And it’s confident the investment is a savvy one, believing the seltzer category has ‘real strength’.
Corona Hard Seltzer will be introduced in four flavors in the US: tropical lime, mango, cherry and blackberry lime. The 4.5% ABV beverage will contain 90 calories, zero carbs and zero sugars (for comparison, Corona Extra contains 148 calories per 12 oz bottle).
'Seltzer is not going to take space from our core beer franchise'
Corona carries ‘unbelievable strong brand equity’ as a brand among both Hispanic and total drinkers in the younger 21-54 age category. As a result, Constellation Brands has made the decision to brand its seltzer entry under Corona. In addition, it sees a strong parallel in the ‘refreshment DNA’ of both seltzers and the Corona brand.
“We're excited about our plans for the launch of Corona Hard Seltzer this spring, which will help to further strengthen our position as the leader in the high-end of the US beer segment,” said Constellation Brands CEO Bill Newlands. “Our launch strategy includes the largest-ever single brand investment for our portfolio of more than $40m in marketing to support this introduction.
“We've already started to take orders from distributors and have received incredibly positive feedback from retailers who are excited about the prospects of Corona Seltzer and have already incorporated our newest portfolio addition into their shelf set programing plans for the spring selling season.”
A key question for Constellation Brands, however, is whether Corona seltzer can take share from other seltzer brands - or whether it risks cannabalizing its own beer brands. Newlands says the company has considered this question: and concluded Constellation’s beer portfolio is not as vulnerable as other beer categories.
“Our research shows that seltzer is taking share across the board from beer, wine and spirits,” he said. “While a significant amount of this growth is sourced from the beer category, it is primarily coming from domestic premiums, crafts and FMBs [flavored malt beverages] with minimal interaction of seltzer consumption with imported brands."
Both consumers and retailers see seltzers and beer as distinct categories, says Newlands.
“Seltzer is, in all likelihood, not going to take space from our core beer franchise. The consumer views it as something different, the retailers view it as something different, whether it's on the shelf or in the cold box. So we think there will be a distinct differentiation of product location versus just cannibalizing existing shelf space. That's the way it's been so far, we believe that will continue.”