The Weekly Sip: Canned cocktails boost AB InBev | Powerade puckers up with sour flavor
The Weekly Sip is Food Dive’s column focused on the latest news in the rapidly changing and growing beverage sector. From inaugural product lines to big investments and controversial topics, this column aims to quench the thirst for developments in the category.
AB InBev recovering with help from RTD cocktails
More than a year after the boycott of Bud Light, the brewer is still dealing with the impact. But other alcohol categories, and a stronger international performance, are helping offset some of its stateside beer losses.
AB InBev’s revenues increased 2.6% year-over-year to $14.5 billion in its first quarter of 2024 despite a 0.6% decrease in volumes.
In the U.S., the company’s mainstream beer offerings declined in the quarter, but its RTD and spirits-based drinks saw double-digit volume growth, AB InBev said in the press release.
During the company’s earnings call, CEO Michel Doukeris said growth in the canned cocktail space is being driven by increases in its Cutwater canned cocktails and Nütrl vodka seltzer. They are both in the top 10 fastest-growing spirits brands in the U.S.
The executive said beer volumes in the U.S. are “improving sequentially” and dollar sales in the category are growing compared to last year. He pointed to Michelob Ultra and Busch Light as two brands that have gained momentum in the last quarter.
“The beer category is large and growing, and our unique global leadership advantage, implementation of our replicable growth toolkits and our superior profitability position us well to generate value for our stakeholders,” Doukeris said.
In a note to investors, TD Cowen analyst Robert Moskow said the Bud Light brewer’s declines in North America were “better than expected,” and its earnings bump came mostly from a stronger performance in Brazil and Europe.
AB InBev’s Bud Light woes during the last year have been a boon to competitors like Constellation Brands and Molson Coors.
— Chris Casey
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Courtesy of Coca-Cola
Powerade puckers up
Powerade is getting sweet on one of the most popular flavors in food and beverage: sour.
The Coca-Cola-owned sports drink is debuting Powerade Sour. The limited-time offering will be available in major retail stores nationwide and online throughout the summer. The beverage will be sold in three flavors: Blue Razz, Watermelon Lime and Green Apple.
It’s the first time Coca-Cola has released a sour-flavored beverage in its 138-year history.
“We’re always looking for unique ways to attract new and old consumers alike – and our new SOUR line features a different flavor profile that adds variety, novelty and fun not often seen within this category,” Tom Gargiulo, the chief marketing officer for BodyArmor Sports Nutrition, said in an email to Food Dive. “Our new POWERADE SOUR also taps into that beloved, 2000s nostalgia that so many of our sports drink consumers have heart for and connect with.”
Powerade is currently the No. 3 sports drink across the U.S. behind Gatorade and BodyArmor, the latter of which is owned by Coca-Cola. BodyArmor assumed responsibility for the Powerade brand in North America in 2023.
In February, Powerade rolled out two new flavors to its sports drink portfolio – Island Burst and Strawberry Smash Zero. And a year earlier, it introduced new packaging and an all-new formula, which included 50% more electrolytes than Gatorade Thirst Quencher, according to Coca-Cola. It also added Vitamins C and B12, both of which are not found in Gatorade.
The sour innovation is the latest product launch to help re-energize the brand and drive sales growth.
Gargiulo said Powerade’s dollar share within the sports drink category has increased 15 consecutive weeks year-over-year. Prior to this, it hadn’t happened a single week going back to October 2021.
— Christopher Doering
Guy Fieri holding Waterloo’s limited edition sparkling water varieties.
Courtesy of Waterloo
Waterloo cracks open cocktail-inspired sparkling water
Sparkling water maker Waterloo is tapping the flavors of three popular cocktails for its latest summer varieties.
Waterloo’s new line of alcohol-free drinks includes All Day Rosé which features citrusy and sweet notes. The company tapped sommelier and wine veteran Anthony Washington to advise it in the creation process for the sparkling water. More than 200 iterations tested. Waterloo said the sparkling water rivals a bottle of rosé wine.
“After many hours of tastings to help Waterloo’s Innovation team isolate the unique flavors of a complex sparkling Rosé wine, they replicated them masterfully — without the alcohol,” Washington said. “They layered aromas and flavors to deliver a non-alcoholic sparkling Rosé experience that is truly special — and innovative to the category.”
Waterloo’s line also includes Pi-Ño Colada that contains toasted coconut and dark rum notes, and Mojito Mocktail, with muddled mint and lime flavors along with notes of rum, the company said. The company also enlisted celebrity chef Guy Fieri to help market the product in promotional materials.
The mocktail category is gaining momentum as consumers drink less. Sparkling water brands like Waterloo have honed in on an opportunity to cash in on the craze. The nonalcoholic drinks space was valued at $280 billion in 2023 and is projected to grow at a compound annual growth rate of 7.4% through 2030, according to Grand View Research.
— Chris Casey
Source: fooddive.com