All major categories across the total beverage alcohol industry in the US – beer, cider, wine, spirits, and ready-to-drink (RTDs) – posted growth across premium-plus price tiers in 2022, according to a report from IWSR.
While total volumes of wine (-2%), beer (-2%) and cider (-4%) all declined in 2022, the premium-and-above segments of each grew: wine (+6%), beer (+4%) and cider (+11%). Total spirits volumes were up +2%, with premium+ up +13%, while RTDs showed moderate gains at less than +1% with premium+ up +38%.
High-income drinkers, earning over $150,000. across all demographics feel especially secure about their finances. Millennials show more confidence than older drinkers. IWSR consumer data shows consumer spending and purchasing volume are up in 2022 vs 2021 in most tracked categories.
Despite industry-wide price increases, premiumization (or trading up to higher-priced, often higher-quality products) is still driving all segments of beverage alcohol.
Premiumization is occurring most notably in spirits. Overall, 33% of Americans said they had spent $50 or more on a bottle of alcohol in 2022, against just 24% in 2021. Furthermore, six in 10 online shoppers say they spend more on alcohol online than in-store.
Spirits marked its 25th straight year of volume gains sin 2022, IWSR said. Total whisky category volumes (up +3% in 2022 vs 2021), surpassed vodka (less than +1% growth in 2022 vs 2021) last year for the first time in almost two decades. US whiskey holds the largest share of total whisky volumes, as well as percentage growth (+4%), with value increases led by bourbon which increased by +8%.
Agave spirits contributed $1.6bn to the spirits industry in 2022. This growth accounted for 70% of the overall volume growth and 65% of overall value growth of total US spirits.
Also notable in 2022 – tequila surpassed US whiskey by value to become the second most valuable spirits subcategory in the US. Tequila alone is set to overtake vodka in 2023 to become the industry leader by value.
Traditional spirits are expected to overtake traditional beer as the share of servings leader for the first time in modern history this year. This means on a drink-by-drink basis, more Americans will drink traditional spirits.
Total beer, including premium and imports, is continuing to improve IWSR's analysis said. Domestic beer is 79% of market volume, but has suffered long-term declines, weighing down otal beer performance. The RTD category posted its seventh consecutive year of volume and value gains but at a much lower growth rate than in previous year.
Sparkling wine achieved its 21 consecutive year of volume and value gains. But the total wine category is something entirely different declining by volume for the second consecutive year. Still wine, which posted 1% growth, is finding health and wellness issues bringing awareness to the no- and low-alcohol subsegments.
No/low alcohol is increasing in significance as the health and wellness movement commands a growing portion of consumer spending.
Though no/low products are a mere 1% volume share of total beverage alcohol in the US, the category’s growth rate was +15% in 2022. No/low-alcohol wine and beer hold the largest share, both in volume and value.
More than half of alcohol drinkers claimed to want to moderate their intake in 2022. The leading reasons people say they consume no-alcohol products is to stay in control followed by avoiding the effects of alcohol, while low-alcohol drinkers prioritize reducing alcohol intake in general.
On-premise will strengthen over the next five years, IWSR says.