AB InBev has continued its diversification into the “beyond-beer” category, acquiring canned wine producer Babe Wine.
The beer giant took a minority stake in the winemaker last year, but has decided the time is right to take full control.
The brand was co-founded by Instagram influencer Josh Ostrovsky, known by his handle “The Fat Jewish”. Ostrovsky has more than 10 million followers.
His company, originally called Swish Beverages, first launched a bottled wine, “White Girl Rosé” in 2015, but now generates more than 95% of its revenue from Babe Wine, which is sold in cans.
Ostrovsky initially focussed on rosé to capitalise on its popularity on Instagram with younger drinkers.
“We knew they were the No. 1 group drinking wine, but they couldn’t cite a brand,” Ostrovsky said. “We wanted to be the Bud Light of wine.”
AB InBev US chief sales officer Brendan Whitworth told Bloomberg: “We think this is the right time to capitalize on what’s going on in canned wine space and wine in general.”
While Americans drank less beer in 2018, wine and spirits picked up market share. According to IWSR, rosé consumption gained 8.2% in the US last year.
Last year, canned wine sales jumped 69% to more than $69 million, totalling 739,000 cases in US retail outlets tracked by Nielsen.
That’s up from $42 million in the previous year and less than $10 million three years earlier.
“Canned wines continue to grow at phenomenal levels, even accelerating into the most current periods,” Danny Brager, senior vice president at Nielsen, told the New York Times.
AB InBev CEO Michel Doukeris said: “We pride ourselves on putting the consumer first and evolving with them through innovation and cultural engagement, and Babe Wine is in a class by itself when it comes to understanding their drinkers and building brand loyalty.
“We’re looking forward to taking this partnership to the next level and using our distribution capabilities to share Babe’s great portfolio with more consumers around the country.”
David Oliver Cohen, co-founder of Babe Wine, added: “Anheuser-Busch pioneered the modern beverage landscape. We have a dream to make Babe into America’s #1 wine, and A-B has the vision, the capabilities, the people and the network to help us get there.”
Babe appoints chief tasting officer
Earlier this year, Babe appointed model Emily Ratajkowski as its first-ever Chief Taste Officer.
“In addition to appearing in the brand’s newest ad campaign, Ratajkowski’s role as Chief Taste Officer includes helping with creative consulting and marketing insights, and providing brand awareness and visibility,” noted People magazine. “Her 22.3 million Instagram followers will likely help with said visibility.”
Ratajkowski tweeted: “Consciously coupling w/ my good friend, wine visionary & fellow entrepreneur @FATJEW is an actual dream.”
AB InBev’s spirited purchases
The acquisition of Babe Wine follows AB InBev buying its first US spirits company earlier this year.
Cutwater Spirits is an award-winning spirits and canned cocktail company that produces seven mixers, 14 canned cocktails and 16 types of spirits encompassing variations of whiskey, vodka, gin and rum.
Cutwater joined AB InBev’s “Beyond Beer” portfolio, which also includes
non-alcoholic energy drink Hiball, which it acquired in 2017, and flavoured malt beverage offerings including Spiked Seltzer.
At a recent investor day in New York, AB InBev set a target to increase its non-beer revenues in the US to $1billion.