- Molson Coors has increased production capacity for seltzers and popular innovations by more than 400% to keep up with consumer demand, the company said in a statement.
- The beer giant said sales of Vizzy, Coors Seltzer, Blue Moon LightSky and other offerings continue to soar nationwide, prompting overhauls at breweries in Fort Worth and Milwaukee. The changes include new canning lines and a state-of-the-art filtration system.
- While Molson Coors is best known for its iconic beers, the company has been expanding its reach into trendier alcoholic products such as seltzers and a suite of nonalcoholic products, such as a grain-based milk alternative fortified with proteins and nutrients, and a plant-based diet soda.
Just over a year ago, Gavin Hattersley took the helm as CEO, and he has wasted little time moving the storied beer maker into faster-growth categories both in alcohol and outside of the space. Now, the company is showing signs that its move into these areas is paying off either through demand for its specific products or as part of a rising tide that is lifting all offerings within those categories.
“We’ve seen tremendous growth in Vizzy, Coors Seltzer and LightSky since each of these products were introduced earlier this year, and we’re full steam ahead from a production standpoint,” Brian Erhardt, chief supply chain officer at Molson Coors, said in a statement. “These investments will allow us to keep up with demand as we work to aggressively grow our above premium portfolio and prepare for additional product launches that the revamped Fort Worth and Milwaukee breweries are able to handle.”
While Molson Coors’ beers such as Miller Lite, Coors Light and Keystone remain a key part of the company’s portfolio and a meaningful source of revenue, the beverage giant realizes that consumers are moving away from these products to faster-growing, more trendier products. Vizzy, for example, competes with top-selling hard seltzers White Claw and Boston Beer’s Truly that dominate the category. LightSky and its 95 calories caters to those watching their weight, placing the Molson Coors product up against AB InBev’s popular Michelob Ultra and Constellation Brands’ Corona Premier.
Even though Molson Coors and other large beer companies have been catching up to some of these trends, they have little choice but to do what they can to make up lost ground or risk falling further behind. Overall, according to IWSR, beer volume slipped 2.3% in 2019, its fourth straight year of declines. This was led by a 3.6% drop in domestic brews.
In the last year, Molson Coors has expanded its presence in beer by purchasing Atwater Brewing and forming a distribution partnership with the country’s oldest brewer, Yuengling. It also struck a distribution deal with La Colombe, a maker of RTD coffee drinks.
The dramatic increase in production for some offerings comes as Molson Coors looks to cull its portfolio. Last month, Hattersley told analysts a can shortage prompted the beer giant to consider dropping some SKUs it produces.
Hattersley didn’t mention which brands or lines under an existing brand could be susceptible to being cut. “From a complexity point of view, from a brewery point of view, I would expect that we will have less SKUs coming up when we come out of this pandemic than we did coming into the pandemic,” Hattersley said.
By concentrating its production on popular brands and SKUs while increasing its capacity in certain growing categories, Molson Coors has more bandwidth to produce additional seltzers, low-calorie beers and other new products yet to come. This ultimately increases its chances of getting one of its drinks into the hands of a consumer, some of whom may have previously turned away from the company’s other brands.