Big Alcohol Tries to Go on a Health Kick

Companies embrace millennials’ health-obsessed lifestyles.

Source: Bloomberg Businessweek

Jennifer Kaplan

August 18, 2016

Every week, after a grueling hourlong CrossFit session, Casey O’Neill and some of her workout friends typically gather for post-exercise drinks at her Boston apartment. Until last summer, she often wasn’t sure what to serve-wine was too alcoholic, cocktails too caloric, beer too bloating.

Then she came up with another option: seltzer with a kick. O’Neill makes her living concocting drinks for Boston Beer, maker of Samuel Adams, and the fizzy libation she developed has inspired the craft beer company to branch out into the new category of healthy-sounding hard drinks. Truly Spiked & Sparkling, made from fermented cane sugar with natural flavors, made its debut in May and packs just 100 calories per serving, half the intake of a standard gin and tonic. “People are concerned about gluten, they’re concerned about sugar,” says O’Neill.

Alcoholic beverage companies have steered clear of the health-and-fitness trend that’s overtaken virtually every consumer category from food to clothing. Now that’s changing as millennials, especially women, obsess over everything they ingest. Big alcohol players, including Diageo and MillerCoors, are trying to cater to the so-called athleisure-wearing customer. Their challenge: to give fitness-chic status to a product more associated with binge drinking and addiction. “There’s a reason you see people in yoga pants all over New York City-not because they’re working out,” says Valerie Toothman, vice president for marketing innovation at Anheuser-Busch InBev. “It’s this idea that a kind of health and well-being is the new premium.”

MillerCoors is releasing two alcoholic drinks with healthy-sounding names. Easy Tea is a drink that the company recently described as a “refined, brisk and less sweet iced tea.” It began selling the brew on Aug. 8 in liquor and convenience stores around the Northeast and Midwest. Zumbida Mango, the first of several fruit-flavored fermented drinks, will be introduced on Sept. 1 in several Western states.

Diageo, the world’s largest distiller, said on Aug. 5 that it will soon sell a Smirnoff Spiked Sparkling Seltzer line, in addition to a new hard soda brand, to join a suite of products catering to consumers looking for seemingly healthier drinks. The 90-calorie seltzer will have nutrition labels on its packaging pitching its natural flavor and the absence of added sugar, artificial sweeteners, and preservatives, says Diageo spokeswoman Kristen Crofoot. The product is also gluten-free.

“The idea of what [people] are putting into their bodies is more prominent in consumers’ minds today,” says James Thompson, Diageo North America’s chief marketing and innovation officer. “It’s natural that spirits will follow.”

Forty-seven percent of Americans who are of legal drinking age say there are too few low-calorie alcoholic beverage options, according to a Harris Poll commissioned by Boston Beer.

Startups are going after the market, too. Nick Shields, co-founder of Boathouse Beverage, hit on the idea of a healthier option when he noticed seltzer waters replacing carbonated soft drinks in his family’s refrigerator. He started brewing small batches of an alcoholic seltzer in his garage, and the business grew from there. SpikedSeltzer, with 6 percent alcohol, is now sold in Whole Foods, Trader Joe’s, some Targets, and regional groceries in 13 states. Shields says he expects to sell more than 40,000 barrels this year.

The Beer Institute, a trade group whose members include MillerCoors and AB InBev, announced in July that its companies will start listing nutritional information, including calories, carbohydrates, and protein, on their labels.

“Alcohol isn’t good for you unless it’s in moderation,” says Dave Holmes, who co-founded Boathouse with Shields. “The desire is to have something that’s both transparent and healthier.”

The bottom line: Diageo, Boston Beer, and MillerCoors are among the companies marketing so-called healthy alcoholic drinks.

http://www.bloomberg.com/news/articles/2016-08-18/beverage-makers-go-after-the-athleisure-set