in Drizly’s top 10 brands year-to-date, suggesting that there still is room for new entrants to succeed in an increasingly crowded category. Some of these new launches, in fact, have bumped former favorites like Smirnoff Seltzer off the top 10 list.
The success of Topo Chico Hard Seltzer is just one example of a traditional nonalcoholic beverage brand branching out into hard seltzer; Hornell Brewing Company, which owns iced tea brand AriZona, is among the fastest-growing hard seltzer brands after launching AriZona SunRise Hard Seltzer last year. Some of Drizly’s best-selling craft hard seltzer brands also come from regional breweries.
Despite competition from new hard seltzer entrants, the top four brands have remained consistent year-over-year. “Brands like Truly, White Claw and Bud Light have found continued growth with their recent flavor innovations from fruit punch to lemonade and iced tea,” says Paquette. Though White Claw and Truly have firmed their positions as the two best-selling hard seltzer brands in recent years, their third former category leader, Bon V!V, has steadily moved down the ranks each year, sitting in the No. 10 spot year-to-date.
Drizly’s Top-Selling Hard Seltzer Brands, 2021 vs. 2020
- White Claw vs. White Claw
- Truly Hard Seltzer vs. Truly Hard Seltzer
- Bud Light vs. Bud Light
- Corona vs. Corona
- Topo Chico Hard Seltzer vs. Bon V!V Spiked Seltzer
- Michelob vs. Smirnoff Seltzer
- Vizzy vs. Vizzy
- CACTI vs. Upslope
- Press Spiked Seltzer vs. Press Spiked Seltzer
- Bon V!V Spiked Seltzer vs. Wild Basin
The fastest-growing brands year-to-date include: Lone River, Ashland, Nude Beverages, Bootstrap, Calicraft, and Hornell Brewing Company.
Who Is Buying Hard Seltzer?
Though hard seltzer has broad appeal, on Drizly, sales have been dominated by millennials (ages 26 to 40), who hold 62 percent share year-to-date. However, this has declined by four percentage points over last year as more Generation Z purchasers hit the legal drinking age; Gen Z (ages 21 to 25) now holds 14 percent of share, up from nine percent in 2020. Gen X users (ages 41 to 56) hold 21 percent of share, while baby boomers (ages 57 and up) hold three percent of share.
Continued Success for Hard Seltzer
Despite slowing growth and increased competition from RTD cocktails, hard seltzer has not yet reached a saturation point. There is still plenty of movement within the top-selling hard seltzer brands, with new entrants that have launched this year outperforming former category leaders.
When it comes to stocking new brands versus familiar options, Paquette suggests that retailers pay attention to which products sell well both in-store and online. “It is clear that consumers are thirsty for new offerings in this category, but some rise to the top while others fade,” she says.