Red Stripe’s rum brand extension is a stroke of genius. Why has it taken so long?

In a piece of NPD likely to leave Captain Jack Sparrow salivating, Red Stripe is to extend into rum with a trio of RTD cocktail serves.

The move makes huge sense. Despite being a famous Jamaican beer brand with wide cultural appeal, Red Stripe is suffering in a challenging beer category where mainstream brands are in freefall. Its own sales are down 9.5%, on volumes that have slipped 19.4% [NIQ 52 w/e 24 April 2024].

By contrast to beer, the ready-to-drink market is thriving. It has more than doubled since 2014, and is now worth £543m, according to a recent report from Global Brands [NIQ 52 w/e 24 February 2024].

Key to this growth has been the explosion in canned RTDs, which have grown from £89m in 2014 to £411m in 2024. In the past year alone, cans have added £44m in category value.

Hence, a canned cocktail brand extension could be just the shot in the arm Red Stripe needs to revive its fortunes.

Impulse channel is key

Brand owner Heineken has been clever in its choice of flavours, and launch channel for Rum Stripe.

The three variants – Rum Punch, Cherry & Cranberry and Pineapple & Coconut – take inspiration from Caribbean rum cocktail culture, but will be familiar (and plenty sweet) enough for the UK palate. Their abv has also been sagely dialled down from US counterparts.

And choosing to launch via impulse and convenience, where Red Stripe has majored historically and where on-the-go RTD consumption is booming, is just sensible planning.

Rum Stripe’s UK launch will be supported by activations at and around Notting Hill Carnival later this month. Given Red Stripe’s long association with the annual Caribbean festival, it’s a great opportunity for the brand to get ‘sips on lips’ for its latest innovation. It wouldn’t be a surprise to see Rum Stripe at a whole host of festivals by the time next summer rolls around.

In short – Rum Stripe looks a stroke of genius. The only question is: why didn’t Heineken do it sooner?

Heineken has struggled to move beyond beer

The answer lies in the Dutch brewer’s hitherto cautious approach to ‘beyond beer’ in the UK.

In contrast to overseas – where brands like Lagunitas and Desperados have been more readily used as guinea pigs for non-beer innovation – Heineken has been reluctant to extend its major brands in emerging categories in the UK.

Perhaps it’s still scarred by Ultra, Strongbow’s answer to hard seltzer. Launched to much fanfare in 2022, the extension is now worth just £2.4m [NIQ 52 w/e 24 April 2024] and absent from most major mults.

Heineken UK’s plays beyond beer and cider had (until this week) been limited to acquiring a minority stake in Ellie Goulding’s Served RTD brand. Served has been growing fast, but annual sales are still less than £1m [NIQ].

If it is to be successful beyond beer, HUK will need to be bolder and come up with more innovations like Rum Stripe. But it’s a great start.