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Senior executives at Constellation Brands have hailed the early success of low-carb Corona extension Premier in the US market.

Corona Premier first launched in three test markets in 2017

Corona Premier first launched in three test markets in 2017

On a Morgan Stanley investor call yesterday, CMO James Sabia said the Corona Premier iteration has big-brand potential. The innovation, one of Constellation's first around the Corona brand, rolled out nation-wide at the start of this year, following tests in 2017.

During yesterday's call, Sabia said the launch taps into timely consumer trends. "This could be our next big brand because of the product benefits that it delivers to the consumer," he said. "That's what you're looking for in terms of lower carbs - 2.6g of carbs - and 90 calories."

Sabia noted that the company has spent "about US$35m" on the introduction of Premier.

"We think it has so much upside because where the consumer is going with better-me and better-for-you, we're going to put more and more resources against it, and we're going to continue to advertise against it," he said. "Our target consumer right now - we really went after a little bit older male consumer. But, we understand that it's really trying to cross over now to males and females, all different ages."

Sabia added that the brand is gaining traction among Hispanic consumers, where Corona Light had been unsuccessful.

"The exciting part for us around Corona Premier is out west with Corona Light, it was very difficult to sell a Corona Light to Hispanic consumers from Mexico. They did not really want Corona Light," he explained. "We tried, but it didn't work. Corona Premier is different... so we're starting to get some very good traction in some of the Hispanic accounts in California."

When asked about cannibalisation, CFO David Klein said the Premier extension "has been 74% incremental". He said: "We'll take that all day long."

just-drinks' Mergers & Acquisitions database - October 2018


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