Canteen Spirits CEO Brandon Cason discusses disrupting the hard seltzer market by focusing on spirit-based beverages, capitalizing on consumer demand for premium options. The episode highlights Canteen's rapid growth despite the pandemic, emphasizing the agility of startups over large corporations in innovation and strategic market entry through wholesale before DTC expansion.
Key takeaways
Identify underserved niches: Canteen succeeded by offering spirit-based hard seltzers to consumers looking for premium alternatives to malt-based options, demonstrating the power of targeting specific consumer desires.
Prioritize wholesale for initial traction in the spirits industry: Cason emphasizes that for spirits startups, achieving retail distribution and traction is a crucial first step before heavily investing in DTC channels.
Leverage agility as a startup: Big companies are often slow to innovate; startups can disrupt by quickly adapting to market trends and consumer preferences, as Canteen did with its spirit-based approach.
Strategic product expansion: Expand into new categories that align with current successes and consumer trends, as Canteen is doing with its tequila-based Cantina brand.
Don't fear market challenges: While COVID-19 initially slowed Canteen, they adapted and eventually thrived, showing the importance of resilience and market responsiveness.
Canteen Spirits was ready to take on the hard seltzer industry -- and then the coronavirus hit.
The company launched in late 2019 and began 2020 expecting to grow to new heights. According to co-founder and CEO Brandon Cason, the first few months of the pandemic were hard when the country shut down and many channels slowed down. But things began to quickly ramp up once the first coronavirus peak subsided -- and the beverage brand is in growth mode once again. Canteen makes canned vodka-based sparkling beverages. Cason joined this week’s Modern Retail Podcast and described the year’s journey.
According to Cason, Canteen hit on the right space at the right time. Most hard seltzers are malt-based, but many people have been seeking out similar drinks that are made from spirits. “We recognized that consumers wanted to elevate and go premium when it comes to what they’re drinking,” he said. In the third quarter of last year, things began to take off, with sales doubling month over month during that period. Now, Canteen is about to expand into a new area -- Tequila -- with a soon-to-launch sparkling beverage called Cantina.
Cason has a history in both liquor and CPG -- hailing from both the sparkling water brand Waterloo and the vodka company Deep Eddy -- and thinks that with new types of beverages it’s better to be the disruptor. “Big companies are usually not as good at innovation as they are mergers and acquisitions,” he said. Which is to say that a big company like AB-InBev may only invest in making a brand new product if the market has already bore out the results.
Even with this current success, Canteen has a lot of growth to do. For one, it’s yet to build out its DTC channel and has only been focusing on wholesale. In his view, growing a direct online presence is a mid- to later-stage step for a spirits startup -- getting retail traction was the most important first step. The company is also waiting until the world opens back up, so it can begin more heavily marketi
Identify underserved niches: Canteen succeeded by offering spirit-based hard seltzers to consumers looking for premium alternatives to malt-based options, demonstrating the power of targeting specific consumer desires.
What does this episode say about brand & content?
Prioritize wholesale for initial traction in the spirits industry: Cason emphasizes that for spirits startups, achieving retail distribution and traction is a crucial first step before heavily investing in DTC channels.
What does this episode say about founder & leadership?
Leverage agility as a startup: Big companies are often slow to innovate; startups can disrupt by quickly adapting to market trends and consumer preferences, as Canteen did with its spirit-based approach.
What does this episode say about product & merchandising?
Strategic product expansion: Expand into new categories that align with current successes and consumer trends, as Canteen is doing with its tequila-based Cantina brand.
What does this episode say about dtc strategy?
Don't fear market challenges: While COVID-19 initially slowed Canteen, they adapted and eventually thrived, showing the importance of resilience and market responsiveness.
