Hop Water Accelerant
Hop Water has proven to be an exciting, albeit raw segment to explore, especially for IPA-centered breweries interested in non-alcoholic (NA) offerings. A key advantage that the category possesses over an NA IPA is the occasion of pairing alongside or in between alcoholic beers, to break up the action. Though certainly not the goal of all drinkers, much of craft beer’s core demographic want to enjoy a few rounds without jeopardizing their next day. The refreshment & hydration offered by hop water keeps drinkers under the umbrella of craft beer, without any consequences. This “in between occasion” is relatively new to breweries, but the most dominant beer company in the US has stepped into the arena and is deploying a new strategy around it. Will it send the Hop Water into hyperdrive?
Hop Water has two especially unique players, beyond Lagunitas & Sierra Nevada, in that neither are existing breweries or beer brands. First there’s Hop Lark, who is known for flavor innovation, rotation, and direct-to-consumer (DTC). Hop Lark has more of a patient, organic feel to its strategy that’s angled more toward margin versus volume. A beer geek’s hop water.
Then there’s Hop WTR, which aims more at the mainstream, health & wellness conscious consumer by highlighting the adaptogens & nootropics and focusing on fruit flavors instead of specific hop varieties. Hop WTR is especially unique in that they took an early investment from Constellation Brands who own the brand rights to the best selling beer in the country, Modelo, in addition to Corona and Pacifico. This Fall, the two companies will cross streams for the first time according to their Instagram.
Pacifico was chosen to join forces with Hop WTR and begin pounding the pavement together via a new, in-store rebate program. The two brands will seek a mutual lift by offering a $5 rebate to customers who buy a 12-Pack of the Mexican Lager and any Hop WTR offering exceeding $7.50 in price between 9/1/2023 - 10/31/2023. It appears that a receipt will be needed along with the offer code before filling out an online form, then waiting 6-8 weeks for processing & payment. These rebate programs are effective from many angles including a low redemption rate compared to purchases, but in this case and more importantly, an upsell that doesn’t cannibalize either product.
The Hop WTR brand doesn’t have the pedigree of a long standing craft brewery, like Lagunitas. That would normally give me pause around it’s value proposition, and still does, but naming the brand after the entire category is a smart way to compensate for that lack of awareness. While I prefer the more aggressive beer-centric approach of Hop Lark’s products, I really enjoy and relate to the backstory of Hop WTR, which was created by friends who love IPAs but grew out of being able to have so many.
The strategy of pairing Hop WTR with an alcoholic beer actually jives well with their past marketing efforts too. In June, they introduced a clever “invention” called the SPCR designed to link a Hop Water to an alcoholic beer, reinforcing this key use case for hop waters, as a companion to beer, not an alternative.
At this point in Hop Water’s (the category) young existence, every investment across the industry will raise the tide for all. When Lagunitas made it public that Hoppy Refresher would be their #1 priority in 2023, it put the entire industry on notice. Now with Constellation not only making an investment in the namesake Hop WTR brand in 2021, but now cross promoting them via their well-known Mexican Lager brand Pacifico, the category received yet another injection to accelerate its trial, adoption, and growth.
