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At a news conference in Tokyo, Japan, bottles of Beam Suntory Inc. spirits are on exhibit. Getty Images | Yuriko Nakao | Bloomberg Beam Suntory, the maker of Maker’s Mark, and Boston Beer, the maker of Sam Adams, have formed a new relationship that will expand the legendary brands into new areas. Boston Beer’s Truly hard seltzer will be expanded into the spirits sector, and Beam Suntory’s Sauza brand will be used for ready-to-drink beverages, according to initial plans for the long-term relationship. The new items will be available in mid-2022, with the companies planning to expand into additional brands in the future. Boston Beer CEO Dave Burwick and Beam Suntory CEO Albert Baladi have a long history of collaboration. They worked together at PepsiCo nearly two decades ago and have remained in contact. The trust between the two men, according to Baladi, will strengthen the cooperation even further. Burwick told CNBC, “I gave Albert a call as we watched the category changing, customer trends, and I thought it could be a good idea to call over to Beam Suntory to see if there were any ways we could partner.” It’s the latest move by booze behemoths to diversify and adapt to changing consumer preferences. A “fourth category” of alcoholic beverages has evolved in recent years, blurring the distinction between wine, beer, and spirits. According to industry tracker IWSR, consumers in the United States consumed more ready-to-drink beverages than spirits last year. Ready-to-drink canned cocktails are one of the beverages fuelling the trend. According to industry tracker IWSR, the premixed cocktail segment rose by 50% in the United States between 2019 and 2020. According to data from the Distilled Spirits Council of the United States, the market is still modest, accounting for only 3% of total spirits volume in the United States. Anheuser-Busch InBev and Molson Coors Beverage are two companies that are betting on the segment. Beam Suntory paid an undisclosed sum in September for the canned drink brand On the Rocks. The partnership’s financial details were not disclosed. Baladi, on the other hand, described it as a “fully integrated relationship” that goes beyond a licensing agreement. Both CEOs have worked on joint projects before, dating back to their time at Pepsi. He stated, “We’ll have strategic reviews, innovation reviews, and all of that nice stuff.” “As we move forward, we’ll have teams that are linked at the hip.” Beam Suntory and Boston Beer intend to rely on each other’s experience in new segments and leverage their distribution networks. Because of state-by-state differences in alcohol legislation, beer may take a different route to market than spirits, which are more tightly regulated due to their greater alcohol content. “As a beer company, Boston Beer has a lot more access than we do, so it can get the brand into the hands of a lot more people,” Baladi said./nRead More

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