Constellation closed on the Casa Noble purchase (for an undisclosed sum) in September as the beer, wine and spirits giant seeks a share of 10% growth in the super premium and above tequila segment in the States. Indeed, Casa Noble is its first super premium spirits brand.
In comments made at this month’s Barclays Back to School Conference in Boston, Ryder spoke of his excitement over Casa Noble, which he described as a “fast-growing authentic tequila brand made from organic blue agave”.
Super-premium tequila complements Mexican beer brands
“This is a super-premium brand that grew approximately 20% last year in a category growing about 10%. The brand complements our spirits portfolio and our Mexican beer brands,” he said.
“Bill Hacket, who leads our commercial beer business, has told me many times ‘Corona has helped sell a lot of tequila over the years. Now it’s our turn to start seeing some of that benefit,” Ryder said.
“We have a good track record of integrating high potential brands into our portfolio and capitalising on their growth opportunity as we leverage our strong routes to market and marketing expertise – especially as it relates to the Hispanic consumer,” he added.
Discussing Constellation’s beer business – significantly larger following its acquisition of Grupo Modelo’s export business and brewery in July 2013 – he said the company now owned five of the Top 15 US import brands.
Constellation’s US net beer sales totalled $2.8bn in FY 2014, while operating margins run high at circa.31% since its brands are what Ryder calls ‘high end’.
Hispanic beer drinkers ‘very brand loyal’
Ryder said the company over-indexed with the Hispanic consumer in regard to beer sales, with this group accounting for 25% of Corona sales and 50%+ of Modelo Especial sales.
He said the company expects to grow market share in this vital demographic, since the Hispanic drinking population is growing with close to 1m in this group turning 21 each year.
“Hispanics are expected to account for nearly half of the legal drinking age population growth,” Ryder said. “In addition we’re seeing an increase in affluent Hispanics – becoming a more critical and influential consumer segment.”
“From a beer perspective we believe the Hispanic consumer spends proportionately more of their income on beer and they’re very, very brand loyal – all these factors bode well for our beer business over the medium to long term,” Ryder added.