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The premium spirit market size is projected to increase by USD 54.8 billion at a CAGR of 6.55% between 2023 and 2028. The market is experiencing significant growth, driven by several key trends and factors. One of the primary drivers is the increasing demand for high-end drinks among the millennial generation, who prioritize quality and unique experiences over mass-produced alcoholic beverages. Another trend is the growing dependence on technology throughout the value chain, from production and distribution to marketing and sales. This includes the use of advanced technologies for alcoholic drinks processes such as distillation, aging, and labeling, as well as digital marketing campaigns and e-commerce platforms. However, the market also faces challenges, such as increasing campaigns against alcohol consumption and regulations on advertising and marketing. These factors necessitate innovative strategies and adaptability to remain competitive in the market.
The market is experiencing a significant surge among the millennial generation, who are increasingly seeking out authentic beverages like high-end drinks, margaritas, martinis, manhattans, and more. Cocktail culture is at an all-time high, with consumers emphasizing the importance of Spirit quality and distinctive aromas. Premiumization is a key trend in the Alcohol industry, with Distillers producing small batches of Alcoholic spirits using Herbs and spices to cater to this market. Lifestyle changes and Social media influence have played a crucial role in the Premiumization of spirits. DIY cocktails and Bartending skills are in vogue, with Resto bars and Specialty stores offering unique and innovative creations. Tourists are also contributing to the growth of the Market, seeking out local and authentic spirits during their travels. The Medical benefits of Alcohol consumption, when consumed responsibly, are also driving demand for Premium products. The Alcohol industry is responding by investing in research and development to create new and innovative offerings. Mixology is a popular trend, with consumers seeking out new and exciting flavor combinations. The future of the Market looks bright, with continued growth expected in the coming years.
The growing demand for premium drinks by the millennial generation is driving market growth. In recent years, millennials have become a notable proportion of the alcohol-consuming population, and this trend is predicted to continue during the forecast period.
They are above the legal drinking age (LDA) and have decent purchasing power. Moreover, premium spirits are preferred as they are of superior quality to traditional spirits. Additionally, the growing consumer disposable income, along with increasing awareness of quality premium products are expected to further boost the growth of the market during the forecast period.
The increasing dependence on technology throughout the value chain is a key trend in the market. The integration of apps into the luxury spirits market is helping consumers to customize alcoholic beverages. Some examples of personalized drink-making apps include Distiller, Speakeasy Cocktails, Cocktail Flow, and MiniBar, which help boost alcoholic consumption. Some of the other technological advances found in this domain include infusion machines and home brewing. Moreover, some apps like Drizly, MiniBar Delivery, Saucey, Drinkfly, and Klink Delivery can be used for tracking the consumption and delivery of alcoholic beverages.
Even though the apps are mostly available in a few states in the US, their accessibility is increasing. Some apps can also give the option of personalizing based on ingredients, such as old-fashioned, Scotch, and cognac, while others, like BAC Alcohol Calculator, R-U-Buzzed, and ALCulator, can help keep track of the number of drinks the consumer had. Hence the increasing prevalence of technology in the market is likely to result in further market growth during the forecast period.
The rising launch of campaigns against alcohol consumption is challenging market growth. They largely focus on raising awareness of the negative impacts of consuming alcohol for society at large. The increasingly common trend of alcohol abuse, dependency, and alcohol-related accidents, particularly among the youth, has resulted in various stakeholders, including regulatory bodies and social organizations, launching anti-alcohol consumption campaigns.
Additionally, the government is prioritizing the issue by educating and raising awareness about the injurious impact of alcoholic beverages on people's health. The direct linkage of alcohol consumption with liver diseases, cancer, cardiovascular problems, tuberculosis, and others was highlighted by the Live Better, Drink Less campaign launched by the Pan-American Health Organization (PAHO) in November 2021. Hence, the numerous campaigns and efforts to reduce alcohol consumption will be a hindrance to the growth of the market during the forecast period.
The vodka segment includes high-quality, luxurious spirits that have managed to distinguish themselves from other alcoholic drinks in the competitive market. They are renowned for exceptional quality, purity, and unique flavor profiles. They are made using ingredients of the highest quality and meticulous manufacturing techniques. Premium vodka is made using high-quality grains, locally grown potatoes, and often water from natural springs with their taste slightly varying from region to region. Hence the high quality and consumer preference are likely to boost the growth of this segment of the global market during the forecast period.
The market share growth by the off-trade segment will be significant during the forecast period. It includes supermarkets and hypermarkets that have sections dedicated to alcoholic beverages as well as specialty stores. They provide convenience and a greater variety of choices from many brands. Hence alcohol sales, particularly from supermarkets and hypermarkets, are expected to increase during the forecast period. Additionally, the expansion of key hypermarkets and supermarkets such as Tesco, Carrefour, and Target and the increasing number of vodka manufacturers shall further expand the demand for premium spirits.
The off-trade segment was valued at USD 71 billion in 2018 and continued to grow until 2022.
Growth in Internet penetration and convenience are making e-commerce a popular means of shopping mode for alcoholic beverages, especially for millennials. Quick delivery, a variety of choices, and a greater amount of information about the quantity, taste, texture, and flavor of the spirit are also advantages of this segment of the luxury spirits market. Consumer reviews help to make more informed decisions, and discounts also increase demand for the premium spirits market. Hence the above factors are likely to contribute to the growth of the global market during the forecast period.
Europe is estimated to contribute 29% to the growth of the global market during the forecast period
Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Within the region, Eastern European countries like Russia, Romania, and Poland and Western European countries like France, Germany, the UK, and Belgium are among the largest alcohol beverage-consuming countries. Other regions of growth for the luxury spirits market include the Czech Republic, Denmark, Spain, and Switzerland. Sparkling wines are very popular in Denmark, France, Poland, and Spain. The region overall has also seen increasing consumption of alcoholic beverages. The largest consuming segment is the elderly population who prefer premium spirits like whiskey, vodka, rum, liqueurs, and brandy. Additionally, the alcoholic beverages industry is one of the biggest businesses in the region, generating a massive number of job opportunities. However, certain factors that limit its growth in the region include awareness campaigns, stringent government regulations, and restricted advertising. These factors shall hinder the growth of the regional premium spirits market during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The market forecasting report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments
Premium spirits have gained significant attention in the alcohol market, particularly among the Millennial generation. This demographic is known for their preference for High end drinks and authentic beverages, leading to the Premiumization of Cocktails such as Margaritas, Martinis, Manhattans, and more. The Cocktail culture is thriving, with health-conscious consumers seeking out Natural spirits and Low alcohol beverages. On-trade establishments, including bars and pubs, and Off Trade sales through supermarkets and E-commerce platforms, are both seeing growth in the Premium spirits sector. Tequila, Vodka, Whiskey, Gin, Rum, Brandy, and other Alcoholic spirits are all experiencing this trend towards Premiumization. Distillers are focusing on the use of Natural ingredients, including Herbs and spices, and implementing Distillation and Maturing processes to enhance the quality of their products. The Premium spirits market is influenced by various factors, including Drinking habits, Bar culture, and Social media. Luxury spirits are becoming increasingly popular, with consumers seeking out Medical benefits and a more immersive experience. On-trade sales are expected to continue to drive growth in the Premium spirits market, as consumers seek out unique and authentic experiences. Off-trade sales are also seeing growth, as consumers look for convenience and the ability to recreate their favorite cocktails at home. Overall, the Premium spirits market is a dynamic and exciting space, with innovation and quality driving growth in this sector. Whether it's the distillation process, the use of Natural ingredients, or the focus on Authentic beverages, the future of Premium spirits looks bright.
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Market Scope |
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Report Coverage |
Details |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 6.55% |
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Market growth 2024-2028 |
USD 54.8 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
5.79 |
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Regional analysis |
Europe, APAC, North America, South America, and Middle East and Africa |
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Performing market contribution |
Europe at 29% |
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Key countries |
US, China, UK, France, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Alliance Global Group Inc., Allied Blenders and Distillers Pvt. Ltd., Bacardi Ltd., Becle S.A.B. de C.V., Brown Forman Corp., Campari Group, Constellation Brands Inc., Diageo Plc, Fifth Generation Inc., Heineken Holding NV, Hite Jinro Co. Ltd., LVMH Group., Pernod Ricard SA, Remy Cointreau SA, Roust, Sazerac Co. Inc., Suntory Holdings Ltd., Tanduay Distillers Inc, The Edrington Group Ltd., and William Grant and Sons Ltd |
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Market dynamics |
Parent market analysis, market trends , market growth analysis , market forecast , Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, Market growth and Forecasting, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Distribution Channel
7 Market Segmentation by Product
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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