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September 19, 2019

The Never-Ending White Claw Summer

MHT Partners  | Consumer Investment Bank

Summer might be coming to an end, but White Claw popularity seems to be heating up for Mark Anthony Brands, the maker of both White Claw and Mike’s Hard Lemonade. White Claw officials confirmed a nation-wide shortage this month. So, what exactly is causing this frenzy? Maybe people do really believe in the slogan that “there ain’t no laws when you’re drinking claws” or maybe it’s the fact that the popular hard-seltzer has 5% ABV (alcohol by volume) and is a mere 100 calories per can, making it an easy choice for increasingly health conscious consumers. Having positioned itself as a more refreshing, low calorie alcoholic beverage, White Claw is a significant new contender to more established alcohol brands.

Perhaps another part of White Claw’s growth story can be attributed to its endemic marketing strategy. The company has gone beyond outdated alcohol marketing strategies that attempted to genderize an entire product line, and instead presents a gender-neutral product that focuses on wellness, health, and the individual. White Claw’s low cost and effective marketing strategy is simple – let the consumers be the voice of the brand. White Claw’s decision to not institute a well-established brand definition allows each customer to decide for themselves what the product symbolizes.

Hard-seltzer has clearly become the drink of 2019, not only because its dominating growth within the overall beer market, but because of its broad-based appeal. While hard-seltzer beverages still only capture about 2% of the total beer market, sales in the past year have increased over 200% with 164% of the growth occurring in July alone. White Claw by itself accounts for more than half of hard-seltzer sales. Currently, the hard-seltzer market is estimated to be worth $550 million but is predicted to be a roaring $2.5 billion market by 2021.(1,2)

Yet, large untapped opportunities in this segment of the food and beverage market remain, and we are excited to watch them unfold. Although White Claw is the clear market leader, other hard-seltzer brands such as Boston Beer Company’s Truly and Anheuser-Busch InBev’s Bon & Viv are also gaining strong momentum. Interestingly, these large beer companies appear to be following White Claw’s lead, shifting away from gendered advertising when marketing hard-seltzer. Competition could become more heated as many major beer companies currently have at least one hard-seltzer brand in their portfolio and appear to be expanding their marketing sales and efforts. In the meantime, if you’re unsure of what to bring to your next get together, as your consumer investment bankers, we are telling you that you can’t go wrong with a pack of Claws.

(1) Kendal, Justin. “Nielsen: Total Beer Dollar Sales Up 5 Percent During July 4th Holiday Week.” Brewbound, 17 July 2019.
(2) Reinicke, Carmen. “Hard-seltzer Sales Are Booming in the US – and UBS Says these 5 Beer Companies Are Best Positioned to Profit from the Trend.” Business Insider, 30 July 2019.

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