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Is Craft Hard Seltzer Here to Stay?

As Portland enters Day 3 of an unprecedented heatwave featuring 107+ degree temps, should we be asking ourselves, why not have a Hard Seltzer?

I pose this question with the assumption that many of us still aren’t on the Seltzer Train, as many beer nerds and brewers find them to be quite a divisive substance. As such, I have to come clean with my own experience with the latest aberration in the craft landscape.

My general feeling is that ultra clear, naturally flavored, mass-produced, and otherwise vapid Hard Seltzers mostly suck. I’ve had many of the versions created for the low-carb, price conscientious consumer and it’s just not palatable to me. While some of these offerings far pre-date the pandemic (my first White Claw had to be over 4 years ago) their popularity exploded with the increase in grocery-focused alcohol purchases during it.

What’s transpired over the past year shouldn’t be a surprise to anyone closely following craft beer trends of late. On top of that, we’ve seen the continued popularity of fruit-forward and over-fruited “smoothie” beers, resulting in a confluence of two post-BJCP styles. Brewers saw an opportunity to make a sub-par product better (see Industrial Adjunct Lagers) by making hard seltzers with actual fruit and quality ingredients, as well as smoothie seltzers: pulp forward hard seltzers, sometimes with vanilla and/or lactose. As for that latter incarnation I’ve tried? They’re actually pretty tasty.

So it begs the question, can breweries who’ve carved out their own niche with packaged, craft versions of hard seltzer sustain interest versus Big Seltzer? Further, as the overall craft beer segment’s sales swing back toward draft, can craft hard seltzer continue to grow?

The Sub-Brand Seltzer

The impetus for taking on a subject I never thought I’d be writing about here was Jeff Alworth’s recent take on the “Middle Market.” In short, his article examines how both AB-InBev and craft brands, with the exception of Sierra Nevada, have struggled to maintain volume and quality on a national scale. A number of times, he alludes to large industrial brewers resorting to hard seltzer and FMBs (Fermented Malt Beverages) to sustain and grow.

This got me thinking about all the regional and national craft (and “crafty” brands) that have taken on hard seltzer over the past few years. And it’s only been over the past few months that I’ve become aware of some of these brands, likely because most are made under a separate name as a hard seltzer brand, not a hard seltzer style with beer branding. I primarily purchase beer at bottle shops, so it’s rare for me to walk down the beer isle when grocery shopping, much less what’s become a dedicated seltzer section.

Most of The Bier Stein’s Hard Seltzer selection found this weekend in Eugene

Did you know that Ninkasi has had their own seltzer line called Pacific Sparkling for over 2 years now? I sure as shit didn’t. Not to mention Deschutes off-shoot Modified Theory, Day Fade by No-Li Brewhouse, White Water by Great Divide, Fruitfizz by Reuben’s Brews, Bandwagon by Immersion, SeekOut by 2 Towns Cider, Hard Sisters Seltzer by Three Creeks, Fruit Stuff by Stillwater Artisanal, plus quite a few others throughout the west coast and across the country.

While it seems a shrewd move by existing medium sized breweries catering to a regional audience, they’re also competing against unknown upstarts that focus solely on hard seltzer. I find it intriguing just how many breweries have opted to create a new brand as they move into the category, likely to ensure placement in the hard seltzer section, but also to avoid turning off devoted consumers of their everyday beers.

The Next Wave: Smoothie Seltzers

Not long after the pandemic forced breweries to pivot into a new reality, brewers such as HOMES Brewery in Ann Arbor, Michigan began franken-brewing a new idea. Take the popularity of hard seltzers and mash them up with the latest fad of over-fruited smoothie beers, resulting in Smoothie Seltzers. HOMES secondary brand, called Troobado, makes Smooj which has fast become the 6th highest rated brand on untappd.

With smoothie sours only being made by a handful for brewers in the PNW and the seltzer craze more pursued by larger brewers, it’s no surprise that this phenomena has yet to really take root in our region. Yet it’s booming in the mid-west with regular releases coming out of Fair State Brewing Cooperative in Minneapolis (Fruit Boom), Eagle Park Brewing in Milwaukee, “Puréental Advisory” by Mikerphone Brewing outside of Chicago, Untitled Art’s line of Florida Seltzers out of the Madison Wisconsin area, plus a few out west such as Alvarado Street’s Bubble Bath series and Yakima’s Hop Capital Brewing.

Why Are Seltzers & Smoothies Even A Thing?

The advent of hard seltzers initially seemed like one more fad-driven scheme on par with wine coolers, Zima, and Mike’s Hard Lemonade. Yet the continued appeal is undeniable as these “lifestyle brands” appeal to those preferring lower calorie, low carb, gluten-free options versus beer. Not to mention those already into La Croix or Topo Chico sparkling waters, the latter of which just released their own line of hard seltzers.

Further, the impetus for the creation of White Claw – the most ubiquitous of all hard seltzers, was to emulate a Vodka Soda. Where ready-to-drink cocktails have fallen flat (I found them to be too sweet or intensely flavored), the popularity of seltzers have exceeded expectations. Even more, I’ve seen folks blending hard seltzers and smoothie hard seltzers with grain alcohol or champagne (smoothie mimosas anyone?), assuredly something that’s become quite popular since the pandemic started.

Then take a look at the other end of spectrum, those who love smoothie beers: essentially beer nerds and the 420 crowd. Again theses options appeal to those not wanting “beer flavored beer” but instead something fruit forward with an often complex list of ingredients – from pastry inspired pie flavors to tropical fruit slushies that are more akin to Jamba Juice.

Both of these markets are young – that target demographic advertising and marketing folks dream of: young, upwardly mobile, social. Lastly, add in the fact that these products can be brewed/fermented at a huge scale, with a fast turnover and a reasonable cost, resulting in potentially huge margins for the producer.

The Big Guys

Speaking of huge profits, those who’ve wagered the most and seen the most success thus far include White Claw and Truly (Sam Adams), who collectively made up 75% of total hard seltzer sales to end 2020. The top 10 brands ending last year make up 96% of the market. Sound familiar craft beer folks?

Craft Hard Seltzer certainly pales in comparison to Big Seltzer, though it mirrors craft beer in this way – a large number of craft producers with only their toes in the water because they’re all about making a quality, local product, not something price focused and mass-produced.

Courtesy of T4.ai

Still, the Hard Seltzer Market last year witnessed sales in excess of $1.8 billion and with growth of 35% expected in 2021, it’s projected to top $2.5 billion this year. While that sounds like a lot, that’s less than 2% of sales seen by the entire beer industry at $94 billion and 8% of the $22 billion craft beer segment.

Even with the dominance of the aforementioned mass market brands, which now include hard seltzers from Bud Light, Natural Light, and Corona, we’re also seeing new, larger brands pop up from Harpoon Brewing/Polar Seltzer (Arctic Chill), Topo Chico (their owners, Coco-Cola, linking up with MolsonCoors) and Michelob’s Organic Ultra. Those late to the game are catching on, creating even more competition for craft brands and independent producers.

Conclusions?

There was a time when we said “Hazy IPAs are a fad.” That seems quaint now as we’ve entered head-first into a new era of overfruited everything and hard seltzer mania.

Seltzers are here to stay, whether we like them or not. Can craft brands sustain their viability? Just this weekend I learned that The Bier Stein in Eugene now has a dedicated hard seltzer draft line, previously occupied by a cider and currently occupied by Three Sister’s Hard Mango Seltzer. And if you’re ever visiting a Buffalo Wild Wings, you might notice that Truly is now on draft at their locations nationwide.

How craft hard seltzers can truly (pun intended) find an advantage by taking roost in a taproom, restaurant, or bar is by showcasing the often real fruit color they posses versus their mass produced counterparts. There’s no doubt that clear seltzer is less appealing on draft.

So if you’re a taproom or brewery, having at least a few seltzer offerings in cans before adding draft is a given. For whether you love or hate hard seltzers, if you’re a brewery or taproom owner, you should at least entertain the idea of offering what has become an appealing beverage for so many.

But will seltzer ever become a full time draft offering? And who gets bumped, a beer or a cider? Only time will tell how that plays out, but if I were a betting man, I’d put my money on the continued growth of hard seltzer – even the slowly growing sliver of craft and smoothie versions.

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