CANarchy Craft Brewery Collective reports continued growth in 2020 by leveraging the platform it has strengthened over the last several years, and through diversification of its portfolio across brands and key U.S. regions. Despite encountering many unforeseen challenges and obstacles during a difficult year, the collective’s successes were driven by fresh innovation, strength in the seltzer space as a craft segment leader, variety pack victories and a robust digital strategy.
Sales to wholesale (STW) jumped from 480,000 barrels in 2019 to 490,000 in 2020, an increase of 10,000 barrels, or 2%. The collective also grew sales to retail (STR) at a rate greater than shipments at 5%, indicating that velocity at retail was strong.
2020 saw the following developments in $ trend for IRI scan data for Total U.S. Multi-Outlet and Convenience:
- An increase within CANarchy’s beer portfolio of 18%, outperforming total craft trends of +9%
- An increase of 33% when factoring in incremental hard seltzer brand growth
- All CANarchy breweries up YTD compared to 2019
- Cigar City Brewing increased 27%
- Oskar Blues Brewery increased 53% including seltzer
- Three Weavers Brewing Company increased 67%
- Strong performance in home markets, including Florida, Texas, North Carolina, Colorado, Utah, Michigan and Southern California
“2020 was a year in which we strengthened our processes, our productive capabilities and most importantly, our key partnerships at the wholesale and retail levels,” said Chris Russell, CCO. “We believe that we are well positioned to build on this momentum in 2021 as a strong contributor to category growth through strong core brands, a robust innovation pipeline and an effective go-to-market strategy.”
All hail hard seltzer
In 2018, CANarchy became one of the first national craft breweries to produce hard seltzer. CANarchy continues to be a strong craft player in the seltzer category, with brands including Wild Basin Hard Seltzer by Oskar Blues, Blind Lemon Seltzer by Deep Ellum; Grandeur Peak Spiked Sparkling Water by Squatters; and Clear Coast Fresh Hard Seltzer by Perrin.
Wild Basin grew by 334%, increasing its share of Total Seltzer by 44% versus 2019. The Berry Mix Pack ranked #9 among new variety 12-pack entries in 2020, and the brand continued to innovate with the introduction of Cocktail Mix Pack in October. Blind Lemon increased by 694% in 2020, ranking as the #5 local Hard Seltzer in Texas Multi-Outlet and Convenience. Grandeur Peak currently occupies the #2 spot in local seltzer in Utah Multi-Outlet and Convenience, with 32% growth in 2020. Clear Coast is the #2 local seltzer in Michigan Food.
Cigar City Brewing and Three Weavers have launched exciting new entries into the seltzer space in Q1 2021 – Cigar City Seltzer launched at the beginning of February across the Southeast, with expansion throughout the east coast to follow; and Surfwood Clean Hard Seltzer is available at Three Weavers’ Inglewood taproom.
New in beer
Cigar City Brewing’s Jai Low IPA was one of the most successful year-round craft brands to hit the market last fall, finishing second to Sierra Dankful IPA in the last 13 weeks of 2020, and performing at the top of the Florida market. Florida Man Double IPA, also by Cigar City Brewing, earned the #2 New Double/Imperial IPA spot in the country. New Hazy IPAs performed well across the collective, with Oskar Blues’ Thick Haze IPA securing a #5 spot among New Hazy IPAs in Colorado Multi-Outlet and Convenience; Three Weavers’ Cloud City Hazy IPA among the Top 10 Hazy IPAs in Los Angeles Food and Perrin’s Call Me Hazy IPA the #1 New Hazy IPA in Michigan Food.
Recovery beverages too
Revitalyte joined the collective in December and was successfully introduced in approximately 20 test markets in 2020. The initial distribution build and pull through velocity have surpassed expectations and show a promising future as availability increases through the US. Availability should reach the collective’s entire distribution footprint by the end of Q2. The addition of Revitalyte gives the already diverse CANarchy portfolio new reach into the growing non-alc recovery beverage category.
Viva variety packs
The CANarchy Mix Pack, a Top 10 IPA Mix Pack, led variety packs in $ growth trend versus 2019; and Oskar Blues CANundrum Mixed Pack and Cigar City Brewing Mix Pack rank among the Top 20 Variety packs. Mix packs also performed well locally. The Deep Ellum MixTape Mix Pack is among the Top 20 Variety 12-packs in Texas Multi-Outlet and Convenience and has increased by 39% since 2019; and the Wasatch Party In a Box and Squatters Session Sampler packs ranked #2 and #3, respectively, among Variety 12-packs in Utah Multi-Outlet and Convenience.
CANarchy was able to track more than 40 million visits to chain retailers’ store locations where their digital ads were a part of the path to purchase. The ads use compelling creative content to reinforce brand stories and cultivate view rates well above industry benchmarks. Investments in digital marketing will continue into 2021, planned to increase over 200% across the collective in order to further track path to purchase, while providing transparency with distributor partners.
Investment in Growth
CANarchy is currently investing in additional capacity across its facility footprint to support future growth. Investments include new fermentation and brite tanks in Longmont, CO, to increase seltzer capacity to over 200,000 barrels per year; incremental fermenters in Salt Lake City, UT, Grand Rapids, MI and Los Angeles, CA, to increase beer capacity; and mix packing capability in Austin, TX, Brevard, NC, Tampa, FL and Los Angeles, CA.