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Athletic Brewing just announced its biggest summer marketing campaign in brand's 8-yr history, with campaigned called "Exceed Every Expectation" as keystone, as we brought you last wk (BBI, May 20). But what's emergent category's broader context and how's that driving Athletic's strategy? We had a chance to sit down (virtually) with cofounder/CEO Bill Shufelt and his comms chief Chris Furnari yesterday and elicited some key themes. Moderation Trend Smoothing Out Dry January Bumps; Lager-Dependent Marketers in Long Tail Feeling Pressure When Athletic got off to a more sluggish than expected start to 2026, some wondered, did it presage a slowdown for category and for its indie leader? Now that it's more developed, was category headed toward a plateau of slower growth going forward? Not at all, Bill said. For starters, brand was dealing with some special factors: tuff year-earlier comps, pipeline fill of NA entry from biggest beer brand, Michelob Ultra, and 6 wks of atrocious weather in much of US. There were some technical factors in the scans themselves. And scans don't capture the brand's hottest growth area, on-premise. But Shufelt pointed to a more fundamental factor too: a muting of Dry January as a growth stimulant. As moderation trend takes hold as a year-round trend, Dry January's impact seems to be declining. Sure enough, with warmer weather, brand has come roaring back to healthy double-digit growth.About Mich Ultra Zero: given clout of Budweiser system, brand quickly achieved 66% ACV, way higher than the 38% Athletic's top sku has required years to attain. Despite the upheaval, Athletic maintained its #1 spot overall at 18.1% $$ share vs #2 Heineken at 13.3%. Within craft NAs, Athletic continues to hold over 50% share.Meanwhile, barrage of ads behind megabrewers' NAs on tentpole events like Olympics, NBA and now World Cup is building awareness for category, beyond Athletic's own individual summer campaign. While top indie NAs are holding their own, there has been some shakeout in the long tail, specifically of lager-dependent brands and craft players that extend into the NA space early on but shifted focus since.For Athletic, riding core entries like Run Wild IPA, the data continues to bear out its constructive role in category. Some 23% of all Athletic drinkers are new to beer category, maybe coming from sparkling water and soda, he hypothesized. At same time, many Athletic drinkers continue to consume alcohol, meaning "we're the second sixpack in the basket," elevating register ring. It continues to handily lead in repeat purchase behavior and is only brand with conversion rate higher than 50%, Bill shared.Sober-Specific Sets & Retailers May Be Fading Tho many media outlets (including this one) marveled at how rapidly retailers moved to erect sober-specific sections, even as every urban area incubated new breed of non-alc-only stores, both trends are fading, Shufelt reported, as recognition broadens that non-alc consumers are you and me, zebra-striping our way thru social occasions and TV binge-watching. "There's not a purely sober shopper who travels in groups of 5 to 10 sober people," as Bill put it. Sober retailers in particular are very challenged now, he believes, even as he commends them for their "very thoughtfully curated" assortments. Athletic does best when it's sold in sections where alc beer drinkers already are going.At retail, NA beer is getting more and more cold placements. But the ultimate cold-box mecca, the c-store, still doesn't rank very high in moving volume - low-single-digit share of Athletics' own volume, compared to megabrand extensions from Mich Ultra and Heineken who're able to command a greater presence within constrained assortments in that channel. That's not an issue that needs fixing now, Shufelt said. "We've not prioritized (c-stores) an enormous amount," he said. Still, brand is getting good proof points across regions and retailers, with Quik Trip and Town Pump chains among those who're "leaning in."On-Premise Burgeons as Pandemic-Stunted Younger Consumers Return to Social Hubs As recent "no alcohol is good for you" health debate has played out, sociability-enhancing role of alcohol has only lately begun to get bigger weighting on balance sheet, at time of soaring loneliness and depression among younger people, likely worsened by pandemic-era isolation. Of course, the perfect solution to moderate alcohol while socializing is to drink more NA beer at bars and music venues, thereby getting the best of both worlds. Shufelt can see that in Athletic's own consumption patterns, where its on-premise biz is outgrowing its already-robust off-prem biz by 2-1, with Athletic on draft "the most exponential" growth engine.He chalks that up to younger urban consumers' flight to "in-world" interactions after too much on-screen isolation. Covid exacted a 3-4 yr delay but it's happening now. Crucially, for an indie brand not tethered to a gigabrewer, the on-prem is easier to crack. "We have more sway with tastemakers in that channel" compared to situation in off-prem, where Athletic may be top seller but remains fourth most distributed brand. The result is that Athletic claims 38% share of on-premise and is #1 in 8 of 9 Nielsen divs, Shufelt indicated. Three of top 10 NA brands are Athletic.Multiyear deal forged last fall with Live Nation is accelerating that. Partners are bringing Athletic into more venues, even as brand adds more bells and whistles to its booth at activated events like BottleRock in Napa last weekend, as Furnari noted. Tasting flights offer sampling oppty so festgoers know what to purchase at the grocery once they're back home. And of course, these events offer a chance to romance the brand, as when Mt Joy band stopped by Athletic booth last Sunday for photo opp. For all the activity in RTDs and other styles, partnership has demonstrated that "beer is still right in the mix."Then there's draft format. Remember, because NA beer doesn't benefit from sanitizing quality of alcohol, Athletic took very deliberate tack into draft 3 years ago, selecting only elite on-premise partners who could be trusted to exhibit great care. Since then, Athletic's draft presence has quietly exploded to thousands of lines across US now, and hundreds in UK. Its draft volume grew 178% year over year thru Apr 30, its draft accts +70% during that period. All told, co has sold 20K+ kegs since launching in 2023. Among chains really leaning into format are World of Beer, Yard House and The Winking Lizard, Chris told us. (Strictly speaking, Athletic launched as a draft brand but quickly pivoted to cans.)When Not to Innovate Athletic certainly has demonstrated an experimental bent, as with nitrogenated Irish stout released a few weeks ago (BBI, Feb 17). But sometimes you're better off playing the hand you've got if it's workin'. So Athletic is not introducing a ton of innovation, Shufelt said, because all its leading styles are performing well both in 6-pk and 12-pk formats, with plenty of distribution upside remaining. Despite skills of cofounder/brewer John Walker, that requires discipline to "not over-innovate" with new styles and packaging formats.One area where brewer is bullish is its newer line of brewed cocktails. First 2 sku's, Paloma and Moscow Mule, are expanding at partners like Whole Foods, Target, HEB and Wegmans, and co will gradually add more styles while further expanding in off-premise and testing oppty in on-premise. Newer entries likely will be teased on ecomm site first.Daypack Sparkling Water Reaches End of Road One area where Athletic won't be moving forward is with its Daypack sparkling water line, which plays in hopped water segment that's moved into decline. Daypack was pulled from retail back in 2024 but has continued to be available via ecomm to its fan base in Lemon Lime, Black Cherry and Mango expressions. This year it will be discontinued altogether, we were informed.

ALC-ALTERNATIVES: How Athletic Brewing's Shufelt Sees NA Beer Brand & Category Going: Fewer Dry-Specific Sections, Lager-Focused Indies Suffering, Draft Exploding, Innovation Muted for Now

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