Is higher-end vodka in trouble?
The higher end of the vodka market has suffered recently, but producers still believe in its long-term health.
*This feature was originally published in the September issue of The Spirits Business magazine.
“Vodka is the little black dress of the spirits world. No-one hates vodka,” says Frank Grillo, founder of Altamura vodka.
“We’ve done a lot with fashion brands in Italy, and done cocktail events, and they choose vodka as their spirit because the idea is, you may love Tequila and you may love gin, but nobody hates vodka. It’s always been the steady, safe alcohol.”
Is vodka – a category that shifts massive volumes but never seems to be surrounded by much consumer buzz – always the bridesmaid? Vodka hasn’t been the spirit driving consumer trends for some time. It’s there, and it’s reliable.
But recent commentary from Emily Neill, chief operating officer, research and operations at IWSR, suggests things are slightly worse than that. While “premiumisation is becoming selective” in major categories including Tequila, there is “widespread evidence of downtrading in categories such as vodka”. Where does that leave vodka brands, and how can they combat this?
Largest declines
IWSR data shows that in the US and UK markets, it’s the higher price points that have endured the largest relative declines. In the UK, the lowest priced ‘value’ segment lost 8% in volume year on year from 2023 to 2024, and fell by 3% in the US. Yet at the top end last year, the ultra-premium segment dropped by 11% in the UK and by 10% in the US. The largest declines for the US are in the super-premium segment, down by 15% in 2024, and the premium segment in the UK, which plunged by 17%. Meanwhile, ultra-premium agave-based spirits are up by 27%.
“Consumers can defer buying an ultra-premium vodka with confidence that it will be available in future,” says Luke Tegner, IWSR’s director of consulting. “The same cannot be said for the most sought-after whiskies or other aged spirits. Non-aged spirits, like gin or vodka, are more vulnerable to consumers downshifting from the top price bands. This is partly because they lack the age credentials and scarcity value of a premium-plus aged spirit.”
In short, if vodka is to thrive, consumers need a reason to be invested in it. Dawn Davies, buying director for The Whisky Exchange, believes it is the 25- to 35-year-old demographic driving vodka sales on the site. The average transaction value is a healthy £32. But that’s far from super-premium.
“You can tell brands want after it, because they’re all releasing higher-price-point bottlings,” she says. “But the sales aren’t really there.”
She adds: “My gut feeling is it’s a little early for premiumisation to start. I’m seeing vodka starting to pick up again, but that’s from a general base, not from a premiumised one. I just don’t think the vodka category is strong enough in itself yet to kind of hit that premiumisation level. That said, vodka is making a comeback. As people’s palates change, you get the next generation coming through. Vodka is the obvious one, because it’s flavourless. But that next generation aren’t the people that are going to spend £100, £200, £300 on a bottle of vodka.”
Adrian Lugg, head of marketing at UK online retailer Master of Malt, says that the median price customers are willing to pay for a bottle of vodka on the website has risen from £27.25 to £28.95 in August 2025.
“Looking at the numbers for both retail and trade, sales tell a slightly different story when comparing direct-to-consumer to the on-trade. Over the past four years in Master of Malt retail, we’ve seen a 5% decline in sales of standard (sub-£20/US$27) vodkas, with that volume moving predominantly into premium (£20–£40) and some growth in super-premium (£60–£80). This reflects a clear trend towards premiumisation in the at-home drinking occasion.
“Master of Malt Trade paints a different picture. Four years ago, 51.6% of our vodka sales to venues were in the sub-£20 range; in 2025, that figure has increased sharply to 87.8%. Over the same period, the average price a venue is willing to pay has dropped from £19.80 to £18.35.
“This shift is largely driven by margin pressures in the on-trade, where operators are having to manage rising overheads and customer price sensitivity. As a result, many bars and hospitality venues are prioritising lower-cost vodkas to maintain profitability,” Lugg concedes.
Will Meredith, co-founder and bar director of new London bar Sprout, says evolving cocktail culture is driving sales, but more could be done to showcase vodka’s unique flavour, thus driving sales of more premium products. The Kensington venue’s drinks menu is partly seasonal, inspired by abundant ingredients. Once they become unavailable, the drinks are retired. Its menu includes the Sweet Pea Spritz, a light, floral cocktail made with Pod Pea vodka and sweet pea cordial, finished with honey-roasted pea husks, bubbles, and mint.
“Vodka is an interesting one,” he says. “It has always been one of the most consumed spirits in the UK market for years, thanks to pubs and nightclubs. More often than ever, we are seeing our favourite celebrities drinking vodka Martinis on our TV screens, and that seems to be resonating.”
Rare and protected
One new brand that is focused entirely on its unique flavour profile is Altamura. Launched in 2022, it is made from Altamura durum wheat, a rare and protected grain grown in the Puglia region of Southern Italy for more than 2,000 years. A custom distillation process preserves the full character of the wheat, which is also used to make Pane di Altamura, the only PDO-protected bread in the world.
Founder Frank Grillo says sales doubled in 2024, compared to 2023, and claims that the business is “not hitting any headwinds”. It has recently expanded into Hong Kong and mainland China, Australia, the Middle East, and more extensively across the US.
“We come at vodka from a different perspective,” he says. “The whole idea was to just express this really unique wheat, which has been unchanged for 2,000 years. It kind of has an umami flavour profile. We’ve focused on mixology, not yet the consumer directly. We’re seeing a real trend towards food and cocktails together. There’s a little bit of a rival around a Martini. But I see a lot more like vodka cocktails being added back to menus, not just one.”
Nick Gillett is managing director of premium spirits distributor Mangrove Global, which has vodkas such as East London Liquor Company and Fair on the books. He says: “It is true that we don’t see the same premiumisation as we have in Tequila or rum but for us we don’t see downtrading. We don’t see vodka in decline – it remains the world’s biggest spirits category and is forecast to grow to US$40.25bn by 2030 with a compound annual growth rate of 6.5% [according to Grand View Research]. Global giants are investing heavily into retaining market share and volumes, and this is leading to a cheapening of some brands.
“Vodka is ever-present – one in eight cocktail searches includes it. Consumer interest is shifting towards quality and flavour-led expressions in general across a range of categories, which is a more challenging message for brands to get across in vodka. But with the exception of comparatively few brands there isn’t a great deal of romance or stories around the art of distillation to be told.”
Range of needs
For established category leaders, leaning into how drinkers perceive and want to consume vodka has been key. “At Smirnoff, one of the big things we’re working on is ensuring we have different products and format sizes to suit a range of consumer needs and price points, including when they’re feeling the pressure to trade down,” says Stephanie Jacoby, global senior vice-president of vodkas at Diageo. She adds that Smirnoff is the world’s number-one vodka – with sales more than double that of the runner-up (Pernod Ricard’s Absolut) – and the sixth-biggest spirit brand by volume. This has meant a renewed push on Smirnoff Ice, with its first global campaign unveiled in June.
“Our campaign research revealed a growing consumer pushback against overly polished perfection, with audiences craving authenticity and reality,” adds Jacoby. “We’ve identified a unique truth about our original RTD: its self-aware, playful tone has always set it apart as a marketing tool.”
Flavours, burgeoning in almost all categories, are often used as tools of category recruitment. But according to a social media survey by Dutch Barn Vodka, co-owned by comedian Ricky Gervais, flavoured vodka is facing a trust crisis, with 60% of UK drinkers believing flavoured vodka tastes artificial, is packed with sweeteners, synthetic flavourings, and too much sugar. The brand claims that 88% say they’d happily drink it if it were made with real, natural ingredients.
Launched in 2022, Dutch Barn recently added a raspberry flavour, and a Black Cherry Vodka, and entered the US, Canadian, and select European markets.
“The vodka category has been very boring for a long time and been dominated by cheaply made mass-produced products,” says Chris Fraser, founder and chairman of Dutch Barn maker Ellers Farm Distillery. “We are growing our sales quickly against a tough industry backdrop, with a 170% sales rise over the 12 months to June 2025.”
He adds its new naturally made flavoured vodkas are part of a broader premiumisation trend. “There is a large-scale shift in consumer values in regard to what ‘premium’ really means, and we believe we are at the forefront of that – our flavours are a big step up in quality from most flavoured vodkas on the market, and seem to be resonating with customers at home and in the on-trade.”
For Polish three-grain, super-premium vodka, Konik’s Tail, forget the Martini, forget campaigns. The future of premiumisation in the category depends on a return to simplicity, says founder Pleurat Shabani.
“The essence of me making Konik’s Tail is rooted in my relationship with the land,” says Shabani. “It’s about the soil. It’s about the growing the grains. It’s about the farming. Consumers are jaded. They’re sick and tired of the overcomplicated. And marketing is like a Christmas cracker, right? One big disappointing bang, and the novelty wears off.
“Conveying the simplicity of the brand is the most important thing. It has to create emotion, a memory, warmth. As a farmer I’ll go and spend time with my grains, harvest them at the right time, so they give me the right oils and sugars.
“Let bartenders keep that simplicity and serve it in a beautiful glass. Consumers want that. Not 16 million ingredients. That’s what’s got lost with vodka. But that’s what’s most beautiful.”
Industry insights
IWSR insights suggest ‘widespread downtrading’ in vodka. What do consumers really want from vodka brands these days, and how can the category remain competitive?
Jordan Rothschild Noomé — chief marketing officer, High Basin Brands
“When people choose to drink, they want to know exactly what’s going into their bodies – they want transparency: simple ingredients and clean sourcing. Alcohol is finally catching up to beauty and food, where clean and organic are becoming the baseline.
“The brands that last will be the ones that spell out what’s inside, how it’s made, and stand behind certified organic standards so people don’t have to guess. This is precisely what our brand Ghost Hill Organic Vodka delivers: certified organic, a transparent process, and a clean, balanced spirit at a price that makes sense.”
Camille Sebbag-Barjon — general manager, Le Philtre
“In a context of growing consumer concerns around health, wellbeing, and purchasing power, vodka is also being challenged — yet it has strong assets compared to other spirits.
“1) Its timeless and versatile nature makes it a staple for mixology.
“2) The rise of ready-to-drink and ready-to-serve formats offers major growth potential.
“3) Sustainability and transparency — from ingredient sourcing to responsible production — are increasingly important for consumers nowadays. This is maybe our main focus with Le Philtre vodka, which is organic and eco-friendly.
“4) Vodka should also explore new consumption moments beyond nightlife, aligning with Gen Z’s shift toward more mindful, daytime occasions.”
Ryan McFarland — chief commercial and strategy officer, Drinksology Kirker Greer
“I believe what we are seeing is a post-Covid reset from erratic buying patterns back to normal behaviour. Consumers still aspire to trade up, but only if the proposition feels accessible within their own context, delivering something different, with genuine quality, without breaking the bank. In the category, certain niches will outperform, such as premium Asian vodkas. We have seen continued on-premise interest in Ukiyo Rice Vodka, as an example. Vodka’s scale and adaptability remain unmatched, from simple, refreshing serves to the backbone of classic cocktails, giving brands huge scope to connect with diverse drinkers. For us, the value growth will come from the ‘accessible premium’ space, balancing substance with style, creating emotional connection as well as liquid credibility.”
Chris Canale – co-founder, Old Dominick Distillery
“I’d say downtrading in the vodka category began with Tito’s over 10 years ago when they completely disrupted the category. Super-premium vodkas took a backseat, so there’s clearly been a commoditisation of the category.”
Tim Landers – operations director, Old Dominick Distillery
“Consumers are still willing to support craft brands that offer smooth taste and local lore at an accessible price. But the key to standing out is transparency. People want to know what they’re drinking. How was it made? Where were the ingredients sourced? Old Dominick’s Memphis Vodka is charcoal filtered by the same Tennessee whiskey mellowing process used for the distillery’s whiskey. It gives our vodka a smooth finish, and it’s proofed using water unique to Memphis.”
Zak Oganian – CEO, Origen X Brands
“We are seeing a considerable shift in all consumer categories, not just vodka. Consumers are moving beyond the generic and toward brands, products, projects, and offerings that can prove and defend value. In vodka, authenticity, transparency and terroir-driven narratives, exactly what Mikolasch Vodka delivers, tick the right boxes today. As downtrading grows, drinkers aren’t simply seeking cheaper options but looking for real value, truly rooted in origin and craftsmanship. This is also tied into the importance of ‘experience’. Mikolasch stands apart by embracing single-farm organic production exploring Ukrainian terroir and offering full traceability, ‘as traceable as a DNA test’. This obsessive authenticity and commitment to heritage answers modern demands. To remain competitive, the vodka category must elevate provenance, champion sustainability, and tell bold truth-rooted stories that resonate with today’s conscious and curious consumers.”
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