Welcome back to the BevNET spirits newsletter. Hard tea may be raging on, but this week we’re looking at the staying power of the ready-to-drink margarita. 

What insiders are reading: George Clooney and the gang are at it again, and several canned cocktail brands make big moves ahead of spring.

Thanks for reading. 

-BevNET spirits editor, Ferron Salniker

Remember simpler times when a margarita was simply on the rocks or frozen, but always involved tequila? Not the case now, with the word “margarita” used to describe a sparkling sugar-based liquid made with “tequila flavors” that is also “naturally flavored with other natural flavors.” Huh?

Still, the ready-to-drink (RTD) margarita – in all its sometimes cringey malt, wine, and spirit based forms – has staying power, according to a new report from Bump Williams Consulting. The style hit $1.6 billion in dollar sales across NIQ-tracked off-premise outlets in the 52 weeks ending January 31 – placing the margarita between the hottest new style, hard tea ($2 billion), and hard lemonade ($1.3 billion). 

And while everyone and their mom has debuted a new style of hard tea for this summer, the margarita (+8.4%) is outpacing hard tea (+7.4%), and hard lemonade (-1.1%). The versatility of the cocktail as well as the rise and availability of quality tequila have helped fuel the cocktail and constant innovation. 

One of vendors seeing the most success from its canned versions is Anheuser-Busch InBev (ABI), which claims just over one-third of RTD margarita dollars, shooting up 60% in its dollar sales YA, propelling it to the top position among RTD margarita vendors. That's thanks to Cutwater (+94%) and Ritas (+18.6%) – the two fastest-growing brands within the top ten RTD margarita brands. 

What does the growth of Cutwater tell us, besides what drinking games the kids are up to? High ABV (8% or greater) is where the next wave will likely be. High ABV RTD margaritas now account for nearly two-thirds of total RTD margarita dollars, up +34.3% in dollar sales, while all other ABV segments saw a decline of -1.1% versus the year prior. 

That may point to why tequila leaders, such as Diageo, are eyeing the segment. 

Continue reading the full breakdown with Insider access

A federal grand jury has indicted five former senior executives at Southern Glazer's Wine and Spirits (SGWS) – the largest alcohol distributor in the U.S. – along with a salesman from a major Napa Valley wine company, on charges stemming from an alleged bribery scheme that prosecutors say ran for nearly a decade and earned favors from California’s largest grocery retail chains.

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Uncle Nearest founders Fawn and Keith Weaver have made their final courtroom arguments to take back ownership of the troubled bourbon company after it defaulted on more than $100 million in loans and went into receivership.

• The battle has brought to light new findings – including a $20M drop from Jay-Z that was hidden from the bank by Weaver – that could significantly expand the court’s control over other Weaver family businesses.
• I hopped on The Fingers podcast to talk about how the troubled bourbon business got to this point and what’s next. 

Non-alcoholic (NA) wine, beer and spirits still account for less than 1% of total alcohol category sales – leaving a runway for brands that innovate with popular functional ingredients, according to a new report from market research firm NIQ.

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De Soi, the non-alcoholic apéritif brand co-founded by Katy Perry, is pursuing daytime consumption with the upcoming release of a line of adaptogen-infused beverages featuring a lighter flavor profile.

Continue reading the breakdown on BevNET

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Have a tip to share? Reach out to Ferron Salniker, spirits editor at fsalniker@bevnet.com

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