Beam Suntory and Boston Beer Collaborate on New Products

Fresh Drinks Will Debut in 2022

Beam Suntory (STBFY) and Boston Beer (SAM) are entering a partnership to create new products in response to consumers’ changing alcohol preferences. Beam Suntory owns spirits brands including Jim Beam and Maker’s Mark. Boston Beer’s brands include Samuel Adams, Angry Orchard Hard Cider, and Truly Hard Seltzer.

The companies are collaborating on new products which will debut in mid-2022. They first plan to use Beam Suntory’s Sauza brand to create a ready-to-drink beverage and to bring Boston Beer’s Truly Hard Seltzer into the spirits category.

Pandemic Alters Alcohol Preferences

Many alcohol companies are in the process of adapting to changes in demand. The pandemic altered people’s socializing and drinking habits and some of those changes are here to stay. For example, the ready-to-drink canned cocktail category grew by 50% between 2019 and 2020. While bars were shuttered, people flocked to buy premixed drinks.

This segment still only accounts for about 3% of spirits sales in the US, but alcohol makers are betting it is poised for growth—even as consumers return to their pre-pandemic habits. Pre-mixed cocktails became popular during the pandemic and now some people are seeking out these drinks at bars.

A History of Working Together

Boston Beer CEO Dave Burwick and Beam Suntory CEO Albert Baladi have a long history of collaborating. They first met when they both worked at PepsiCo (PEP) and have kept in touch for years. They believe that their experience working together will help foster a symbiotic relationship between the companies they lead.

Boston Beer and Beam Suntory will depend on each other for expertise in various categories of the liquor market. They will also use each other’s distribution networks as they bring their new products to consumers across the country. As the pandemic subsides, people are toasting a post-COVID future. However, many people’s drink preferences have changed over the past year and beverage companies are finding ways to respond.

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