US spirits consumption climbs 2.6% in 2016
The US spirits sector saw consumption rise by 2.6% last year, driven by double-digit growth in the Cognac category and high single-digit gains for Bourbon and Tequila, according to the IWSR US Beverage Alcohol Review (US BAR).
The analyst found that spirits gained 0.2% of total US alcohol sales in a market where total alcohol consumption dropped by 3.5m cases to end the year at 3.39bn cases.
The Cognac category led the growth, increasing by 18.8% in 2016, with Hennessey standing out as the top seller. The domestic brandy category was up by 4.1%, driven by “high-quality offerings from small producers”.
Tequila sales grew by 7.4% in 2016, reaching an all-time high of 16.3m cases to claim a 7.5% share of the spirits sector. Meanwhile, Bourbon grew by 6.4% in 2016, hitting a total of 15.9m nine-liter cases as demand in the category continues.
In total, imported whisky grew 3.4% in 2016 led by Irish whiskey, which grew by 17.6% – the highest rate in more than a decade.
Canadian whisky grew by 2.4%, driven by Diageo’s Crown Royal and Sazerac-owned Fireball. Scotch posted the lowest growth rate among the imported whisky categories, increasing by just 0.5%.
The rum category suffered, declining by 1.2% as consumer interest “shifted to whisky and Tequila”.
In white sprits vodka grew by 2.3% to hit 74.8m nine-liter cases, driven by domestic brands including Tito’s and New Amsterdam.
Gin posted 1% growth following consecutive years of decline, achieved in the premium-and-above segments and bolstered by “high-end” imports.
The data reveals a “fast-evolving product marketplace”, where lower-priced brands “struggle to capture consumer attention”, the report states.
It adds that so-called ‘category blur’, which refers to consumers drinking products across multiple categories, is more prevalent – making it difficult for marketers to predict or rely on a loyal customer.
In addition, on-premise sales volumes decreased “slightly”, while off-premise sales picked up as more consumers chose to drink at home
The IWSR has forecast a return to growth for total US beverage alcohol, with consumption slated to increase in 2018, reaching a CAGR of 0.2% by 2021.
Earlier this week the IWSR reported that global spirits volumes grew by 0.3% in 2016, bolstered the gin, Tequila and whisky categories.