MillerCoors is taking action to get to growth by 2019, despite a challenging external environment in which beer continues to lose share to wine and spirits, CEO Gavin Hattersley said in a speech yesterday to distributors.
“We’re leaning in,” Hattlersley said at the meeting, held during the National Beer Wholesalers Association conference in Las Vegas. “We’re confident we have the right plan to get to growth, and we’re continuing to execute with relentless focus.”
By building a portfolio of beers that plays across every major beer segment – from economy to premium lights to craft – the company is laying the groundwork to “invite new drinkers while retaining and creating loyal beer enthusiasts,” Hattersley said. The key, he said, is to capture new legal-age drinkers who either started with or defected from beer to wine and spirits. “We believe our plan will help bring people back to beer and improve the health of the overall category.”
To do that, MillerCoors is taking a multi-pronged approach that relies on new products and continued investment behind some established standbys. Starting next year, the company is launching three new products: a new light beer with subtle fruit flavors called Two Hats; the easy-drinking Mexican import Sol (which it assumed control of this month); and a hard iced tea/lemonade mix named Arnold Palmer Spiked.
Sol and Arnold Palmer Spiked will “enable us to participate in fast-growing segments where we didn’t play before while helping accelerate our growth and profitability in above premium,” Hattersley said. Two Hats, meanwhile, “will compete directly with spirits and provide an easy entry point into beer and our portfolio.”
The company will continue to invest behind its national craft brands Blue Moon and Leinenkugel’s, both of which are growing in part because MillerCoors doubled-down on each brand’s flagship styles, Blue Moon Belgian White and Leinie’s Summer Shandy. Blue Moon Belgian White, the nation’s top-selling craft beer, is up this year, while Leinenkugel’s Summer Shandy had its best year ever. Plans for next year include 24-oz. cans for both brands, as well as a new, 15-pack of cans for Belgian White.
MillerCoors also is working to position its four craft partners for the long term. Hop Valley, Terrapin, Saint Archer and Revolver each are expanding into new markets in the second half of 2017 and into 2018.
With its economy brands, stalwarts including Miller High Life, Hamm’s and Keystone Light all are growing in 2017, per Nielsen, following a decision to reinvest behind them. Those beers, which represent huge volume and act as an entry point into beer for younger legal-age drinkers, will continue to be a focus next year.
Among Hattersley’s top priorities for 2018 is revitalizing Coors Light and Miller Lite, both of which are down year-to-date though still gaining share among the premium light segment.
“We know you want and need us to fix these brands because they’re the biggest driver of our collective volume and profit,” Hattersley said. “And we’re working to do that by revitalizing (them) with authentic positions that build respect for our beers.”
He asked wholesalers to commit and rally behind the MillerCoors plan: “Together we will gain traction despite a rough road. And together, I know we can — and will — get to growth.”
This story was updated on Oct. 12.