The closure of bars and restaurants, confinement and the need to have healthier habits in the face of the arrival of the coronavirus changed the interior of Mexicans’ refrigerators, which they added to their carts of prepared and ready-to-drink super drinks. And the companies added products without alcohol, hard seltzer, with less sugar and less calorie content to their portfolios.
Last year Heineken, Modelo and even Coca-Cola opened a new category in Mexico that was very popular in the United States: hard seltzer, a mixture of mineral water, with a slight touch of flavor and low in calories and content. alcoholic. Efforts to win over consumers went further, and brewers also strengthened their ultra-light, alcohol-free brands.
The opportunity is not small. The consulting firm Grand View Research estimates that the market value of hard seltzers was $ 4.4 billion in 2019, the latest data available. The compound annual growth rate, that is, the one that measures the return on investment, will be 16.6% between 2020 and 2027, so it will reach 14.5 billion dollars towards the end of that period.
Heineken entered this category with Pura Piranha, a hard seltzer that it presented in September 2020. Grupo Modelo launched the Michelob Ultra Hard Seltzer in December, the month in which Coca-Cola Femsa entered the segment with the Topo Chico brand. They are not the only players, there is also BASIC, from the Joseph Roberts group, and Fitzer, from Morelian entrepreneurs.
Yanira Reyes, Analytics Leader at Nielsen IQ, explains that during 2020 and until May of this year this category has grown steadily and already represents 3% of the premixed beverage segment.
In this category, hard seltzers share space with other soft drinks that have an alcohol content of between 3 and 7 degrees. For Reyes, one of the successes that has driven sales growth is availability at different points of sale. “From the first launch it has not stopped growing. It is a boom and is confirmed by the different brands that have joined this trend (…) This type of product not only grows because there is supply and availability, it is accompanied by demand. The Mexican is repeating, they don’t do it just once ”, he points out.
But they are not only the hard seltzer. Also light or ultra beers and those that do not contain alcohol have benefited in the last year, as more and more consumers look for drinks that have less carbohydrates and calories, and are marketed under a healthier label.
Heineken Mexico has its 0.0 or Amstel Ultra beer on the market and on June 14 it presented Dos Equis Ultra Lager, which has 94 calories and 4% alcohol. “The results in this segment have been successful. “The health and wellness trend has impacted numerous industries and consumer habits globally. This new commitment strengthens the company’s expansion strategy, ”said José Antonio Lie, the company’s brand director, in a meeting with the media last week.
Grupo Modelo has Corona Ligera and Victoria Chingones in its portfolio, both with 1.8% alcohol. The company expects this segment to represent 20% of its portfolio in 2025.
Open opportunity
With a segment in development, more players have raised their hands to enter new innovations to alcoholic beverages. Recently, Pepsi filed the registration application for Rockstar, the brand with which it intends to market alcoholic beverages: beers, cocktails and hard seltzers, according to a Bloomberg report.
“Products in Mexico will continue to grow, they all add to the wellness trend. Non-alcoholic beverages are growing in double digits. Light beers, which are also a very new segment, grew 40% in supermarkets. It is a very marked trend and it is a step towards innovation recently explored in the country, ”says Reyes.
Goodbye beer?
In 2020, beer companies were forced to stop their operations for two months, because they were not considered an essential industry. Although this was a trigger for them to turn to new categories, beers continue to have a place within the preferences of consumers, since other types of drinks – such as seltzers – have a higher cost and are not accessible to everyone.
Although, yes, before the COVID-19 hit, the beer industry had a 6.2% drop in exports and 4.7% in production in 2020, according to data from the National Chamber of the Beer and Malt Industry .
Marianna Vargas, communication and marketing manager of Kantar Mexico’s Worldpanel division, comments that during the first quarter of the year, the sale of beer has had an upswing in channels such as self-service stores, neighborhood stores and liquor stores, which do not They are a common channel for beer, and now there are 2.8% more buyers who purchase this drink for consumption at home.
“As beer consumption increased, other alcoholic beverages began to be sold, especially related to the summer and December sale seasons, which are consumed for parties or gifts. We do not see a migration and since the beginning of the year there are already a greater number of homes where beer is consumed, so consumption is taking root more in the home ”, he points out.
