Although RTDs aren’t a primary drink, those who consume them tend to drink several times a week or more. The challenge for RTD brands is to steal occasions from beer, wine and spirits, especially in a cooling RTD market.
US RTD Alcoholic Beverages Market Analysis
For RTD drinks brands, staying relevant requires new demographics in addition to new occasions, making spirits-based RTDs the segment to watch. Forty-one percent of consumers consider the type of spirit an important factor in their purchase decisions – a sentiment that grows stronger with age and is more prevalent among women than men. Keeping up with spirit trends is essential for any RTD brand and will only become more critical over time.
Brand loyalty in the RTD sector remains low, driven by consumers’ strong appetite for exploring new varieties. In this dynamic landscape, innovation is more essential than ever. Building brand loyalty takes time, and flavor is a promising route, particularly through LTOs and seasonal products that encourage the new product trials consumers enjoy.
Key Topics Analysed in the Report
- Market drivers, market size and segmentation
- RTD brand performance
- Types of RTDs purchased, and RTD purchase influence
- Frequency of RTD consumption
- RTD attitudes and behaviors
- Innovations and marketing
What is an RTD alcoholic beverage?
RTD alcoholic beverages include: flavored malt beverages – including prepared malt beverages such as Bud Light Lime-a-Rita and hard seltzers such as White Claw, prepared spirits-based cocktails – drinks such as Bacardi Classic Cocktails Mojito that are made with distilled spirits, and wine-based beverages include traditional wine coolers, made with wine combined with fruit juices and other sweeteners and wine-based cocktails such as RTDs such as Rancho La Gloria’s Panoma Wine Cocktail and BeatBox Party Punch.
Note: This report excludes non-alcoholic mixers typically added to alcohol to make alcoholic cocktails and mixed drinks, such as: “just add alcohol” mixes designed for specific cocktails (eg Bloody Mary mix, margarita mix), non-alcoholic mixers positioned for use with alcohol to make cocktails (eg bitters, grenadine).
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EXECUTIVE SUMMARY
- What you need to know
- Market size and forecast for RTD alcoholic beverages
- Market predictions
- What consumers want and why
- Opportunities
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MARKET DYNAMICS
- Market context
- Market drivers
- Annual inflation is within range of the Federal Reserve’s 2% target rate
- Graph 1: headline CPI and core CPI, 2021-24
- Consumer sentiment rebounds after a number of months on the slide
- Graph 2: consumer sentiment index, 2022-24
- If current tariff plans go into effect, expect more attrition from the category
- A casual life calls for a casual drink
- Sober curiosity drives consumers toward low, no alcohol beverages
- Graph 3: awareness and interest in sober curious*, 2022-23
- Market size and forecast
- RTDs are cooling off from their hot streak
- Retail sales and forecast of flavored malt beverages/hard seltzer
- Market segmentation
- The category leader is beginning to stabilize
- Spirit-based RTDs to ride the wave of double digit growth
- Flavored malt beverages lead growth, with volume sales projected to increase through 2026.
- The future looks bright for wine-based beverages
- Market share/brand share
- Twisted Tea dominates the FMB segment
- Sales of flavored malt beverages, by company
- Industry leaders aren’t the only ones falling behind
- Sales of hard seltzers, by company
- Things are on the up for High Noon
- Sales of spirit-based seltzers, by company
- RTD wine is a small but potentially mighty opportunity
- Sales of RTD wine-based beverages, by company
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CONSUMER INSIGHTS
- Consumer fast facts
- The RTD consumer
- Create space for more occasions
- Graph 4: alcohol beverages drank most often, 2024
- Relative consensus among majorities allows brands to cast a wide net with most messaging
- Graph 5: alcohol beverages drank most often – NET, any drink, by various demographics, 2023
- Frequency indicates opportunity on the daily
- Graph 6: frequency of drinking any alcoholic beverages, by alcoholic beverage type, 2024
- Types of RTDs purchased
- The RTD market is normalizing in more way than one
- Graph 7: types of RTDs purchased – NET, 2023-24
- Gen X, Baby Boomers need refreshed messaging to increase appeal
- Graph 8: types of RTDs purchased, by generation, 2024
- Cocktail interest can solve at least one problem of the sexes
- Graph 9: types of RTDs purchased, by gender, 2024
- RTD consumption frequency
- Keep convenience, ease, while mixing up ingredients and flavors
- Graph 10: RTD consumption frequency, 2024
- Points of attrition indicate opportunities
- Graph 11: change in RTD consumption, by gender and generation, 2024
- A paradox of trial means brands have to deliver on promises to win repeat consumers
- Graph 12: reasons for drinking RTDs more often, 2024
- Moderation doesn’t have to equal total abstinence
- Graph 13: reasons for drinking RTDs less often, 2024
- Typical RTD consumption occasions
- Versatility boosts casual claims for RTD occasions
- Wine-based seltzer struggles more than others to find an occasion
- Graph 14: occasions for RTDs, 2024
- Third spaces increase visibility, accessibility for women
- Graph 15: RTD occasions – NET, any RTD, by gender, 2024
- Younger consumers give more latitude to RTDs
- Graph 16: RTD occasions – NET, any RTD, by generation, 2024
- RTD influential factors
- RTD claims have to do more to have broad appeal
- Graph 17: RTD purchase factors, 2024
- Opportunity to engage across ages can particular motivate the otherwise least engaged
- Graph 18: RTD purchase factors, by generation, 2024
- General ambivalence may prove more challenging than gender gaps
- Graph 19: RTD purchase factors, by gender, 2024
- RTD behaviors
- LTOs can manage a complex issue for RTDs
- Graph 20: RTD behaviors, 2024
- Product trial is tricky in the absence of brand loyalties
- Graph 21: RTD behavior toward alcoholic beverages, by generation, 2024
- Women want more options for flavor in the formats they already enjoy
- Graph 22: RTD behavior toward alcoholic beverages, by gender, 2024
- RTD attitudes
- Convenience is not enough to carry RTDs
- Graph 23: RTD attitudes toward alcoholic beverages – NET, 2024
- RTDs are struggling to find their niche, especially with women
- Graph 24: attitudes about RTDs – NET, by gender, 2024
- The evidence continues to stack up: RTDs can’t live on convenience alone
- Graph 25: attitudes toward RTD alcoholic beverages – NET any agree, by generation, 2024
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INNOVATION AND MARKETING STRATEGIES
- Launch activity and innovation
- Natural refreshment reaches key consumer groups
- Graph 26: interest in spirit-based RTDs, by generation, 2023
- Graph 27: interest in spirit-based RTDs, by gender, 2023
- Consumers don’t want RTDs to replace their cocktails, but small tweaks to classic recipes change their tune
- Two powerhouse brands are better than one
- Extending along ABV lines brings men to brand
- Winter, summer, spring and fall, there’s an RTD flavor for them all!
- Surfside makes waves with unique claims
- Truly invites all the girls to brunch
- Innovation takes a sharp turn
- Marketing and advertising
- High Noon takes it to the course
- Twisted Tea puts a twist on LTOs and multipacks
- Spindrift Spiked scores big with real fruit
- White Claw’s super claw opens the doors for new occasions
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APPENDIX
- Market definition
- Consumer research questions
- Consumer research methodology
- Generations
- Abbreviations and terms
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