In recent years, the American beverage landscape has undergone a significant transformation, with hard seltzers and canned cocktails emerging as the new darlings of the alcohol industry. Initially marketed as a healthier alternative to traditional beer, these ready-to-drink (RTD) beverages have captured the hearts and taste buds of consumers across the nation. However, as the market evolves and diversifies, a concerning trend has emerged: Americans are inadvertently consuming higher levels of alcohol than they might realize.
The Rise of Hard Seltzers and Canned Cocktails
The popularity of hard seltzers skyrocketed during the COVID-19 pandemic, as people sought out convenient, at-home drinking options. Kaleigh Theriault, an associate director of beverage-alcohol thought leadership at NIQ, a market research firm, notes, "During the pandemic, hard seltzers really blew up, and I think hard seltzers are one of those ones that were perceived as a little bit of a better-for-you option". This perception was fueled by marketing strategies that positioned these drinks as low-calorie, low-carb, and low-sugar alternatives to traditional alcoholic beverages.
However, the landscape of RTD beverages has rapidly evolved beyond just hard seltzers. Canned cocktails, often containing higher alcohol content, have entered the market with force. Chris Budzik, a senior market analyst at IWSR, explains, "There's so many more products available that another lime hard seltzer probably isn't going to get much shelf space. So companies are having to innovate more and more, and that has led to some higher-ABV canned cocktails".
The Alcohol Content Conundrum
Understanding ABV in RTD Beverages
One of the key issues surrounding the consumption of RTD beverages is the varying alcohol by volume (ABV) content. While traditional hard seltzers typically contain 4-6% ABV, similar to many beers, the new wave of canned cocktails often packs a much stronger punch.
High-ABV Options
Many canned cocktails now available on the market contain spirits like vodka, gin, or tequila, naturally resulting in a higher alcohol content. For instance, some prepackaged gin and tonics or negronis can have an ABV as high as 10-12%, more than double that of a typical beer or hard seltzer.
Consumer Awareness
The varying alcohol content across different brands and products has led to confusion among consumers. Emily Stewart, a senior correspondent at Business Insider, shares a personal anecdote: "A friend and I regularly go on walks with her dog in my neighborhood, accompanied by a couple of cans of gin and tonic. The other day I pointed out to her that the ABV on those little cans was three times a Bud Light — she had no idea".
The Market Shift
From Hard Seltzers to Spirits-Based Drinks
The RTD beverage market has seen a significant shift in recent years. According to NIQ data, while hard seltzer sales have declined by 13.1% over the past year, spirits-based drinks have surged by 22.5%, reaching $2.5 billion in sales. This shift reflects changing consumer preferences and a growing appetite for more sophisticated, higher-alcohol options.
Factors Driving the Trend
Kate Bernot, lead analyst at Sightlines, an analyst group covering the alcohol industry, identifies three main factors driving the growth of RTD cocktails and their increasing alcohol content:
Consumer Taste: People are drawn to the convenience and perceived quality of prepackaged cocktails.
Corporate Ambition: Beverage companies are innovating to stand out in a crowded market.
State Policy: Changes in regulations have made it easier to sell and distribute these products in many states.
The Impact on Drinking Culture
Changing Perceptions of 'Light' Drinking
As the market becomes saturated with higher-ABV options, the perception of what constitutes a 'light' drink is shifting. Budzik observes, "I've personally noticed that the 8% double IPAs have become the standard". This normalization of higher alcohol content beverages could lead to unintended overconsumption.
The Convenience Factor
The portability and convenience of canned cocktails have made them increasingly popular for social gatherings, outdoor events, and even as alternatives to traditional host gifts. Bernot notes, "There's genuine consumer organic excitement" around these products, driven by their ease of use and variety of flavors.
Health and Safety Concerns
The Myth of 'Healthier' Alcohol
Despite marketing claims, it's crucial to remember that no alcoholic beverage is truly 'healthy'. The initial positioning of hard seltzers as a better-for-you option has led to misconceptions about their impact on health and wellness.
Increased Risk of Overconsumption
The higher alcohol content in many RTD beverages, combined with their easy drinkability, raises concerns about the potential for accidental overconsumption. The CDC defines binge drinking as consuming 5 or more drinks for men, or 4 or more for women, within about 2 hours. With higher-ABV canned cocktails, reaching this threshold can happen more quickly than consumers might expect.
The Future of RTD Beverages
Market Saturation and Innovation
The RTD beverage market is becoming increasingly crowded, with new brands and products constantly emerging. Theriault from NIQ observes, "There are just so many more options nowadays. It's also overwhelming". This saturation is driving further innovation, but also raising questions about the long-term sustainability of the trend.
Regulatory Responses
As the RTD market evolves, regulations are adapting. Some states have changed laws to allow the sale of canned cocktails in more locations or have adjusted taxation structures. For example, Pennsylvania recently changed its laws to allow grocery and convenience stores to sell canned cocktails up to 12.5% ABV.
Consumer Responsibility and Education
Reading Labels and Understanding ABV
Given the wide range of alcohol content in RTD beverages, it's more important than ever for consumers to be aware of what they're drinking. Stewart advises, "The next time you grab a drink in a can, you might want to take a second look at the ABV — or be prepared to wind up under the table".
Moderation and Mindful Consumption
As with all alcoholic beverages, moderation is key. Consumers should be aware of the alcohol content in their drinks and adjust their consumption accordingly. This is particularly important given the easy drinkability and often sweet flavors of many RTD beverages, which can mask their alcohol content.
The rise of hard seltzers and canned cocktails represents a significant shift in America's drinking culture. While these beverages offer convenience and variety, they also bring new challenges in terms of alcohol awareness and responsible consumption. As the market continues to evolve, it's crucial for consumers to stay informed about the alcohol content of their drinks and to approach these new options with the same caution they would apply to traditional alcoholic beverages.
The trend of RTD beverages is likely here to stay, but as Budzik notes, "When something becomes popular, it's going to get some play. Products are going to come out that reflect that. Will they still be here in five years? Who knows". What is certain is that as long as these products remain popular, consumers must remain vigilant about their alcohol consumption and prioritize their health and safety.
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