If you were so sure the hard seltzer craze was here to stay, recent data actually suggests that consumers are starting to stray. In fact, the shift in drinking patterns has been so extreme that this week, the CEO of one of the world's top two hard seltzer brands admitted that as sales are suddenly nose-diving, he and his team "don't look very smart."
David Burwick, the CEO of Boston Beers, commented as shares of his company "plummeted Friday, closing down 26% at $701 apiece, as Wall Street reacted negatively to the company's worse-than-expected quarterly results released Thursday evening," CNBC reports.
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Boston Beers is the parent company of Samuel Adams, Dogfish Head IPAs, Coney Island Brewing Company, and Twisted Tea, among others. But the Boston Beers brand that's currently under the spotlight is Truly Hard Seltzer, whose demand the past few months months has been "lower-than-anticipated," CNBC suggests.
It seems the company is attributing the sudden drop in Truly love to the fact that in recent weeks, the loosening of COVID-19 restrictions has drawn consumers out of the house to imbibe at bars and restaurants, where sexy wine lists and bartender-curated cocktails might seem more compelling than your average flip-top can of hard seltzer. "The trade-off from grocery and liquor store purchase and consuming at home to bars during that time period, particularly as the summer hit, is really what hit us," Burwick stated on Closing Bell. "And honestly, it hit us hard and fast . . . We don't look very smart by missing on that guidance."
Another possible reason for the migration away from Truly is that this year, many consumers have been swayed by brands that have made a more recent splash in the market (like Vizzy and Corona), as well as those that boast more natural, lower-sugar, better-for-you ingredients (such as Spindrift Spiked, Lunar, and Kona).
And, if you're a hard-core hard seltzer fan, you may find it interesting that consumer research brand Reach3 Insights recently found that 79% of consumers think the hard seltzer trend will last another year, but only 37% of consumers believe it's here to stay for good.
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