In an already saturated hard seltzer market featuring over 200 brands with few distinguishing traits, Spindrift’s launch this spring could have easily been overlooked as just another business seeking growth in a popular sector. However, the beverage producer remains hopeful that it can replicate the initial success of its sparkling water with the introduction of Spindrift Spiked. The company believes that its commitment to using real fruit and minimal ingredients will help it stand out in the $4.3 billion market, which is largely controlled by brands like White Claw and Boston Beer’s Truly. “We aim to compensate for our late entry with the quality and uniqueness of our product compared to other hard seltzers available,” stated Sue Kim, Spindrift’s Vice President of Brand Strategy and Marketing Insights. “There isn’t a product like [Spindrift Spiked] currently on the market.”
Spindrift, which introduced its sparkling water 11 years ago, first explored the hard seltzer category in 2019 after consulting its customers about potential new products. The company discovered that more than half of its consumers were hesitant to try hard seltzers due to concerns about artificial ingredients—a perception that many also held regarding sparkling waters—and the belief that these beverages primarily appealed to college students and young adults. Nevertheless, developing a hard seltzer took time. Despite prior experience with fruits like lime and pineapple in its non-alcoholic drinks, Spindrift needed to determine how real fruit would interact with the alcoholic base used in the new offering. “I can’t envision launching an entirely new brand under the current market conditions,” Kim remarked.
Spindrift Spiked first appeared on shelves in April, primarily around its Massachusetts headquarters and in nearby Rhode Island, as well as in California, where the brand enjoys a strong following. The beverage currently offers four flavors—lime, pineapple, half and half, and mango—and is actively working on new varieties. The company is also considering expanding its hard seltzer distribution to other regions where its sparkling water is already popular. “It’s a small initiative, but it’s a significant gamble for us. The category is substantial, and consumers are seeking options like ours,” Kim explained. “We are approaching our expansion very cautiously and methodically.”
Truly and Mark Anthony Brands’ White Claw together dominate 75% of the market, with other contenders like Bud Light Seltzer, Topo Chico Hard Seltzer, Vizzy, and Corona Hard Seltzer also vying for a share. While hard seltzer consumption surged by 130% in 2020, recent trends indicate a slowdown in growth. According to NielsenIQ data, hard seltzer sales increased by over 51% for the 52 weeks ending July 10, 2021, but only rose by 7.8% in the last 12 weeks of that same period. Boston Beer significantly reduced its full-year forecast in July after misestimating demand for its popular Truly brand, resulting in billions lost from its market cap. A few months later, it withdrew its earnings guidance due to persistently low demand for hard seltzer. Meanwhile, Molson Coors announced this summer that it would stop distributing Coors Hard Seltzer in the U.S. to concentrate on more promising products. Constellation Brands also recently adjusted its growth expectations for Corona Hard Seltzer, indicating it would modify the flavor and taste profile to better align with “changing consumer preferences.”
The rush to capture market growth has led to an overwhelming influx of similar products, causing confusion among consumers and straining retailers who can’t stock them all. During Boston Beer’s July earnings call, President and CEO Dave Burwick referenced IRI data indicating around 220 brands and 1,000 SKUs, a figure approximately 50% higher than the previous year. “The explosion of brands in this sector has created a herd mentality. Many introduce new brands into the market, resulting in a sense of sameness and a lack of originality,” he noted. The unique appeal for some consumers has seemingly diminished.
Spindrift is optimistic that its emphasis on real fruit ingredients will set it apart from the multitude of other hard seltzer options, allowing it to command a premium price. Kim mentioned that typical hard seltzers retail between $15 and $18 for a 12-pack, while Spindrift Spiked usually ranges from $20 to $25. “There’s room for everyone in this category,” she asserted. “We’re here to carve out our niche.” Additionally, the brand is exploring potential collaborations with platforms like Amazon to enhance accessibility, as they believe that integrating elements like calcium citrate could further elevate their product’s appeal to health-conscious consumers.