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The US - Vodka Market size is projected to increase by USD 5.28 billion and the market size is estimated to grow at a CAGR of 4.45% between 2023 and 2028.
This US Vodka Market report extensively covers market segmentation by price (premium and value), distribution channel (on-trade and off-trade), product (unflavored and flavored), and geography (North America). Our report examines historical data from 2018 - 2022, besides analyzing the current market scenario.
The increasing prominence of private-label brands is notably driving the market growth. Private-label vodkas are becoming a key focus area for retailers in the US, as the demand for flavored vodkas and cocktails (that include vodka as an essential ingredient) is high among the millennial population. Retailers are selling different types of vodkas under their private-label brands to increase their profitability, which is contributing to the growth of the US - vodka market. Retailers, especially grocery stores, see private label products as a profitable option, as margins are 10%-15% higher than national and global brands in the US. Private-label vodkas are made exclusively for a single retailer or for a brand that sources its vodka manufacturing to a third party. Major grocery retailers, such as Walmart Inc. and Costco Wholesale Corp., have come up with their own brands of vodkas and the penetration level of private labels in the US. Therefore, the growing prominence of private-label vodkas is expected to drive the growth of the market during the forecast period.
The US Vodka Market shows an Accelerate CAGR during the forecast period.
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Urbanization and socializing are emerging trends shaping the market growth. Due to the trend of urbanization and socializing, particularly among young adults, there has been an increase in the consumption of vodka in recent years. Over the past few years, the ready-to-drink (RTD) beverage category has grown rapidly due to consumer demand for convenient, high-quality beverage options, variety, and quality. However, vodka-based RTD drinks increased to nearly 46% of the category by 2023, more than doubling their market share. In order to fortify brand image, create market segments, and achieve larger profit margins, the industry players are under constant pressure to innovate through the introduction of unique products or services.
For instance, Diageo plc, a London-based company, introduced Raspberry Crush, a new flavored vodka, under the Smirnoff brand in 2021. The new flavored vodka is distinguished by its labeling, which is colored turquoise and red. Hence, the demand for new products in the vodka market due to urbanization and socializing can boost the growth of the market during the forecast period.
Increasing competition from other alcoholic beverages is a significant challenge hindering the market growth. The increasing competition that the US - vodka market faces from the popularity and adoption of other alcoholic beverages, such as tequila, rum, brandy, mezcal, and whiskey, will likely limit market growth during the forecast period. Players operating in the whiskey market are coming up with new flavors to increase the popularity of whiskey among millennial consumers. Also, the growing popularity of craft beer and craft whiskies will affect the growth of the vodka market in the US. Consumer tastes and preferences are changing, and they are now more open to experimenting with new flavors and products.
Consequently, to build their customer base and sustain and grow in the highly competitive market, it has become important for vodka manufacturers in the US to focus on innovative marketing strategies and develop better products. Hence, due to these factors, the growth of the US vodka market is seen to be hampered during the forecast period.
On-trade distribution channels, popularly known as on-premises distribution channels, include establishments where buyers not only purchase vodka but also consume it on the premises. The different types of on-trade distribution channels are bars, pubs, clubs, restaurants, and hotels. The growth of the on-trade distribution segment is mainly driven by the rising consumption of vodka at bars and pubs, particularly by the millennial population in the US. The increasing number of distilleries, the growing number of visitors to vodka distilleries, and the rising number of pubs that serve vodka products are some of the factors that will drive the consumption of vodka through this channel. In addition, bartenders are innovating cocktails based on various vodka products to cater to the demands of consumers. Owing to such factors, the consumption of vodka through the on-trade channel is expected to remain high, which can boost the growth of the US vodka market positively during the forecast period.
The market share growth by the premium segment will be significant during the forecast period. The premium segment of the US - vodka market includes vodkas that are priced above USD 25 and include premium, high-end premium, and super-premium vodkas in 2023. The growth of the segment will primarily be driven by the increasing perception among consumers that premium vodka products are made from better quality ingredients than value vodkas
The premium segment was the largest and was valued at USD 13.15 billion in 2018
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Also, factors such as the increasing number of new product launches and the extension of existing product lines with the addition of new flavors will drive the premium vodka segment. The US is a developed nation, and millennial consumers, who have high purchasing power, especially in on-trade distribution channels, form an attractive consumer segment for the players in the market. Therefore, the demand for premium vodkas among millennials through on-trade distribution channels is expected to drive the growth of the segment 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 US Vodka Market report also includes detailed analyses of the competitive landscape of the market and information about 20 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 US Vodka Market report forecasts market growth by revenue and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
US Vodka Market Scope |
|
Report Coverage |
Details |
Page number |
139 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.45% |
Market Growth 2024-2028 |
USD 5,284.56 million |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
3.03 |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Bacardi Ltd., Becle SAB de CV, Brown Forman Corp., Campari Group, Constellation Brands Inc., Diageo Plc, E. and J. Gallo Winery, Ethical Wine and Spirits Inc., Fifth Generation Inc., Grain and Barrel Spirits, Novabev Group, Pernod Ricard SA, Phillips Distilling Co., Podlaska Wytwornia Wodek POLMOS SA, Polmos Zyrardow Sp. ZOO, Stoli Group S.ar.l., Suntory Holdings Ltd., William Grant and Sons Ltd, Eastside Distilling Inc., and Globefill Inc. |
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, 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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