`Alcopops': A Little Booze For The Kiddies?

New alcohol-laced drinks pitched to younger drinkers are stirring controversy

With sales stagnating, marketers turn to cartoon characters to boost a product under attack as a health risk. Critics lash out, accusing the companies of targeting kids and calling for new government regulation.

Sound familiar? No, it's not Joe Camel and the cigarette industry. It's alcohol--specifically new lemonade-flavored drinks that contain about 4 1/2% alcohol, the same punch as beer but masked so well they can be chugged like soda. Big in Australia, Britain, and Hong Kong, "alcopops" have begun pouring into the U.S. The top two sellers, Bass PLC's Hooper's Hooch and Two Dogs Lemon Brew, an Australian brand, are rolling out nationally.

They'll compete against a handful of homegrown versions from smaller brewers. And the industry giants? Both Miller Brewing Co., which tested a version this spring, and Anheuser-Busch Cos. have names picked out for their own brands, but don't look for Wiley's or Yellow Jack any time soon. The megabrewers are staying on the sidelines for now, possibly because they fear a backlash.

NOT STOUT-HEARTED. The sweet lemonade brews, malt-based in the U.S. and priced about the same as beer, are just the latest attempt to woo younger people more used to orange soda than hearty stout. Wine coolers, a hit in the 1980s, shriveled fast. Recently, Coors Brewing Co.'s Zima, a clear malt beverage, has lost its fizz. After more than a decade of flat sales as consumers have become more health-conscious, brewers and distillers have good reason to try to attract the younger generation, which they fear they may lose to soda and iced teas. "There's no question the target has shifted," says Tom Pirko, managing partner at Bevmark, a management-consulting firm. "Everything the companies do is now geared much more to this younger audience."

The first alcopop was concocted three years ago by an Australian brewer named Duncan MacGillivray trying to find a use for a truckload of lemons. Vaguely similar to the beer-and-lemonade mixture sold in British pubs as shandy, MacGillivray's brew, Two Dogs, is now Britain's second-biggest seller. First is Hooper's Hooch, which Bass claims will ring up sales of $300 million this year. If alcopop sells at the same rate in the U.S. as in Britain, it could soon capture 4% of the $50 billion beer market.

It won't happen without controversy, however. Their makers promote them as refreshing alternative drinks aimed, above all, at women in their 20s. But with their cartoonish labels and nearly undetectable alcohol, the carbonated drinks have been blasted in Britain by health advocates who say they represent a blatant strategy to introduce teens to alcohol. The companies fiercely deny that. "There is no evidence to suggest there was an increase in underage drinking because of [alcopops]," says Martin Fagan, general manager for the Americas at Bass Beers Worldwide.

TEENY POP. That may be, but there seems little question that teens crave the beverages. On a recent night at Trocadero, a London entertainment complex, five giggling teenage girls stopped to talk about the Hooper's Hooch they had just drunk. "They taste just like lemonade. That's why we drink them," said Alison, 16, two years younger than the legal drinking age. "You can drink them so fast. They just go right down."

Already, U.S. critics are lashing out. "The earlier you begin drinking, the more likely you are to have alcohol problems and drunk-driving problems," says Jim Mosher, senior policy adviser at the Marin Institute, a San Rafael (Calif.) antidrug group. In California, where Hooch was successfully test-marketed, state lawmakers offered a bill this spring prohibiting alcoholic-beverage labels with cartoons. The effort died but could be a taste of things to come. Representative Joseph P. Kennedy II (D-Mass.) has proposed a bill in Congress to restrict alcohol advertising. Wait until critics see what else is out there. Family Frost, a company in eastern Germany, introduced alcoholic beer-flavored popsicles last month and has sold nearly a million. The next step: taking them to western Germany--and perhaps the U.S.

    Before it's here, it's on the Bloomberg Terminal.