RTD to MVP
How do you dominate the ready-to-drink category?
10 years ago, RTD was a gimmick. Today, it’s bigger than wine.
So why isn’t success a certainty?
The Problem
The US RTD market continues to sparkle. NielsenIQ data says it’s grown 104% in the past two years, as all other alcohol segments contract. IWSR puts the category at 11% of the US alcohol market – a bigger share than wine.
So how is this a problem?
Like any category, RTD has its leaders, its imitators, and its challengers. But they’re all so new it’s hard for consumers to tell the difference. On-shelf impact counts for so much: NielsenIQ suggests that RTDs are much more likely to be an impulse purchase than beers or spirits.
And the shelf continually gets more crowded. In the 12 months to July 2023, Drizly added over 400 new RTD cocktail SKUs to its catalogue.
It’s a land rush, where newness isn’t a differentiator, and the rules regarding what will cut through and what won’t are yet to be established.
Everything in moderation
Part of the reason the rules for success remain unclear is that the key demographic for RTD drinks – Gen Z – don’t play by them.
They’ve come of age with a digital information overload of political volatility, climate breakdown, cost of living crunches and a global pandemic. Their reaction is the moderation movement, born of informed consumers looking for a more healthy relationship with what they drink.
Low and no alcohol drinks and functional beverages are all booming. Sober spaces are appearing as hospitality catches up. Gen Z doesn’t need alcohol to have a good time.
Value in values
Reduced consumption doesn’t mean reduced interest, however. NielsenIQ suggests consumers drank less alcohol in 2023 – but often spent more when they did buy.
Premiumization creates an experience, and experience is essential. Gen Z expects more from its flavours: complex pairings, real ingredients, smart science.
But it’s also about bonding with a brand; this savvy set want to know that the brands they consume align with their values, and are making the world a better place than the one they found.
So you’re trying to establish a brand, alongside hundreds of similar brands, in a market without rules, to reach an audience that has a mind of its own, and can spot a fake a mile away.
The Need
How exactly do you stand out in the right way?
Innovate to dominate
There’s a new consumer to engage, and they’re bringing with them new ideas and drinking occasions.
RTD brands don’t just have an incentive to innovate, it’s a need. Product offerings, brand identity and messaging all need to be moving forward, not standing still.
It could be flavours for the health-conscious, or tastes for a specific moment in time; it could be attitude, packaging, placement or celebrity endorsement, but RTD brands will pop or fizzle in line with their ability to innovate.
Identity problems
Unfortunately, innovation alone won’t cut it. There are many cautionary tales of brands that innovated and expanded, but lost sense of themselves. When that happens, customers quickly lose interest.
Innovation needs to be backed by a strong brand identity, which creates a seamless experience from online to on-shelf.
Gen Z have flipped the conversion funnel: they’re buying first, researching brands later. This leaves more time to delve into detail: what brands stand for, what their values are, and whether their actions match their words. Because brands that don’t stand up to scrutiny won’t stand the test of time.
See how we took Stories & Ink from D2C challenger to retail hit.
The Solution
It’s brand identity – visual and verbal, backed by a clear strategy – that holds the product range together and allows freedom to innovate.
Your strategy will give you a clear mission. A map to navigate to your category, avoid clichés and show you where innovation will pay off.
Your visual and verbal identity will bring that strategy to life. Compelling creative will engage your audience wherever it finds them – and leave a lasting, authentic impression.
Your design system will tie your product ranges together and flex with every innovation. The brand itself will always be a strong, central component of the consumer experience.
If you have a creative partner who can bring all these elements together.
Robot Food makes work that lasts.
Creative guts, commercial heads, unapologetic honesty and dependability – this is what we bring to every creative partnership.
Because when it comes to making a success of your brand, we’re as invested as you are.
We’ve worked with some of the world’s biggest brands, owners, founders, investors and entrepreneurs. Guided decision-makers and supported stakeholders. We’re short-term problem solvers and long-term creative partners.
We’ve built successful brands of our own. We know what it takes, the challenges, and the mistakes. We’ve made them. Now we make sure others avoid them.
When big plans need big ideas, we’re your first, last and best call.
