Close Menu
News

Vodka and Tequila lead spirit-based RTD market

Products featuring vodka and Tequila are the most popular spirit-based ready-to-drink (RTD) beverages, according to data from IWSR Drinks Market Analysis.

RTD market
Spirit-based RTDs benefit from the trend towards premiumisation

The RTD market continues to boom, with its volume growth expected to outpace the total spirits category by 2025.

In the US, malt-based drinks are the biggest-selling RTDs, claiming nearly 90% of volumes in 2020. However, on-the-go formats featuring spirits are on the rise.

“By 2025, spirit-based RTDs are expected to see annual volume growth of 33% in the US, and many producers and distributors are leveraging the opportunity,” commented Brandy Rand, COO Americas at IWSR.

“Some are exploring the spirit-based RTD space for the first time, and others are expanding their existing portfolios.”

The IWSR noted that consumers are likely to perceive spirit-based RTDs as higher-quality products compared to malt-based beverages, indicating a trend towards premiumisation in the category.

Brands have been increasingly tapping into the thirst for drinks with vodka and Tequila bases, which together make up more than 50% of spirit-based RTD launches between 2019 and the first half of 2021, IWSR said.

“Examples emerge almost daily in the US where large brewers venture into Tequila- or vodka-based RTDs, while traditionally pure spirits players are extending their core ranges into the category, aiming to capitalise on their established brand equity,” Rand continued.

RTD opportunities

The IWSR highlighted whisky-based RTDs as having major potential.

Though the number of whisky-based product launches is lower than vodka, Tequila or rum, making up just 3% of spirit-based RTDs in 2020, whisky is forecast to post the most growth of any spirit-based RTD in the next few years, with a compound annual growth rate of 84% by volume from 2020-2025.

The IWSR found that whisky-based RTDs are particularly popular during virtual gaming events, a trend led by Covid-19 lockdowns.

“If these trends continue, whisky-based RTD brands have an opportunity to elevate their brand activation strategies online – perhaps by creating branded digital storefronts or virtual experiences, for example,” Rand concluded.

For a closer look at the RTD market, check out our pick of the category’s brands to watch in 2022.

Related news

RTD growth in US driven by spirits

Nude RTD drives Corby Q1 sales

Spirit Master: Spicy Margarita, The Drinks Bureau

It looks like you're in Asia, would you like to be redirected to the Drinks Business Asia edition?

Yes, take me to the Asia edition No