As demand for Bud Light slumped, Molson Coors conducted a cleanup this summer, expanding tap handles at its bars and shelf space in its stores.
But if the world’s fourth-largest brewer hopes to post a third straight year of sales and profit growth in 2024, it will need to respond quickly to shifting tastes among younger drinkers and move beyond a position dominated by Coors Light and Miller Lite. traditional product portfolio.
According to Molson Coors, Generation Z consumers of legal drinking age (referred to by management as “LDACs”) drink 20% less than Millennials at the same age. The company’s research shows that 30% of Gen Z don’t drink at all.
Chief executive Gavin Hattersley told CNBC’s “Mad Money”: “This fits in with our overall strategy to move beyond beer and towards non-alcoholic products, whether that’s energy drinks or non-alcoholic beers.” Host Jim Cramer Wednesday.
The interview comes after an investor day this week, in which Hattersley’s executive team unveiled their plans to defend its market share in light ales and premium beers, which make up the bulk of its business, while moving into New product categories.
The non-alcoholic beer category currently accounts for less than 1% of the market but is expanding at a double-digit rate. To better capture this growth, Molson Coors has launched a new alcohol-free version of its craft Belgian white beer brand Blue Moon.
“I think one of our bigger innovations that will be huge for us is the launch of Blue Moon non-alcoholic beverages, which we’re launching in December, just in time for the dry period in January,” Hattersley told Cramer.
Gen Z drinks less
Molson Coors also expanded its partnership with The Coca-Cola Company to launch a new Peace Hard Tea brand in addition to spiked versions of Coca-Cola’s Simply line of juices. The brewer also aims to attract Gen Z consumers who do drink alcohol with Vizzy hard seltzer.
But a key pillar of its strategy is the further development of a range of zero-sugar energy drinks called ZOA, co-founded by Dwayne “The Rock” Johnson.exist SeptemberMolson Coors struck a deal to expand its minority stake and remain the exclusive distribution partner for the line, while also gaining a board seat.
To help Molson Coors better understand the tastes of younger consumers and the types of beverages that might appeal to them, its management developed what they call the Legal Age Gen Z Culture Panel.
“If we want to build a product they want, we need to know what makes them interested,” Chief Commercial Officer Michel Saint-Jacques told investors on Tuesday.
According to Gallup’s Lydia SaadYoung consumers believe that moderate drinking is too unhealthy.In a recent article, she also quoted Switch from alcohol to marijuananow legal in several states.
But Saad said a major reason for the decline in drinking among young Americans is that the share of black, Hispanic, Asian or other racial minorities in that age group has doubled over the past two decades. Fan. These groups are consistently less likely to drink alcohol than their white peers across all age groups.
“As the proportion of non-whites increases, overall drinking rates among 18- to 34-year-olds naturally decline,” saad wrotedirector of Gallup’s U.S. Social Research Division.
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