Twisted Tea helped build this fast-growing FMB subsegment, and plenty of new brands are following suit.
By: Kate Bernot
Globally, tea is the most consumed beverage in the world besides water. In the U.S., hard tea’s star is skyrocketing, with the category expanding and diversifying as consumers develop distinct preferences within the segment, primarily driven by desire for flavor. Flavored alcohol – sometimes referred to as the “fourth category” – represents 12.2% of all beverage-alcohol dollar sales, up half a share from the year prior.
But hard tea’s rise to ubiquity comes behind the well-carved path from the clear category leader: Boston Beer Co.’s Twisted Tea. Though Twisted Tea has existed since 2001, sales expansion and greater marketing investment from its parent company have propelled the brand to the top of FMBs. Since 2023, it’s been Boston Beer’s top-grossing product in chain retail, and it accounts for 60-70% of all hard tea dollar sales in those stores.
With Twisted Tea as the leader, the hard tea segment is poised to be a 100 million case segment. Through mid-May, hard tea accounted for 30.6% of total flavored malt beverages dollars in chain retail, up just shy of 4% versus the year prior. In 2023, hard tea was the number two-dollar growth segment within ready-to-drink alcohol, second only to spirits-based seltzers, according to Nielsen.
Though few major competitors existed during Twisted Tea’s first decades of existence, the category is becoming an increasingly crowded sea. In May, Boston Beer founder Jim Koch told the Beer Insights Spring Conference that he estimates that 100-150 new hard tea brands have launched within just the prior eight months, chipping away at the 95% market share of hard tea that Twisted Tea used to command. Some of these plays are national competitors, but many are regional or even local offshoots from existing breweries and distilleries. New hard tea entrants over the past few years include standalone brands like Lover Boy; soft-to-hard crossover brands from Lipton; and hard tea extensions from beer brands such as 2SP’s Northeast Tea. They’re distinguishing themselves by regionality, flavor, ABV, and more, but all are banking on the ongoing drinker interest in spiked versions of a classically American beverage.
“I don’t see this trend dying off because iced tea is just part of our lives. Hard tea is something someone is always grabbing for,” says Mike Contreras, Director of Sales and Marketing for 2SP Brewing.
This resonates particularly deeply in the Northeast, where Wawa, Turkey Hill, and cardboard carton-packaged dairy farm iced teas are beloved regional beverages. That tie may help explain why Philadelphia is the top market nationally for Twisted Tea Light, beating out other markets such as coastal Alabama, Phoenix, and Houston, where the brand is popular. (A July 2024 Philadelphia Magazine article ran under the headline: “How Philadelphia Became Obsessed with Twisted Tea.”)
“Twisted Tea Light makes up about 35% of our overall Twisted Tea brand in Philly’s five counties. We are one of the largest Tea Light markets in the country,” said Caitlyn Musselman, Origlio Beverage’s Boston Beer Brand Manager.
Regardless of the brand, hard tea owes a debt to Americans’ fondness for iced tea. Koch writes of Twisted Tea’s origins in nostalgic, down-home terms in his 2016 business book Quench Your Own Thirst: Business Lessons Learned Over a Beer or Two stating: “[Twisted Tea], I thought, would evoke the simple pleasures of spending time outside or whiling away a hot afternoon on the porch.”
That idyllic reference point is fairly universal, but the hard tea market is increasingly diversifying and flavor reigns supreme.
To meet the demand for flavor, hard tea brands have expanded their lineups: Twisted Tea has a full range including Half & Half (with lemonade), Black Cherry, Light, and a limited-edition summer Rocket Pop version. Jack Daniel’s Hard Tea lineup includes Original, plus fruit spinoffs Blackberry, Peach, and Raspberry. Alcohol content varies, too, between brands, with Smirnoff Ice SMASH Tea clocking in at 8% ABV, compared to Arnold Palmer Spiked’s 5%.
With Twisted Tea as the leader, the hard tea segment is poised to be a 100 million case segment.
There are other points of differentiation, including carbonation. Twisted Tea is a completely still product (which is how Boston Beer is able to package it in the novel bag-in-box form), and most of its competitors have followed suit by packaging them without carbonation. Some, however, are lightly effervescent. Calories also vary: The “better-for-you” hard tea segment includes brands such as Twisted Tea Light (110 calories) and 2SP’s Northeast Tea (85 calories), while higher-alcohol brands tend to have more than double those calories per 12-oz. serving.
Then there’s the base fermentable. Hard tea is also diversifying there. The vast majority of brands are malt-based (more than 70% of the flavored alcohol category is malt-based), however, newer spirits-based brands such as Surfside and High Noon’s Vodka Iced Tea have emerged within the past two years as well. (Counterintuitively, Jack Daniel’s Country Cocktails Original Hard Tea is malt based.) Malt-based hard teas also tend to come in at a lower price point versus vodka-based versions.
So despite spirits-based entries, hard tea remains predominantly a malt-based segment, riding a wave of consumer demand for flavor, convenience, and variety, and combining beloved flavors with the ease of a premixed drink. Malt-based RTDs broadly have been on a tear, jumping from 9% of all beer dollars in 2018 to 18% year-to date through May 2024, as tracked by Nielsen. And hard tea is no small part of that trajectory.
Hard teas meet a variety of consumer needs: flavor, convenience, premiumization, and variety-seeking. These are some of the most important trends in beverage alcohol at large, and have helped propel the growth of FMBs as well as broader ready-to-drink alcohol. Circana data shows sales of combined RTDs (including FMBs) have more than tripled between 2018 and 2023, to more than $10 billion.
Those needs are also particularly acute among young legal-drinking age consumers. This subset of Gen Z is critically important for brands to reach, and their preference is clear: flavor and variety. Circana’s consumer research indicates that households aged 21 to 34 have the highest percentage (22%) of FMB buyers among all age groups, and also the highest percentage (29%) of malt based seltzer buyers. Nielsen also called out hard iced teas as one of the core flavor-forward alcohol options that LDA members of Gen Z seek.
About the Author: You may know her as the director of the North American Guild of Beer Writers, but Kate Bernot wears many hats. The work of this celebrated journalist and BJCP Certified Beer Judge routinely appears in The New York Times, Washington Post and the online publication Good Beer Hunting – to name a few. Ms. Bernot resides in Missoula, Montana where she enjoys the great outdoors and a good pint of beer made by the area’s skilled local brewers.