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The spirits market size is projected to increase by USD 138.31 billion, at a CAGR of 3.94% between 2023 and 2028.
Europe plays a pivotal role in global markets, offering a diverse array of spirits, from whiskey to vodka. The continent's rich cultural heritage and longstanding traditions in spirit production provide significant benefits to market dynamics. Factors such as increasing disposable income, evolving consumer preferences, and a growing demand for premium and craft spirits drive the growth rate of the European market. With convenience, consumer consumption trends, and forecasts in analysis, Europe remains a key player in global markets. Campari Group offers spirits under its brand Jose Cuervo Especial, RESERVA DE LA FAMILIA, Cuervo Tradicional and Jose Cuervo Margatitas.
The market shows an Accelerated CAGR during the forecast period.
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The increasing demand for high-quality premium products is the key factor driving the market. This demand is propelled by several factors contributing to consumer willingness to pay a premium for top-tier products. Shifting consumer preferences toward premiumization reflect a desire for elevated experiences and superior quality. Consumers seek out unique and sophisticated spirits offering exceptional taste profiles, craftsmanship, and exclusivity. Lifestyle trends like cocktail culture and experiential drinking experiences contribute to the popularity of premium spirits.
Also, the market is also influenced by factors such as tax revenue, production technologies, and government policies. Craft spirit makers offer unique products catering to consumer preferences. Effective branding, marketing, and social media initiatives create awareness and promote products. Bars, pubs, hotels, and restaurants drive demand for premium spirits. Distribution networks play a crucial role in ensuring availability. Key players focus on building goodwill and reputation, driving demand for their products.
The rise in the popularity of low-alcohol or alcohol-free spirits catering to health-conscious consumers is one of the primary market trends. Health-conscious individuals are seeking alternatives to traditional alcoholic drinks that allow them to enjoy the social aspect of drinking without the negative effects of excessive alcohol consumption. This trend has led to a surge in the development and availability of innovative low-alcohol or alcohol-free spirits by both established brands and new entrants. These products often replicate the taste, aroma, and complexity of traditional spirits using natural ingredients such as botanicals, herbs, and spices.
Furthermore, the increasing prevalence of low-alcohol or alcohol-free spirits is driving changes in social drinking norms, making it more socially acceptable to choose non-alcoholic options in various settings. This shift is reshaping the hospitality industry and providing opportunities for bars, restaurants, and retailers to diversify their offerings and cater to a growing number of health-conscious consumers. Therefore, the increase in popularity of low-alcohol or alcohol-free spirits will boost the growth of the market during the forecast period.
An increase in counterfeit products is a challenge that affects market expansion. The prominence of counterfeit products negatively impacts brand reputation and consumer trust in several ways. Counterfeit spirits, often produced using inferior or harmful ingredients and sold under reputable brand names, can result in serious health risks for consumers. Instances of counterfeit alcohol causing illness or even death have been reported worldwide, leading to widespread concern among consumers about the safety and authenticity of products.
Moreover, the presence of counterfeit products in the market erodes consumer confidence in the integrity of the entire industry. When consumers are unable to distinguish between genuine and counterfeit products, they may become hesitant to purchase spirits altogether, leading to decreased sales and revenue for legitimate producers. Consequently, the increase in counterfeit spirit products will hamper the growth of the market during the forecast period.
The increasing preference for off-trade distribution channel segment will increase the market growth. The off-trade distribution channel plays a pivotal role in the market, encompassing retail outlets where consumers purchase alcoholic beverages for consumption at home. This channel includes various subcategories, such as supermarkets, hypermarkets, convenience stores, liquor stores, and duty-free shops. Further, liquor stores specialize in alcoholic beverages, offering an extensive range of spirits, including premium and niche products. Also, duty-free shops, commonly found in airports and international borders, offer spirits to travelers at tax revenue prices, making them an attractive option for those looking to purchase alcohol while traveling. Hence, this segment is expected to grow significantly during the forecast period.
The market share by the whisky segment will be significant during the forecast period. Whisky, a beloved spirit cherished worldwide, encompasses a rich diversity of types, each offering distinct flavors and characteristics that appeal to a broad spectrum of palates. Scotch whisky, hailing primarily from Scotland, is renowned for its tradition and craftsmanship. It is often categorized as single malt, made from malted barley in a single distillery, or blended, combining malt and grain whiskies from different distilleries. Its flavors range from smoky and peaty in Islay malts to the more delicate and fruity notes found in Highland and Speyside whiskies.
The whisky segment was valued at USD 180.10 billion in 2018.
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Moreover, whisky distilled primarily from corn and aged in new charred oak barrels, bourbon boasts a sweet, robust flavor profile with hints of caramel, vanilla, and oak. Irish whiskey, characterized by its smoothness and triple distillation process, offers a mellow and approachable taste, often featuring notes of honey, fruit, and spice. Japanese whisky, inspired by Scotch whisky production, has gained international acclaim for its precision and innovation. It encompasses a spectrum of styles, from light and floral to rich and complex, often reflecting the meticulous Japanese craftsmanship. Thus, with an increasing array of whisky types, this segment drives market growth during the forecast period.
Europe is estimated to contribute 30% to the growth of the global market during the forecast period
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Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The rising popularity of craft spirits, driven by consumer interest in unique and artisanal products, presents opportunities for small-scale companies through small-batch. Moreover, the growing trend toward sustainability and ethical consumption influences purchasing decisions, prompting companies to adopt eco-friendly practices and transparent supply chains.
However, fluctuating raw materials prices, geopolitical uncertainties, and the emergence of non-alcoholic alternatives pose challenges to traditional spirits manufacturers. Furthermore, the increasing demand for experiential drinking occasions, such as cocktail culture and spirit tourism, will drive innovation and product diversification in the Europe market. Hence, such factors are driving the market growth in Europe 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 forecasting growth and analysis.
The market growth and forecasting report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Abtshof Magdeburg GmbH, Bacardi Ltd., Becle SAB de CV, Diageo Plc, Eastside Distilling Inc., KWEICHOW MOUTAI Co. Ltd., LVMH Moet Hennessy Louis Vuitton SE, Mast Jagermeister SE, Novabev Group, Pernod Ricard SA, Remy Cointreau SA, Suntory Holdings Ltd., The Edrington Group Ltd., William Grant and Sons Ltd, Yanghe Distillery Co. Ltd., Alcobrew Distilleries India Ltd., and Bainbridge Organic Distillers
The market analysis and report of 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 and growth report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
The global spirits market is witnessing significant growth driven by various factors. Spirit manufacturers are capitalizing on consumer knowledge to enhance their marketing initiatives and promote premium alcoholic beverages. Marketing activities focus on building goodwill and promoting responsible alcohol consumption. Craft spirits market is thriving, with craft spirit distilleries catering to younger consumers with innovative products sourced from family farms and emphasizing artisanal craft. Flavored craft spirits and flavored whisky are gaining popularity, featuring natural flavors like raspberry and fresh citrus flavors. There's a shift towards premiumization strategy and brand renovation, with a focus on taverns and professional gatherings. Mission-driven efforts and clean-label ingredients appeal to consumer demand for artisanal spirits and highlight the spirit quality. Local associations promote non-GMO cereals and spring water, further enhancing the variety and appeal of the artisan spirits industry.
The spirits market is dynamic and influenced by various factors. Beverage firms play a crucial role in shaping trends through innovative products and effective branding and marketing strategies. Consumer preferences for flavored spirits like whiskeys and flavored liqueurs are on the rise, driven by a desire for unique taste experiences. Trends such as the preference for premium alcoholic drinks and the popularity of craft distillers are evident, especially among younger people. With a growing focus on natural ingredients like fruits, organic flavors, and natural spices, the market caters to evolving consumer tastes. Rice whisky is gaining traction, offering a distinct flavor profile. Social gatherings continue to drive demand, reflecting the importance of spirits in Western culture and fostering goodwill among consumers.
Market Scope |
|
Report Coverage |
Details |
Page number |
163 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 3.94% |
Market Growth 2024-2028 |
USD 138.31 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
3.08 |
Regional analysis |
Europe, APAC, North America, South America, and Middle East and Africa |
Performing market contribution |
Europe at 30% |
Key countries |
US, China, Japan, Germany, and France |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Abtshof Magdeburg GmbH, Bacardi Ltd., Becle SAB de CV, Brown Forman Corp., Campari Group, Charbay Distillery, Constellation Brands Inc., Diageo Plc, Eastside Distilling Inc., KWEICHOW MOUTAI Co. Ltd., LVMH Moet Hennessy Louis Vuitton SE, Mast Jagermeister SE, Novabev Group, Pernod Ricard SA, Remy Cointreau SA, Suntory Holdings Ltd., The Edrington Group Ltd., William Grant and Sons Ltd, Yanghe Distillery Co. Ltd., Alcobrew Distilleries India Ltd., and Bainbridge Organic Distillers |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the forecast period. |
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 Type
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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