This piece was initially shared with Beer Branding Tendencies Publication subscribers. Be part of practically 6,000 different beer trade execs who obtain the Beer Branding Tendencies Publication every month protecting tendencies, currents and actionable recommendation from CODO Design.
As of November 2022, Hop Water is not a development within the you-see-it-everywhere-and-everyone-is-talking-about-it sense. Although the class has truly been round for a number of years (way back to the early 2010’s from what I’ve seen), Hop Water remains to be comparatively new so far as shoppers are involved.
Certainly, this complete class may fizzle out and get misplaced within the veritable sea of recent product growth we’re presently having fun with throughout the beverage trade. BUT, as arduous seltzer loses steam (or at the very least, as the novelty that drove seltzer’s wild ascendency continues to wane) and the non-alcoholic (NA) class continues to increase, I feel Hop Water is in an ideal place to flourish.
There are sufficient on-trend and compelling worth props that would make Hop Water a decently-sized class in its personal proper, and one thing that any brewery who’s producing past beer merchandise would possibly need to take into account.
If you happen to’re seeing what I’m seeing, then it may very well be price experimenting with this fashion over the winter forward of spring/summer season 2023. (Clock begins now, people.) — This could be affirmation bias on my half (I really like Hop Waters), however CODO has seen a sharp uptick in inquiries for Hop Water branding tasks. Sharp uptick as in we acquired one inquiry in all of 2021 and practically a dozen this yr. These inquiries (two of which turned enjoyable, ongoing tasks) have come from startup Hop Water manufacturers, to smaller breweries (~1,500 bbl per yr) and all the best way as much as regional breweries.
One other attention-grabbing level right here: We’ve additionally seen a gentle decline within the variety of breweries reaching out to debate non-alcoholic beer branding tasks this yr. We had lots of motion on this entrance all through 2021 and even into early 2022. However this has since quieted down virtually totally. Whereas anecdotal, this context issues. There’s motion right here, in any respect ranges, and there are land grabs accessible for early movers who get it proper.
Okay, preamble over. Let’s hop to it.
What’s Hop Water?
Hop Water, in its easiest type, is simply hops, water and carbonation. That’s it. There’s an infinite quantity of tinkering you are able to do with it, however it’s a easy beverage. And it’s price noting that the majority of what we’re discussing right here can apply to any beer adjoining, NA hopped product, from Hop Water to Hop Tea and Soda, (espresso?), and so forth. I feel Hop Water is essentially the most instantly thrilling product on this class, significantly as a potential foil towards NA beer, however these will all seemingly develop over the approaching years.
What tendencies and worth props may drive Hop Water’s development?
It’s a glowing water (so it’s acquainted)
Glowing Water has been trending for years (see LaCroix, Polar, Topo Chico, Spindrift, Bubly, Waterloo, and so forth.). What this implies for Hop Water is that you simply don’t must work to teach your shoppers on what this product is. They have already got acquainted ingesting expertise cues to tug from when being launched to your model, significantly in off-premise, the place they are going to seemingly encounter your Hop Water for the primary time. (Client training is an ongoing situation for the kombucha class, for instance.)
It’s acquired nothing (which makes it higher for you)
Hop Water has no alcohol, no energy, no carbs, no sugar, no sodium, no gluten, no cute bunnies harmed through the brewing course of. Nothing. Which means that it’s wholesome to drink, which follows a broad cultural shift in the direction of stability, wellness and total health.
Search for this to be a main level of differentiation, significantly if Hop Water begins squaring off with NA beer. And so far as what classes Hop Water may steal share from, my guess is squarely on NA beer due to the shared viewers and this key differentiator.
For the brewer particularly (COGs and path to market)
1. Hop Water may hit a candy spot for (the rising variety of) brewers who’re occupied with releasing a non-alcoholic beverage, however aren’t set as much as correctly make NA beer.
2. In its base type, Hop Water can be excessive margin (much like arduous seltzer) and comparatively simple to make (in comparison with NA beer). Nevertheless, the COGS can enhance considerably relying on what additions go into your closing beverage. I reached out to a CODO associate within the taste growth and components trade to focus on the prices to supply Hop Water and he gave me a radical run down. I’m together with this on the backside of this e-mail for anybody who’s occupied with exploring these merchandise.
3. Providing choices like this in your taproom are a no brainer. You will get patrons to stay round longer and enhance your common ticket measurement. Whether or not they get pleasure from a Hop Water as a pacer in between beers, or end their night off with a number of, you’re nonetheless banking an additional $5 – $8 (no matter you cost for it in your taproom) per pour. And a great deal of that’s revenue. We wrote concerning the myriad advantages of providing nice NA choices in your taproom in our 2022 Beer Branding Tendencies Evaluate. Revisit that piece right here.
4. Hop Water, like NA beer, is good-to-go for direct to shopper (DTC) delivery. You possibly can mail it out to anybody within the nation. Hell, you should purchase Hop Waters on Amazon. That is cool as a result of ultimately, delivery beer shall be made authorized (or at the very least, simpler). That is undoubtedly a boon for bigger producers, however for smaller outfits, you possibly can nonetheless benefit from this (or at the very least, put in place a DTC plan for when/if delivery beer truly turns into much less onerous and extra viable at your scale).
Broad (early) ideas on branding and positioning Hop Water
Can Hop Water transfer past a beer-drinking viewers? (or, does it must?) + Alternatives for Categorical Differentiation
1. I feel we’re nonetheless in Part 1 of Hop Water (assume ~2018 for arduous seltzer) the place shoppers are nonetheless not totally conscious of it. And the breweries that are shifting on this class are leaning closely into the hop angle. This primary cohort of Hop Water manufacturers are being positioned as beer alternate options. Or, a beer alternative-various (an NA beer various). With as quick as tendencies transfer at this time, I see this part lasting a bit longer earlier than we begin to see established manufacturers and new entrants alike begin to carve out different (categorical) positioning alternatives en masse.
2. I’ve outlined my doubts earlier than about the long run runway of NA beer. (NA dialogue begins across the 26 minute mark on this podcast.) As a refresher, why would a Zoomer who isn’t occupied with beer, however is largely sober, attain for a non-alcoholic beer? Or on this case, a (beer-adjacent) Hop Water? On this identical vein, a key problem for Hop Water because the class matures, shall be in reaching past a conventional beer ingesting viewers who’s in quest of a extra wellness-focused beer-ish choice. Although with an growing old Millennial cohort (searching for extra beer alternate options), and extra development throughout NA beverage typically, there could also be loads of runway (or at the very least, alternatives for incremental development) with a conventional beer ingesting viewers as is.
Hop Water as a platform (or, a clean canvas)
We should always consider Hop Water as a platform for experimentation. There’s the quick angle of exploring completely different hops, and dry hopping and total degree of carbonation, and so forth.
However I feel Hop Waters are an ideal chassis to simply accept different macro beverage tendencies. Think about the litany of higher for you, purposeful components, the extra emergent and esoteric the higher (e.g. nootropics, adaptogens, tremendous fruits, mushrooms, electrolytes, caffeine, THC, CBD/CBN).All of those may work in a Hop Water, as long as they don’t add to the calorie or carb rely. Once more, having a conventional beer tasting observe whereas being calorie and carb free (and refreshing) is the true worth prop right here.
Hop Water can be a clean canvas in relation to visible rule set and class cues. It’s so new (and hasn’t had a rocket ship to outline what’s and isn’t allowed, visually, like White Claw or Really did for the seltzer class), that there aren’t any class norms, constraints, or visible canon but. There aren’t any preordained codecs, colours or iconography. Nothing. That is thrilling from a model constructing standpoint as a result of we can swing massive and make some stunning stuff.
Hop Water’s class nomenclature
Just like how Hop Water has no outlined visible canon but, there are additionally no guidelines (from a shopper standpoint) that dictate what we name these drinks on pack. We’ve seen Hop Waters (and quite a lot of non-alcoholic water-based drinks) referred to as “seltzer,” “carbonated water,” “hop-infused glowing water,” “soda water” and “glowing water.”
If I used to be compelled to choose certainly one of these, I feel “glowing water” is essentially the most approachable for the lay individual. Although your broader positioning targets for this product (together with any label necessities and dietary info) ought to dictate which route you go right here.
Two further ideas to form your buyer expertise:
1. Whereas calling a Hop Water a “seltzer” is technically appropriate, I feel this can be a mistake from a messaging standpoint. In 2022 and past, authorized ingesting age shoppers will see “seltzer” and assume it’s a arduous (alcoholic) seltzer.
2. As your brewery continues to increase its portfolio past beer, it can turn into more and more vital to delineate between your alcoholic and non-alcoholic merchandise. Hop Waters are non-alcoholic and must be clearly famous as such so your prospects could make an knowledgeable buying determination. Don’t assume individuals know this out of the gate (the class remains to be too younger for that).
Take into consideration your Model Structure
Hop Water may very well be a nice past beer match for a lot of breweries as a result of it’s so beer-centric. From a Model Structure standpoint, you may not must be overly-worried about defending your dad or mum model, and may seemingly place your Hop Water as both a straight Model Extension or a Sub Model.
However for those who’re contemplating these two choices particularly, take into consideration the long run runway of this model.– Might your Hop Water promote like loopy and carve out a big a part of your portfolio? – Are you able to envision line extensions and even model extensions spinning off of your Hop Water model (into hop teas or sodas, and so forth.)? – Might your Hop Water steal gross sales away from one other Low & No providing in your portfolio? If you happen to answered sure to any of those questions, you then would possibly need to discover extra of the center floor choice (Sub / Endorsed Manufacturers) on the Beverage Model Structure Continuum.
This Model Structure portion was painted with a brilliant broad brush. Your positioning and dad or mum model’s status, in addition to your aggressive set and targets in your Hop Water line will all drive whether or not or not that is appropriate.
Take our Beverage Extension Evaluation Device (B.E.A.T.) to ensure your Model Structure strategy is dialed in earlier than making any massive selections on this entrance.
For extra insights like this, be a part of practically 6,000 different subscribers who obtain CODO Design’s Beer Branding Tendencies e-newsletter every month protecting tendencies, currents and actionable recommendation from the entrance traces of beer branding.