MillerCoors tried to convince millennials to drink more beer with Two Hats, a new brew that debuted earlier this year. Now, mere months later, the beer giant is instead killing the new beer.
On Monday, MillerCoors announced it is ceasing production of Two Hats. The beer, which the company described as a “light beer brand targeted at younger legal-age drinkers,” will exit the market by early 2019.
MillerCoors announced the debut of Two Hats in February 2018. Two Hats’ campaign utilized partnerships with social-media-centric brands including College Humor, Snapchat, and YouTube, and it featured catchphrases like “Good cheap beer is coming … so stop your wine-ing.” The beer industry has struggled to win over millennials.
Beer consumption among drinkers from 21 to 24 has fallen roughly 3% per year over the last 15 years. Beer penetration fell one percentage point in the US market from 2016 to 2017, while both wine and spirits were unmoved, according to Nielsen data. And, beer lost 10% of its market share to wine and hard liquor from 2006 to 2016.
“There haven’t been any new mainstream light beer launches for this group at this price point … so it’s no surprise they think of beer as dusty and old and migrate to wine and spirits,” Justine Stauffer, the MillerCoors brand manager who led the Two Hats launch told the company’s blog. “With Two Hats, our goal is to build the next generation of beer drinkers.”
However, millennials failed to jump on the Two Hats bandwagon.
“We believe industry growth requires healthy brands across all segments, and we won’t stop trying to be part of the solution to grow beer,” MillerCoors executives Bryan Ferschinger and Kevin Doyle wrote in a recent note to employees and distributors. “At the same time, right now we simply cannot get to profitable growth without significant improvement in Coors Light and without gaining a bigger piece of (the) above premium (segment.)”
Molson Coors reported last week that sales decreased for the fourth straight quarter, with Coors Light’s decline contributing to the slump.