Good Beer Hunting

Bubbling Up — Monthly Beer Sales Have Already Peaked; Not So for Hard Seltzer

truly 2.jpg

We may be in the dog days of summer—but we haven’t hit peak seltzer season yet.

According to an analysis tracking the past four years of sales logged by IRI, a market research firm that compiles scan data from chain stores, category leaders White Claw (owned by Mark Anthony Brands) and Truly (owned by Boston Beer), will hit their sales zeniths in August. For both brands, which together represent 85% of America’s hard seltzer market, it has been the top-selling month for three straight years.

The week of July 4 was the best seven-day stretch for White Claw and Truly last year, although August racked up 5.6% more sales than July in IRI-tracked grocery, convenience, and other stores. Over the last four years, both brands’ trajectories have continued to climb through Labor Day.

To give perspective on how much sales have grown since the bubbly, clear booze burst onto the scene in 2016, White Claw and Truly seltzers sold the equivalent of 1.4 million cases during this year’s July 4 week (which equates to roughly 102,000 barrels’ worth of product). That's almost half of what was sold in the entire month of June. (That combined production was roughly the same as the 29th-biggest craft brewery in the country last year, Rhinegeist Brewery.)

These numbers also highlight the seasonality of seltzer.

Every category follows similar patterns—no alcohol is a flat line across all 12 months—but hard seltzer is particularly polarizing, thanks in part to marketing that leans heavily on warm temperatures and poolside enjoyment.

In 2017–2018, beer, for example, sold 9.9% of its total volume in June, its highest-selling month. Hard seltzer hit a high of 15.6% in August across those two years. 

(Beer data is from the Beer Institute, which tracks all domestic shipments of beer. Hard seltzer data is from IRI chain sales, where the majority of the category’s volume is moved, and for White Claw and Truly only, which represent 85% of all hard seltzer sold in the U.S.)

Click to enlarge

It’s a pattern that holds for the start of 2019, too.

Click to enlarge

Hard seltzer clearly shows stark bursts of popularity. While beer sales may not feature such extremes, beer is not devoid of ups and downs throughout the year, much like wine and spirits. 

According to two years of data collected by Drizly, an alcohol delivery service that caters to cities across the country, each category experiences seasonal variation. Based on orders placed between 2016–2018, beer showed clear downturns in the winter, with wine and liquor taking that share. Beer typically bounced back in spring and summer, while the other two categories held relatively steady. Similar trends have been spotted by other companies.

Click to enlarge

It’s impossible to miss the fluctuation of beer’s volume across an entire year. The last five years all follow the same pattern.

Click to enlarge

When we discuss the month-to-month shift in hard seltzer sales, then, the assumption shouldn’t be that this beverage goes away after Labor Day. Sales decrease—as they do with beer—but by no means disappear. By this point, the category is selling so much that it’d be impossible to ignore what an impact it’s had on consumer spending.

Market research company 3x3 Insights reported in June that 70% of the hard seltzer sales it tracked took place between April and September in the years preceding 2019. Now, however, sales are rounding out a bit across the rest of the year. Additionally, the company noted that customers appeared to be more likely to substitute alcoholic seltzer for light beer, and were buying more than one package of hard seltzer about 15% of the time.

What does that mean for dollar sales? Well…

Click to enlarge

On an annual basis, these brands are up despite quarterly/seasonally fluctuation, although spring/summer (Q2/3) are clearly favorites. The second quarter of 2019 is the highest-performing yet for both brands. Their sales tally a combined $246 million, which is equivalent to the combined sales for Sierra Nevada’s and Samuel Adams’ portfolios (Samuel Adams’ parent company, Boston Beer, makes Truly). Again, this chart shows IRI dollar sales for White Claw and Truly since these two represent the vast majority of sales, but other brands like Bon & Viv ($35.6 million) and Smirnoff Spiked ($24.8 million) are certainly adding to the category’s bottom line.

As we get into the tail end of summer, don’t think America’s love of clear, bubbly, and boozy drink is over. It’s just heating up.

Words by Bryan Roth