Ready to Dominate? RTDs, Simmering Volatility and Effervescent Trajectories

Delivery

This report comes in PPT.

Key findings

Change is the only constant: A story of disruption, volatility and evolutionary adaptability

RTDs have been disrupting drinking rituals and occasions since their inception while mirroring the zeitgeist and the values and lifestyles of youth demographics of each era. But behind the dramatic volatility and headline-grabbing controversies faced by key subsegments, the overall category has nearly quadrupled its volumes since the mid-90s.

Significant “Other” and the spirit of evolution

The hard seltzer (“Other” RTDs) segment’s meteoric rise and ongoing downfall should be seen as part of an overreaching pattern that also defined the lifecycles of wine coolers in the 70s and alcopops in the 90s. Lasting roughly five years before peaking, one segment’s demise leads to another one’s rise.

Spirit-based RTDs become the new protagonists in the RTDs saga

Adopting a more aspirational positioning, replicating signature cocktail recipes and utilising iconic spirit or mixer brands that - when combined - can be more than the sum of their parts, experimenting with alternative packaging, formulations and design cues are some of the attributes that will define the segment. 

Non-alc RTDs: Still niche yet intoxicating potential 

While still in its infancy and only just making inroads in key markets, non-alc RTDs will most likely steal the limelight in the short to medium term as the no/lo trend comes of age and cements its position in the mainstream.

Competition will remain fierce, and brand equity will remain elusive

High levels of brand fragmentation and long tails of challenger brands should be expected to continue defining share breakdowns across most subsegments. Building communities, supporting sustainability goals, pushing the limits of flavour sophistication without crossing into oversaturation and prioritising natural ingredients while lowering sugar content will be key.