Beer slumps, but premium alcohol is on the rise

Thursday, 16 June, 2016

Growth in the premium spirits market indicates a rise in preference for quality over quantity, according to the IWSR 2016 database.

Total spirits grew 0.5% globally in 2015 versus 2014, which equated to an additional 14.1m cases. However, excluding growth from national spirits, dominated by baijiu and soju, the market shrank by 8.2m cases overall (-0.5%), with significant declines from vodka (-8.6m, -1.8%), brandy (-7.3m, -3.7%) and flavoured spirits (-4.3m, -2.7%).

Premium sprits grew by 6.7m nine-litre cases in 2015 versus 2014, a 5% uplift, with the largest-growth categories in the premium segment being whisky, gin, vodka, rum and tequila.

For whisky, the premium-and-above category added 3.9m cases between 2014 and 2015 (+7.3%). In comparison, standard whisky grew by 2.5m cases (+3.1%). Premium whiskies grew strongest in the US (+2.5m, +14.6%), but also saw good growth in France (+169K, +11.0%), the UK (+136K, +7.6%), Canada (+130K, +8.5%) and Mexico (+126K, +10.0%).

The US market is driving growth of premium vodka, rum and tequila, while the UK is the key growth market for premium gin, where a revival of the gin and tonic trend and a growing range of craft gins continues to enter the market.

The top markets for super-premium spirits growth are the US (+3.3%), UK (+19.0%), Mexico (+23.1%), Duty Free (+3.7%) and France (+14.5%). In the premium spirits segment the top growth markets are the US (+8.6%), UK (+11.6%), Canada (+8.2%), France (+10.7%) and Australia (+11.0%).

The popularity of premium alcohol is not limited to spirits; premium still light wine saw the largest growth of any category and premium sparkling wine has the third-largest growth behind premium whisky. Total wine consumption overall declined by -3.5m cases (-0.1%), whereas the premium-and-above market gained 13.8m cases in 2015 (+4.7%). Premium still light wine contributed 11.9m cases to this growth (+5.3%), with the strongest growth recorded in the US (4.8m cases, +8.7%) and China (4.1m cases, +35.5%).

In 2015 global beer consumption declined by -0.6%, following a levelling off of volumes in 2014, but cider continued its strong upward trend as new markets were established and innovation and new flavours helped drive growth of 3.1%. The mixed drinks category also remains in growth, adding 1m cases in 2015 (+0.3%).