CBrands Brand-Building Playbook Evolvin

Constellation Brands is seeing the results of a sharpened focus "on capturing additional growth opportunities by winning with more consumers across more occasions," CEO Nicholas Find will tell analysts during a call this morning.

While the company has "built some of the most successful, enduring, and valuable brands in beverage alcohol, including Modelo Especial, Corona Extra, and Kim Crawford," sustaining that leadership at scale requires "an evolved playbook."

As brands mature, growth requires remaining culturally relevant, remaining top of mind with consumers, "executing a refinded commercial playbook" and deploying investment with great precision, he will say.

A Refined Playbook

Exactly what does that mean? For Modelo Especial, closing a 20% distribution gap below domestic competitors and investing in marketing and brand activation to raised unaided awareness, which remains significantly below several large beer brands.

For Corona Extra, it means "evolving the way we invest behind the brand, including optimizing our marketing mix, leveraging price-pack architecture and revenue growth management initiatives, and strengthening our presence in the on-premise channel, where Corona Extra remains a leading packaged beer offering."

For Kim Crawford, the No. 1 Sauvignon Blanc in the wine industry, whose depletions increased about 11% during the quarter, it means deepening emotional connection with consumers while expanding the brand’s relevance across the occasions that matter most to today’s consumer."

"The same proven playbook that helped build Modelo Especial, Corona Extra, and Kim Crawford into some of the most iconic beverage alcohol brands in the U.S. is now being applied to the next wave of growth brands in our portfolio, including Pacifico, Victoria, and Mi CAMPO," he is to say.

Next Wave

The "Next Wave" brands "are exhibiting many of the same characteristics that defined our most successful scaled brands at a similar stage, including strong consumer connection, accelerating awareness, increasing velocity, and significant distribution runway," he said.

Pacifico and Victoria are already demonstrating the strength of this model, he said. They are the two fastest-growing brands within the top-50 beer brands in the U.S., and Pacifico recently became a top-10 brand by dollar sales while growing depletions over 19%--even as depletion levels remain about 80% below comparable brands, he said.

Mi CAMPO is the No. 2 growth driver in the $24 to $38 per bottle tequila price segment, while its distribution remains more than 75% below comparable tequila brands.

New Goal

As consumer preferences continue to evolve around betterment, flavor, moderation, and occasion-based choice, the executive said Constellation's goal is to meet consumers with a set of brands that satisfy more of their needs across more occasions.

He pointed to the acquisition of SpikedAde as providing a differentiated, consumer-led brand and platform. RTDs are one of the fastest-growing segments and spirits-based RTDs continue to attrect new customers. ""Ade" products are increasingly growing share.

Non-alcoholic beer and wine is another opportunity. Fink notes that consumers who are increasingly seeking moderation without compromising on brand, taste, or social experience.

Corona Non-Alcoholic has emerged as the No. 3 brand by dollar sales in the non-alcoholic beer category, with depletions growing more than 12% during the quarter.

"The brand has achieved this momentum with limited direct investment and a focused package assortment, giving us confidence there is considerable runway to accelerate growth through incremental investment, expanded availability, and greater consumer awareness," said Fink. adding that Modelo Chelada Limón Y Sal Non-Alcoholic ranks as the #4 dollar share gainer in the non-alcoholic beer category and Kim Crawford Alcohol Removed emerging as the #1 dollar share gainer in the non-alcoholic wine category.