USA: Constellation Brands says its first two major Corona innovations already exceeding expectations

Corona Premier and Corona Familiar – the first major Corona innovations in over 25 years – are already exceeding expectations, says Constellation Brands, while it is also experimenting with premium spiked refresher Corona Refresca in test markets, BeverageDaily.com reported on July 3.

Corona Premier – ‘a smooth, perfectly balanced lager with only 90 calories and 2.6g carbs’ – is a light beer launched in the US in March. Corona Familiar – a ‘full flavored lager that taps into the tradition of sharing with family and friends’ - was launched in Constellation Brands’ major Hispanic markets in 12 oz bottles last year.

The Corona portfolio is brewed in Mexico by Constellation Brands and imported and marketed exclusively to the US by the company. Corona Extra has been the top imported beer in the US for more than 20 years and the number five beer brand overall.

Constellation Brands says the test launch of Corona Premier last spring validated the interest in a light beer alternative, targeting men over 35 who want to trade up. “Corona Premier offers the light beer experience men 35 plus have been waiting for …these guys have upgraded just about every brand in their life since college – now it’s time to upgrade their beer, too,” said John Alvarado, vice president of marketing for Corona as Premier launched in March.

The target market is a key one for light beer: men aged 35 and over make up 43% of the light beer segment, and represent 54% of US light beer volume.

Corona Premier differentiates itself from Corona Extra and Corona Light as a low carb and low calorie variety suitable for ‘the mature, sophisticated consumer’. Corona Premier has 90 calories and 2.6g carbohydrates; compared to the 148 calories / 13 grams carbohydrates in Corona Extra and 99 calories / 5g carbohydrates in Corona Light.

Rob Sands, CEO, Constellation Brands, says the launches of Premier and Familiar have benefited from significant investment in marketing as the company continues to invest in building brands.

“The successful launches of Corona Premier and Corona Familiar are the first two major Corona initiatives in more than 25 years,” he said, speaking in the company's Q1 2019 earnings call last week.

“Premier has achieved record speed to shelf with velocities increasing each month since launch and Familiar has already achieved a healthy share of the category in its regional expansion with velocities outpacing our expectations.

“These innovations help drive industry’s leading depletion growth of 9% for our beer business during the first quarter despite unfavorable weather-related impacts early in the quarter in some of our largest markets.”

Sands says Premier is ‘responding probably a bit above our expectations’ and is pleased with the brand’s performance over its first four months.

“We don’t see any chinks in the armor - we think it’s going to be a very, very successful brand launch, plus we put a lot of investment behind the marketing of the brand.”

Sands acknowledges that cannibalization against Corona Extra and Light could be a concern but says that it has not been an issue to date.

“Cannibalization is well within what we expected and predicted. We don’t see cannibilization really being a huge factor except perhaps against Corona Light, which I would say is what we expected.”

So where are consumers for Corona Premier coming from?

“I think it’s probably pulling its consumers from domestic premium lights and that kind of makes sense when you think about it, because it’s a low calorie, low carbohydrate beer,” said Sands.

“This is a premium choice for the already health conscious and light consumer. That’s what I would believe.”

Corona has been supporting the launch of Premier with TV, digital, out-of-home, social media and public relation campaigns; including as broadcast sponsor of the US Open of Golf and the British Open, as well as title sponsor of the American Century Golf Tournament.

Corona is also experimenting with Corona Refresca, a premium alcohol-spiked refresher available in passionfruit lime and guava lime. The flavored malt beverage was recently introduced in three test markets, supported by English and Spanish language TV and sampling events.

Constellation Brands says it is targeting high-single digit volume growth and 9%-11% net sales for its beer business – which also includes Modelo, Ballast Point, and Funky Buddha - in fiscal 2019.

03 July, 2018