One Category Is Fueling the Booze Industry’s Resiliency
According to a new report, we're drinking more, and we're drinking hard seltzer
No doubt the booze industry has suffered losses this year during the COVID-19 pandemic, particularly with the closings of restaurants and bars (and the subsequent loss of jobs and overall market instability).
If there’s good news, it’s that the alcohol is a resilient business; according to a recent IWSR Drinks Analysis report, the global beverage alcohol industry may have only suffered an eight percent decline in 2020. And the United States and Canada actually showed small volume growth, meaning overall consumption patterns have stayed constant.
For this mid-year assessment, IWSR studied beverage alcohol consumption in 20 key global markets. Instead of the expected double-digit losses, there were actually some modestly encouraging signs. “Excluding national spirits such as baijiu and shochu, total beverage alcohol in the 19 focus countries will recover to 2019 levels by 2024,” says Mark Meek, CEO of IWSR Drinks Market Analysis, who partially credits a big rise in e-commerce as a reason for somewhat steady sales. “We may see that recover even faster now, given the recent news on encouraging vaccine trials.”
Leading the way in 2020: Ready-to-drink (RTD) cocktails, the only category to show growth, at a whopping 43% increase in volume. Some specific spirits, such as U.S. and Canadian whisk(e)y, are also expected to show small gains by year’s end.
While low- and no-alcohol beer grew by a modest amount, over beer sales were down — coupled with wine, those non-spirits markets are forecast to decline by 9%.
Although the report suggests most categories will recover by 2024 (if we’re out of this pandemic), there is one interesting trend that may last for a few more years. “Very premium high-end spirits have also held up well, while low-end and value products have seen gains in struggling markets as COVID-19 leads to downtrading,” says Meeks. However, “some of the more standard middle ground categories, blended Scotch for example, have lost share.”
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