Mike Perry, founder and chief creative officer at Tavern, the US based global creative agency said that the RTD market is “reminiscent” of craft beer in 2016, which was “incredibly crowded”, and full of brands fighting for the same small amount of attention.
According to Fortune Business Insights overall RTD beverages (including non-alcoholic like Sports/Energy Drinks & Coffee) is expected to hit valued at $847.69 billion in 2026, growing at a CAGR of about 6.60% through 2034.
Larger companies are also targeting RTDs as a growth market. Pernod Ricard, the French drinks giant, is focusing on innovation, RTD and small formats in the US, while Brown-Forman has said innovation is key to its strategy as it saw sales of its own RTD portfolio increase by 20%.
However, despite the focus of these larger companies Perry said that having a famous name does not guarantee success in the market.
He said: “But getting a share of those sales is becoming harder. IWSR found that the steady stream of new hard seltzers drove significant growth until 2021, when saturation began reducing the incremental volume generated by each new launch across many brand lines.”
How can brands ensure their RTD is a success? Mike Perry gives his top three tips for RTD brand success.
Treat it as a distinct product
Legacy drinks brands often misunderstand the RTD opportunity as a format extension rather than a brand-building opportunity.
“The thinking goes: we have a famous brand, let’s put it in a can,” Perry said.
“But the occasion is different, the format is different and the purchase environment is often completely different. A premium gin brand might have spent decades building an on-premise world around bartenders, cocktails and beautiful glassware. Put that gin into a can and suddenly it’s competing in convenience stores, supermarkets, festivals and refrigerators against products designed specifically for those occasions.”
He argues that the RTD product needs to have a distinction to deserve space alongside the master brand.
“You can absolutely trade off the equity of a master brand, but you need to translate it for the new context,” he said.
“The strongest extensions don’t just borrow the logo – they go deeper into the brand’s DNA and give consumers a reason to choose that expression specifically. Otherwise, it starts to feel less like a meaningful extension and more like a heritage brand chasing a category opportunity.”
Find the heritage spark
Creating something distinct doesn’t mean starting from scratch as legacy brands have an advantage newer RTD brands would love to have, Perry said: “decades, sometimes centuries, of history to draw from. ”
That means understanding what is working for the master brand and looking at what pieces of heritage have been forgotten, which can provide an “authentic connection” to the brand without “simply shrinking its existing identity onto a can,” he advises.
“The relationship works both ways: the master brand gives the RTD credibility at launch; the RTD can bring new relevance and consumers back to the master brand,” he said.
He highlighted the example when McDonald’s did “something interesting” with CosMc’s, its spinoff American fast food restaurant focused on hot and cold speciality drinks.
“It reached back into McDonaldland and revived a relatively obscure character, giving CosMc’s genuine McDonald’s provenance while enough distance to develop its own identity, storytelling and experience,” he said.
“Legacy drinks brands can do the same. Find something intrinsically yours and reinterpret it for the new product and occasion. The aim is an RTD that lives within the memory structure of the master brand but has enough distinction to build a world of its own.”
Build for your customer, not the category
A successful RTD has to do more than look good on a shelf with long-term demand coming from giving people a reason to talk about the brand and introduce it to someone else.
Perry said it is crucial that the brand understands who it wants to reach and not just focus on the younger consumers and default to paid social, influencers and sampling.
“But there are already valuable, RTD-ready audiences spending money in the category,” he said.
“The challenge is to understand their occasions and journeys and build around them.”
Perry said that this is why brand building can’t be separated from go-to-market strategy as product, identity, channel, advertising and experiences should reinforce the same idea.
“Legacy brands enter the category with an advantage: awareness, history and consumer associations that a new RTD might spend years building. But those assets should be the raw materials for something new, not a substitute for creating it. A famous logo might get you trial. It won’t, on its own, create long-term demand,” he said.
