With national distribution, attractive demographic appeal and constant innovation, the relatively small Cider segment is poised for great growth.

While Cider represents a small, 0.3 percent share of Beer (including Flavored Malt Beverage & Cider volume), the segment is quickly growing thanks to national distribution. Ciders have grown 65 percent in 2012 versus last year, to 1.8 million cases. As an emerging category with high growth, the category has added 54 items this year.

Cider and Craft Demographics:

Cider captures the young millennial, a consumer group that has traditionally been a core consumer in the Beer category, but in past years has been consuming more spirits. Ciders also attract a younger, more affluent consumer. All demographics purchase craft beers, providing an outlet for major brewers to stay innovative within the Beer industry. In turn, the innovative Cider offerings keep the millennials engaged, hopefully preventing them from abandoning the Total Beer category. The millennial consumer also enjoys trying new beers. Furthermore, Ciders help the beer category remain relevant in current health trends, as they are an ideal gluten-free offering.

Continual Growth and Innovation:

Ciders focus on innovation, with new packaging concepts, brands and flavors, leading to greater distribution across channels.

Many new brands are entering the category:

• Though the two top-selling brands made up 80 percent of the category last year, their combined share has dropped to 57 percent as new players have entered the category.
• Every major player now competes in Ciders, either through the creation of new brands or the acquisition of existing ones.

Packaging innovation is a key contributor to growth in Cider. Brewers are expanding to include new options for Cider, including singles, four- packs and boxes:

• While four-packs and singles are smaller players in the category, with just 75K cases and 66K cases respectively, they are quickly growing. Four-packs are up 112 percent, while singles are up 57 percent.
• While larger pack sizes are driven by mainstream brands, higher-end brands perform strongly in single and four-pack sales (causing mainstream brands to lose share).
• Boxed packaging, similar to what has been since in the Wine category, has been introduced to Ciders.
• Six-packs are still the key size for the category, with 84 percent of case volume share (1.6 million cases) and 82 percent of category growth.

The Food channel contributes 79 percent of Cider Total Case Volume, significantly more than any other outlet:

• Ciders are up 54 percent cases in the Food channel
• Convenience and Drug channels are gaining sales quickly, up 184 percent and 90 percent respectively.

While traditional, apple-flavored Cider leads category (83 percent share), Cider has followed the trends of FMBs and Beer by experimenting with different flavors:

• Both Non-Flavored Cider and Flavored Cider are growing, up 64 percent and 68 percent respectively.
• The top Non-Traditional Flavors are Pear, Hard Apple and Raspberry

The Cider category is expected to continue to grow for the reasons above. More experimentation are expected to be seen, such as combinations with spirits and beer.

Source: Nielsen Syndicated Beer Database (Total US – xAOC/Conv; Curr YTD week ending 9/15/2012 vs. YTD YA week ending 9/17/2011); Nielsen Homescan (52 weeks ending 09/01/2012)