Premium Alcoholic Beverages Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Premium Alcoholic Beverages Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The global premium alcoholic beverages market is projected to witness a CAGR of 8.43% during the forecast period (2022-2027).

Alcoholic beverages do not come under essential commodities even though alcoholic beverage manufacturers have formed a considerable contribution to the enhancement of the market of alcoholic beverages globally owing to reinforcing supply chain, distribution channels, and elaborate purchasing channels by selling online grocery shops and convenience stores. Although, the government eased restrictions during the third phase of lockdown, and many states reopened their liquor stores. Various studies have depicted that few government bodies that implemented duty hikes and COVID tax, between 10% and 75%, are inclined to raise the price of alcoholic beverages.

There is a growing trend that prefers low-alcohol beers, which is attributed to the growing awareness of alcohol unit consumption and the customer’s willingness to try new beverages. This shift in trend is witnessed in demand for low alcohol drinks in the regions of Europe, North America, and Asia, where the sales of off-licenses and supermarkets have soared to a record high.

In most mature and some emerging markets, consumers are starting to drink ‘less-but-better’ alcohol, generally with higher barley and malt contents. However, the emerging independent and small-scale breweries to improve the production of craft beer to offer to the ever-rising requirement of consumers will further propel the growth of the alcoholic beverage market globally.

The rising health awareness among people and the promoted inclusion of functional and natural ingredients offer greater opportunity for the premium alcoholic beverage market as craft beer is less expensive than its high-alcohol counterparts, with 2.8% ABV. The demand for craft beer is growing at a faster rate in emerging countries like India, China, Indonesia, and Singapore. The growing demand for premium alcoholic beverages is considered to be one of the primary drivers of this market. For instance, In 2021, Coca-Cola FEMSA announced its acquisition of The Rezopolis, a Brazilian beer brand, to obtain access to the market of Brazilian Craft Beer. However, the rising popularity of brewpubs and taprooms among millennial consumers due to the socializing trends will support the speedy expansion of the premium alcoholic beverage market globally. Efforts by alcoholic beverage manufacturers to strengthen distribution channels and extension of purchase channels, such as online stores, and convenience stores, are also contributing substantially to the growth of the alcoholic beverages market.

Asia-Pacific is witnessing significant growth in market share in the premium alcoholic beverages market across the globe. Moreover, Asia-Pacific has a large millennial consumer base, and this encourages key players to expand their geographical presence and increase their consumer base in the region, which is supporting the premium alcoholic beverages market growth in the region. The huge variety of flavors used in spirits, beer, cider, and wine with a tint of fruits, botanicals, herbs, chocolates, and spices, fabricate a special texture and taste in alcoholic beverages in order to fulfill Asian customers' requirements as they prefer variation in premium alcoholic beverages. China holds the major share in the premium alcoholic beverage market in Asia owing to its augmented exposure to western culture and lifestyle, along with the rising suspicion of domestic liquor is increasing the trend of consuming premium alcoholic beverages in the region. Adding to this, the major players operating in the market are expanding their product portfolios, with strategic acquisitions of breweries, in order to spread their footprints across the world and tap the premium alcoholic beverage market.

The premium alcoholic beverage market is highly competitive and comprises regional and international competitors. The market is dominated by players like The Brown-Forman Corporation, Pernod Ricard SA, Gruppo Campari, Diageo plc Brands Inc., and Bacardi Limited. Advanced distribution network and manufacturing expertise give an upper edge to the manufacturers to expand their range of products. Most of the market players in the flavonoid industry are focusing on R&D for innovation which is expected during the forecast period. Leading producers of the premium alcoholic beverage market are concentrating on leveraging opportunities posed by emerging markets, like United States, Brazil, China, and India, to expand their revenue base, owing to the increasing income levels and their changing preference for different types of innovative alcoholic beverage product type.

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