Bacardi Rum Rides RTDs, E-Commerce To Accelerated GrowthApril 5, 2021
Following years of decline, the rum category grew 2.5% in the U.S. market in 2020, with depletions increasing from 22.3 million cases in 2019 to over 23 million cases last year, according to Impact Databank. No.-1 brand Bacardi advanced significantly, at 8.5% to just under 7 million cases.
“We’ve seen a huge spike in off-premise sales that has in many ways mitigated some of the decline of the on-premise,” says Ned Duggan, senior vice president of Bacardi rum globally. “So at least in North America that’s a very positive sign. It’s not as positive elsewhere in the world, where lockdowns and much more stringent conditions haven’t had the same effect on the industry in the off-premise.”
Online retail and delivery in particular have been a big boon. “E-commerce has been a small portion of our sales up to now,” Duggan explains. “We were always expecting that business to grow over time, but we felt like it was going to be a slow-growth period at least before the pandemic began and we’ve seen explosive growth there. It’s really shifted a lot of our resources, and people who were working in the on-premise all became digital and e-commerce experts overnight to help bolster that area of the company. So that’s a piece of innovation that we had planned to launch in the spring of this year, but we ended up launching it right about the exact same time as the pandemic.”
Another segment where Bacardi has made gains recently is the ready-to-drink space. The Bacardi Real Rum Cocktails line launched in cans in spring 2020 with three flavors—Lime & Soda, Limon & Lemonade, and Rum Punch—and has been extremely successful. “We met our yearly forecast in the first six weeks of the year, so that’s been a real bright spot for us,” Duggan says. The brand will add Bahama Mama, Mojito, and Sunset Punch expressions later this year.
In addition to the single-serve cans, large-format prepared cocktails have also seen rapid growth. “In some states where delivery was an opportunity in the on-premise, Bacardi ready-to-serve cocktails became a tool that venues could use, and the range grew over 100% this year when we repackaged the range and launched a new Bahama Mama variant,” Duggan notes. Bacardi’s ready-to-drink and ready-to-serve pre-mixed cocktails combined for a 131% increase in 2020 to 583,000 cases, according to Impact Databank.
Bacardi has its eye on greater premiumization going forward. “Over the course of the next five to 10 years, we’ll push toward introducing our aged rums to consumers who don’t really know rum as a dark spirit and as a more premium spirit,” Duggan says. “So we continue to invest behind Bacardi Cuatro, Bacardi Ocho, and Bacardi Diez for the long-term.” The brand’s Spiced variant, which had already been on the market in the U.K., also launched in North America this past summer. “We do see spiced rum as a driver of the rum category as well and Bacardi Spiced is a fabulous product that I think we’re just really at the beginning of,” Duggan adds.—Amber DreaSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.
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