GLOBAL – The alcohol beverage industry across the globe has taken a hit from the coronavirus pandemic. The closure of bars and restaurants has set the category back dramatically.
Although there has been some slight recovery in performance reported by different industry players as different markets come to life, it is still not enough to offset the loses already incurred.
The IWSR Drinks Market Analysis, a leading source of data and intelligence on the alcoholic beverage market has released a comprehensive global trends report that examines the drivers and disruptors shaping the alcohol industry.
In the report IWSR has highlighted that the COVID-19 has triggered changes in consumer habits and preferences which has in turn opened opportunities in certain segments.
Consumers are expected to continue to search for authenticity and status, enabled by consumer knowledge and spending power.
To this end premium-and-above spirits are forecasted to increase their global volume market share to 13% by 2024 as consumers continue to favour quality over quantity, including cocktails and high-end sipping spirits.
By value, China is the world’s largest premium-and-above market for wine and spirits, although, by volume, the US trails it closely.
In both countries, premium-and-above brands are forecasted to increase their volume market share by approximately one percentage point between 2019 and 2024, as the premiumization trend continues to influence market developments.
Travel restrictions brought about by the global pandemic has led to the rise in popularity of local products as consumers also rally behind symbolic and job-sustaining producers.
Also adapting to bar and restaurant outdoor dining restrictions and closures has forced consumers especially the generations to form new drinking habits that will likely persist into the future, with portable/convenient beverages such as canned wine and RTDs well-poised for this.
However, some Spirits categories are expected to continue to ride the globalization trend i.e. premium-and-above tequila (which has grown 15% year-on-year between 2015-2019), and spirit aperitifs.
The report has indicated that this categories after the Covid-19 slump will return to healthy growth by 2021, with volumes increasing by almost 16% from 2019 levels.
With the pandemic health and wellness awareness has been heightened. Health-conscious drinkers are adopting a policy of moderation, cutting back in volume or reducing occasions.
These consumers are likely to trade up to a higher quality drink or one they perceive as healthier when they do choose to drink.
Regular drinking occasions are also changing, thanks to the growing profile of better low- and no-alcohol alternatives.
No-alcohol beer is set to grow its share of the beer category to 4.45% by 2024, as sober and moderating consumers embrace newly improved products across a wide range of occasions.
“From mastery of the ecommerce channel and at-home consumption, to futureproofing the production and distribution chain, to aligning with lifestyle choices and consumer experiences, beverage alcohol brands are wise to identify and understand macro trends taking place right now in the industry, to ensure longevity and success post-Covid,” says Mark Meek, CEO of IWSR Drinks Market Analysis.
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