Alcoholic beverages are distilled drink or liquor produced from fermentation of the sugar obtained from fruits, berries, and grains. These beverages contain more than a minimal amount of ethyl alcohol or ethanol. They are classified into three general classes called beer, wine, and spirit. Increasing number of adult and young population and high disposable income of the consumers are the major factors driving growth of the market. Innovation in product due to high demand for alcoholic beverages with changing taste and preferences is key factor for growth of this industry. Advancement in the distribution channels such as availability of separate counter for females, outlet on airports, online sales, and growing tourism sector are some of the factors boosting growth of market.

Consumption of alcoholic beverages in a limited quantity is associated with reduced risk of cardiovascular diseases. Furthermore, consumption of red wine reduces the risk of heart diseases and burns fat. Therefore, introduction of varieties among beer and spirits is expected to create lucrative opportunity for growth of the alcoholic beverages market.

Alcoholic Beverages Market Taxonomy

Based on the product type, alcoholic beverages is segmented into:

Beer

Ale



Lager



Stout

Distilled Spirits

Rum



Whiskey



Vodka



Gin



Others

Wine

Sparkling



Fortified



Champagne

Based on distribution channel, the alcoholic beverages market is segmented into:

Hyper markets

Supermarkets

On shops

Others

Spirits hold highest share in the global market of alcoholic beverages. More than 45 percent of the total alcohol is consumed is in the form of spirits. Increasing demand for premium and super premium whiskey is expected to fuel growth of alcoholic beverage market.

According to World Health Organization (WHO), the alcoholic beverages are not only marketed through the conventional broadcast media (such as radio and television), but also by direct marketing technologies such as the internet and podcasts. Furthermore, by featuring alcoholic drinks in the entertainment sector such as films and songs, producers attracts the young population for consumption of alcohol.

Alcoholic beverages market outlook-

Europe is reported to have highest number of population consuming beer. Alcoholic beverages market in this region is led by France, followed by Germany, Italy, UK, and others. The high consumption rate of alcohol has also been recorded in the economies such as Estonia, Belarus, and Lithuania in this region. According to the World Bank Group, in 2015, Belarus consumed 17.1 liters per person per capita as compared to world average of 6.3 liters per person per capita.

North America is gaining significant traction in alcoholic beverage market, owing to increasing trend of alcohol consumption in young-adult people, which increases demand for high-quality alcoholic beverages. According to National Institute on Alcohol Abuse and Alcoholism (NIAAA), in 2015, around 6.2 percent of adult population were reported to be consuming alcoholic beverages in the U.S

India and China are projected to witness high demand for alcoholic beverages over the forecast period, owing to substantial growth in the disposable income, increasing population, and inclination of young generation towards the western culture. Availability of local spirits such as baijiu in China is propelling the growth of alcoholic beverages in Asia Pacific region.

Alcoholic beverages market challenges-

However, changes in climatic condition leads to decrease in the yield of the crop, thereby, increasing raw material prices. Furthermore, strict governmental regulations is one of the major challenge in the growth of the alcohol industry. Availability of substitute products and the legalization of marijuana especially in the U.S. is also expected to hinder growth of this market.

Key Players in the Global Alcoholic Beverages Market

Major players are focused on strategies such as merger and acquisition to maintain leading position in market. Innovations and new product development in the manufacturing of flavored wine, vodka, beer, and cocktail such as wine based cocktails, vintage cocktails, and exotic spirits are expected to drive growth of the market.

Key players operating in the global alcoholic beverages market include Anheuser-Busch InBev SA/NV, Bacardi Limited, Beam Suntory Inc., Constellation Brands Inc., Diageo Plc, Heineken Holding NV, Molson Coors Brewing Co., Pernod Ricard SA, SABMiller Ltd., and Carlsberg group.

Key Developments:

For instance, in October 2016, Anheuser-Busch InBev SA/NV acquired SABMiller, U.K. based brewing and beverage manufacturer. After the acquisition, the new company’s annual sale is expected to boost from US$44 billion to US$55 billion.

In April 2018, Bacardi Limited acquired Patrón Spirits International AG and its PATRÓN brand, the world’s top-selling super-premium tequila. This acquisition helped Bacardi Limited to expand its super-premium tequila business in global market.

For instance, in April 2019, Bacardi Limited launched a lime-flavoured version of rum in the United States. The lime flavoured rum has 32% alcohol by volume. This new product is estimated to expand its product portfolio in North American market.

In April 2014, Suntory Holdings acquired Beam Inc. with outstanding shares of Beam for US$83.50 per share, the company renamed as Beam Suntory Inc. This new company is expected to create strong position in global alcoholic spirit and beverage market.

For instance, in December 2018, Constellation Brands, Inc. a leading beverage alcohol company invested US$ 100 million in two specialty beverage companies: Austin Cocktails and Vivify Beverages. This investment is expected to drive incremental growth of business, deepen consumer knowledge base, and broaden pipeline of ideas and talent of Constellation Brands, Inc.

Key players operating in the global alcoholic beverages market include Anheuser-Busch InBev SA/NV, Bacardi Limited, Beam Suntory Inc., Constellation Brands Inc., Diageo Plc, Heineken Holding NV, Molson Coors Brewing Co., Pernod Ricard SA, SABMiller Ltd., and Carlsberg group.