Findings:
RTD (ready-to-drink) spirits continue to grow, with a global market value of $4.5 billion in 2023 and a projected growth rate of 6.5%.
Alcohol consumption overall has been declining since the mid-2000s, driven by health and wellness trends.
Gen Z is less interested in alcohol, while older millennials and urban professionals still embrace RTD products.
Key Takeaway:
The RTD spirits market is still growing despite a broad trend of declining alcohol consumption. The rise of healthier drinking alternatives and moderation has not significantly impacted RTD spirits, thanks to convenience, variety, and premium product offerings.
Trend:
Consumer behavior: Increased demand for premium, lower-alcohol or non-alcoholic RTD spirits and pre-mixed cocktails, particularly among younger generations and urban consumers.
Consumer Motivation:
Health consciousness: Consumers, especially post-pandemic, are choosing healthier alternatives and drinking less overall, preferring high-quality alcohol when they do.
Convenience and variety: The appeal of on-the-go drinks with a wide selection of flavors, from margaritas to negronis.
Driving Trend:
Health and wellness movements encourage moderation and healthier lifestyle choices.
Urbanization and busy lifestyles fuel demand for convenient, ready-made premium products.
Who Are the People?
Key demographic: Women, younger consumers under 44, urban professionals with disposable incomes.
Generations: Gen Z is showing the least interest in alcohol, while older millennials and Gen X continue to embrace RTD products.
Product/Service Description:
RTD spirits: Pre-mixed, portable drinks such as canned margaritas, G&Ts, and negronis, ranging from alcoholic to lower-alcohol and non-alcoholic options.
Consumer Age:
Primarily under 44, including millennials and Gen Z consumers.
Conclusions:
RTD spirits are bucking the overall alcohol decline by adapting to health-conscious trends, offering premium, convenient, and varied choices. The category is stable but may face future challenges as Gen Z moves away from alcohol consumption.
Implications for Brands:
Brands should focus on premiumization, low-alcohol, and non-alcohol options to capture health-conscious and younger consumers.
Continued innovation in flavor and convenience will be critical for sustaining growth.
Implications for Society:
A broader societal shift toward moderation in drinking and healthier lifestyles is emerging.
Consumers are focusing on wellness, with alcohol increasingly viewed as a less essential part of socializing.
Implications for Consumers:
More choices for low-alcohol, non-alcoholic beverages and premium RTD products allow consumers to balance enjoyment with health goals.
Implications for the Future:
The future of the RTD category may hinge on how it adapts to Gen Z’s disinterest in alcohol and the growing trend towards non-alcoholic alternatives.
Consumer Trend:
Health-conscious consumption of alcohol is increasing, with reduced frequency but higher quality choices when drinking.
Consumer Sub-Trend:
"Zebra-striping" (alternating alcoholic drinks with water) and participation in movements like Dry January reflect growing interest in moderation.
Big Social Trend:
The rise of health and wellness is influencing multiple industries, including alcoholic beverages, leading to innovation in low-alcohol and alcohol-free options.
Worldwide Social Trend:
Global decline in alcohol consumption, driven by younger generations, as health becomes a more prominent factor in lifestyle decisions.
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