Growth Brands: Beer (and cider) Here!

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Beer is the adult beverage of choice in the U.S., according to a recent Gallup poll. The study found that 41% of participants typically drink beer; 31% drink wine and 23% consume liquor.

Americans’ current preference for beer is among the highest Gallup has recorded since beer fell to 36% in 2005. Still, total beer consumption slipped 1.6% in 2013 to 2.8 billion 2.25-gallon cases, according to the Beverage Information Group, the research unit of Beverage Dynamics’ parent company.

Light beer, which still commands a 49% share of the total beer category, was down 4.1% in 2013, while malt liquor fell 3.2% from 2012. Consumption of popular beers dropped 2.7%, and superpremium and premium domestic beers decreased 2.2%.

So where is the growth? Primarily in craft brews, ciders, and specialty beverages. Craft beer consumption, for instance, increased 14%, about the same percentage as the previous year.

Ciders, which are included in our Beer Growth Brands, posted tremendous growth overall. The cider category’s consumption was up a whopping 66%, reaching 16.8 million 2.25-gallon cases in 2013.

Thanks largely to the Bud Light Lime-a-Rita phenomenon, flavored malt beverage consumption was up 2.7%, though that’s not quite as robust as the category’s 7.8% increase for the previous year.

Still, with all the new flavors and styles of beer products, the beer industry continues to be driven by new releases.

That said, the following identifies the fastest-growing and most promising beer brands in the U.S. market today.

 

Fast Track Growth Brands

To be considered a Fast Track brand, domestic beers must have exceeded 9 million 2.25-gallon cases in 2013, and imported brands/microbrews must have exceeded 1.5 million with double-digit growth over the past four years.

Dos Equis continues its domination at the top of the Fast Tack beer brands: It recorded annual compound growth of 18.5% from 2009 to 2013. The Mexican lager reached 23.2 million cases last year, up from 18.7 million in 2012 and 16.1 million in 2011. The brand, which has been owned by Heineken USA since 2010, this past spring launched Dos Equis Dos-A-Rita, a ready-to-serve lager Margarita modeled after the popular cocktail recipe.

Sierra Nevada Torpedo, an American IPA from Chico, CA-based Sierra Nevada Brewing, moved over from the Rising Star category to the Fast Track list this year. It reached 5.4 million cases sold in 2013, up 25.1% from the previous year.

Once again, Leinenkugel’s Summer Shandy posted the most significant annual compound growth rate from 2009 to 2013 — 59.1% — of all the Fast Track brands. The seasonal wheat beer mixed with lemonade, which came out in 2007, was up 25% in 2013, to 5.4 million cases.

Still, Lagunitas IPA from Lagunitas Brewing Co. in Petaluma, CA, posted the most impressive growth from 2012 to 2013 — 55.9% to 1.8 million cases sold. The IPA is the company’s first seasonal.

 

Rising Star Growth Brands

Rising Star Growth Brands are, well, on the rise: There are 19 Rising Stars in 2014 versus 12 in 2013 and seven in 2012. Rising Star brands must be under five full years of age and have exhibited notable growth during the past few years.

Interestingly, three out of the 19 Rising Star Growth Brands are Bud Light Ritas, four are ciders and most of the remaining brands are craft beer releases.

Indeed, the top two Rising Star brands are Anheuser-Busch InBev’s Bud Light Ritas: Straw-Ber-Rita and Lime-A-Rita. How popular is Bud Light Lime-a-Rita? The Margarita-flavored malt beverage, which was introduced in 2012 (with an 8% ABV), was up 40% in 2013, reaching 10.2 million 2.25-gallon cases. But the original Lime-a Rita has already been eclipsed by the Bud Light Straw-Ber-Rita flavor, which was unveiled in late March 2013 and has already sold 11.3 million 2.25-gallon cases in less than a year.

Then there’s Bud Light Lime Cran-Brrr-Rita, which was introduced as a limited-time seasonal offering in 2013. The company sold 500,000 2.25-gallon cases of Cran-Brrr-Rita last year. AB-InBev introduced two new permanent flavors to the Bud Light Lime franchise in spring 2014: Mang-O-Rita and Raz-Ber-Rita.

A-B InBev’s Budweiser Black Crown is the third-ranked Rising Star, selling more than 7.7million 2.25-gallon cases in 2013. Introduced in February 2013, Black Crown was the result AB-InBev’s Project 12 initiative, in which the company’s brewers came up with a dozen different beers in the style of Bud. The 12 brews were then whittled down to six; Budweiser Black Crown was the winner based on customer taste tests and opinions.

The fourth-ranked Rising Star is part of the fast-emerging cider niche. Cider remains a small fraction of the beer market, but the category’s growth in recent years is remarkable. Total cider consumption increased 66% from 2012 to 2013, according to Beverage Information Group data, reaching 16.8 million 2.25-gallon cases last year.

The leading cider brand, Boston Beer Co.’s Angry Orchard, posted a staggering increase of 242% from 2.2 million cases in 2012 to 7.5 million cases in 2013. The brand launched in late 2011 in New England and went nationwide in mid-2012.

Angry Orchard comes in the core Crisp Apple, Traditional Dry, Apple Ginger and Green Apple flavors, as well as the seasonal Elderflower (available from April through August) and Cinnful (August through March) cinnamon spice flavors. The brand also includes the Cider House Collection flavors: Ice Man, Straw Man and The Muse.

While Angry Orchard is the clear cider leader among the Rising Stars, the major beer producers have quickly adapted to the cider craze. Crispin Cider, which launched in mid 2011 and was acquired by MillerCoors in 2012, increased 71% to 1.2 million cases sold in 2013. MillerCoors has also recently released the higher-in-alcohol Smith & Forge Hard Cider.

And A-B InBev’s Michelob Ultra Light Cider, which came out in May 2012, was up 63%, to 570,000 cases. The company also introduced Stella Artois Cidre (pronounced see-druh) to the U.S. market in May 2013. The European-style cider from the Belgian beer brand sold 300,000 cases in 2013.

A-B InBev is further betting on the cider category with Johnny Appleseed, a hard apple cider it rolled out in April. It’s the first new brand introduction by the company since the Shock Top craft brew in 2006.

Redd’s Apple Ale from MillerCoors is not a cider, but rather a golden ale with red apple hints. It’s growing like a cider, though: Launched in late 2012, the brand reached more than 7 million cases in 2013.

As it did the previous two years, Fort Collins, CO-based New Belgium Brewing had the most Rising Star brands on the list. Ranger IPA increased 12% in 2013, to 1.3 million cases, while New Belgium’s winter seasonal beer Accumulation had a strong debut with 400,000 cases.

The brewer sold some 330,000 cases each of its Rampant Imperial/Double IPA beer and summer fruit ale Rolle Bolle in 2013, while its Shift pale lager increased 19.4% over the previous year to 271,000 cases in 2013. Pumpkick, New Belgium’s new, traditionally spiced seasonal fall ale, reached 230,000 cases in 2013.

Chainbreaker, a White IPA from Bend, OR-based Deschutes Brewery, is back on the Rising Stars list: The brand increased 57% to 342,000 barrels. It’s joined by the company’s River Ale, a year-round session beer Deschutes launched in 2013.

New to the Rising Stars list is Founders All Day IPA, an American IPA style beer from Founders Brewing Company in Grand Rapids, MI. The first Founders brew to be canned, All Day IPA was initially unveiled in early 2012.

 

Established Growth Brands

Established Growth Brands are top-selling beers that have grown moderately or substantially over the past four years. The brands must have exceeded 3 million 2.25-gallon cases in 2013.

A-B InBev’s Michelob Ultra — which was up 7.1% in 2013, reaching 50.2 million cases — took the top spot from Coors Light, which did not make the list this year. But MillerCoors brand Coors Banquet improved its growth rate from 1.5% the previous year to 6.5%, reaching 21 million cases sold.

The company’s craft brand Blue Moon grew 4.9% in 2013 to 26.9 million cases; it had grown at 13.5% the previous year.

Mexican pilsner Modelo Especial from Crown Imports posted an 18.0% increase to 50.1 million cases of beer sold in 2013. The company had boosted its advertising expenditures for the brand 27% from 2012 to 2013. Consumption of another Crown brand, Pacifico — a Mexican pilsner-style beer — was up 4.5% in 2013, to 6.2 million cases.

Shock Top from Anheuser-Busch InBev moved over from the Fast Track to the Established Growth Brands in 2014. The Belgian-style wheat ale grew modestly in 2013 to 9.3 million cases; it had increased 56.6% the previous year.

The most impressive growth rate among the established brands belongs to Heineken USA’s Tecate Light, which increased 24.3% in 2013, to 3 million cases. And Stella Artois, distributed by Anheuser-Busch InBev, was up 22.9% over 2012, reaching 21.0 million cases in 2013.

Natural Ice is back on the Established Growth Brands again. Though it grew less than 1%, the brand reached 43.4 million cases. The venerable Pabst Blue Ribbon’s growth rate slowed a bit from 10.4% in 2012 to 8.2% this past year, but it reached the 40 million-case mark.

Indeed, many of the established brands saw their growth rates slow in 2013. For instance, Yuengling Light Lager, from D.G. Yuengling & Sons, grew 24.3% in 2013 over 2012, vs. 78.0% the previous year. The Pottsville, PA-based brewer sold 6.2 million cases of Yuengling Light Lager last year.

Shiner Bock, a dark lager, increased 8.2% over 2012 to 6.5 million cases. Owned by Gambrinus, Shiner beers are made in the Spoetzl Brewery in Shiner, TX; the company aims to distribute Shiner Bock in all 50 states by the end of 2014.

As it was last year, Boston Beer Co.’s Twisted Tea is the only Established Growth Brand that’s not a traditional beer. Introduced in 2001, the hard iced-tea beverage comes in seven flavors, including a seasonal tropical, as well as three flavors of Twisted Lemonades. The brand increased a healthy 15.5% in 2013 to 7.6 million cases.

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