February 10, 2021

2020 Growth was Fueled by Innovation, Seltzer, Variety Packs and Digital Strategy
All stats are Total U.S. Multi Outlet + Convenience YTD, unless otherwise stated

Longmont, Colo. (February 10, 2021) CANarchy Craft Brewery Collective continued to grow in 2020 by leveraging the platform it has strengthened over the last several years, and through diversification of its portfolio across brands and key U.S. regions. Despite encountering many unforeseen challenges and obstacles during a difficult year, the collective’s successes were driven by fresh innovation, strength in the seltzer space as a craft segment leader, variety pack victories and a robust digital strategy. These initiatives and many others boosted sales to wholesale (STW) from 480,000 barrels in 2019 to 490,000 in 2020, an increase of 10,000 barrels, or 2%. The collective also grew sales to retail (STR) at a rate greater than shipments at 5%, indicating that velocity at retail was strong.

2020 saw the following developments in $ trend for IRI scan data for Total U.S. Multi-Outlet and Convenience:

An increase within CANarchy’s beer portfolio of 18%, outperforming total craft trends of +9%

An increase of 33% when factoring in incremental hard seltzer brand growth

All CANarchy breweries up YTD compared to 2019

Cigar City Brewing increased 27%

Oskar Blues Brewery increased 53% including seltzer

Three Weavers Brewing Company increased 67%

Strong performance in home markets, including Florida, North Carolina, Colorado, Utah, Michigan and Southern California

Chris Russell, Chief Commercial Officer, said, “While the past year presented a significant number of challenges for our business, we were able to continue to build momentum and create growth by leveraging our diversified brand portfolio that ultimately tapped into what the consumer was looking for during a tumultuous time. 2020 was a year in which we strengthened our processes, our productive capabilities and most importantly, our key partnerships at the wholesale and retail levels. We believe that we are well positioned to build on this momentum in 2021 as a strong contributor to category growth through strong core brands, a robust innovation pipeline and an effective go-to-market strategy.”

Leadership in Hard Seltzer Space

In 2018, CANarchy became one of the first national craft breweries to produce hard seltzer. CANarchy continues to be a strong craft player in the seltzer category, with brands including Wild Basin Hard Seltzer by Oskar Blues, Blind Lemon Seltzer by Deep Ellum; Grandeur Peak Spiked Sparkling Water by Squatters; and Clear Coast Fresh Hard Seltzer by Perrin. Wild Basin grew by 334%, increasing its share of Total Seltzer by 44% versus 2019. The Berry Mix Pack ranked #9 among new variety 12-pack entries in 2020, and the brand continued to innovate with the introduction of Cocktail Mix Pack in October. Blind Lemon increased by 694% in 2020, ranking as the #5 local Hard Seltzer in Texas Multi-Outlet and Convenience. Grandeur Peak currently occupies the #2 spot in local seltzer in Utah Multi-Outlet and Convenience, with 32% growth in 2020. Clear Coast is the #2 local seltzer in Michigan Food.

Cigar City Brewing and Three Weavers have launched exciting new entries into the seltzer space in Q1 2021 – Cigar City Seltzer launched at the beginning of February across the Southeast, with expansion throughout the east coast to follow; and Surfwood Clean Hard Seltzer is available at Three Weavers’ Inglewood taproom. Also in February, Deep Ellum Brewing Company released Blind Lemon Variety Mix Pack, including new Blind Peach, Blind Berry, Blind Lime and original Blind Lemon flavors; and Grandeur Peak released two new flavors. Starting at the end of Q2, Wild Basin will roll out with refreshed branding. The new design maintains the colorful packaging and unique branding that Wild Basin is known for, and incorporates a new font inspired by classic National Park signs. CANarchy also plans to launch VII by CANarchy, a 7% ABV seltzer in single-serve 16 oz. cans, targeted primarily at the convenience segment with the objective of capturing new consumers and new occasions.

New Beer Innovation

Cigar City Brewing’s Jai Low IPA was one of the most successful year-round craft brands to hit the market last fall, finishing second to Sierra Dankful IPA in the last 13 weeks of 2020, and performing at the top of the Florida market. Florida Man Double IPA, also by Cigar City Brewing, earned the #2 New Double/Imperial IPA spot in the country. New Hazy IPAs performed well across the collective, with Oskar Blues’ Thick Haze IPA securing a #5 spot among New Hazy IPAs in Colorado Multi-Outlet and Convenience; Three Weavers’ Cloud City Hazy IPA among the Top 10 Hazy IPAs in Los Angeles Food and Perrin’s Call Me Hazy IPA the #1 New Hazy IPA in Michigan Food.

CANarchy Moves Into Recovery Beverage Category

Revitalyte joined the collective in December and was successfully introduced in approximately 20 test markets in 2020. The initial distribution build and pull through velocity have surpassed expectations and show a promising future as availability increases through the US. Availability should reach the collective’s entire distribution footprint by the end of Q2. The addition of Revitalyte gives the already diverse CANarchy portfolio new reach into the growing non-alc recovery beverage category.

Variety Pack Victories

The CANarchy Mix Pack, a Top 10 IPA Mix Pack, led variety packs in $ growth trend versus 2019; and Oskar Blues CANundrum Mixed Pack and Cigar City Brewing Mix Pack rank among the Top 20 Variety packs. Mix packs also performed well locally. The Deep Ellum MixTape Mix Pack is among the Top 20 Variety 12-packs in Texas Multi-Outlet and Convenience and has increased by 39% since 2019; and the Wasatch Party In a Box and Squatters Session Sampler packs ranked #2 and #3, respectively, among Variety 12-packs in Utah Multi-Outlet and Convenience.

Digital Strategy

Safe practices during the Covid-19 pandemic meant pivoting away from traditional events and samplings to focus heavily on digital marketing efforts. Digital strategy included expanding scope outside of owned markets, curating wider audiences, developing nuanced digital targets and learning from one campaign to the next. Detailed targeting ensures that potential beer and seltzer drinkers are introduced to beverages that suit their interests, and CANarchy executed on multiple delivery service campaigns to be at the forefront of mass user adoption to those platforms, seeing immediate results.

CANarchy was able to track more than 40 million visits to chain retailers’ store locations where their digital ads were a part of the path to purchase. The ads use compelling creative content to reinforce brand stories and cultivate view rates well above industry benchmarks. Investments in digital marketing will continue into 2021, planned to increase over 200% across the collective in order to further track path to purchase, while providing transparency with distributor partners.

Investment in Growth

CANarchy is currently investing in additional capacity across its facility footprint to support future growth. Investments include new fermentation and brite tanks in Longmont, CO, to increase seltzer capacity to over 200,000 barrels per year; incremental fermenters in Salt Lake City, UT, Grand Rapids, MI and Los Angeles, CA, to increase beer capacity; and mix packing capability in Brevard, NC, Tampa, FL and Los Angeles, CA.

For more information about CANarchy, please visit https://www.canarchy.beer/

About CANarchy
Founded in 2015, CANarchy is a disruptive collective of like-minded brewers dedicated to bringing high-quality, innovative flavors to drinkers in the name of independent craft beer. The portfolio of craft breweries includes Oskar Blues Brewery, Cigar City Brewing, Squatters Craft Beers, Wasatch Brewery, Deep Ellum Brewing Company, Perrin Brewing Company, Three Weavers Brewing Company and Revitalyte. In 2020, CANarchy experienced dollar growth trends that doubled that of Top 20 Vendors in retail scans; increasing total shipments by 2%. The collective provides craft beverages throughout the United States and 21 countries and US territories.