BBD: The Super-Premium Beer Brand Making Moves in the High Octane FMB Space

Island Brands USA, a Charleston-based supplier that launched five years ago with a target around the super-premium segment, has revealed its next area of play: high ABV FMBs in a 16-oz. can.

CHECKING IN AT 10% ABV, COMES “CRUSH.”

That’s right, the company, known for its super-premium beer brands like Island Coastal Lager and Island Active, is now rolling a new convenience-oriented FMB line across some of its Southeastern footprint. The line, called CRUSH, packs a 10% ABV per 16-oz. can and comes in two flavors: Tropical Punch and Lime Margarita (each going for about $2.50 a can).

How in the world did this young company pick these two very different spots to play in? We caught up with Island Brands co-founder and CEO, Scott Hansen, to find out.

HOW DID CRUSH COME ABOUT?

The latest play from Island Brands might seem a bit off the wall, but the explanation behind it is pretty simple. When they began thinking about the next space they wanted to attack, Scott said it all boiled down to two things: distributor feedback and scan data.

“We’re not in the scope or size where we can throw stuff up against the wall,” Scott said. “You see so many larger suppliers cram things down their partner’s pipeline and supply chain, loading up their warehouses, loading up their trucks. It’s not our go-to-market. Our go-to-market is very much trying to understand… First and foremost, the needs of our distributor partners, understand where they have gaps in their portfolio, and then also looking at syndicated data and what’s growing with the consumer.”

He adds that they “don’t really target brands. We target segments with growth and we’re going to continue to target segments that grow.”

Indeed, FMBs excluding hard seltzer is currently the second fastest growing segment in beer YTD, up 5.7% in dollars, per NielsenIQ data thru May 28, and the segment is the second-largest dollar share gainer over the year, up 0.5 points. And when you think about the specific area that Island Brands is targeting with Crush (high ABV FMBs), a company like Geloso comes to mind, who has made a killing playing nearly exclusively in this space for quite some time.

Beyond the distributor feedback and data, it’s clear that Island Brands will see little to no overlap with these two lines too. “It’s very intentional,” Scott said, “one zigs and one zags… just a different consumer, different segment.” Adding that Crush holds its “own identity,” and “its own brand family under the Island Brands umbrella.”

SO, HOW’S THE CRUSH ROLLOUT GOING?

Well, they launched the brand in Tennessee this May, and it’s “gone very well,” Scott said. 

“As a matter of fact, we’re already reloading the convenience stores and expanding in Tennessee, but also poised to proliferate that brand throughout our footprint in the Southeast. Crush will find its way to South Carolina, North Carolina, Mississippi, Alabama, and Arkansas next, and then we’ll be looking at continuing to expand distribution throughout the balance of this year and rounding out the full footprint by the fall sets.” He also told us they’ll add a third flavor to the Crush line, a Strawberry Daiquiri, that should hit in Q3 as part of the fall sets.

CHECKING IN ON OVERALL ISLAND BRANDS.

For reference on Island Brands distribution footprint, the overall company distributes to 10 Southeastern states currently, and they’re looking to bring on a few more states – Louisiana, West Virginia and Maryland – by year’s end.

TARGETING TO TRIPLE ITS BIZ THIS YEAR.

Scott told us that they’re really having a great year. In fact, “in the last four weeks, we produced as much beer as we sold all last year,” Scott said. 

After selling 11,612 barrels in 2021, “they have produced 156,000 CEs in the past 4 weeks to keep up with accelerating demand with a target of reaching over 36,000 bbls in 2022.”

NEW ISLAND ACTIVE VP “EXCEEDING EXPECTATIONS.

” Part of that growth is due to new innovation like its new Island Active Variety Pack, which brings three new flavors – Lime, Mango and Watermelon – to the low-cal (88), and low-carb (2.6g) Active beer line. That is “moving faster” than they anticipated, he said. “The feedback on the flavors and the packaging has been overwhelmingly positive. It has exceeded our expectations all the way around.”

BRINGING BACK DRAFT AFTER 26-MONTH HIATUS.

Another big thing set to pump up Island Brand’s volume, is bringing back kegs. Indeed, they’ve been without draft for 26 months now. “We shut draft down, which was always a very good performer for us, and now we’re bringing that back and looking at targeted distribution for certain accounts in certain areas.”

LAST WORD. “We’re poised for a very strong selling season and the majority of what we’re doing is just cleaning up as many chain mandate gaps we have, streamlining our processes and just doing our very best to make every effort to be good partners with our distributors,” he said.

“We do have some big things coming down the pike that are going to help us continue to accelerate growth in the domestic US…  and we’re excited about where we’re headed.”