Hard seltzer’s share of total beer category dollar sales reached its lowest point since the beginning of the pandemic in the fourth quarter of 2022, according to Jefferies’ most recent hard seltzer dashboard.
For Q4 2022, hard seltzer accounted for 7.4% of all dollars spent on beer category products at off-premise retailers tracked by market research firm NielsenIQ, the lowest recorded since Q1 2020 (5.9%), the majority of which occurred before the COVID-19 pandemic forced the closure of bars and restaurants and shifted consumers’ beverage-alcohol spending to the off-premise channel.
Hard seltzer reached its highest share (10.8%) of beer dollar sales in Q2 2021, before dipping slightly the next quarter, to 10.6%, according to NielsenIQ data Jefferies shared. It failed to reach 10% in 2022, cresting at 9.4% in Q2 2022.
The segment is “still searching for a bottom,” as dollar sales declined -3.9% year-over-year (YoY) in the four weeks ending January 28, Jefferies equity analyst Kevin Grundy wrote. Dollar sales of malt- and sugar-based hard seltzers – which account for 84.6% of the segment – declined -10.2% in the same period, while spirits-based varieties increased dollar sales +56.9%, Jefferies reported.
Those declines are accelerating. In the 12 weeks ending January 28, malt- and sugar-based hard seltzers’ dollar sales declined -8.6% YoY. Including spirits-based seltzers’ gains, the segment declined -2.4% in the L12W.
Within the hard seltzer segment, spirits-based versions lost -107 basis points to their malt- and sugar-based cousins in the L4W, which coincided with increased promotional activity among beer manufacturers.
White Claw maker Mark Anthony Brands was the biggest share gainer in the segment, increasing share +177 basis points, to 46.8%. Dollar sales of Mark Anthony’s hard seltzer portfolio increased +9.6% in the L4W and +5.2% in the L12W. That’s offset by significant declines of the Mike’s Hard Lemonade Seltzer (-49.7% in the L4W and -55.4% in the L12W), which accounts for only 0.5% of the hard seltzer segment.
The White Claw brand (46.3% of the seltzer segment) increased share by +178 basis points and dollar sales by +10.9% in the L4W and +6.9% in the L12W. White Claw Surge, the portfolio’s 8% ABV offering, recorded dollar sales growth of +36.9% in the L4W and +42.7% in the L12W, as well as +56 basis points of share, bringing its share to 5% of the segment.
Boston Beer’s hard seltzer portfolio, which includes Truly Hard Seltzer and Hard MTN Dew, lost the most share in the segment, declining by -117 basis points, to 20.2%. All varieties of Truly declined in both share and dollar sales except for 8% ABV Truly Extra, which gained +5 basis points of share and increased dollar sales +19.3% in the L4W and +15.5% in the L12W. Truly Vodka Seltzer, the new spirit-based offering, gained +2 basis points of share, to 0.5%.
Truly’s base fruited hard seltzers, which were reformulated in mid-2022, declined by -74 basis points of share, to 7.8% of the segment. Dollar sales declined by -12.1% in the L4W, a marked deceleration from the -24.6% decline in the L12W.
Hard MTN Dew, which is available in 11 states, declined by -21 basis points of share, to 1.1% of the segment.
Anheuser-Busch InBev’s (A-B) hard seltzer portfolio increased share by +36 basis points, to 11.3% of the segment, making it the third-largest supplier. However, those share gains came amid dollar sales declines of -29.2% in the L4W, which accelerated from -13.6% in the L12W.
Only Bud Light Platinum Seltzer was roughly flat, with dollar sales declines of -0.1% in the L4W. Michelob Ultra Organic Seltzer gained the most share among A-B hard seltzer brands, increasing +22 basis points, to 1.8% of the segment.
The core Bud Light Seltzer portfolio, which accounts for 3.8% of the segment, lost -9 basis points of share. Its dollar sales declined -53.9% in the L4W and -23.8% in the L12W.
Molson Coors, the fourth-largest hard seltzer supplier, accounts for 5.8% of the segment, a decline of -7 basis points of share. The company’s hard seltzer dollar sales declined -4.3% in the L4W, driven by the Vizzy Hard Seltzer brand (-23.2% in the L4W). Topo Chico Hard Seltzer, which Molson Coors produces under a licensing agreement with Coca-Cola, recorded dollar sales gains of +13.8% in the L4W and +92.1% in the L12W.
Since its nationwide expansion in January 2022, Topo Chico (3.6% of the segment) has overtaken elder sibling Vizzy (2.1%) in share.
Constellation Brands’ Corona Hard Seltzer gained +2 basis points of share, increasing to 1.1% of the segment. However, its dollar sales declined -36.1% in the L4W and -47.9% in the L12W.
Diageo-owned Lone River Ranch Water’s dollar sales gains (+6.8% in the L4W and +14.4% in the L12W) weren’t enough to offset Smirnoff Spiked Sparkling Seltzer’s declines (-55.5% in the L4W and -55.2% in the L12W). Diageo’s hard seltzer portfolio, primarily consisting of those two brands, accounts for 1.1% of the segment.
High Noon Sun Sips, the vodka-based offering from E. & J. Gallo Winery, recorded near-triple-digit growth (+89.1% in the L4W and +92.5% in the L12W), but lost -77 basis points of share, declining to 5.7% of the segment.
High Noon’s share has declined from 8% of the overall segment in Jefferies’ August hard seltzer report. At the time, it accounted for nearly all of spirits-based seltzer sales, which were 9.1% of total hard seltzer. Since then, other spirits-based brands, such as A-B’s NÜTRL (0.8% of the segment), which received nationwide distribution in 2022, have entered the market.