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'Summer of seltzer explosion': Why the alcoholic water wave is set grow bigger

Katie Spain
Katie Spain

Husband-and-wife business partners James and Jacqui McKay, owners of Sips Hard Seltzer.
Husband-and-wife business partners James and Jacqui McKay, owners of Sips Hard Seltzer. Joe Armao

If hard seltzer was a surf break, it would go down in history as a monster. Just a few years ago, the term "seltzer" wasn't even part of the Australian vernacular. Fast forward to spring 2021, and it's everywhere.

Australians have Americans to thank for the wave of boozy fizz. Major retailers are full of the stuff and hordes of producers have climbed on board in a bid to cash in. But what is hard seltzer and, in an increasingly saturated market, which brands will rise to the top?

In the US, "seltzer" is commonly used to describe sparkling water. In a nutshell, hard seltzer is sparkling water mixed with spirits or other alcohol and infused with flavouring.

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"It is the fastest-growing alcoholic drinks category in the US and is set to triple by 2022," says Saintly Hard Seltzer co-founder Kieron Barton. "It has gone nuts in America. It's bigger than vodka."

Here in Australia, the beverage is coined as the next craft beer. "Last year was a summer of [seltzer] discovery," Barton says. "This year is the summer of explosion."

Entries in this year's national Drink Easy Awards indicate the category is here to stay, with more than 30 hard seltzer and 14 non-alcoholic seltzer submissions. Just this week, Coca-Cola Australia announced its entry into the local alcohol market with Topo Chico hard seltzer, inspired by a Mexican mineral water brand.

Founders of Fellr (L-R) Andy Skora and Will Morgan, with their seltzer cans in Sydney.
Founders of Fellr (L-R) Andy Skora and Will Morgan, with their seltzer cans in Sydney. Janie Barrett

The growth has been exponential. When James McKay and his wife Jacqui hit the streets of Melbourne with their brand Sips in July 2020, most potential retailers were baffled.

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"Most bottle shop staff weren't sure what it was," McKay says. "By spring 2020 everyone had heard of hard seltzer."

The couple launched Sips after working in hospitality (beer and coffee) for 20 years. Initially, their brand was sparkling water focused, but the pair added hard seltzer to their repertoire after seeing the trend explode overseas, largely thanks to the public's increasing shift towards health and wellness.

Topo Chico Hard Seltzer just launched by Coca-Cola Australia.
Topo Chico Hard Seltzer just launched by Coca-Cola Australia.Supplied

"COVID has accelerated that a bit," McKay says. "The pandemic has forced people to be a little bit more reflective about some of the choices they're making about what they consume."

It's not what's in the beverage that attracts a following, it's what's not. Hard seltzer typically contains zero or very little sugar, is usually gluten-free, and clocks in at 4 to 5 per cent alcohol (about one standard drink per can).

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It can be made by blending water and vodka or brewed from grains and appeals to people who like spirits, wines, and beer. Rather than replacing their drink of choice, consumers are adding a new one to their repertoire.

Danielle Allen, left and Jayne Lewis, co-founders of Two Birds Brewing in Melbourne.
Danielle Allen, left and Jayne Lewis, co-founders of Two Birds Brewing in Melbourne.Salona Chithiray

So too, are brewers. Two Birds Brewing began experimenting with seltzer recipes in its Melbourne brewery at the end of 2019.

"We started with grapefruit versions and realised there was something in it," says Two Birds co-owner Danielle Allen. "It's very drinkable and fits where we have always tried to place ourselves in the market… to be different."

After trialling hard seltzer on tap, Two Birds has two canned hard seltzers in its Chirpy range: watermelon and mango.

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"It turns out that everyone jumped on the bandwagon so ironically, we're not that different," Allen says. "Big brands are saving up their pennies for sponsorship of festivals and outdoor events when they return. Hard seltzer isn't going anywhere. It's going to get bigger."

It looks like the term is here to stay, too.

"When we launched, I didn't like the word 'seltzer'." says Allen. "It was hard to say and we didn't think Aussies were going to warm to it, so we led with 'brewed alcoholic soda'."

It wasn't to be. "We got it into some national chains but they were only promoting products that used the name seltzer so we had to change all of our labels."

The flurry of new brands means noise and lots of it; an emphasis on quality and flavour is essential for independent seltzer-makers to survive.

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Sydney-based mates Will Morgan and Andy Skora pair quit day jobs with drinks giant Pernod Ricard to launch Fellr seltzer out of their garages in July 2020.

For their efforts, they won Start Up of the Year at the 2020 Australian Young Entrepreneur Awards and predict a growth of 500 per cent for the 2022 financial year. After selling more than 1000 kegs of watermelon hard seltzer nationally, the business partners added passionfruit to Fellr's canned and on-tap arsenal.

Morgan and Skora also created their own brewing method in a bid to stand out from the crowd. "It adds more mouth feel and makes it a bit more balanced," Morgan says. "Seltzer is really delicate, so any type of imperfection will be picked up."

The consumer demographic ranges from 18-year-olds to 45 and over. "We focus on premium and are probably one of the most expensive brands out there so we target the higher age bracket with a disposable income," says Morgan. A four-pack of watermelon Fellr retails for $23 at Liquorland.

Meanwhile, brothers Kieron and Christian Barton, and friend Gareth Whittle, drew on wider industry experience when they launched Saintly Hard Seltzer in 2020. Their business Chilli Marketing previously developed global brands such as Peruvian beer Cusquena and Rekorderlig Swedish cider.

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"There is a seismic shift in consumer drinking," Barton says. "We're right in the midst of it now. We've seen consumption of alcohol fall these last few years. Younger people are looking to drink 'better for me', lower calorie options.

"Hard seltzer has alcohol in it but it is lower in calories, has zero sugar, zero carbs and is gluten free. It pushes all the buttons."

Saintly launched a new cocktail-inspired range in August. "The Swedes taught us years ago that the most important thing is taste," Barton says. "You can have all the fancy marketing in the world but if a customer opens a product and it tastes horrible, they'll never come back."

Slick packaging, slimline cans, on-tap options and, more recently, Fizzer's introduction of the world's first on-premise post-mix seltzer (by craft brewer Moon Dog) add to the appeal and competition.

No-one feels this more than the likes of the McKay family, especially during lockdowns. As a point of difference, their triple-distilled vodka and fizzy water is flavoured with Australian botanicals such as lemon myrtle and Davidson plum sourced native ingredient specialist The Australian Superfood Co.

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"We work really closely with the hospitality industry and businesses in the food service channel so lockdowns affect us quite a lot," says McKay.

"People at home are still able to buy online so from a business standpoint, it's been a double-edged sword. People are thinking more about provenance. They want to buy Australian products and support local suppliers."

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Original URL: https://www.brisbanetimes.com.au/goodfood/summer-of-seltzer-explosion-why-the-alcoholic-water-wave-is-set-grow-bigger-20210902-h1yc76.html