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Molson Coors exec on beer, seltzer demand amid coronavirus

Molson Coors Chief Communications and Corporate Affairs Officer Adam Collins joins Yahoo Finance’s Zack Guzman to break down the outlook for hard seltzer as the brewing giant launches Vizzy Hard Seltzer.

Video Transcript

ZACK GUZMAN: In the meantime, we're digging into the battle that is brewing in hard seltzer. Of course, we've highlighted on this show multiple times how it has benefited from a shift in healthier drinking amongst Americans. White Claw got off to a hot start there, but other brewers have been playing catch up. The latest being Molson Coors trying to tap into what has been a very quickly growing category.

We've seen hard seltzer sales double from 2017 to 2018 and then triple from 2018 to 2019. And now, Molson Coors is launching their own variety called Vizzy. And for more on that, we're joined by Molson Coors Chief Communications and Corporate Affairs Officer Adam Collins, who joins the show. And Adam, it's good to see you.

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Vizzy launched just about a month ago. You guys are off to a hot start already, but the one thing that differentiates your guys is drink from the other ones out there is you're really leading into the fact that yours has the antioxidant vitamin C. What's the thinking around that? I mean, I know right now, a lot of people are worried about being healthy. But what's the take on focusing on that front?

ADAM COLLINS: Well, I think, as you mentioned in the lead up there, seltzers are not slowing down. They're continuing to grow, even during the coronavirus pandemic, and you look at sales in stores. They're continue to grow, and grow, and grow, and grow, and grow. So as you look to compete, you've got to figure out how you can differentiate yourself from the competition.

So when you see Vizzy, it is a bright orange pack. You cannot miss it. It stands out on shelves. Retailers and distributors were very excited about that, but it also has differentiated ingredients. It's the first one made with antioxidants and vitamin C, and that's something that consumers in our testing, what we're seeing in the early days and early weeks are really gravitating toward. So it's very early, like I said, but the signs are positive. And we think Vizzy is going to be a great product for a long time.

ZACK GUZMAN: Yeah, your label makes it very clear. A 12 ounce can deliver 20% of your recommended daily intake of vitamin C, so definitely trying to push that there. When you look at the growth, though, since launch, what's it been like?

Because the numbers we got looks like the volume share was under about 0.5%. And you look at the domination from White Claw, 56.2%, Bud Light Seltzer around 10ish%. I mean, what's the goals for the first year of launch here when you look at Vizzy?

ADAM COLLINS: Well, you know, I think, let's say, the market has shifted fairly significantly, because the world has shifted fairly significantly since we first talked about plans here. You know, what I'd say is that, obviously, White Claw and some of the bigger ones have been around for five, six years. And Vizzy's been around for five or six weeks. So comparison is are a little tough there, but the feedback we've gotten from major retailers in the US, the feedback we're getting from distributors and the orders that we're seeing are starting to see come through are really positive signs for that brand.

ZACK GUZMAN: Yeah, and when you talk about marketing it, too, I mean, I understand you're trying to stand out on the antioxidant front. But when you look at maybe trying to market it to people who are more active into sports, I mean, right now, it's a bit of nothing going on in the sports world. Tough to do that.

I mean, Bud Light Seltzer at least latched on to marketing with the XFL when they were still around. They've seen their share come down since that league evaporated. So how do you really attach to maybe a healthier maybe a more active demo right now?

ADAM COLLINS: Yeah, it's a good question, and I think the biggest thing for us is to really lean into the differentiation. I mean, that's what separates Vizzy from the rest of the pack or what we would say, it's what separates Vizzy from the sea of sameness. You know, when you go into a store, whether it's a liquor store, or a grocery store, or 7-Eleven, or whatever, you see a whole row of white boxes or some [INAUDIBLE] and things like that. So we're really leaning into the differentiation is the reason that people will pick it and pull Vizzy off the shelves.

ZACK GUZMAN: Yeah, the other aspect that I would be remiss to not bring up here, of course, is Molson Coors is quite levered to the beer market. We've seen hard seltzers start to eat into the share of sales here when we think about how beer is taking it relative to some other categories when hard seltzer took off, so how do you manage that?

I know that Coors Seltzer is still being planned for later on. That got a bit delayed. You didn't delay Vizzy, so how could that compete in the space? How do you differentiate a Vizzy from a Coors Light Seltzer from a Bud Light Seltzer? What's really the thinking there?

ADAM COLLINS: No, it's a good question, and I'm taking a sort of step back. When you look at it last year, we went through a significant revitalization plan, streamlined the company to use resources that can be put back into the business. We actually changed the name of the company as well to Molson Coors Beverage Company. And to us, that signifies that there is-- obviously, our foundation is in beer. It's always going to be in beer.

Beer is-- believe me, people are drinking a lot of beer right now from stores and whatnot. But it also signifies to us that there are other places that we believe we have the right to play, and win, and succeed. Seltzer is one of those. We've got some exciting new partnerships with a company called LA Libations in the nonalc space as well.

We just launched our first canned wine ever, MOVO. It's a sparkling wine that you can get at stores. So I think from our standpoint, like I said, our foundation is always going to be in beer. And we've got some big trusted known brands, Coors, Miller, Molson, and many others. But there's a lot of space to compete and win in other markets as well. And we're going to continue to do that.

ZACK GUZMAN: Yeah, real quick before we let you go, and obviously, the places where people drink, as you noted, has shifted pretty considerably when we think about restaurants, bars, and pubs being closed down for the better part of the last month. How do you really address that as a company a lot of people are used to having interactions with outside the home, and how has Molson Coors been kind of helping on that front?

ADAM COLLINS: Yeah, you know, it's been a challenging time, I think, for everybody. From our business standpoint, bars and restaurants are about 20% of our business in North America. So when that goes to zero or very near zero, no matter how much growth you see in stores, you can't offset for that. But we're part of a community here.

Beer is a social product, so we've done a number of different things to try to bring people together in this moment. Coors Light had, I thought, a fantastic campaign a couple weeks ago called America Could Use A Beer, which was started by Olive. I remember this 93 year old woman put a sign up outside her house that said, we need more beer. We delivered her plenty of beer. She's got a lifetime supply, but it sparked something for us.

So we launched this campaign, America Could Use A Beer, where you can tweet at someone and tag Coors Light. And we'll send them a six pack of beer. Miller Lite started a virtual tip jar to help support waiters, waitresses, and bartenders across North America, who are out of work as a result of this. Molson Canadian's done something similar up in Canada.

We've bought meals for health care workers, frontline health care workers, who are just doing incredible work to protect all of us and within our own company. We produced our own hand sanitizer that can be shared with employees to make sure that they have the kind of safety equipment that they need, so those kind of efforts are obviously going to continue. And we're going to do everything we can to support our people, and support our business, and to support our communities.

ZACK GUZMAN: All right, there you go. Much more than just the launch of a new seltzer going on at Molson Coors. But Adam Collins, I appreciate you taking the time. Good luck with everything. We'll see how it does against the big boys out there in the seltzer space.

ADAM COLLINS: It's a good product. It's a good product.

ZACK GUZMAN: All right, I appreciate you taking the time.