• Diageo's Bundaberg Rum & Cola mini keg is expected to be snapped up by Bundaberg Rum's loyal customer base.
    Diageo's Bundaberg Rum & Cola mini keg is expected to be snapped up by Bundaberg Rum's loyal customer base.

Beverage manufacturers have a long history of introducing new packaging sizes and formats for well-established products to drive convenience, reduce waste, or to just boost interest in the brand.

A good example of this would be the energy drink category, which has seen products such as Red Bull and Mother introduced in a number of novel formats, including ‘energy shot’ miniatures and XL-sized cans with resealable lids.

In the past we have seen ‘mini kegs’ rolled out in the beer space, most notably for Heineken. This product was launched in 2007 and has been enduringly popular.

However, a handful of beverage producers have recently appropriated the format for other alcoholic beverages.

First off the rank last September was Beam Global and its local distributor Coca-Cola Amatil (CCA), which released a five-litre RTS keg for its Jim Beam and Canadian Club brands.

A CCA spokeswoman told F&DB that it was the first time they had been used for ready-to-drink (RTD) products in the local market.

She added that the Jim Beam and Canadian Club mini kegs had performed exceptionally well and resulted in incremental RTD category value creation for its retail partners. She also said that the company will look to do special releases of five-litre kegs for products across its portfolio.

Later in the year, Rebello Wines introduced a keg of the same size for its Cheeky Rascal strawberry pear cider.

And most recently, Diageo has launched a mini keg of Bundaberg Rum & Cola, which a company spokesperson says was expected to be snapped up by Bundaberg Rum’s “extremely loyal and passionate base of consumers” as a collector’s item.

This is the first mini keg that Diageo has introduced in recent years, although it does have a Pimm’s and lemonade mini keg in the UK market.

Melbourne-based Kegs on Legs, Australia’s largest keg company delivering to the private market, began selling both Cheeky Rascal and its own-brand pre-mixed cocktails in mini kegs a couple of months ago.

Tim McWilliams, Kegs on Legs' managing director, says sales of these products are going well and that consumers have been purchasing the mini kegs as testers before moving on to bigger sizes, which has helped the company get new customers on board.

Ray Noble, brand director for bourbon at Beam Global Australia, described its mini kegs as “the ultimate conversation starter”.

Katrina Diamonon, senior analyst for Datamonitor, says mini kegs have the appeal of novelty and are particularly suited to social gatherings and entertaining occasions where such formats encourage sharing and discussing.

These products could be viewed as an evolution of the 2011 boom for premixed cocktails or spirits in two-litre bag-in-box and 700ml glass bottle formats.

As with bag-in-box products, mini kegs are highly convenient and fit well with the broader trend for at-home entertaining, allowing consumers to serve up high-end cocktails and alcoholic beverages that were once the domain of swanky bars.

“[The Bundaberg Rum & Cola mini keg] delivers the convenience of being able to serve a number of guests at home as we know that our target demographic is most likely to attend social occasions in groups,” the Diageo spokesperson says. “The keg features the messaging ‘Best served with mates’.”

From a practical perspective, the mini kegs also require less storage space than standard cases of ready-to-drink beverages, they reduce packaging and wastage, and can boost longevity.

For example, Kegs on Legs’ RTS cocktails last for up to 12 months unopened, and once opened remain drinkable for a week if refrigerated.

“The problem with beer [in kegs] is a lot of them go off quite quickly, but cocktails and ciders tend to last longer, so I think RTS drinks in kegs may well be the next step for a lot of these big companies,” McWilliams says.

Retailing at about the $50 mark and containing 15 to 20 drinks, these mini kegs do offer value; however, Euromonitor analyst Bettina Kurnick says this probably isn’t a key selling factor.

“Consumers will reward what they perceive to be genuine innovation,” Kurnick says.

“Convenience is key and the innovations for summertime entertaining will be well received in the short term, but potentially only in the short term.”

Kurnick stresses that there is a “degree of fad” with these type of products, pointing to Diageo Australia’s Signature Serves RTS range as a cautionary tale.

In 2011, the Signature Serves range of premixed cocktails in bag-in-box and 700ml glass bottle format did phenomenally well.

However, a number of its competitors quickly introduced me-too products and by 2012 the RTS market had mushroomed, prices came down and margins narrowed, causing Diageo Australia’s managing director Tim Salt to refer to Signature Serves as its “Achilles heel” that year.

The Bundaberg Rum & Cola mini kegs have been released as a limited edition. Perhaps Diageo has learnt its lesson.

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