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Bacardi’s Ned Duggan On New Products And The Post-Pandemic Landscape

June 8, 2020

Ready-to-drink cocktails have been among the fastest-growing spirits segments lately, and top players are taking notice. Bacardi recently expanded in the space with a new line of Bacardi Real Rum Cocktails. Launched nationally this spring, the RTDs are made with Bacardi Superior Rum and come in three flavors: Lime & Soda, Limón & Lemonade, and Rum Punch. Major chains have picked up the line, including Publix and Total Wine, where a 4-pack retails for $13.

Global senior vice president of Bacardi rum Ned Duggan points to the spirit base as a strong selling point for the cocktails among longtime RTD consumers. “Just like with most categories within spirits, people are going to be looking for more and more premium products as the segment evolves,” Duggan told SND. “The segment has been known as primarily malt-based, which is more affordable, but more spirit-based cocktails are coming into the market and we’ll see a natural trade-up for some of those malt-based RTD drinkers.”

Canned cocktails and other RTDs generally perform best in the summer, but Duggan questioned whether that seasonality pattern will hold true going forward. “In today’s environment where more people are at home and unable to go to bars and restaurants, we think that seasonality might flatten out a bit,” he said. “People are looking for easy solutions to drink cocktails at home. So we can see this extending into the fall and then even into the winter months.” With the new range enjoying a strong start out of the gate, Duggan noted that Bacardi has upwardly revised its yearly forecast by 60% based on the initial response, although he declined to provide a case figure. Bacardi’s flagship rum label advanced 1.1% to 6.4 million cases in the U.S. last year, according to Impact Databank. The brand’s ready-to-serve cocktail volume jumped 11% to 88,000 cases.

On the topic of the pandemic, Duggan noted that Bacardi has been fortunate that its supply chain hasn’t been disrupted. The most significant development in his eyes has been the acceleration of the rise of e-commerce and delivery services. “Seeing the development of e-commerce and delivery has been a very welcome change for the industry, and for us in particular,” he said. “In the last two months we’ve seen our e-commerce business grow to more than five times larger than before. Any time we’re able to provide more access for consumers, we see that as a good thing.”

Duggan believes the shift to e-commerce will be permanent. “What Covid-19 has done is catapulted e-commerce forward three or four years in just two months. Once people realize that they can very easily order a bottle of Bacardi or some of our new Bacardi canned cocktails online and have it delivered to the doorstep in less than 30 minutes, they aren’t going to shift back.”

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